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Business Strategy

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BS3100 Business Strategy

Giffgaff and EE Analysis

Bsc Business Studies Group 12: Anastasia Bargan 120037238 Phillip Schade 120023167 Rita Boudou 120002452 Tooba Saeed 120008220

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Table of Content

Introduction . . . . . . . .. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3 Giffgaff . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3 EE . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 4 Attractiveness of the Industry . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 4 Competitive Strategies . . . . . . . .. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 6 Giffgaff financial analysis . . . . . . . .. . . . .. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 6 EE financial analysis. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .8 Porter’s Generic Strategic Matrix . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .9 SWOT Analysis . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .12 EE challenges . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .. . . . . . . . . . . . . . . . . . . . . . . . . .14 Giffgaff challenges . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .14 General challenges . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .15 Scenarios analysis . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .16 Conclusion . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 16 References . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 17

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Introduction:
The UK’s mobile culture was introduced in 1985 when the first mobile phone call was made. Initially, the use of traditional mobiles phones was very limited offering calls and SMS service as a form of communication. Nowadays, mobile phones are a powerful gadget, highly sophisticated and complex. They offer multiple features such as a digital camera, access to internet, games and many more tools allowing users to perform tasks and activities that would have seemed impossible a few years ago.

The phenomenal rise of the mobile phone has seen its image change from a luxury product to a daily essential. In wealthier countries, penetration rates exceed 100% because of individuals with multiple subscriptions, offsetting for the disparity in poor countries where penetration rates are on average 89.4 subscriptions per 100 habitants. This significant growth in cellular phone subscriptions has had a negative impact on fixed-telephone subscription as they have decreased (Fernholz, 2014).

The UK is one of the most mature and competitive mobile markets in the world. There are four dominant network providers: Three, Everything Everywhere, Telefonica and Vodafone. Other smaller players like Giffgaff is referred to as Mobile Virtual Network Operators (MVNO), as they use the infrastructure of primary providers to administer their services. In June 2012, Giffgaff was announced best MVNO in the Mobile Industry Awards (Giffgaff, 2012).

Giffgaff:
In late 2009, Telefónica O2 created Giffgaff, a SIM-only pay-as-you-go mobile network operating in the UK (Giffgaff, 2014). Essentially the company’s strategy is to keep costs low by encouraging its customers to help grow and run the business. Hence, Giffgaff’s name meaning ‘mutual giving’ in ancient Scottish. The firm’s main operations (calls, texts and data) utilise the O2 cell infrastructure, however some of its processes are outsourced. Along with these three main services Giffgaff delivers SIM-cards to customers, provides a platform for resolving their clients’ issues, receives payments and provides a user-friendly sign-up process.

Giffgaff serves a small segment providing only mobile networks, unlike EE which provides more services such as home internet, landline, and mobile connection. The company has also branched into mobile phone sales, yet this remains a small department of its operations and is 3

outsourced to Ratesetter (Whitcombe, 2013). Giffgaff’s most unique operation is the customer service entailing the ‘Community’ forum created for the firm’s clients’ interaction. Giffgaff’s whole customer base resides in the UK. A major part of the customer base is focused on money saving by avoiding long-term contracts and topping up as they require. Many of the customers may be international citizens residing in the UK, whose circumstances are regularly changing.

EE:
EE, previously known as Everything Everywhere, was created in 2010 after Deutsche Telekom and France Telecom, the parent companies of mobile giants T-Mobile and Orange, decided to merge the two companies into an equally joint venture. The motivation behind this was to gain synergies and stronger market share. EE is one of the most advanced digital communications company in Britain, providing mobile and fixed line services. EE’s main strategy is to target a diverse range of customers and differentiate itself from the competitors, thus increasing customers’ willingness to pay. One of the ways it does this is by focusing on research and development hence enabling the firm to remain at the forefront of innovation. For example they were the first digital communications company in Britain to offer superfast 4G mobile services alongside fibre broadband. Additionally, EE provides substantial customer service via its hotline, this is in comparison to Giffgaff which only uses online forums.

Attractiveness of the Industry:
The attractiveness of the service network provider industry is evaluated using Porter’s Five Forces Model. Porter’s Five Forces framework analyses the level of competition within an industry and business strategy development. However, there are challenges in applying the five forces framework, such as the challenges of choosing the appropriate level of analysis, uncertainty and rapid structural change. First to be discussed is the threat of substitute products or services. The buyers’ propensity to substitute is relatively low in the mobile industry. Landline, Skype, ooVoo and Viber are the closest substitutes whereby people could communicate without using the services of a mobile network provider. However, they all require either a landline or mobile network provider for 4

Internet connection. Therefore, with a limited number of alternatives, we can conclude that the threat of substitutes in this industry is relatively low.

