Documenti di Didattica
Documenti di Professioni
Documenti di Cultura
Vodafone
International
Academy
of Shrikant
Management Kumar
PGPM/0911/026
& 2009-2011
Entrepreneurship
CONTENT
INTRODUCTION
VISION
PASSION
TURN OVER OF THE COMPANY
HISTORY
MILESTONE
BUSINESS MODEL
ORGINATION STRUCTURE
MARKETING ANALYSIS
PRODUCT PROFILE
TARGET CUSTOMER
POSITIONING STRATEGY
MARKET SHARE OF COPETATIORS
FINANCIAL ANALYSIS
Vodafone Current Ratio
Vodafone total asset turnover ratio
Vodafone Debtors' Turnover Ratio
VALUE CHAIN
OUT OSURCING
QUALITY MANAGEMENT
SWOT
FUTURE OUTLOOK
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VODAFONE
Vodafone Group plc is a British multinational mobile network
operator headquartered in Newbury, Berkshire, United Kingdom.
Vodafone is the world's largest mobile telecommunication network
company, based on revenue, and has a market value of about 71.2
billion (November 2009). It currently has operations in 31 countries
and partner networks in a further 40 countries. Based on subscribers,
it is the world's second largest mobile phone operator behind China
Mobile, with over 427 million subscribers in 31 markets across 5
continents as of 2009. In the UK, its home ground, Vodafone has
badly underperformed in the last few years due to brisk change in
administration. It has slipped from first to third largest telecom
operator generating revenue of 4.9 billion from its 18.7 million
customers in 2008-09. As of March 31, 2009, the company employs
more than 79,000 people worldwide.
The name Vodafone comes from voice data fone, chosen by the
company to "reflect the provision of voice and data services over
mobile phones.
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OUR VISION
To enrich our customers lives through unique power of mobile communication.
OUR PASSION
1. FOR CUSTOMERS:
3.FOR RESULTS:
Vodafone believes in being action oriented & is driven by a desire to be the
BEST.
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Turn Over OF the Company
In Millions of GBP (except for per share items) 6 months ending 2009-09-30
Revenue 21,761.00
Other Revenue, Total -
Total Revenue 21,761.00
Cost of Revenue, Total 14,115.00
Gross Profit 7,646.00
Selling/General/Admin. Expenses, Total 4,057.00
Research & Development -
Depreciation/Amortization -
Interest Expense(Income) - Net Operating -
Unusual Expense (Income) 0
Other Operating Expenses, Total -157
Total Operating Expense 15,693.00
Operating Income 6,068.00
Interest Income(Expense), Net Non-Operating -948
Gain (Loss) on Sale of Assets -
Other, Net -7
Income Before Tax 5,747.00
Income After Tax 4,795.00
Minority Interest 25
Equity In Affiliates -
Net Income Before Extra. Items 4,820.00
Accounting Change -
Discontinued Operations -
Extraordinary Item -
Net Income 4,820.00
Preferred Dividends -
Income Available to Common Excl. Extra Items 4,820.00
Income Available to Common Incl. Extra Items 4,820.00
Dilution Adjustment -
Diluted Weighted Average Shares 5,276.00
Diluted EPS Excluding Extraordinary Items 0.91
Diluted EPS Including Extraordinary Items -
Dividends per Share - Common Stock Primary Issue 0.27
Gross Dividends - Common Stock -
Net Income after Stock Based Comp. Expense -
Basic Normalized EPS -
Diluted Normalized EPS 0.91
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History
Vodafone was formed in 1984 as a subsidiary of Racal Electronics Plc. Then
known as Racal Telecom Limited, approximately 20% of the company's capital
was offered to the public in October 1988. It was fully demerged from Racal
Electronics Plc and became an independent company in September 1991, at
which time it changed its name to Vodafone Group Plc.
Following its merger with Air Touch Communications, Inc. (Air Touch), the
company changed its name to Vodafone Air Touch Plc on 29 June 1999 and,
following approval by the shareholders in General Meeting, reverted to its
former name, Vodafone Group Plc, on 28 July 2000.
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Bharti Tele-Ventures in India.
