External And Internal Analysis Of Singtel Telecommunications Essay.

Details of task: Select any one of the following companies:

1. Scoot Airline
2. OCBC Bank
3. Singtel

Report Format Details:

1. Presenting the organisation (10%) - (i) a brief discussion on the background of the company you have selected; (ii) a list of major players; (iii) key recent changes in the industry of your chosen company is located
2. External analysis (25%) - macro-environmental and industry analysis;Porter’s five force.
3. Internal analysis (25%) - (i) core competencies, Identify the main features of the company's strategies (ii) critically analyse the main elements of its strategies. Value Chain or VRIO analysis.
4. Strategy implementation and Triple-bottom-line performance (10%) - critically analyse how company implements its strategies to achieve intended goals. How the present strategy impact on the triple-bottom-line performs of the company.
5. Key challenges (10%) - challenges should be discussed in the context of current business environment with appropriate example
6. Recommendation (10%) - recommendation should have been made for the firm's future strategic development in light of your previous analysis

Analyzing the external and internal business environments is the most significant process when any company plans to formulate and implement new strategies. This environmental analysis provides the insights about different internal and external factors which can affect the growth and success of a particular organization (Dibrell, Craig and Neubaum, 2014). Considering the importance of environmental analysis, the below report is focused on assessing the external and internal environments of chosen organization i.e. Singtel Telecommunication. Singtel Telecommunications is a Singapore based telecom company that is operating its business as largest mobile network in this country with around 4.1 million subscribers. This report includes the external and internal analysis of Singtel Company by using different frameworks like Porter’s five forces analysis and VRIN analysis. Moreover, it describes the strategies which are implemented by this company to attain its predetermined objectives. There is the discussion about the challenges faced by Singtel in current business environment. At the end, some recommendations are given for the future strategic development of Singtel Company.

Singtel Group is a leading communication group of Asia that is engaged in providing a wide range of information technology solutions and multimedia services, including data, video and voice services over wireless and fixed platforms. It is the largest mobile network operators in Singapore with approximately 4.1 million users. It has a collective mobile use base of total 640 million customers at the end of 2017. It was popular as Telecommunications Equipment till the year 1995. It offers IPTV (Singtel TV), mobile phone networks and ISP (SingNet) and fixed telephonic services. Now, it has become a long term investor in different nations such as Thailand, India, Indonesia, Pakistan and Philippines etc. In fulfilling the expectations of MNCs, it is able to establish an extensive network across Europe, United States and Asia Pacific (Singtel, 2018).

Apart from Singtel, other major players in this industry are Telstra, M1, Vodafone and StarHub. Singtel is operating its business in Singaporean telecom industry successfully. Singapore has created a status of the global leader in telecommunications by developing a high quality network and very progressive regulatory atmosphere for domestic telecom industry (Wolf and Floyd, 2017).

Recently, Singaporean telecom sector has experienced various significant changes which contributed to its growth. For example, Google has started working on the 3^rd facility in Singapore. Moreover, StarHub has signed a MOU to introduce commercial Internet of Things applications. Singtel introduces its FutureNow Innovation Centre to assist the firms to fasten their digital transformation. M1 introduced first commercial NB Internet of Things in Southeast Asia (Goh, 2017).

Macro-environmental Analysis (PEST): Political/ Legal Factors

In Singapore, Privatization and Liberalization is supported by the Telecommunication Authority of Singapore. Singtel is entered in the stage that is driven by the changing technology. To fulfill the needs and demands of customers, there has been a trend towards liberalization, privatization and deregulation of telecom sector. This political trend has offered many opportunities to Singtel but any challenges as well. To operate the business successfully, the company needs to comply with different laws and regulations of Singaporean government and TAS (Singtel, 2018).

Economic conditions are the factors which affect the business of Singtel directly. Globalization is the best way that has jumped the national borders and enhanced business and trade that provides various opportunities to Singtel. The economy of Singapore provides an opportunity to Singtel to make investment in overseas market so that it can increase its profitability.

There are various factors which have large impact on the business growth of Singtel in the country. Considering this, the company has adopted a Singtel Touching Lives Fund which increases the funds for charities which help the youths and children. The people are becoming very advanced so they are switching from traditional and fixed telephony lines (López-Gamero and Molina-Azorín, 2016).