There are many factors affecting the threat of new entrants in this industry. As there is still potential growth in this industry, many new companies would want to enter this market. However, capital requirements are relatively high with large sunk costs, for example, licensing fees, R&D and advertising. O2 shares its mobile network with its subsidiary Giffgaff as it requires large capital investment in the short term to establish a telecommunication operation. The new entrant Giffgaff, renting from O2 network, is unable to fully exploit economies of scales, hence Giffgaff’s costs are increasing the long term. In comparison, EE has its own mobile network infrastructure, which gives them long term significant absolute advantage.

The bargaining power of suppliers is moderate. It is relatively easy to set up a network provider in the UK due to a large number of mobile manufacturers and advanced technological infrastructure. However, associated costs are relatively high, therefore suppliers have moderate level of bargaining power.

Perhaps one of the most crucial aspects of the framework with regards to this industry is the bargaining power of buyers. Customers have relatively high bargaining power as there are a large number of mobile operators and price wars between companies, therefore buyers are highly price sensitive. Buyer’s switching between network providers will feel relatively low repercussions such as the time lag between changing phone contracts. It only involves loss of service during switching process, effort of searching for a new suppliers and learning the new system. The final aspect of Porter’s Five Forces is the intensity of the competitive rivalry. Due to low product differentiation, companies are differentiating on brand loyalty and trying to ‘lock in’ existing customers. Generally in this industry, high levels of budget are allocated to marketing and advertising indicating intense rivalry. However, Giffgaff and EE have very different marketing strategies. On one hand, EE uses ‘traditional’ marketing to attract and retain customers. For example, they use celebrity endorsements, like Kevin Bacon, who is the face of the company to build a strong brand image. Moreover EE attempts to improve customer service and minimise complaints to help retain customers. On the other hand, Giffgaff seldom use high cost marketing. Giffgaff rely upon word-of-mouth advertising as it is a low cost and 5

effective strategy. As well as this, they advertise highly using low-cost mediums such as online through Facebook and Twitter. Although Porter’s Five Forces helps demonstrate the rules governing the industry structure and attractiveness, it nonetheless has its setbacks. For example, the model is constrained by continuous changes in the environment, development of new technologies, government regulations and is not supported by empirical evidence.

Competitive Strategies:

Table 1: Giffgaff Financial Analysis Measurement Factor Total Customers Revenues Average Revenue per user Operating Income before depreciation and amortisation (OIBDA) Operating income before depreciation and amortisation Margin Market share .89% 1.3% (48)% 5.7% 2012 0.8 million 78,951,000 £8.22 (38) million 2013 1.2 million 137,559,000 £9.55 7.8 million

The slogan for Giffgaff is “the mobile network run by you”, reflecting how the operations are run by its customers. The original idea behind Giffgaff was to create a business operating efficiently without the traditional human-capital constraints and reduce costs through customer involvement. This concept flows throughout the whole business model and is a key idea to the organisational design branching into areas such as sales, customer service and marketing (Giffgaff, 2014). Although Giffgaff’s customer base is small, it has rapidly increased by 50% from 2012 to 2013. There are a number a reasons for this that point towards the use of their resources and capabilities. One intangible resource that has attracted new customers is their brand image. Giffgaff prides itself on being low cost offering goodybags (packages) at affordable rates targeting students and international visitors. 6

Moreover, Giffgaff’s revenue has dramatically increased by 74.23% which is explained by the increasing number of consumers as mentioned before. The average revenue per user has increased from £8.22 to £9.55 suggesting the consumers’ willingness to pay a higher price because of brand loyalty. In Table 1, Giffgaff’s OIBDA (Operating Income Before Depreciation and Amortisation) jumped from -48% to 5.7% as the revenue increased at a faster rate than the cost of sales1. This shows efficient operation without the traditional human-capital as a cost constraint. Since the business operates primarily online, Giffgaff avoids large costs in setting up and running callcentre shops. Moreover, Giffgaff uses its customer-orientated business strategy during the R&D stages. For example, Giffgaff asked its community what varying factors they wanted in the packages, and received 285 responses (Lithium, 2014). This helped guide the company in the development of the various bundles. Therefore, large customer involvement allows Giffgaff to keep its human capital costs low hence increasing ARPU (average revenue per user) and operating income margin.

Although Giffgaff is relatively new, its increase in market share from 0.89% to 1.3% is due to the public’s increased awareness of the firm. Primarily, the company advertises through wordof-mouth as mentioned before. Moreover, those current customers who attract new customers to Giffgaff will receive a financial reward of £5 (Giffgaff super-recruiter, 2014).

