Globe Telecom, Inc Strategies
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Globe Telecom, Inc Strategies, by Joshua Banzon & Janny Ann Reyes, University of the Philippines
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Globe Telecom, Inc Strategies
- 1. Telecom, Inc. by : Banzon, Joshua Neil Reyes, Janny Ann University of the Philippines Institute of Management BA 190 - Strategic Management Prof. Mita Angela M. Dimalanta
- 2. THE COMPANY Globe Telecom, Inc., is one of the leading companies in the Philippines’ telecommunication industry. It is the #1 mobile brand that offers cellular, mobile data and broadband services enriched to cater to customers’ penchant for different multimedia platforms through various mobile devices and screens. Ernest L. Cu is Globe’s President and Chief Executive Officer (CEO)
- 3. Vision and Mission • VISION We see a Philippines where families' dreams come true, businesses flourish, and the nation is admired. • MISSION We create wonderful experiences for people to have choices, overcome challenges, and discover new ways to enjoy life.
- 4. SWOT Analysis Internal Environment STRENGTHS Technology, wider coverage and profitability WEAKNESSES Weakness on signal reception, aspects in customer service and late adaption of latest technology External Environment OPPORTUNITIES New acquisitions, mergers, joint ventures or associates, globalization, increasing demand for internet services, and network expansion THREATS Intense competition, government regulations, and environmental risks
- 5. External Factor Evaluation (EFE) Matrix Total Grade of 2.95 pertains to a relatively excellent external position for Globe Telecom.
- 6. Internal Factors Evaluation (IFE) Matrix Total weighted score of 2.95 pertains to a relatively excellent internal position for Globe Telecom.
- 7. Competitive Profile Matrix (CPM) Globe and PLDT are very tough competitors as their accumulated scores only differ by 0.1 and both companies excel with respect to their performance in the telecommunications industry in the Philippines.
- 8. Globe Telecom’s Strategies (Actual and Proposed) • Globe is improving in all aspects with the strategy that they pursued and implemented. . • Mr. Gil B. Genio, former Chief Operating Officer (COO) and still Chief Strategy Officer (CSO), as the company’s Chief Technology and Information Officer (CTIO), allows Globe Telecom to respond to dynamic business and market demands. . • Alberto de Larrazabal, who was Globe’s Chief Finance Officer (CFO), is the new Chief Commercial Officer (CCO) to ensure effective implementation and execution of strategies across all commercial units of Globe Telecom. • Globe can opt to offer more economic bundles or promos to bring in more customers
- 9. Strategic Positioning and Action Evaluation (SPACE) Matrix • Globe Telecom falls on the Aggressive quadrant which means their strategy can capitalize on their internal capabilities in dealing with their weaknesses, avoiding threats that may hinder success and take advantage of the opportunities that come in the way of Globe Telecom being one of the top companies in the telecommunication industry in the country. • Some strategies that are best applicable to the company are Market Development, Product Development, Integration and Diversification.
- 10. Boston Consulting Group (BCG) Matrix • Globe Telecom’s Fixed Line division falls under the Question Mark quadrant. Therefore, Globe maintains a relatively low market share position in a high growth sector of the fixed line business. They can either pursue market penetration, market development or product development to improve their fixed line division and attain high market share position, or just sell this division and focus more on their strengths. • Globe’s wireless division falls under the Stars quadrant. This means that Globe Telecom has a relatively high market share position in this high- growth sector of the telecommunications industry. Globe shall strive to protect this competitive advantage by investing into it. Market development and product development are the most advisable for Globe Telecom to pursue to address some weakness issues that they are facing.
- 11. Quantitative Strategic Planning (QSPM) Matrix • Globe could implement the prevailing strategy of product development which got the highest score among the three options of strategies to be implemented by Globe. This allows the company to capitalize on the strengths and address their weaknesses, and to take advantage of opportunities that they face and dodge the threats
- 12. SWOT Matrix
- 13. Globe Telecom’s Organizational Chart
- 14. Product-Positioning Map Based on the Product- Positioning Map, Globe is better than PLDT in terms of the quality of customer service while PLDT outshines Globe Telecom in delivering high quality telecommunications services. Although Globe has a larger subscriber base in SMS department, PLDT’s internet services are said to be better than that of Globe’s.
- 15. Strategy-Evaluation Report • Business strategies are driven by Four factors: The Customers, Operations/Processes, Community/Social Responsibility, and Financial. Key strategies that they have implemented, and reason for their existing reign as the leading telecommunication provider, are investments on improving the quality of their key growth areas by improving the speed, capacity and reliability of their core network, improve their customer satisfaction by minimizing corporate hierarchy, increase management visibility and putting clear procedures in dealing with customer issues.
- 16. Code of Business Ethics • Globe Telecom adopted a Code of Conduct and these aspects of their business ethics stands out because they all indicate devotion to the components of their mission and vision. The Whistleblowing is for abiding to laws, and rules and regulations for their customers, Conflict of Interest policy is for their internal environment and their employee’s safety and interest, Related Party Transactions Policy is for their stakeholders and other parties involved in their operations and products.
- 17. Focus Location for Globe • Due to the threat the government once imposed on the competing telecommunication companies, it would be advisable to focus on expanding the reach of their networks in geographic areas in the Philippines where there are no means or signals for any communication or areas where they have spotty or lousy signals. As part of their vision in steering the Philippines to be a digital nation, they need to establish more cell sites and strengthen capabilities of the country’s mobile and wireless networks through different technological and digital advancements in the Philippines before they expand the reach of their services to other countries.