Nowadays, technology has developed and changed very quickly. New services like increased use of telecom and internet telephone are the major reasons that Singtel needs to invest in advanced technologies. Considering the trend, Singtel needs to focus on internet based and e-commerce activities which can increase its customer base.

Rivalry in Singaporean telecom industry for Singtel is intense as there are various leading players which are operating their businesses by using effective business and marketing strategies. There is an increase in the number of competing brands while the growth of industry has slowed down. It has caused the strong rivalry in telecom sector. M1 is the major competitor which has strong power and huge resources. Other competitors are such as Vodafone, Telstra, StarHub etc. However, the competition is high but Singtel has the potential to fight with these players. StarHub is another competitor that undoubtedly puts a great competitive threat on this company. The possible merger of Mobile1 and StarHub will be major threat to the top position of Singtel in Singapore’s telecom market (Battistella, 2014).

For Singtel Company, the bargaining power of buyers is higher because of availability of pricing transparency making the customers analyze the prices. As mentioned above, the company is facing intense competitors that indicate customers have varieties of communication plans. In this industry, switching cost is very low so buyers can select to use internet telephony than fixed line services. In this country, two biggest competing brands are Mobile 1 and StarHub, where the chosen company has to look at their products and services. People have various options in undifferentiated and standard between the products of Singtel and others.

Economic Factors

There is a lack of suppliers because of their ability to supply reliable and complex networks. In this industry, there is equilibrium between telecom companies and suppliers in Singapore, so suppliers’ power is moderate. On the other side, suppliers are unable to compete directly with its existing customers due to geographically widen networks. It is moderate because switching costs in telecommunication market are generally high (Dobbs, 2014).

Threat of new entrants is low in this telecommunication sector as the new entrants are needed license that should be issued by Telecommunication Authority of Singapore (TAS). The major entry barriers are requirement of huge capital and well-settled infrastructure of Singtel. Moreover, the issues of security are very sensitive in telecom operations, so Singaporean Government will examine before giving approval to the license (Jones, 2015). As the entry barriers are very high so likelihood of new industry entrants in this telecom sector is low.

The threat of substitutes is very high for Singtel Company in Singaporean industry. In this industry, the threat of VoIP (Voice over Internet Protocol) apps is high that provides more affordable and viable options to the customers. Thus, the fixed line telecommunication of Singtel can be replaced by this new technique and mobile phone apps (Sutherland, 2014).

VRIN analysis is a framework that is used to analyze the resources of company and its competitive advantage. It stands for Valuable, Rareness, Imitability and Organization. VRIO analysis of Singtel is stated below:

Valuable

The success of Singtel is based on its major focus on customers. By knowing about the needs of customers, Singtel is involved in enhancing the business success by providing value and quality services to the customers. Moreover, the company is seeking for more innovative and creative ways of operating business. Furthermore, human resources and leadership team are the most valuable resources for Singtel. By practicing as a single team with common objectives, they are establishing good bonds by sharing the knowledge and skills. The company has superior and leadership position due to personal excellence. By looking at the achievement and success of Singtel, it can be stated that employees are the most valuable resources (Knott, 2015). The company has implemented different policies to conduct training programs for its employees so that they can become aware about their roles and responsibilities. Its training programs work as significant resources as it helps the company to train its human resources about company’s vision.

Social Factors

Rare

There are various resources of Singtel which are very rare to find. Apart from commitment to offer a safe and healthy working environment for its people, Singtel Communication has developed an environment to avail the employees where they are not only engaged in attaining objectives, but also they can work in the coordination. Additionally, they share the value to make promises to customers and take their responsibilities effectively. It will be rare as every company cannot do this. Moreover, Singtel is engaged in reduction of environmental impacts by establishing different sustainability practices. It is very much focused on managing the resource conservation, environmental protection and waste reduction. These initiatives of the company enable it to supervise, evaluate and overcome the negative effects of operations on society, customers, employees and environment. The company has use two significant strategies which are very rare i.e. community development program and Singtel Touching Lives Fund (Stan, Oprean-Stan and Pele, 2018).

