VODAFONE GROUP PLC REPORT
Vodafone Group Plc Report
Introduction
Vodafone Group Plc. is one of the global primary mobile telecommunications firm. The company is the prime telecommunication network globally founded on revenue (market value of around $72 billion). It is a United Kingdom based firm, established in 1982. Apart from UK, the company has a noteworthy presence in United States, Europe and the Asia-Pacific region through subsidiary undertakings, direct investments, joint ventures as well as associates. In addition, in these regions the company operates in 31 nations with further partner networking in more than 40 countries. This conglomerate group is engaged in distributing mobile telecommunications services and products, comprising data services, voice, text and video messaging and fixed broadband services. It is considered the world leader in offering data and voice communication services alongside offering internet services. Apart from essential telecommunication services, Vodafone UK is entailed in providing incorporated mobile and PC communication services, wirelessly via 3G and HSPA, and through fixed line broadband. Moreover, it too offers to its clients a range of devices to access Vodafone's products and services, comprising handsets, laptops, fixed line telephones, and desktop computers. Vodafone has greater than 300 million mobile clients globally, which comprise private customers and corporate customers (Boddy 2008).
According to Boddy (2008), management theory is the scientific application of ideas to assist increase organization, quality, as well as profitability. Management theories are executed and implemented to assist several organizations to manage its operations effectively. Therefore, management theories are vital in increasing productivity and quality of services and products. It has been established that not all managers apply a single theory while implementing strategies in the workplace. In many cases, they combine a number of management theories, based on the purpose, workplace, and labor force. Present perspectives of management theory emphasize the changing environment of the external environment as well as the necessity to comprehend and deal with these external forces for change. Moreover, the contribution and role of systems theory and contingency theory to the management process is stressed in Vodafone Group. Management theory emphasizes the need for efficient planning to make sure that organizational goals are achieved. The efficient management of both program as well as operational activities needs an understanding of management principles (Vogel 2005).
For several years, management theory has recommended a rational or economic, technical base for organizational performance. Vodafone uses Rational Goal Model to manage its operations. Management is a process, which spans and links a variety of sub-systems. The basic function of management is to support not only people; however, also the institution itself including processes, technology, and structure. Rational goal models are a response to the challenge of organizing production resourcefully. It is a strategy to management, which utilizes meticulous quantitative methods to assist managers make the greatest use of organizational resources (Boddy & Paton 2013).
In addition, Vodafone uses resource-based theory to manage its operations. The theory is a way of viewing the company approach to strategy formulation. RBV center on the internal environment other than the external environment has been perceived as a safer base for formulating management strategies. The RBV stresses the internal capacity of the organization in formulating an approach to arrive at a sustainable competitive advantage in its market as well as industry. In addition, a bunch of resources and capacities might be applied as a core competency to a market opportunity. The internal environment too can fashion a new market for the company.
Organization
SWOT Analysis
Strengths
Vodafone Group has the biggest geographic footprint in over 70 nations, and the company has extremely gained economies of scale as well as degree to optimize cost-effectiveness as well as efficiency. This has promoted diversity in terms of risks. The company has the capacity to adapt advanced ICT makes sure that its clients are able to stay in touch to the people, as well as information. The company has adopted Group Technology in order to attain time-to-market as well as to sustain cost-efficiency. The company has a brand that is seen as one of the most recognized globally (Boddy & Paton, 2013).
Weaknesses
The company is faced by financial stability as indicated by its financial ratios, such as profitability, liquidity as well as debt management are reported to be lower. In addition, Vodafone has experienced underperformance in some of the major markets due to the economic meltdown, particularly in European markets (Vogel 2005).
Opportunities
In Vodafone, value-added services and products, which may meet individual customer requirements and broaden the degree of its relationship with its clients, are vital for telecommunications providers to reshape its competitive environment. Furthermore, data services are projected to propel converged services other than traditional messaging and voice services. The mobile broadband base is expected to increase, which will boost the sales of the company. In addition, there are emerging markets that will increase the market base, especially in Indian markets.
Threats
Vodafone financial stability is being threatened by the globally instability, especially in European markets. The fierce competition in the mobile communications industry has affected the revenues of the company, and this is likely to continue in future coupled with the economic slowdown. Whilst expanding globally, Vodafone has to cope with every local regulation, some of which are not encouraging for its operations.
