Telefonica

...

Weaknesses

The weaknesses of the company are that it does not have an access to the latest managerial talent and technology. The poor access to the latest technology will give Telefonica a hard time in that in view of new entrants, it may have difficulty coming up with any improvement on the current state of its operations within the market thereby making it hard for the company to maintain its position in the market as their customers may opt out if there is a better technology offered by another company.

Telefonica does not have a competitive advantage over the foreign competitors. They have better skills compared to them. They also have better technology equipments than Telefonica thus difficulty in maintaining the position that Telefonica has in the market.

Opportunities

Telefonica has a great opportunity in the market based on the fact that the cultural ties are similar thus making it easier for Telefonica to fit in the environment. This in turn would see it being given the first priority based on the fact that the locals would prefer them over another foreign company that would seek to invest in the market. In addition, the company still has a strong position in Spain thereby making it have two strong markets that it can comfortably control.

Threats

The entry of the foreign rivals who have cheaper prices and advanced technology puts the company in a position whereby it would have difficulty keeping up with the level of competition. The fact that the companies also get smaller profit margins puts the organization in a position whereby it finds it difficult to keep up with the level of competition.

The abolishing of monopoly allowing entry of foreign countries also puts Telefonica in a difficult position where it will have difficulty maintaining its brand within the market. This would thus lead t a decline in view of the kind of equipment the other telecommunication companies have.

Value Chain analysis and value chain for Telefonica’ business segment

In a bid for Telefonica to keep up with the looming competition in the industry, the management has to come up with a number of improvements that will help in ensuring that their service provision gets better. The process of operation should also be streamlined to meet the desired goals within the company. An activity analysis has to be conducted in a bid to ensure that the activities creating value for clients are:

- Integrating communication services

- Transmitting information

- Information reception

[pic 1]

[pic 2][pic 3]

[pic 4]

[pic 5]

[pic 6]

[pic 7]

Acquisition Strategy

In view of the complex challenge of managing customers in the telecommunication market, the company has to come up with an appropriate means through which it will be able to meet the required targets. With the first strategy being Latin America, the company will not find it hard to penetrate the market given the ability to relate with the customers within the market because they share common cultural practices with Spain, Where Telefonica originates from and thus meeting their expectations will be easy. With the main country being Brazil, the company has been able to have a high stake in the market because of the similarity in their culture and the fact they get along fine with the entire customers.

Seeking partnerships through merging is also a strategy that would help in markets that have a high number of telecommunication operators. For instance, moving to China and merging with a company like China Unicom is a great strategy that has so far seen it get a stake of 9 percent. China Unicom being its number two operator give the company an opportunity to bolster its growth within China.

Moreover the move will see them share profits and losses based on the much they have invested in the company. Telefonica managers are also involved in making of decisions regarding operations and possible adjustments. Telefonica can therefore count that it has one leg in China and likely to do good in years to come.

The presence of Telefonica in Britain should be improved by being more innovative in the kind of products it offers. The company should seek to diversify all the products it offers in a bid to ensure that they meet every customer’s needs effectively. Moreover, the company management should ensure that they keep in touch with the target markets they intend to expand to. In view of the presence of other competitors within the market, the company should ensure that it takes up the role offering the customers better and more unique services that will see their needs met or even get better services. For instance the company should be able to provide them products like internet bundles, free short messages and even free talk time to ensure the clients get to benefit from.

Cultural factors that affect Telefonica’s international dominance

Based on different cultures in the world, there are a section of people in the society that may not wish to be associated with certain products. For one, Telefonica may find it difficult fitting in a Islamic nations because of the view of the fact that the technology itself originated from a country that they do not share common culture with thus leading to difficulty in staying within that region. Moreover, the management may not be able to strike a deal based on the fact that one has to observe the religious nature of the country and seek to blend in, a factor that is difficult for the Telefonica Company based on the fact that a majority of them are Catholics.