Business Strategy: Fast Telecommunication Company - Case Study Example

Lecturer Business Strategy Report Introduction Fast Telecommunication Company Fast Telecommunication Company is a leading telecommunications company in Kuwait. It was established in 2000. The Kuwaiti Shareholding-owned company is specialized in the provision of turnkey internet; local and international termination services for foreign carriers; and local and international data communication solutions. Today, it has established its operations by providing a SDH/ATM/IP network which enables it to provide high quality services to its diverse clients. Because of its expansive service delivery, it became amongst the very first company in the entire Middle East to receive the prestigious Cisco Powered Network (CPN). For the company to achieve such a tremendous success, it has put in place a well organized management which has been spearheading its operations. This has made it possible for it to conduct a self-assessment to have a clear understanding about its strengths, weaknesses, opportunities and threats. This has been done in comparison to the external environment in which the company operates. The information about the external environment is quite crucial in helping the top management to make important decisions about the future development of the company (Kotter & Dan, 2002). Through this, it has come up with measures on how to manage the company’s human, financial and other resources which are used to promote the development of the company. Analysis of the Industry Just like any other nation, the telecommunication industry in Kuwait is quite competitive. Although Fast Telecommunication is among the most established companies, it has to come up with feasible strategies to express is position in the market and look for possible ways of out doing all its competitors and enjoying a competitive advantage over its competitors from the public and private sectors (Gomez-Mejia et al., 2008). Amongst the most competing telecommunication firms in this market are Kuwait Network Electronic Technology, Qualitynet, Arab Telecommunications, Gulfast, Zain, United Networks and Wataniya Telecom. These are some of the major players whose existence in this market should be taken seriously by the management of Fast Telecommunication Company Limited. Just like this company, they also offer Turnkey solutions, data communications, internet services, data centre cervices and voice services. Fast Telecommunication Company Management Strategies As a telecommunication firm, Fast Telecommunication has been operating in a highly competitive environment. Meaning, there are lots of players in this sector which provide alternative, substitutive and similar services to those of the company. For this reason therefore, the company has come up with management strategies to help in coordinating its activities as it seeks to deliver its services to the customers. In its vision statement, the company categorically states that it is committed to providing high quality, cost effective internet and communication services to its diverse clientele. With this in mind, the company is aiming at becoming the leading telecommunication fir in Kuwait and beyond (Fruhan, 2007). However, in order to accomplish these goals, it is incumbent upon the management of this firm to come up with well-thought and manageable strategies. These have been very instrumental in helping the organization to discharge its activities without many problems. At the same time, it has been the pillar for the company’s strategic plan and management of its vast resources. As a well established company, Fast Telecommunication is very complex and has several branches composed of different categories of human and other resources. Each of this needs to be properly managed. However, in order to do this, there is a need to come up with policies and strategies which will help the management to make the right decision at all times. In order to boost the company’s performance, the management has resorted to the creation of a well structured Human Resource Department. This has been the corner stone for the management of the welfare of the workers. Therefore, amongst its major duties is to organize for a transparent recruitment process in which the most qualified applicants are hired. After hiring, the department works closely with employees to ensure that their activities are monitored. Besides, anything to with motivation and promotion is handled by this department. Since remuneration and promotion is purely based on competency, the company has managed to boost the morale of workers and encouraged them to feel comfortable and work hard for the sake of promoting the accomplishment of the organization’s goals. This explains why the performances of the company has been improving, a scenario linked to its quality production. The other important management strategy adopted by this company is the use of bureaucratic procedures in its activities. As a complex organization, it has come up with policies to institute hierarchical structures to differentiate the duties and responsibilities of each group of professionals. Meaning, there is a position of the top managers, middle level managers and first level managers each of whom collaborate with one another. In this system, the organization has come up with departments (Porter, 2000). Each of them is dealing with specific activities such as marketing, sales, production and human resources. However, in order to promote cohesive operations, each department has a distinct boundary and operates under one departmental head. This strategy has been instrumental in promoting quality performance since each departmental head is given the mandate to supervise the activities within their respective departments. Therefore, in case of any issue, they are to be made accountable. This has helped the company to move a step higher as compared to its competitors (Gamble et al., 2010). Moreover, Fast Telecommunication has been concerned about the role of communication in uniting its stakeholders. As an organization, it has given a lot of emphasis to effective interpersonal and corporate communication. Meaning, a part from diversifying the media of communication, a clear structure has been put in place to ensure that each stakeholder is equipped with the necessary information about the organization. In this regard, there exists both horizontal and vertical communication in which the management and junior employees freely interact without any barrier. This has made it much easier for all the stakeholders to freely interact with one