PESTEL Analysis
Political Factors
Vodafone is normally subject to regulations governing the operation of its business activities. These regulations classically take the form of industry explicit laws and regulations covering telecommunications services as well as general competition (antitrust) laws pertinent to all activities. This affects the operations of the company in some markets (Vogel 2005).
Economic factors:
The economic conditions might massively impact Vodafone, for instance, if there is a towering unemployment rate it would affect some of the employees Vodafone wants to employ and hire an outsourcing firm. Moreover, if there is a high illiteracy rate it will too impact the quality of human resources (Boddy & Paton 2013).
Social Factors
Social factors have a big impact on Vodafone, the lifestyle, even the ads are based on the social as well as cultural factors of every nation, for instance, the ads of Ramadan and the feast in Egypt and the Dog impersonating Vodafone in India. The use of the telecommunications industry technology is now part of the lifestyle and the 3G technology, such as surfing the internet from the phone in the younger generations.
Technological factors
Research and development (R&D) in Vodafone is a driving force behind job creation, economic growth, novelty of new products, and growing quality of products. The R&D has an immense impact on Vodafone's revenue, for instance, the kind of products sold in Vodafone stores, such as i-phone as well as blackberry phone all the 3G technology, the iPad and the laptops and all the new technological products has a huge effect on Vodafone (Vogel 2005).
Management at Vodafone Group
Management entails activities of getting people together to achieve desired objectives, as well as goals using accessible resources efficiently and effectively. It consists of planning, organizing, leading, staffing, and controlling for the purpose of attaining a goal. Management techniques are in some cases referred to as models that represent a multifaceted event which are constantly evolving as societies esteems change (Boddy & Paton 2013). Management might refer to the technical task of the organization; however, models of management deal with “both the technical task of an organization as well as organizational ideologies, that is, rationalizations of the system of hierarchical power in the company. There are numerous diverse types of models, most which have been crafted by people to endeavor comprehend and deal with present management issues. Furthermore, the use of more models gives better alternatives and consequently, the extent of alternative and prospective efficiency can be augmented. Several models of management emerged in the 18th century, like the competing values framework (CVF) model. It has been made apparent that no one model was adequate; nevertheless, instead it was essential to see every four models as aspects of a bigger single model like the CVF model (Vogel 2005).
Competing Values Framework (CVF) Model
CVF is a theory, which was developed originally from research carried out on the key indicators of effective organizations. Robert Quinn is amongst those authors that have lately started to argue that efficient leadership needs a balancing and a concurrent mastery of apparently ambiguous or paradoxical capacities. Organizations should be adaptable as well as flexible; however, we also desire them to be stable and controlled at the same time according to Quinn (1983). Every quadrant of the structure represents one of the four main models of organization and management theory. The four diverse hypothetical management models within the CVF comprise; the Rational Goal Model, the Human Relations Model, The Internal Process Model as well as the Open Systems Model. Whilst every model adds to the knowledge of management, none is adequate on its own, although are corresponding elements in a larger whole (Boddy & Paton 2013).
Successive models of management fall into the four main segments and every of the four modes have a perceptual opposite. The human relations model is defined by constancy, and internal focus stands in distinction to the rational goal model that is defined by control and external focus. In addition, the open system model, defined by flexibility as well as external focus, runs counter to the internal focus model that is described by control and internal focus. Whilst the open systems model is concerned with adapting to the constant change in the environment, the internal process model deals with maintaining constancy and stability within the system. There are several parallels amongst the models. The human relations model and the open systems model both stress on flexibility while the open systems and rational goal models share an external focus, as well as the rational goal and internal process models, give emphasis to control. Finally, Thompson and McHugh (2002), the internal process and human relations share an internal focus. Reliant on the models and combinations applied organizational efficiency may be seen as simple and rational, as vibrant and synergistic or as multifaceted and illogical.