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Giffgaff Annual Report and Financial Statements 2013

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Table 2: EE Financial Analysis Measurement Factor Total Accesses/Subscribers/Customers Revenues Average Revenues Per User (ARPU) Operating Income Before Depreciation and Amortisation (OIBDA) Operating Income Before Depreciation and Amortisation Margin Market share 33% 39% 16.3% 18.5% 2012 26.8 million £6,657 million £18.6 £1085 million 2013 27.5 million £3,211 million £18.5 £595 million

EE had the largest market share in 2010 which was due to the combined shares of the merged companies. This can be mainly explained by the group being a joint venture of three of the country’s most famous brands: EE, Orange and T- Mobile, thus EE was able to become the UK’s first ‘supernetwork’. From the table above, EE subscribers increased from 26.8 to 27.5 million in 2012 and 2013 respectively. Therefore, EE has a strong market share of 33% in 2012 and 39% in 2013. This can be explained by EE improved customer service. As an exclusively online retailer, Giffgaff has no customer service call-centres in comparison to EE.

In 2013, EE decided to transform the group into a strong market leader. The main step to achieve this result was through the introduction of an innovative service. EE was the first UK mobile network to launch a 4G network providing customers with the widest and fastest 4G coverage in the UK. As a ‘first mover’, EE was able to charge a premium for its prices to early-adopters of the 4G in the short run. Their increasing willingness to pay was due to a unique service offered. However, this premium couldn’t be charged in the long run as other rivals quickly introduced the 4G, therefore EE had to decrease its prices to retain customers and profits. Thus, the ARPU is quite similar from 2012 to 2013 with a slight decrease (respectively £18.6 to £18.5). Presently, EE provides the cheapest 4G mobile phones deals starting from £13.99 per months (uSwitch, 2014). The success of the 4G in the UK contributed to EE’s strong results performance, including meeting cost saving targets a year earlier than

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planned. Also achieving significantly improved OIBDA margin which increased from 16.3% in 2012 to 18.5% in 2013 (EE, 2013).

EE offers another competitive edge such as 2 for 1 tickets cinema for its subscribers every Wednesday; Deezer, a mobile application allowing EE users to listen and download unlimited music (EE, 2014). Finally, EE signed a partnership with Wembley Stadium attracting millions of visitors for various events. As part of a planned ‘technology road map’ to be delivered during the six-year deal, future technological advancements from EE include mobile ticketing solutions, enhanced mobile network access and super-fast Wi-Fi available for all (Whiters, 2014). However, the significant decrease in revenues by approximately half can be explained by price wars in the mobile industry willing to offer cheap services to attract more customers. Moreover, increased costs might also explain such a sharp decrease in OIBIDA. To determine the types of strategies undertaken by both companies, Porter’s Generic Strategic Matrix is used. By applying their strategies to the matrix, their respective competitive advantages can be determined as seen below. Although Giffgaff and EE operate in different segments, they both face a high density of competition. For example EE competes with Vodafone on differentiation, and Giffgaff competes with Lebara on cost.

Table 3: Porter’s Generic Strategic Matrix
Competitive Advantage
Low Cost Higher Cost

Overall Cost Leadership

Differentiation

Competitive Scope

Industry Wide

Cost Focus
Single Segment

Differentiation Focus

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EE and Giffgaff have very different strategies, thus explaining the difference in their performance indicators. The primary sources of profitability can be explained by the firm resources (tangible, intangible and human) and capabilities. These resources can be evaluated according to the VRIN framework being valuable, rare, in-imitable, and non-substitutable.

One of the key indicators of performance in this industry is market share. It can be seen that EE has a much larger market share than Giffgaff, however this is expected because EE has more established brands in the market place, as an intangible resource. Moreover, it is important to note that the public is becoming increasingly more aware of Giffgaff, resulting in its customer base growing at a faster rate than EE’s. The brand is a valuable resource for both companies, though it could be argued that it is substitutable as there is high density of competition.

The reason that EE has a higher ARPU is because their strategy focuses on differentiation. EE puts a great deal of emphasis on tangible equipment resources in order to produce new technology and be the ‘first-mover’, for example they were the first innovative UK network to launch 4G, hence they can charge a premium. Yet, this comes at a cost as it requires human resources (skills). In comparison, Giffgaff concentrates on low prices; consequently Giffgaff makes a lower ARPU. One of the other ways in which Giffgaff differentiates itself in the market is through its flexible “goodybags”, nevertheless this differentiation is not enough to charge a premium. In regards to the launch of EE’s 4G network, at the time it was rare in the market but not in-imitable as Giffgaff have duplicated this technology in November 2014 (Giffgaff 4G, 2014). Finally, EE’s strategy has a very broad competitive scope; they will target consumers that vary in age and income. This helps them have a large potential market to earn revenues whereas Giffgaff places a heavier emphasis on targeting lower-end incomes and those people who want short-term contracts. In addition, Giffgaff’s intangible culture resource of community forums targets the younger generation who are acquainted with this type of customer service.

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As Giffgaff focuses on low price, they must constantly focus on increasing market share in order to make a profit. Thus it is a volume game whereby the network effect leads to greater economies of scale, as represented in the graph below. The network effect is the effect that one user of a good or service has on the value of that product to other people. In regards to the Giffgaff, there is a positive network effect.