another as they share ideas and communicate their opinion on how the company can be enabled to accomplish its short and long term goals. Since Fast Telecommunication does not enjoy monopoly, it is apparent that it operates in a competitive environment. In other words, it has got competitors which dictate the nature of its external environment. In this regard, it is necessary for the management to come up with policies and strategies to maneuver however competitive the market might be. Once it fails to strategize on how to counteract the high level of competition in the market, it will succumb to the pressure and eventually collapse since it will not be able to survive. Since the company has been operating in such a climate, the management has taken the initiatives to develop strategies to handle this matter (Giddens, 2001). In order to address the issues related to competition, the company has resorted to using Porter’s Models of Management. This has enabled it to deal with challenges arising from the existence of current and potential competitors; and bargaining with suppliers and clients. First, in dealing with the new entrants and existing competitors, the company has adopted strategies such as economies of scale, branding of its products, even distribution of commodities and determination of fair pricing policies. These are important in helping the company to appeal to the clients. For instance, by having economy of scales, it is easier for it to buy in large balks and be able to get huge discounts. This can help it in reducing the costs of operations as it seeks to improve service delivery. Meanwhile, even distribution of commodities to the clients is fundamental for restoring the confidence of the clients. Once they are assured of stable and uninterrupted supply, they will always do their best to stick to the company because all clients are happier to associate with a reliable supplier. On the other hand, the application of bargaining power of suppliers has been so essential to this company. It has made it easier for it to establish a large pool of people who provide it with the required inputs. Just like the consumer bargaining, engaging in a bargaining process with the suppliers can be economical in the long run. Once a good rapport id established with the suppliers, the company will be assured of a constant provision of the necessary inputs which it uses in producing its commodities. By effectively bargaining with the suppliers, it will be much easier for the company to enjoy economies of scale. This will put it in a better position of enjoying a competitive advantage over its rivals. For instance, when the supply tenders are awarded to the lowest bidder, the company will automatically reduce the costs of its operations. As explained by Porter in his generic strategies of management, the company has come up with strategies to sub-divide its market. Under this segmentation strategy, the management of this firm has been able to conduct an extensive research to understand their market. As a result, it has identified its market and narrowed it to its target clients. Through this strategy, the company has been in a position of looking or the possible ways through which it can satisfy its clients. By knowing them, it has been much possible for the company to understand their needs, expectations, interests, tastes and likeness so as to address them. It has been a good strategy since it has made it easier for the company to concentrate only on its clients. Hence, a part from serving their interests, the company has also managed to reduce its costs of production. This is because it only spends resources in marketing its commodities and supplying them to the known market. Rather than market segmentation, the company has successfully managed to exploit the use of differentiation strategy. As already highlighted, Fast Telecommunication is not the only telecommunication firm in the Kuwaiti market. Instead, there are also other firms which offer a variety of services which can be used to substitute, complement and supplement its services. Therefore, the best way to address such a situation is to create uniqueness. This has been done by giving the company products their brand manes. Once such names are given, the company can find it much easier to create the uniqueness in its products and be in a position of eradicating any confusion which might arise from such a similarity. However, for it to be effective, such uniqueness should not only be limited to brand manes, but should be extended to the quality of the products. Meaning, for the company to emerge as the best alternative in the market, it should produce high quality commodities which supersede those of others. Analysis of the Fast Telecommunication Management Strategies From its management strategies, it is evidenced that Fast Telecommunication is a focused company. It must be having a strong team of management which is concerned about the management of its labor force, financial and all the other resources. For example, the application of Porter’s management strategies has made it to realize a tremendous success. Through the segmentation of its market, and creation of uniqueness in its services, the company has managed to deal with the high level of competition in the market. A part from making it to appeal to its clients, it has made it easier for it to minimize the costs of its operations as it seek to improve the quality of its services for the sake of satisfying the diverse needs of its clients (Stroh et al., 2002). It is a clear indication that the company is focused and concerned about enjoying a dominant share of the market however competitive it might be. Its proper application of the Five Porter’s Management Strategies has enabled the company to enjoy a competitive advantage and accomplish its short and long-term objectives. For instance, the company has been implementing the cost leadership strategies. This has been done by taking all the initiatives to reduce the costs of operations. At the same time, it has adopted the strategy of charging slightly lower prices as compared to its competitors. Therefore, it has managed to attract and retain a lot of clients. Once the company can effectively operate under minimal costs, it becomes much easier for the management to focus on how to ensure that it enjoys a larger share of the available market. Meanwhile, the company has been effectively implementing the principles of Resource Based View (RBV) and VRIN approaches in its management. These are dynamic strategies which have made it much easier for the company to properly manage its