AT & T STRATEGIC ANALYSIS Case Study Analysis
However, the recent strategic issues experienced by the firm which includes ineffective strategies related to diversification, shifting the focus from the business core identity and competence, failure to employ flexible wireless models, declining customer sales and trust on the brand and increased competition in the industry threatens the competitive position of the company and suggests that business has failed to pursue its strategic objectives.
It is believed that the above-mentioned mitigation strategies will enable the business to achieve its strategic objectives successfully. In order to achieve rapid innovation and bring new technologies in the market, significant funding is required. However, since the business debt isn’t much higher, opting for a debt source of finance in order to support innovation and new product development appears to be difficult. Therefore, selling off the unprofitable subsidiaries will ensure the business has access to adequate finance in order to achieve growth and future expansion plans. However, selling off the existing subsidiaries might give a poor impression of the company as investors might perceive that business is experiencing financial difficulties and are unable to obtain debt. This will result in a decline in the share price of the company and low investor confidencein the business.
Moreover, related diversification will ensure completion is eliminated in the market, the business achieves growth globally and domestically. In addition, it will ensure that the business would focus on its core competence i.e. wireless devices and Telecomm services. However, the specified risk mitigation techniques might not help the firm in achieving its strategic objectives as a downfall in the industry will affect the overall company’s operations.
It will be suggested to the business to collaborate with the Internet of Things developers and offer 5g and the app to business consumers in a bundle at a completive price. This will allow the business to achieve maximum profit margins in future, as its demand is likely to grow significantly by 2022. In addition, it will also ensure that the business focuses on its core competence i.e. Telecomm and might resolve the financial issues of the company as the Internet of Things software requires low capital. Moreover, it will allow the business to achieve its strategic objective of bringing rapid innovation and bringing new technologies and advancements to facilitate customers. On the other hand, it will ensure that the business maintains its competitive position in the industry as the strategy has significant chances of being successful.
Conclusion
AT&T, a leading firm in the global telecommunication industry, pursued strategic objectives which included bringing new technologies and advancements in the industry, pursuing excellence i.e. maintaining a competitive position in the market and to improve customer experience. The business employed ineffective growth strategy which comprised of taking over companies operating in unrelated businesses mainly media, this imposed a threat to the organization’s strategic objective as the company was shifting its focus towards the media industry.On the other hand, the business’s sales and share price were reduced significantly due to an ineffective growth strategy. Moreover, the business experienced reputational damage, higher debt levels, increased rivalry and threat form emerging technologies.
Therefore, it was recommended to the business to mitigate the strategic risks by selling off its investments in the unprofitable and underperformed subsidiaries, investing in companies operating in the same line of operations, such as: T-Mobile, which will enable the business to eliminate the existing competition, focus on its core competence i.e. telecom services and maintain competitive position in the industry. Moreover, it was recommended to the business to collaborate with developers of Internet of Things (IoT) Technology and offer its 5G devices and internet of things app in a bundle at a competitive rate to facilitate the customers and achieve the strategic objectives of the business.........................
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