July Vodafone reaches 165 million proportionate customers Vodafone
announces new four year sponsorship of the England Cricket Team
May Vodafone completes acquisition of control of MobiFon in Romania and
Oskar in the Czech Republic Vodafone launches Vodafone Simply
January Vodafone reaches 150 million customers - strongest quarter since
December 2000
2006
December Sale of 25% stake in Switzerland's Swisscom. November
Competition of sale of 25% stake in Belgium's Proximus. September
Vodafone launches first Vodafone-only branded 3G consumer
handset Vodafone reports 10 million Vodafone Passport customers
Vodafone to deliver fixed-line broadband services in the UK.
June Proposed Return of Capital via a B share scheme announced .
May Vodafone announces completion of acquisition of the assets of Telsim in
Turkey Vodafone and Softbank agree to form mobile partnership.
April Completion of sale of Vodafone Japan to Softbank .
March The number of Vodafone live! customers with 3G reached 10 million.
February Impairment review and update to outlook .
January Completion of sale of Vodafone Sweden.
2007
December A consortium led by Vodafone Group is awarded the second
mobile phone license in Qatar Indus Towers Limited, an independent
tower company in India is formed between Vodafone, Idea and Bharti .
October Vodafone agrees to acquire Tele2 Italia SpA and Tele2
Telecommunication Services SLU from Tele2 AB Group.
May Vodafone announces completion of the acquisition of Hutch Essar from
Hutchison Telecommunications International Limited Vodafone launches
first ultra-low cost handsets.
February Safaricom, Vodafone's partner in Kenya announces the launch of M-
PESA, an innovative new mobile payment solution that enables customers to
complete simple financial transactions by mobile phone Vodafone agrees to buy
a controlling interest in Hutchison Essar Limited, a leading operator in the fast
growing Indian mobile market Vodafone announces agreements with both
Microsoft and Yahoo! to bring seamless Instant Messaging (IM) services to the
mobile which can be accessed from both the PC and mobile handsets Vodafone
signs a series of ground-breaking agreements which will lead to the mobilising
of the internet. YouTube agrees to offer Vodafone customers specially rendered
YouTube pages on their mobile phones. With Google, Vodafone announces its
intention to develop a location-based version of Google Maps for. With eBay,
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Vodafone announces it is to offer the new eBay mobile service to customers,
With MySpace.com Vodafone
2008
December Vodafone completes acquisition of additional 4.8% stake in
Polkomtel .
November Vodafone to acquire an additional 15% Stake in Vodacom Group
which will increase Vodafone's shareholding from 50% to 65%. Vodacom
Group will be listed on the Johannesburg Stock Exchange and the
remaining 35% of Vodacom Group will be demerged by Telkom to its
shareholders.
October Vodafone launches the new exclusive BlackBerry Storm
smartphone from Research In Motion.
August Completion of the acquisition of a 70 percent stake in Ghana
Telecom.
July Vittorio Colao succeeds Arun Sarin as Group Chief Executive Vodafone
acquires a 70% stake in Ghana Telecom for $900 million.
June Vodafone and Apple(R) announce the iPhone 3G will be available in
Australia, Italy, New Zealand and Portugal on July 11, and in the Czech
Republic, Egypt, Greece, India, South Africa and Turkey later this year.
Vodafone announces that Verizon Wireless, its affiliate in the US, has
agreed to acquire Alltel Corp. for a total enterprise value of US$28.1
billion in cash and assumed debt.
May Vodafone announces that it has agreed to acquire the 26.4% interest in
Arcor that it does not already own from Deutsche Bahn AG and Deutsche
Bank AG for a cash consideration of 474 million.
2009
June Completion of merger between Vodafone Australia Limited and
Hutchinson 3G Australia Pty Limited.
March Telefonica and Vodafone announce milestone Pan European
collaboration to share network infrastructure in Germany, Spain, Ireland
and the UK.
February Hutchinson and Vodafone agree to merge Australian telecom
operations to form a 50:50 joint venture.
January Vodafone trials HSPA+ mobile broadband at speeds of up to 16 Mbps.
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Business models
Customer service vans for rural regions We are bringing mobile services to
rural communities in India through traveling phone shops. Vans drive from
village to village in remote parts of the country, reaching people that otherwise
would not have access to mobiles. As the vans run as a franchise, they also
provide the opportunity for local people to set up a small business.
Free callback requests Our Please Call Me service in South Africa enables
customers to send a free text message asking the recipient to call them back,
even when the sender has run out of credit. The cost of running the service is
covered by advertising that is included alongside the Please Call Me message.