resources very well. Because of this, the company has been able to efficiently satisfy the diverse needs of its employees, shareholders and client (Sirmon et al., 2007). Both the human and financial resources have been given much attention because they are a pillar to the company. By adopting the RBV Plan, the company has been able to take the opportunity to utilize its diverse resources to obtain a competitive advantage over its rivals. However, for this RBV to be effectively applied by the company to enjoy a competitive advantage, the top management of this organization has put measures in place to ensure that in its RBV approach, the characteristics of VRIN is enforced. First, the management has stack to the valuable aspect of VRIN in its commodities. This has been done by ensuring that the commodities are of high quality and more efficient than those of the competing firms. This has made it much easier for the company to enjoy a sustainable and long lasting competitive advantage. All clients are interested in high quality and valuable services. The company has also been keen on ensuring that has rare resource which are not common and ca not b easily acquired by the rest of the competing firms. In doing this, measures have been put to provide uniqueness which might not be attained by any other firm. Essentially, all clients like unique products which are not commonly found everywhere. Thus, by having unique and rare resources, the company is assured that it can not be outshone by any other rival since they can not get such rare resources so as to be in a position to enjoy a competitive advantage like them. Meanwhile, the management of this company has been applying the use of VRIN’s non-substitutable strategy. This implies that its resources can not be easily replaced by any equivalent resources. Even if they are also valuable, for the company to enjoy a competitive advantage, it needs to ensure that its resources can not be imitated by its rival firms. This can limit the chances of its competitors of matching its standards and giving it a stiff competition. This has been one of the reasons why Fast Telecommunications Company has been using its resources to enjoy a competitive advantage over other competing organizations (Sirmon et al., 2007). The other important strength of the management strategy of this company is the way it deals with its employees. Having acknowledged that they constitute an integral part of the company, the workers of this company have been given the kind of treatment and recognition that they deserved. With its strong HRM department, the company has managed to motivate its workers. This has been done by implementing a transparent recruitment and promotion process. Whenever there is a vacancy to be filled, it is publicly advertized before conducting a rigorous interview in which the most qualified applicant is hired. Thereafter, they are remunerated and promoted on merit. By caring for the welfare of its workers, Fast Telecommunication has successfully motivated them. Because of this, they have been able to increase the quality of their service delivery. Once the workers are motivated, they can work so hard for the sake of helping the company to accomplish its short and long-term goals. Based on the above analysis, this report commends that the company should keep up the good management strategies because they have a lot to offer. However, it recommends the management to consider being dynamic and progressive. Meaning, it should embrace the use of modern technology in its activities. Since it is a telecommunication firm, the company should be ready to use a variety of Information Technology (IT) skills to improve the quality of its services. If this is successfully done, it will be able to surpass all its competitors and emerge to be the best alternative company in the market (Stroh et al., 2002). Then, it will manage to serve all its clients and satisfy all their needs. Hence, it will be assured of expanding, enjoying economies of scale, competitive advantage and manage to dominate the market. Conclusion Management is the core of any business organization. In order to succeed in achieving all the goals, the business should be able to make proper decisions to adopt feasible and well organized strategies to manage its operations. This can be a major mile stone in planning the organization’s future. As a well established company, Fast Telecommunication is in the right path of achieving a tremendous growth if it sticks to its management strategies. The manner in which it has managed its workers and financial resources has been quite encouraging. By applying the principles of RBV and VRIN strategies to effectively manage its resources, the company has been able to achieve a sustainable competitive advantage over its rivals despite the dynamic nature of the market. A part from enabling it to appeal to its clients, it has made it easier for it to minimize the costs of its operations and overcome the high level of competition in this market. As a free market, any investor is allowed to enter the market. Meaning, competition might be so higher. Hence, the company should adopt strategies such as differentiation, market segmentation and branding. This not only helps in creating uniqueness in the company’s products, but also in creating a large pool of clients. However, for the company to expand, it needs to improve the quality of its services through the adoption of modern technologies. Works Cited Fruhan, W. (2007) “The NPV Model of Strategy—the Shareholder Value Model," in Financial Strategy: Studies in the Creation, Transfer, and Destruction of Shareholder Value. Homewood, IL: Richard D. Irwin. Gamble, A.A. et al. (2010). Crafting and executing strategy: the quest for competitive advantage: concepts and cases (17th ed. Ed.). Boston: McGraw-Hill/Irwin. p. 149. Giddens, A. (2001). A Contemporary Critique of Historical Materialism. California: University of California Press. p. 125. Gomez-Mejia, L.R. et al. (2008). Management: People, Performance, Change, 3rd edition. New York, New York USA: McGraw-Hill. p. 19. Kotter, J.P. & Dan S. C. (2002). The Heart of Change. Boston: Harvard Business School Publishing. Porter, M.E. (2000) Competitive Strategy: Techniques for analyzing industries and competitors. New York: The Free Press. Sirmon, D.G. et al. (2007). “Managing Firm Resources in Dynamic Environments to Create Value: Looking Inside the Black Box,” The Academy of Management Review, 32 (1), 273-292. Stroh, L. K. et al. (2002). Organizational behavior: A management challenge. Mahwah. New Jersey: Lawrence Erlbaum. Read More