The primary objective of Vodafone as a business entity is profit maximisation. The company has a mission statement that ensures for this objective to be achieved in the best possible manner. Vodafone’s mission statement is “to be the communications leader in an increasingly connected world” (Annual Report, 2010). Accordingly, this mission statement is communicated to all stakeholders of the company, especially to 84,990 employees (Company Description, 2010) of the company, due to the fact that it is employees who are going to contribute the most to the achievement of the mission statement.
Vodafone is committed to achieving its aims and objectives through offering innovative and superior services.
According to Saplista (2008), Vodafone is not limited to offering basic telecommunications services such as mobile phone calls and text messaging, but also offers such advanced services as: * Vodafone at Home and Vodafone Office represent integrated mobile and communication services to satisfy household, as well as business needs. * Vodafone Passport allows customers to ‘take their home tariffs abroad’ through roaming services which is possible due to the wide global presence of the company.
* Vodafone Live! is integrated communication and multimedia solution offered by the company to be used through mobile phones and notebook computers. * Vodafone 3G offers 3G services that allow customers to transfer and download data in various formats. * Vodafone Mobile Connect data cards and Mobile Applications offer customers the possibility of portable internet.
Strategic Model for Vodafone
The level of competition in each industry, especially in telecommunications industry Vodafone is operating in has become very fierce. The only way to survive and expand in such a competitive environment for Vodafone is to have an efficient strategy that would be the source of competitive edge for the company. Currently Vodafone has no clear strategy. Therefore potential customers are not sure in what ways the company can offer value to them. According to Porter’s generic strategies companies can choose cost leadership and differentiation strategy in narrow and broad scope (Porter, 1985). Vodafone is highly recommended to implement differentiation strategy in a industry-wide scope. Thus, Vodafone should develop products and services with additional features that present value for potential and existing customers, and the company can charge additional extra prices for this additional feature.
For instance, in its portable and home broadband services Vodafone can further invest in research and development and achieve increasing the speed of the internet browsing they are offering. This particular strategy is most likely to prove efficient due to the fact that although currently there are many internet providers in UK the speed of internet browsing tends to decrease during specific hours of the day. Another justification for the suitability of differentiation strategy for Vodafone relates to the fact that due to the current size and financial resources of the company Vodafone can commit to high level of research and development expenses this strategy initially requires. Although Vodafone’s competitors do understand the advantages of differentiation strategy, unlike Vodafone the state of their financial resources do not allow them to adopt differentiation strategy.
Vodafone Key Performance Indicators
Key performance indicators adopted by telecommunications companies in general, and Vodafone in particular include free cash flow, service revenue and related organic growth, data revenue and related organic growth, fixed line revenue and related organic growth, capital expenditure, EBITDA and related organic growth, customer delight index, net promoter score, adjusted operating profit and related organic growth, proportionate mobile customers, proportionate mobile customer net additions and voice usage (Annual Report, 2010). Information requirements differ at each level of management due to the difference in the scope of responsibilities related to a specific level.
Generally management levels are categorised into three groups: strategic, tactical and operational. The responsibilities, and accordingly information requirements at each level of management are illustrated on the following table: Management Level| Scope of Responsibilities| Information Requirements| Strategic| Whole Vodafone Company in general| Strategic type of informationInformation regarding global environmentEconomic climate within countryIncrease in GDPInflation rate within country| Tactical| Operations within a specific areaSpecific function within organisation| Level of sales for the regionKPIs for the regionKPIs for a specific department| Operational| A specific branch of the company| KPIs for the specific branchAviability of stock in a specific branch|
Vodafone Information Systems
Information system can be used at each above specified decision-making level in order to give competitive edge to Vodafone manager at that level in particular and to the company itself in general. Curtis and Cobham (2008) define information system as an integrated combination of information technology components and related human efforts that is used to assist in operations and decision making. Information system at each decision-making level at Vodafone should be devised and maintained in a way that it can serve the two following purposes: Firstly, information systems should support the key business functions, and create competitive edge for Vodafone. Secondly, information system should assist in efficient facilitation of Vodafone’s customer relationship management. In order to achieve these objectives the following recommendations should be implemented. Strategic level management. Information system at strategic level for Vodafone should include all external and internal factors that are going to affect the company.
Information of such a nature should be supplied to strategic level managers systematically in order to assist them in decision-making. Moreover, information system intended for Vodafone strategic level management should contain detailed information about potential overseas markets, information regarding the extend of competitor activity as well as information regarding the suitability of Vodafone products and services to today’s competitive standards. Inefficient information system at strategic level management is going to have dramatic negative consequences caused by not being able to respond to changing market conditions, because there was no accurate information about the changing market conditions in the first place. Tactical level management. Information system for Vodafone managers at tactical level should include breakdown of sales by a region, as well as breakdown of sales by a product or a service.
It is important for such type of information to be supplied to tactical level managers on a regular basis. Moreover, information technology should be widely used in order to collect such type of information, because it will make the process faster, as well as cost efficient. Not implementing and maintaining efficient information system for tactical level management will cause huge losses for Vodafone which is going to affect the whole region and damage the image of the company dramatically. Operational level management. The scope and range of information system in operational level management is considerably smaller compared to strategic and tactical levels.
Nevertheless, it is equally important for operational level management at Vodafone to have a constant supply of information relating to the process of products and services, stock availability, customer credit ratings etc. Again information technology must be widely used in order to process and store information system at operational level management. The negligence of this recommendation may result in loss of revenues caused by the absence of stock in stores, improper pricing and many other ways. Currently Vodafone commands a leading position in the global telecommunications market. However, due to the constantly changing marketplace the company cannot afford to take this position for granted and has to engage in increasing its competitive advantages in many fronts.