International Strategy Of The Vodafone Group Plc

COURSEWORK TITLE:

INTERNATIONAL STRATEGY OF THE VODAFONE GROUP PLC

Contents page

1. Introduction

2.Company Background

3.Evaluation of the internal and external environment of the company

4.Analyse the motivation of the company for international expansion

5.Analyze the reasons for operating in a particular region or country

6.Evaluate its market entry strategy in a particularly region or a country

7.Conclusion/recommendation

8.Bibliography

9.Appendix

1. Introduction

The aim of this report is to research into the Vodafone group and their entry into the Indian Market. The research was carried out of Vodafone’s history, their existing market strategy, the internal environment of the company and external environment of their home market.

Also it has been explained what Vodafone international strategy is and why there is such interest in the emerging market. It is also focused on the reasons that Vodafone chose to enter the India market and why the mode of entry they used was chose a joint venture rather than starting moving to a new country using their existing UK strategy.

The following theories and analysis has been used;

• Porter five forces

• Prahalad and Hamel’s core competencies

• SWOT analysis

• PEST analysis

The sources used to carry out this research include secondary information which is the Vodafone’s annual report, internet resources and also the course Textbook.

It then concludes into what kind of problems Vodafone may face, whether they made the right entry mode and suggest an alternative entry strategy.

2. Company Background

Vodafone Group Plc is the world's leading International mobile telecommunications Group, with a major presence in Europe, the Middle East, Africa, Asia Pacific and the United States through the Company's subsidiary undertakings, joint ventures, associated undertakings and investments.

Vodafone Group’s main business is to enrich their customers’ lives by enabling them to communicate in an increasingly connected world. They provide a range of voice and data mobile telecommunications services, which includes text messages, picture messages and other data services.

Customers have voted with their phones to make Vodafone Group the world's 2nd wireless phone services provider with nearly 187 million customers.

Vodafone was formed in 1984 as a subsidiary of Racal Electronics Plc; at this time it was known as Racal Telecom Limited. Vodafone first launched in the UK with the first national UK network on 1 January 1985 and since then have expanded from their UK base market by taking over or being in partnerships with other telecommunication companies around the world. They operate in 27 different across 5 continents.

Here are few high points of Vodafone’s history:

• 1990: Vodafone’s customer base reached 0.5 million

• 1993: Vodafone Group International is formed to acquire licences and supervise overseas interests.

• 1996: Vodafone is the first network operator in the UK to launch a Pre-Pay analogue package

• 1999: Vodafone completed its purchase of AirTouch Communications, Inc. and changed its name to Vodafone AirTouch plc

• 2000: Reverts to its former name, Vodafone Group Plc

• 2005: Launch of Vodafone Simply, a new easy-to-use service for customers who want to use voice and text services with minimum complexity

• 2006: Announces the biggest loss in British corporate history (Ð'Ј14.9 billion) and plans to cut 400 jobs; reports one-off costs of Ð'Ј23.5 billion due to the revaluation of their Mannesmann subsidiary.

• 2007: Vodafone agrees to buy a controlling interest in Hutchison Essar Limited, a leading operator in the fast growing Indian mobile market

This establishes that Vodafone have grown rapidly through gaining and has highly developed its goal which was to offer great and well enhanced service to their customers.

3. Internal and external environment of Vodafone

Every company will focus on how to keep the environment surrounding their company harm free, therefore as every company Vodafone has its own safety for their environment. In order to focus on how to analyse and evaluate the Internal and external environment of Vodafone, the following analytical tools will be used:

Internal Environment of Vodafone:

• Core competencies

• SWOT analysis

External Environment of Vodafone:

• Pestle analysis

• Porters five forces

Core competencies

Core competencies are the capabilities that are critical to a business achieving competitive advantage. The starting point for analysing core competencies is recognising that competition between businesses is as much a race for competence mastery as it is for market position and market power. (Prahalad and Hamel)

There are three analysis, which should be applied when identifying and developing core competence of Vodafone:

The core competence should:

• Provides potential access to a wide variety of markets