Graph 1: Network Effect

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SWOT Analysis:
To identify the major opportunities and threats facing the chosen firms in this industry, a SWOT analysis was conducted, as shown below. Other frameworks can also be used to analyse opportunities and threats such as the PEST analysis.

STRENGTHS  Universal 1) High barriers of entry 2) Strong internal structure 3) Resources and capabilities  Giffgaff 1) Customer loyalty 2) Reduced Labor costs 3) Customer  EE 1) Operational efficiency 2) Widest LTE (Long-Term satisfaction and

WEAKNESSES  Universal 1) Geographical (Internet and signal strength) 2) High staff turnover  Giffgaff 1) Limited global opportunities 2) Investments development 3) High loan rates are possible 4) Future Lebara 5) Unknown: Not as established as EE Units  EE 1) New brand name unrecognizable with parent companies 2) High staff turnover due to the merger 3) Costs in rebranding 4) Future competition- Vodafone and O2 due to resources and competitionsuch as in research and

increasing customer base

Evolution) coverage 3) First mover advantage (LTE) 4) Experienced Business

capabilities shortage

(Orange and T-Mobile) 5) Monetary assistance providedutilizing cash injections from parent companies

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OPPORTUNITIES  Universal 1) R&D in technology 2) Favorable legislation 3) Entering new markets- BRICS countries 4) Licensing their networks  Giffgaff

THREATS  Universal 1) Stringent and strict regulations 2) Entry of new competitors 3) Economic turbulence 4) High technology turnover 5) Theft & damage 6) Changing customer preferences

1) Revenue level is at a constant  Giffgaff increase 2) New acquisitionsvertical 1) Growing competition- Imitable competitive strategy 2) Lower profitability- price wars 3) Poor customer service due to limited infrastructure and lack of more  EE 1) Overtake of network coverage 1) Diversification of productsfrom smaller competitors 2) Growing competition and lower profitability- Vodafone 3) Government regulations- limiting monopoly power 4) Tax changes with regards being a public listed company capitaltechnology human resources (online forum)

integration 3) Growth rates and profitability increasing trends 4) Growing  EE economy-

opportunity for sales

cloud service for customers 2) Licensing- Tesco mobile 3) Global marketsinternational

expansion 4) Growing demand- especially for 4G 5) Venture sector

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EE Challenges:
EE faces major challenges in product development due to the fact that their core product for competitive advantage, 4G, is highly imitable and has been introduced by other competitors like Vodafone and Giffgaff. For this reason, they are facing growing competition in the mobile market so will need to invest heavily in product development, perhaps offering an additional service not offered by other networks. For instance O2 offers concert tickets exclusively to customers. EE must diversify into new markets for first mover advantage such as providing cloud services for their customers. However, this can only be successful if they invest in research to ensure there is a demand for the products they want to launch. EE may offer new mobile packages to target different groups of customers such as students (lower price), executives (international calls) and pensioners (increased customer service). This will lead to sustainable competitive advantage if they are effectively utilising their resources and capabilities. In the future, there is the possibility that the biggest network coverage title may be taken over by a close competitor, O2. This means EE may lose one of its major selling points as being a market leader. To avoid this, the company should improve its coverage, as there are still areas where coverage is not as good as in the city (EE Limited, 2013) by investing in better resources for network coverage and extending their capabilities.

Giffgaff Challenges:
Giffgaff is relatively new to the mobile market, however being a subsidiary of network giant, O2, they some access to useful resources and capabilities, particularly in marketing and product development. Giffgaff is famous for their bundle packages for consumers however these products are easily imitable and worth imitating by competitors to generate extra profit. Therefore, it can be argued that this strategy does not provide them with sustainable competitive advantage and they are facing growing competition from others like Lebara and Virgin who have introduced similar SIM only bundle packages. Competitors have also differentiated by offering additional services, for example landline, TV, broadband. Thus the consumers can become ‘locked-into’ one brand for their various needs. This poses further challenges for Giffgaff to provide a service that will be attractive and valuable enough to the consumer to make them switch. Will consumers go for Giffgaff’s value or Virgin’s brand loyalty?

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However, Giffgaff can differentiate their products in response to competition. They can perhaps think about market development, moving into underdeveloped international markets like Africa. This way they will gain more opportunities for profits as well as first mover advantage. In those markets, the cost structure that Giffgaff works in is highly valuable as they won’t need to differentiate their products as much as they have to in highly developed markets where there is a lot of competition.