A similar service in Egypt enables customers to send up to three free Please
Call Me text messages a day as part of our Wayak initiative.
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Community phones Many people cannot afford a mobile phone but have
access to mobile services by sharing with family or friends, or through
community phone shops where you can pay per call. Community phone shops
enable affordable telecommunications in poor, rural and under-serviced areas
where there are few or no fixed line phones. In South Africa, our joint venture
Vodacom provides training and support for local people to run phone shops as a
franchise business. In India, we offer the Vodafone PCO, a phone that looks like
a fixed-line handset, but is connected to the Vodafone network. It is aimed at
entrepreneurs that can install it at their shops or homes.
Organization structure
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Marketing Analysis
Product Profile
Company Profile will assists individual investors, managers and companies in
evaluating opportunities, trends, market innovations, and selecting appropriate
information solutions in order to make effective decisions. The report has been
made after extensive research using the data available from reliable
publications, trade associations and the companies sources. The report
elaborates on the company's business structure and operations, products and
services. The report includes key financial information and strategic analysis
that intends to aid investors to find better prospects with the company and gain
an insight into the corporate policies.
Target Customers
Positioning Vodafone as a younger, more dynamic network, based on brand
personality and attitude, would have greater appeal for Vodafone's core 18 to 39
age target.
Positioning Strategies
First brand in the category to develop a personality-based brand positioning.
Positioning Vodafone as a younger, more dynamic network, based on brand
personality and attitude, would have greater appeal for Vodafone's core 18 to 39
age target.
It would also further encourage the perception that Optus was moving in the
direction of Telstra's older, more conservative position.
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FINANCIAL ANALYSIS
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Vodafone total asset turnover ratio
Let's see what we find when we analyse Vodafone's total asset turnover ratio.
Go to the database and find the data you need for these calculations then
calculate the total asset turnover ratios and tell us what you have found.
Did you think these were terrible results? Me too! Especially when we compare
it with the Carphone Warehouse's results which were 1.56 and 2.57 for its latest
two years respectively - significantly better than Vodafone's turnover ratio
results.
History shows us Vodafone's total asset turnover ratio looks like this:
2002 2001
Debtors due within one year: m m
Trade debtors 3,389 1,852
... ... ...
Total Debtors 6,095 3,701
Do what the financial analyst did for the Carphone Warehouse and rework the
debtors' turnover ratio and find the length of time that trade debtors take to pay
their accounts ... is it more sensible and realistic than three months?
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Vodafone 31 Mar 2002 31 Mar 2001
m m
Turnover 22,845 15,004
TRADE Debtors due within one year 3,389 1,852
Remember that we talked about the liquidity of debtors when we discussed the
acid test ratio. Now we can see that the Carphone Warehouse's debtors are not
that liquid.
VALUE CHAIN
We spend more than 2 billion on goods and services from suppliers every year
including handsets, network infrastructure, IT, general and marketing services.
We have over 1,550 suppliers worldwide.
There is always the possibility that some companies in our supply chain may
not meet acceptable standards on the environment or human rights. We adopt a
risk-based approach concentrating on suppliers who present a higher risk of
unethical conduct due to their location, the type of product or service they
supply, or the size of their contract with Vodafone.
Our main focus is on tier 1 suppliers (those with whom we deal directly) but we
can influence standards further down the supply chain by:encouraging suppliers
to develop their own supply chain programmes participating in the Global e-
sustainability initiative, an industry collaboration.
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Many larger suppliers also work with other Vodafone operating companies, so
much of our supplier engagement is carried out at Group level. Code of Ethical
Purchasing Our Code of Ethical Purchasing (CEP) describes the standards that
companies must meet if they are to be a part of the Vodafone UK supply chain.
It is included in all our supplier contracts.
The Code is base on Group values and international standards set by the United
Nations and the International Labour Organisation. It covers issues relating to
human rights, working conditions, the environment and corruption.
We may terminate a contract with any supplier that breaks the Code, depending
on the severity of the incident.
All new suppliers with a contract value over 10,000 will complete a
preassessment. These assessments help us to determine higher risk suppliers
with whom we need to engage more closely.
Our top 50 suppliers (by spend and business impact) are re-assessed every six
months and improvement plans agreed where necessary.