Inimitable

Singtel possesses various resources which cannot be imitated by others. One of the major resources is innovative technologies. The company prefers to make higher investment in technologies and adopted tried and tested technologies. It allows the organization to eliminate different risks. Singtel is experiencing sustainable growth due to its unique human resource practices like employee welfare, career management, recruitment, retention practices etc. Moreover, this firm has established a wide local and international infrastructure that has potential to fulfill the demands and expectations of customers. These resources support the organization to attain sustainable competitive advantage in telecom sector (Yang, 2015).

Organization

Stay competitive in changing telecommunication sector is a continuous challenge for Singtel Organization. Thus, it is very important for Singtel to organize it’s all the resources and core competencies so that it can capture a significant value. The major core competencies of this organization are its brand image, organizational culture and human resources. It can be analyzed that company is ready to exploit its resources and capabilities to provide value to the customers. It assists the organization to attain sustainable competitive advantage over other players (Knott, 2015).

On the basis of competition in Singaporean market, Singtel focuses on maintaining its exceptional profitability records and retain significant market share. This company is running its business operations and serving large customer base by implementing differentiation and cost leadership strategy. By adopting these strategies, Singtel effectively serves its telecom services with differentiated attributes and maintains operational costs (Sutherland, 2016). The above strategies support Singtel in attaining triple-bottom-line performance goals i.e. economic, social and environmental goals. In context of economic goals, these practices will allow Singtel to obtain cost advantage by enhancing the efficiencies of processes and to have competitive edge by differentiating its services.

Technological Factors

Moreover, it will help it in gaining customer satisfaction and loyalty towards its products and services. By reducing the costs of operations, the company is making investment in sustainability initiatives like environmental protection, resource conservation and waste reduction (Danish, Latif & Zeeshan, 2016). It helps Singtel in attaining its environmental and corporate social responsibility objectives. The company is very much focused on the development of its stakeholders, employees and community (Jamali and Karam, 2018). As mentioned above, Singtel has implemented community development program for their growth and benefits. In this way, its strategies support it to attain different goals of triple bottom line.

In Singaporean business environment, Singtel Organization may face various challenges which are discussed below:

• Merger of two leading companies:

While operating its business in Singaporean telecommunication industry, Singtel is facing the challenges due to strategic collaboration of two leading firms. For example, possible merger of MobileOne and StarHub will be a biggest threat to the top position of Singtel in Singaporean mobile market (Singapore Business Review, 2013).

• Competition

Competition is the biggest business challenge that is confronted by Singtel in telecom industry. In Singapore, telecom sector is highly competitive and Singtel has to fight against Mobile1 and StarHub by using effective pricing and promotional strategies. It is very challenging for Singtel to analyze the strategies and actions of competing brands so that it can compete with them effectively. Due to this challenge, Singtel needs to enhance its customer service so that it can create an excellent service experience for its customers.

• Stringent Regulations

The Singapore Government has imposed various strict rules and regulations for telecommunication industry players. They need to take the approval of government before launching any new service for public. It may delay the introduction of service. It may affect the business revenues and sales of organization (Jones, 2015).

It is hereby recommended that Singtel should use more effective strategies and processes so that it can improve its future position in perspective industry. The company should make efforts to expand its business in emerging markets. It will help the organization to enhance its brand presence and increase its subscriber base. For future strategic development, it is very important for Singtel to become more innovative and modern. It should upgrade its traditional services of fixed telephony line. Additionally, the company needs to focus on understanding the needs and demands of customers so that it can provide them complete customers satisfaction. By using these recommendations, the company will be able to develop its position in the future.

External Analysis (Porter’s Five Forces Analysis): Industry Rivalry (High)

Conclusion                            

In the limelight of above report, it can be concluded that Singtel Organization is operating its business effectively even after facing the strong competition. The above external analysis shows that competition in telecom industry is very high but Singtel has the potential to deal with it. The company possesses various resources and capabilities which can assist the company to gain competitive advantage against other competing brands. It is using effective business and marketing strategies which help the company to overcome potential challenges. By practicing above recommendations, Singtel will be able to overcome the challenges and gain top position in Singaporean telecom industry.

References 

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