General Challenges:
An important challenge faced by both firms is the fast pace of technology changes. Both firms have to invest considerably in research and development (R&D) for technology to remain at the forefront of the changing environment. Technology development allowed for the creation of 4G which showed high opportunities for profit in this area. Also, political factors play a minor role in influencing the performance and strategies of both Giffgaff and EE. Favourable legislation and low tax rates can help both companies increase their profits and reduce costs, hence improving their cost advantage in the market. However, with recent cases such as the phone-hacking scandal, the government may be more restrictive in the involvement of mobile networks to avoid association in these cases. Also it must be noted that the mobile telecommunication industry is regulated by Ofcom, an independent regulator. Moreover, EE could out-license their network to smaller firms (Mobile Virtual Network Operator) such as Tesco Mobile. Due to the recent economic financial crises in UK, consumers are more cost aware and therefore more likely to buy from renowned low cost retailers such as Tesco Mobile rather than directly from high-cost EE. This will provide consumers with a cost advantage however this simultaneously increases the network coverage of EE as they licenseout to Tesco Mobile. However, they may face competition from Giffgaff which is also a low cost retailer. Giffgaff and EE must also take into account socio-cultural changes such as customers’ preferences. Customers’ preferences in the future might be different from now, as they have changed drastically in the past ten years. Therefore, it is important for both firms to create new strategies to adapt to such changes. For instance, a growing trend is the increase in mobile date usage so both firms can perhaps increase this in their bundle packages over other things like minutes and texts.

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Scenario Analysis:
There are a number of mega-trends occurring in the mobile service industry that directly affect the chosen companies. Ranked below in order of importance are the scenarios: 1. According to PWC report, “continuing trend of declining mobile voice usage as subscribers consume more data services. The average minutes of use (MOU) per postpaid subscriber decreased from 720 MOU per month in the previous survey to 673 MOU per month in the 2012 survey.” Giffgaff and EE must bear this in mind when producing consumer packages as demand for texts and minutes is decreasing and data is increasing, as people use data more for apps like WhatsApp and Viber so don’t require the texts and minutes in current packages. 2. According to Accenture, “Mobile payments our research shows that mobile payment capabilities are highly attractive to consumers, presenting communications service providers with an opportunity to attract customers and create new revenue streams. Already, 20 percent of smartphone users make payments via their phones, and another 31 percent plan to do so in the next 12 months”. Giffgaff and EE can invest heavily in creating mobile service capabilities and can be used as a way to attract and retain consumers to their brand with a unique service. Also, it can provide them with partnership and licensing opportunities with other companies.

Conclusion:
The mobile telecommunications industry is highly competitive. There are high barriers to entry so moving into this market without established resources and capabilities will not be a successful move. The analysis of Giffgaff and EE presents two successful companies on opposite ends of the spectrum. Their varying uses of resources and capabilities has largely affected their respective strategies. On one hand, Giffgaff’s low-cost strategy enabled them to expand their market share. On the other hand, EE’s focus on differentiation has allowed them to charge a premium on their products but this is not a sustainable competitive advantage. Finally, a successful strategy looks to the long term as well as being flexible enough to respond instantly to competitor actions and changing customer preferences.

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References:
EE (2013) ‘Annual report’ [pdf] Available from: http://ee.co.uk/content/dam/everythingeverywhere/Newsroom/Bonds%20and%20financials/EE_Accts_YE_2013_EY.pdf [Accessed 5 December 2014] EE (2014) ‘EE Interim Results for 6 Months 30 June 2014’ [pdf] Available from: http://ee.co.uk/content/dam/everythingeverywhere/Newsroom/Bonds%20and%20financials/2014%20June%20interim%20docs/EE %20Interim%202014%20Results%20Release_FINAL2.pdf [Accessed 5 December 2014]

EE (2014) EE Interim Results for 6 Months 30 June 2014 [pdf] Available from: http://ee.co.uk/content/dam/everythingeverywhere/Newsroom/Bonds%20and%20financials/EE_Accts_YE_2013_EY.pdf [Accessed 5 December 2014]

Fernholz (2014) More people around the world have cell phones than ever had land-lines [Online] Available from: http://qz.com/179897/more-people-around-the-world-have-cellphones-than-ever-had-land-lines/ [Accessed 20 November 2014]

Giffgaff (2014) Giffgaff, the mobile network run by you [Online] Available from: Giffgaff, Earn serious money with our Super Recruiter program [Online] Available from: http://giffgaff.com/super-recruiter [Accessed 23 November 2014]

Giffgaff, Hooray! 4G has arrived [Online] Available from: http://giffgaff.com/4g [Accessed 23 November 2014]

Giffgaff, The mobile network run by you [Online] Available from: http://giffgaff.com/index/us [Accessed 23 November 2014]

Giffgaff, We're all the boss Available from: http://giffgaff.com/?utm_source=google&utm_medium=cpc&utm_term=%20+award%20+g iffgaff%20&utm_campaign=ps-