Rational Goal Model
There are several values to the rational goal model. Frederick W. Taylor, a mechanical engineer, concentrated on the relationship between the employee and the machine-based production system, a system that was called scientific management and fashioned by Taylor is the 1990’s. The five major values to Taylor’s scientific management were; 1.) Build up a science for each job that replaces the old rule-of-thumb technique. 2.) Methodically select employees so that they fit the job, and train them efficiently. 3.) Provide incentives in order for employees to behave in line with the principles of the science that has been developed. 4.) Support employees by vigilantly planning their work and smoothing the means as they do their jobs and 5.) Train, teach as well as develop the employee to follow the defined processes accurately. “Taylor’s primary principle was that scientific study and a fact, not presumption must inform management. In addition, he supposed that efficiency increases if tasks were custom and predictable (Boddy 2008). The other practice within the rational goal model is operational research (OR). This came up in the 1940’s, and is a scientific technique of providing (managers) with a quantitative foundation for decisions concerning the operations under their control (Boddy, 2008). The current application of the rational goal model stresses control and external concentration, with views of goal setting, planning, efficiency and effectiveness. It too presents two leadership roles. The producer is work-focused as well as task-oriented, and inspires members to augment production and to achieve affirmed goals. The director participates in goal setting and planning sets objectives and establishes comprehensible expectations (Boddy & Paton 2013).
Vodafone Group and the Rational Goal Model
It is evident that the UK mobile communication company Vodafone Group uses the rational goal model. Thus, the application of this model for Vodafone Group reduces risk, creates balance between efficient and resourceful processes and maximizes income for the company. The advantages for Vodafone Group for utilizing this model is that work will be done more precisely as workers have more direction as well as advice from management so workers understand what is anticipated from them (Bishop 2008). Profitability and productivity will be enhanced as employees will be performing competently. Though there are some limitations to using this model, like workers may become fed up easily, consequently leading to employees putting less and less effort in, as a result monotony, so work production is of poor quality. Furthermore, tasks might too not always be finished, and the quality of work may in some cases below. Vodafone Group offer an official training program for their new workers , which cover topics in management skills, consumer , leadership, and worker legislation, human resource management ,health and safety, and policies and processes. Vodafone Group wholly believes in the values of self-development where the individual is responsible for attaining their learning objectives and goals.
Recommendations
Vodafone Group has to lay out more strategies so that it can increase its market share, which means that its revenue will increase. The company should drive operational performance through value enhancement, which means optimizing the value of its existing consumer relationships, not basically the revenue and cost reduction; however, they should pursue growth prospects in total communications. This entails expansion in mobile data services, growth in enterprise (business) customers comprising small, medium, and home offices as well as broadband. The company needs to adopt a market-by-market strategy focused on the service, rather than the technology. This will be targeted at enterprise as well as high value customers as precedence. The management should venture emerging markets comprising expanding delivery of mobile services and selective expansion into new markets. In addition, Vodafone Group need to reinforce capital discipline including an objective of generating about £6 billion in free cash flow yearly with the investment priorities of support for existing business, as well as expansion of entertainment ,mobile data, and broadband (Bishop 2008).
Conclusion
Vodafone Group, as a leading and expanding global communication firm, it is dedicated to providing premier quality products to several nations with varied cultures and economies. Vodafone Group is dedicated to the producing and distributing its products being carried out in stringent accordance with the Vodafone Group Code of Conduct. Through the rational goal model which highlights the management model that Vodafone Group use, they are able to be as successful and proficient as possible ;however, they still experience various challenges with regards to business ethical issues , like child labor, women’s and workers’ rights, health for their employees, providing a living wage and better rights for their employees. These challenges may be dealt with via constant development and on-going assessments of the management.
List of References
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Naylor, J. 2004, “Management”, Second edition, Gosport: Pearson Education Ltd.
Quinn, R.E. 1988. “Beyond Rational Management: Mastering the Paradoxes and Competing Demands of High Performance”. San Francisco: Jossey-Bass.
Senge, P. 1990. “The Fifth Discipline: The Art and Practice of the Learning Organization”. New York: Doubleday
Thompson P. and McHugh, D.,2002, “Work Organizations”, 3rd Ed. New York: Palgrave
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Vogel, D. 2005, “The Market for Virtue: The Potential and Limits of Corporate Social Responsibility”, Brookings Institution Press, Washington, DC.
