Business Case Study: Case study of T-mobile

Table of Content
1. Background of the company’s Product
2. SWOT Analysis
3. PESTLE Analysis
4. State the Problems
5. Select one of this Problem
6. Overview of the Problem with Facts
7. Solutions

1. Background of the company

Name of company: T-Mobile

Year of Formation: December 1999

CEO: John Legere

Products of the company: Wireless PDAs, Cellular Telephones, Tablet-PCs

Annual revenue: US $40.6 Billion (2017)

Countries in which it operate: USA, Austria, Germany, North Macedonia, Hungary, Albania, Romania

Net operating cost: US$35 billion

Ad Expenditure: US$18 billion

Net Sales volume: US 43.3 billion

Main competitors: AT&T, Verizon and Comcast

Background of the company’s Product

BCG Matrix of the products  

Stars

  • financial services strategic business unit
  • supply chain
  • brand Strategic business unit
Question Marks

  • market development
Cash Cow

  • supplier management service
  • innovative product
  • research and development
Dogs

  • horizontal integration strategies

Figure: BCG matrix for T-mobile

Background of the task force environment and their interplay

SWOT Analysis

Strengths

    • Reliable suppliers: It has a strong base of reliable supplier of raw material thus enabling the company to overcome any supply chain bottlenecks.
    • Strong Free Cash Flow:  T-Mobile US, Inc. has strong free cash flows that provide resources in the hand of the company to expand into new projects.
    • Successful track record of developing new products: product innovation.
    • Highly successful at Go-To Market strategies for its products.
  • Superb Performance in New Markets: T-Mobile US, Inc. has built expertise at entering new markets and making success of them. The expansion has helped the organization to build new revenue stream and diversify the economic cycle risk in the markets it operates in. 

Weaknesses

  • Not highly successful at integrating firms with different work culture. As mentioned earlier even though T-Mobile US, Inc. is successful at integrating small companies it has its share of failure to merge firms that have different work culture.
  • Financial planning is not done properly and efficiently. The current asset ratio and liquid asset ratios suggest that the company can use the cash more efficiently than what it is doing at present.
  • Days inventory is high compare to the competitors: making the company raise more capital to invest in the channel. This can impact the long term growth of T-Mobile US, Inc.
  • Limited success outside core business: Even though T-Mobile US, Inc. is one of the leading organizations in its industry it has faced challenges in moving to other product segments with its present culture.

Opportunities

  • Stable free cash flow provides opportunities to invest in adjacent product segments. With more cash in bank the company can invest in new technologies as well as in new products segments. This should open a window of opportunity for T-Mobile US, Inc. in other product categories.
  • The new taxation policy can significantly impact the way of doing business and can open new opportunity for established players such as T-Mobile US, Inc. to increase its profitability.
  • Opening up of new markets because of government agreement – the adoption of new technology standard and government free trade agreement has provided T-Mobile US, Inc. an opportunity to enter a new emerging market.
  • The market development will lead to dilution of competitor’s advantage and enable T-Mobile US, Inc. to increase its competitiveness compare to the other competitors.

Threats

  • New environment regulations under Paris agreement (2016) could be a threat to certain existing product categories.
  • Increasing trend toward isolationism in the American economy can lead to similar reaction from other government thus negatively impacting the international sales. 

PESTLE Analysis

i. Political

The political factors are the one that falls under the external factors for the company. This comprises the governmental policies, legal documentation and taxes. The political power in the countries are different in nature. As the company has international ventures, the political stability and policies influence the business endeavours of the company. In the European countries, the political issues are stabilised. But in the countries like China, political influence plays the pivotal role. 

ii. Economic

The factors in the economic sections that the company has to keep in mind while doing their business are- unemployment rate and policies, economic growth of the country, consumer confidence, interest rate, inflation and other necessary policies. For example, in the countries like Australia or USA, the economic growth is quite impressive. Here the company has the scope for both their daily and luxury products more than the developing countries. 

iii. Social

Social factors have influenced the business and performance of the company time and again. The main factors in the social impact are income destruction. Socio-economic status of the people, lifestyle changes, social and labour mobility, demographic changes. 

iv. Technological

The innovations in the technological sectors re always the positive part of the mobile phone industry. The development in the industries could accentuate the business and its scope in each part. The innovation of the hybrid technologies and modern equipment have increased the sales of the company. Changes in the information technology has increased the communication factors.

v. Legal

The tax policies of the country and the employment laws are the main things that a company has to review before doing business of any kind. In the manufacturing of the cars the company has to go through the safety policies of the company and apply it in the operations. There are also competition regulations of the countries which are the part of legal contexts for the company. 

vi. Environmental

T-mobile has been trying to increase their involvement in the environment- friendly business. The company is trying to reduce the carbon emission of their productions and make the world green. This company is serious of their CSR and environmental protection regulation of the respective countries. 

2. State the Problems

  • New companies are entering the market regularly and reducing the sales of the company. The company is no more the most reputed mobile company in USA. The new entrants are a great threat to its business.
  • Signal issues in the phones and connection of T-mobile is increasing. This is creating dissatisfaction in its customer base. 
  • The data speed of the company is not satisfactory for the customers as well. These issue has been in the country for long time now. 

3. Select one of this Problem

Increasing number of mobile communication network is resulting into the fall of sales number for the company. 

4. Overview of the Problem with Facts

According to Ana, a senior Business consultant at Myassignmenthelpreview, “The stock of the company fall by 2.6% in the first quarter of 2019. The low networking services and the increasing number of the competitors in the market is considered to be the reason behind such fall”. The number of sales unit if decreasing. This has also influenced the marketing potentials of the company. The company has invented a huge amount in its marketing but the sales and stocks are not increasing. The growth rate of the company has been down from 3.6% to 25 because of the network related issues.

5. Solutions

  • There should be some technological interventions involved in the business of the company. This company is mainly cantered around the USA. The main areas of the company are well connected with the T-mobile networks. But there need to be more connectivity in the suburb areas. 
  • To overcome the obstacles in competitive advancement the company need to invest more in its promotional ventures. These promotions could be done in both online and offline media.
  • Another important aspect to increase the sale is the customer relation management. The services of the company is customer centric. If the consumer feedbacks are inserted in operations, the results would be more in favour of the company. 

Author Bio: Ricky is an academic consultant who has recently joined Myassignmenthelp as a Business subject matter expert. His work as an SME is to provide My assignment help review to students with necessary Business and marketing guidance. Besides being a marketing guru, he loves to paint and travel.

Leave a Reply

Your email address will not be published. Required fields are marked *