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G_PC_Brand_General&gclid=CPml9OaYsMICFYgufAodqDQAxA&gclsrc=ds&dclid=CK WS-OaYsMICFYlHfAodoUkAag [Accessed 5 December 2014] Lithium (2011) ‘Using community to build an entirely new kind of company’ [pdf] Available from: http://www.lithium.com/pdfs/casestudies/Lithium-giffgaff-Case-Study.pdf [Accessed 5 December 2014] Loozen et al. (2013) Mobile web trends: Opportunities for communications service providers [Online] Available from: http://www.accenture.com/…/outlook-online-2013-mobile-web-t… [Accessed 28 November 2014] PricewaterhouseCoopers (2013) North American wireless industry survey [Online] Available from: http://www.pwc.com/…/north-american-wireless-industry-surve… [Accessed 29 November 2014] uSwitch, (2014) Cheapest 4G Contract Deals Online [Online] Available from: http://www.uswitch.com/mobi…/families/4g_mobile_phone_deals/ [Accessed 2 December 2014]. Whitcombe, L. (2013) P2P loans to finance Giffgaff mobile handsets [Online] Available from: http://www.moneywise.co.uk/news/2013-11-22/p2p-loans-to-finance-giffgaff-mobilehandsets [Accessed 5 December 2014] Wigginton (2014) 2014 Telecommunications Outlook [Online] Available from: http://www2.deloitte.com/…/2014-telecommunications-outlook.… [Accessed 26 November 2014]

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...05341_02_ch02_p021-044.qxd 9/25/07 10:01 AM Page 21 CHAPTER 2 OPERATIONS, STRATEGY AND OPERATIONS STRATEGY INTRODUCTION An organization’s operations function is concerned with getting things done; producing goods and/or services for customers. Chapter 1 pointed out that operations management is important because it is responsible for managing most of the organization’s resources. However, many people think that operations management is only concerned with short-term, day-to-day, tactical issues. This chapter will seek to correct that view by considering the strategic importance of operations. All business organizations are concerned with how they will survive and prosper in the future. A business strategy is often thought of as a plan or set of intentions that will set the long-term direction of the actions that are needed to ensure future organizational success. However, no matter how grand the plan, or how noble the intention, an organization’s strategy can only become a meaningful reality, in practice, if it is operationally enacted. An organization’s operations are strategically important precisely because most organizational activity comprises the day-to-day activities within the operations function. It is the myriad of daily actions of operations, when considered in their totality that constitute the organization’s long-term strategic direction. The relationship between an organization’s strategy and its operations is a key determinant of its ability to......

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Business Strategy

...Slide 1 [pic] Slide 2 LO 1.1 [pic] Sony Ericsson Company is a global provider of mobile multimedia devices and phone accessories. Strategic planning is important process for any organization, but usually fall. Sony Ericson is one of the examples. The reasons are different: the understanding of process of strategic planning are not clear as mission, vision, goals and core competencies, which affect the success of the company. Slide 3 [pic] Strategy of Sony Ericsson is to increase the internal growth with developing new products and technologies. Strategy is a plan for future development of organization, where the long-term goals are successfully achieved by structured decisions (Johnson et al, 2011). Sony Ericson strategy plan did not work, due to lack of understanding customer desires and preferences. To achieve organizational goals management has to develop the customer relationships. Slide 4 [pic] The Sony Ericsson company sees itself as a global brand accessible to everyone. All individuals can be heard. Company has a commitment to develop new communication products, which are accessible to everyone including and individuals with special needs. Sony Ericsson did not follow its commitment, due to lack of information of user desires, which have to be in centered design. The purpose of mission statement is to exceed customer’s expectations. Sony Ericson must deliver benefits and values to individuals. For example delivery......

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Business Strategy

...Introduction Business strategy it should be the foundation of any business weather it was small or huge business, this report will define business strategy, discuss formatting business strategy, and develop competitive advantage over competitors, how to apply strategy using resources and challenges faced by the organization, importance of business strategy, Referencing Qurum Business Group Company LLC, it’s an international company rooted in Oman, they provide services like : Facilities Management, Financial, Engineering, Contracting & Landscaping. Business strategy in simple words is a long term business plan that designed and set to achieve and reach certain goals or objectives, business strategy like a map guide the stakeholder where to go and which way to take! In order to set a business strategy goal, market and customers should be defined. So business strategy is long term plan that guide the action to reach a goal or more. Business strategy is top and core management responsibility to set. haveing strong and a good business strategy won’t mean that the business won’t face unexpected circumstances and it’s not a condition to avoid loss as other conditions can decide the satisfaction of any business, but good business strategy minimize the risks. Business strategy should be revised and amended every period of time as it’s usually 3 to 5 years to facilitate the changes in either the internal capabilities of the company or the external environment. There are......