Hinweis der Redaktion
- Its purpose is to create wonderful experiences for the people, families, and businesses in the Philippines. It is done through putting the needs of the customers first, valuing and making a difference for the people and the nation with integrity, and through creating simpler, better and faster ways to connect.
- The External Factor Evaluation (EFE) Matrix for the Globe Telecom’s displays a total weighted score of 2.95 which pertains to a relatively excellent external position for Globe Telecom. The opportunities outweighed the threats which should be considered in the formulation of their strategies.
- Globe’s Internal Factors Evaluation (IFE) Matrix indicates that the company has a strong internal position as it yields a total weighted score of 2.95. As a strategy-formulation tool, IFE matrix is also considered by the management in strategizing.
- Competitive Profile Matrix (CPM) shows that Globe Telecom and Philippine Long Distance Telephone Company or popularly known as PLDT is evidently head-to-head. Their total weighted grades only vary by 0.1 with Globe garnering a total weighted score of 3.0 and PLDT with a total weighted score of 2.9. Both companies serve as each other’s tenacious rival in the telecommunications industry in the Philippines as they both perform excellently in the industry.
- Reading through various pieces and articles regarding Globe Telecom’s recent strategic positions, it can be said that the company is doing their best to improve in all the aspects covered by the company with the strategy that they are pursued and implemented. They placed Mister Gil B. Genio, former Chief Operating Officer (COO) and still Chief Strategy Officer (CSO), as the company’s Chief Technology and Information Officer (CTIO) that allows Globe Telecom to respond to dynamic business and market demands. It puts him in charge of an integrated and well-structured networked and technology organization that allows Globe to respond to dynamic business and market demands. Alberto de Larrazabal, who was Globe’s Chief Finance Officer (CFO), is also assigned as new Chief Commercial Officer (CCO) to ensure effective implementation and execution of strategies across all commercial units of Globe Telecom. Therefore, all core business segments will be consolidated under the CCO to ensure effectiveness in strategy implementation. As for strategy, it is good that Globe has formed a unifying chief officer for the execution of the company’s strategies across the whole organization for a better implementation and guaranteed success. The strategists are the managers of an organization and having been defined what positions are needed to deal with the dynamic demands of the market, it will be easier for Globe Telecom to deal with it and form strategies as the strategists of the company. The only strategy that we can suggest to Globe is to offer more economic bundles or promos so that more and more customers will come.
- Strategic Positioning and Action Evaluation (SPACE) Matrix for Globe is formed with the average scores of the company’s Internal Strategic Position namely the Financial Position (FP) and Competitive Position (CP), and the company’s External Strategic Position composed of Stability Position (SP) and Industry Position (IP) and these factors being +5.2, -4.6, -4.75, and +5.75 respectively Globe Telecom falls on the quadrant Aggressive. This would mean that their strategy can capitalize on their internal capabilities in dealing with their weaknesses, avoiding threats that may hinder success and take advantage of the opportunities that come in the way of Globe Telecom being one of the top companies in the telecommunication industry in the country. Some of the best applicable strategies that the company can implement would be Market Development, Product Development, Integration and Diversification.
- Globe is divided into two divisions namely their Fixed Line division and their Wireless division. Based on the Boston Consulting Group (BCG) Matrix for Globe, the company’s Fixed Line division falls under the quadrant Question Mark. This means that Globe is highly in need of cash but experiences poor cash generation in this division. Therefore, the company keeps a market share position that is relatively low in a high-growth sector of the industry such as the Fixed Line business. The company has the choice of improving their fixed line division by pursuing market penetration, market development or product development, or they sell this division so they can focus more on their strengths. Regardless of the Fixed Line Division, Globe’s Wireless Division excels as it lands itself in the quadrant Star which means a relatively high market share position in this high-growth sector of the Telecommunications industry. To protect this competitive advantage, it is most advisable to invest in market development and product development.
- Based on the QSPM above, the prevailing strategy that Globe Telecom should implement is to pursue product development, in which the company can capitalize on the aforementioned strengths and address their weaknesses, and also take advantage of the opportunities that they face and dodge the threats given above, with a given total attractiveness score of 4.7. It got the highest score among the three options of strategies to be implemented by Globe. Integration and diversification got a score of 3.5, while Market development is falling behind with a score of 3.15.
- Globe Telecom’s organizational chart incorporates Strategic Business Unit (SBU) Structure. It is displayed that different strategic units that are equally vital to the company’s business are identified and headed by the biggest persons in the company. All eight chief officers together with the Executive Vice President, Senior Advisor, Chief technical Advisor and General Counsel, are under the President and CEO of the company, Mr. Ernest L. Cu. We admire that the Executive Vice President, Mr. Bernard P. Llamzon, is also in charge of Consumer Sales, so that his management and marketing skills are not idle while he is the EVP. If the group was to alter the organizational chart, we would recommend that the Chief Audit Officer and Chief Finance Officer be under a single department but maintain different tasks.
- Based on the Product- Positioning Map, Globe is better than PLDT in terms of the quality of customer service while PLDT outshines Globe Telecom in delivering high quality telecommunications services. Although Globe has a larger subscriber base in SMS department, PLDT’s internet services are said to be better than that of Globe’s.