Engagement with higher risk suppliers is carried out at Group level and may
include on-site assessments and training.
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This is now incorporated in our Group-wide Duty to Report policy. This policy
is applicable to all Vodafone employees and provides suppliers with a means of
reporting concerns. Our suppliers can use Speak up to report any unethical
conduct by Vodafone employees. We wrote to over 2,000 suppliers to notify
them of this service. Suppliers can raise concerns directly to Vodafones Group
Fraud Risk and Security Department or confidentially via an independently
managed telephone hotline.
OUT SOURCING
Vodafone has selected EDS and IBM to manage its application development and
maintenance services in a global IT outsourcing deal, as part of its strategic
commitment to reduce costs while leveraging its regional scale.
Vodafone hopes to conclude negotiations and finalise contracts with the two
outsourcing partners in the coming weeks.
Under the terms of the proposed arrangements, each outsourcing partner will
provide application development and maintenance services for key IT systems
to separate groupings of operating companies within the Vodafone Group.
Vodafone will retain full strategic control of the initiative, which focuses on
writing code for and maintaining systems such as billing and Customer
Relationship Management.
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As previously announced, Vodafone has identified the potential to reduce unit
costs by 25 to 30 percent within three to five years. Activity levels on
application development and maintenance during the last financial year resulted
in a spend of around GBP560 million.
Under the proposals, the substantial majority of impacted staff are expected to
transfer to the employment of the outsourcing partners, and work from similar
locations under similar terms and conditions where possible. The remainder of
staff will be retained by Vodafone. The Group is currently in full consultation
with staff likely to be impacted by the changes.
QUALIYU MANAGEMENT
SWOT
STRENGTHS
Strong International presence and brand recognition. Solid platform across
Europe; HSDPA available in 100% of 3G footprint opening growth
opportunities in mobile broadband services. Controlling interest in strong
growth markets (e.g. Egypt, Romania, South Africa, Turkey, India). Well-
defined cost reduction initiatives: managed purchasing, outsourcing. Stable
operating profit despite downward profit trend in Europe offset by improved
operations in EMAPA. Have now established a clear route to delivering fixed
broadband services in all relevant markets. Consistent in maintaining a 60%
payout ratio.
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WEAKNESSES
Uncertainty in revenue growth in the HSDPA network based on historislow
consumer market take-up of 3G data services. Slow customer growth in DSL
wholesale markets in UK and Italy; slow subscriber growth in Spain arising
from lower promotional activity. Adverse impact from exchange rate
movements particularly in South Africa. The likely slippage of dividends in
Verizon Wireless to 2010 could fuel tension between Verizon Communications
and Vodafone shareholders. Have now established a clear route to delivering
fixed broadband services in all relevant markets Insubstantial capacity to offer
bundled services due to specialization in mobile services; may lead to higher
churn rates and may be pressured to compete exclusively in price.
OPPORTUNITIES
EMAPA remains target for potential acquisitions, with an average mobile
penetration of 27% by end of FY07 ; huge growth opportunity in India in a
market of 1.1 bn people with a low 14% mobile penetration 3G data services
gaining momentum in business customers; successful partnerships with laptop
manufacturers to include embedded Vodafone SIMs to mobile devices allow
opportunities for upselling of mobile broadband services in Europe, only one-
third of voice traffic is carried over mobile networks and Vodafone customers
has a monthly average of only 140 minutes of use; the trend is parallel with the
companys strategy to drive higher voice usage onto mobile through reduction
in prices; Vodafone expects usage demand to eventually exceed the price
reduction.
THREATS
High mobile penetration in principal market leaves little room for growth Fierce
competition in mature markets, especially with converged telcos offering triple-
play and quad-play services; Vodafone lacks a direct substitute for such services
Greater than anticipated competition with internet providers, MVNOs and new
entrants; greater than anticipated customer acquisition and retention Regulatory
intervention on tariffs creates pressure on revenues; on FY08, the company
expects a revenue reduction of 200 mn due to the elimination of top up charges
under the Bersani decree in Italy and reduction of 200 mn to 250 mn from the
deregulation of roaming charges across Europe .
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FUTURE OUTLOOK
CONCLUSION
Taken steps to make a positive difference, by supporting recycling
campaigns
Win-win-win situation for shareholders, employees & the
environment
Improved relationships between stakeholders & has helped to
ensure future growth
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