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Business Strategy

...Assignment Brief | Title of Qualification:Edexcel BTEC Level 4 HNC in Business | Unit title: Unit 1 Business Environment | Unit code(s): Y/601/0546 | Learner:Nuraiym Azygalieva | Assessor:Dinara Bobusheva | Internal Verifier:Talant Asan uulu | Title of Assignment:Organizational purposes of Business and effective strategy in context of Business start-up.Grading criteria: P1.1, P1.2, P1.3; M1; D1.Related learning outcomes:LO1: Understand the organizational purposes of businesses. | Assignment Number:__1__of __3__for this Unit | Date assigned:November 1, 2013 | Date of review:November 8, 2013 | Date for final submission:November 15, 2013 | Learner declaration:I confirm that this assignment is my own work and any assistance received has been acknowledged and all sources have been stated.Signature: Date: November 15, 2013 | Scenario:In order to facilitate the interactive teaching technique due to accepting the basic findings of Interactive Business Situations Analysis conducted during the seminars and independent students’ study, the following two alternative scenario have been proposed for designing the required Assignment # 1 as follows:Scenario # 1:Primary terms of Business start-up to be organized as “Skull-Up” company are determined as Business partnership with full liabilities legal form. Business specialization of considering enterprise is Restaurant service providing...

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Business Strategy

...Part One....................................................... p 4-5 Limited growth strategy and Sony Ericsson ......................... p 6-8 CONCLUSION.............................................................................p 8 BIBLIOGRAPHY.........................................................................p 9 Introduction The following report introduces the business strategy analysis of Sony Ericsson case study based on facts and brand position. The business strategy plan has been summarized after estimation of different theoretical conformation and then validation of the most suitable and applicable approach in terms of the Sony Ericsson business case. Part One Strategy accomplishment could be performed in several ways such as substantive growth, limited growth or retrenchment. Sustainable growth strategies are one of the alternative strategies. Substantive growth is a business strategy in which the company goals to become forehanded in a short term of time and less risky. The advantage of substantive strategies is that it follow and using elements to increase their existing growth: Damage decrease; Authority efficiency; Environmental alarm; Work place surroundings. In one way the substantive growth strategy may guide the company to success, but on the other way fast growing company which looking wealth may lack knowledge on different components which are to make this strategy less risky. For example when the joint venture between Sony and Ericsson was......

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Business Strategies

...BUSINESS STRATEGIES Strategic management involves the formulation and implementation of the major goals and initiatives taken by a company's top management on behalf of owners, based on consideration of resources and an assessment of the internal and external environments in which the organization competes.[1] Strategic management provides overall direction to the enterprise and involves specifying the organization's objectives, developing policies and plans designed to achieve these objectives, and then allocating resources to implement the plans. Academics and practicing managers have developed numerous models and frameworks to assist in strategic decision making in the context of complex environments and competitive dynamics.[2] Strategic management is not static in nature; the models often include a feedback loop to monitor execution and inform the next round of planning.[3][4][5] Harvard Professor Michael Porter identifies three principles underlying strategy: creating a "unique and valuable [market] position", making trade-offs by choosing "what not to do", and creating "fit" by aligning company activities with one another to support the chosen strategy.[6] Dr. Vladimir Kvint defines strategy as "a system of finding, formulating, and developing a doctrine that will ensure long-term success if followed faithfully."[7] Corporate strategy involves answering a key question from a portfolio perspective: "What business should we be in?" Business strategy involves answering......

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...Task 1: Define the strategic planning terminologies such as missions, visions, objectives, goals, core competencies. Present the missions, vision, goal, and objectives statements of Myanmar Noble College. The way to make money is to go into business. Then you are rewarded for the risks you take with the skills and knowledge that you have. The simplest form is that of a sole proprietor. Then you are the business. A company's mission statement is a constant reminder to its employees of why the company exists and what the founders envisioned when they put their fame and fortune at risk to breathe life into their dreams. The mission statement should guide the actions of the organization, spell out its overall goal, provide a path, and guide decision making. It provides "the framework or context within which the company's strategies are formulated." It's like a goal for what the company wants to do for the world. After designing a strategy for our small business, we will need to track whether our desired results occurred as expected. Strategic controls help us do this by analyzing the company and its ability to maximize its strengths and opportunities. The objective of Myanmar Noble College is to produce qualified Higher National Diploma (HND) students. And aiming for success is the goal of the Myanmar Noble College. Core competencies Core competencies are a strategic approach involves identifying a firm’s competencies. These competences develop in a variety of......

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Business Strategy

...rdi resource development international Higher Nationals Module 8 Business Strategy © Resource Development International Consultants Ltd (RDI) All rights reserved. Except as permitted under current legislation, no part of this workbook may be photocopied, stored in a retrieval system, published, adapted, transmitted, recorded or reproduced in any form or by any means, without the prior consent of one of the copyright owners. Initial enquiries should be addressed to RDI Consultants Ltd. The right of RDI as the authors of this workbook has been asserted in accordance with the Copyright, Designs and Patents Act 1988. First published in 2003 for RDI Consultants Ltd RDI Midland Management Centre 1A Brandon Lane Coventry CV3 3RD rdi Business Strategy Contents How to use this workbook Introduction Unit 1 Strategic Planning Introduction Strategic contexts and terminology An evaluation of the strategy framework Differing approaches to strategy The planning process Strategic planning summary References 1.1 1.2 1.18 1.25 1.30 1.36 1.37 Unit 2 Strategy formulation Introduction Environment auditing Assessing current market position Strategic direction The internal audit The formulation of strategy Strategy formulation – summary References 2.1 2.2 2.7 2.24 2.34 2.49 2.52 2.53 Unit 3 Strategic implementation Introduction The realisation of strategic plans to operational reality Resource allocation Review and evaluation Unit summary Module summary References 3.1 3.2 3.14 3.25...

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...Formulating a Feasible Business Strategy to Start the Business in the Home Entertainment Industry A business opportunity has inspired me to start my own business in the home entertainment industry. The business in the industry will be performed by globally selling DVD and CD products, which can be described as physical containers of entertainment elements from film, music and game studios. For acquiring information of the opportunities and possibilities of the business for me, who acts as an entrepreneur, relevant business strategy will be made as the following assignment. 1. Definition of the concept of business strategy. The concept of business strategy will be defined as the points below. 1) To define the concept of business strategy, initially, the definition of strategy will be given. Strategy is the determination of long term goals and course of action on achieving these goals. (Business Strategy 2004) As it has defined, it is a designation of plans for action to achieve a particular goal. Similarly, for a company, it is a particular business goal. 2) One of the most important elements in the business strategy is their objectives. However, before making the objectives, the mission should firstly be set. From this point, business mission is to provide information on the character of a company and what business a company is doing. When the setup of the mission is done, there will be an inspection of the objectives. There are......

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... MAN4120 Exercise 1A: Compare Business Strategy with Military Strategy Ranking the nine military maxims: 1= most important 9= least important Top 9 Maxims: 9= Simplicity-prepare clear, uncomplicated plans and clear, concise orders to ensure thorough understanding Plans are important. Strategic management relies on strategies that are first formulated, implemented and than evaluated for success. This is the most important. 8= Objective- direct every military operation towards a clearly defined, decisive, and attainable objective After plans are formulated in a general scope, now objectives or goals are also formulated in order for it to be implemented and achieved. 7= Unity of Command-for every objective, ensure unity of effort under the responsible commander In business, we have organizational structure. Strategic plans are executed by certain people with duties such as management and employees. Without this type of structure, there is no way of directing the path of success. 6=Offensive-seize, retain, and exploit the initiative At this point, strategy can now be implemented after planning. 5= Maneuver-place the enemy in a disadvantageous position through the flexible application of combat power. Part of implementing strategies, placing competitors in a disadvantage by having “competitive advantage” 4= Mass-concentrate combat power at the decisive place and time Also, part of strategy implementation, deciding when to execute...

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...competition and can only emerge from effective strategy. Strategy, is about “...superior skills in understanding and satisfying customers” (Day, 1990 cited in Wit et al. 2004, p. 278). In the last few decades as the business environment has taken new twists, the perspectives on strategy have evolved using the framework of various eclectic schools of thought within two broad approaches: the prescriptive approach and the descriptive/emergent approach (Mintzberg et al., 1999). Some schools propose that strategy formation is the outcome of systematic analysis and logical planning. It is a deliberate process that is carried out by specialists who ensure that strategy implementation is the direct translation of the planned strategy. Others, like the learning school, argue that strategy is emergent. It takes shape as the result of learning that happens during organisational functioning at all levels. “...strategists can be found throughout the organisation, and so called formulation and implementation intertwine” (Mintzberg et al., 1999, p.25) but is facilitated and enabled by a ‘strategy champion’ – usually the CEO (Stalk et al., 1992, p.62). One supporter of the latter approach is Henry Mintzberg who argues that “Strategy is pushed along by sheer creativity of managers, because they explore new ways of doing things” (Mintzberg et al., 1999, p.29). Literature Review The debate on ‘what constitutes strategy?’ is intense. Is effective strategy an outcome of analysing the......

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...Foundations to Business Strategy Introduction It is a fact that HR professionals at all levels must operate strategically today. This means that programmes must be scrutinized to ensure that they contribute to the capability of the organization to achieve its goals. Once the basics are learned, it becomes easy to talk and practice the operations in the organization’s daily activities. Careful planning and effective leadership are essential for the success of any business or organisation. Only then will the objective of recruitment and selection be achieved. Lots of organizations still struggle with the global market crisis, therefore these companies are in search of ways to obtain or enhance their competitive advantage more than ever. This paper looks at the way Mattel planned the business and became successful in turning a small business into a world famous brand. The evaluation of the generic strategies used by Mattel in Barbie business have to be analysed to find out which strategy will help the company move further forward. Because the industry is seized with high level competition, only those who are able to pursue an effective strategy can survive in the market. Role of Generic Strategies A successful business will always consider the customers’ choice first and then deliver the products. The organizations that gather information of customer choices and needs and then market the products will make a good profit and become successful in the market. This is where......

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