Go to the Coca-Cola corporate website and click on Sustainability and review the company’s most recent Sustainability Report. Determine the six best aspects of the Coca-Cola report.
Part 1(a) Should be between 400-600 words with in text citations. Also, should use at least 2 different websites for resources. Make sure that are websites and based in the United States.
Sustainability reports are increasingly becoming expected or even required by business organizations. This exercise will give you practice in comparing and evaluating sustainability reports.
Challenge
Step 1: Go to the Coca-Cola corporate website and click on Sustainability and review the company’s most recent Sustainability Report. Determine the six best aspects of the Coca-Cola report.
Step 2: Go to the PepsiCo corporate website and click on Sustainability and review the company’s most recent Sustainability Report. Determine the six best aspects of the PepsiCo report.
Step 3: Develop a report comparing and contrasting the two companies’ Sustainability Report with regard to business ethics, social responsibility, and environmental sustainability.
In your opinion, does Coca-Cola receive a grade of A on their business ethics, social responsibility, and sustainability efforts? Grade each company on the three dimensions and give each an overall grade. Justify your grades.
Part 1(a) Should be between 300-500 words. In text citations that are at least 2 different websites and based in the United States. This is a discussion response.
ustainability Reports provide insight into how a company’s operations impact its business environment, including labor practices, energy efficiencies, and business ethics (Davis et al., 2019, p. 307). In reviewing the sustainability reports of corporate giants Coca-Cola and PepsiCo, it is evident that both understand the importance of such programs, as each has invested significant resources into creating sustainability policies. However, as with many corporate strategies, some areas still need improvement or further clarification.
Coke’s sustainability plan includes the following categories: 1. Water Leadership, 2. Portfolio Improvements, 3. Packaging, 4. Climate, 5. Sustainable Agriculture, 6. People & Communities. First, there are many things Coke has done correctly since its inception, which is why it continues to provide a roadmap that teaches other corporations how to be successful. Also, from a people and communities perspective, the Coca-Cola Foundation has launched several philanthropic programs supporting the communities in which it operates. However, in reviewing its entire sustainability plan, while on the surface, it appears to be quite thorough, many of its stated metrics are either unclear or based on undisclosed results. For example, the company notes a 10% water efficiency improvement across all system operations compared to its 2015 results without mentioning precisely what those results were. Also, when reporting the amount of sugar used in its products, Coke notes a reduction of 900,000 tons of added sugar. While that may seem significant, providing exact numbers (i.e., a decrease from 1,800,000 to 900,000 tons) would give a better picture of its progress. Lastly, Coke only references its most recent sustainability results (2022) without noting how its various processes have performed compared to previous years. In addition, despite its claims, Coke continues to struggle with negative press around its use of plastic materials (Greenpeace, 2023).
Likewise, PepsiCo’s sustainability report lists seven categories: 1. Agriculture, 2. Value Chain, 3. Water, 4. Packaging, 5. People, 6. Expanded Portfolio Offerings, 7. Planet & People. Compared to Coke’s one-year snapshot, it also shows five-year results (2018 through 2022), providing a broader overall picture of its progress. For example, one of PepsiCo’s goals includes a management team comprised of at least 50% women. Listing annual results over time quickly provides a baseline and shows the company’s progress toward achieving its goal (i.e., the percentage of women in management roles has consistently increased from 40-44% from 2018-2022). Also, under its Positively Agriculture initiative, the company lists specific targets concerning its efforts to sustainably source 100% of its key ingredients (PepsiCo, 2022). It also notes that a third party will verify the initiative’s results, adding credibility to the sustainability report. However, there are several categories where the details of the company’s performance have been omitted. In listing its emissions of greenhouse gas results, Pepsi only provides numbers for 2022 with a caveat (like Coke) that states, “prior year results are being recalculated to be consistent with the (undisclosed) 2015 baseline” (PepsiCo, 2022). Also, like Coke and despite its efforts, Pepsi continues to struggle with using plastics, adversely affecting the environment (Pyzyk, 2023).
In summary, while Coke and PepsiCo have invested heavily in creating detailed sustainability strategies, there are still areas where both could improve by sharing more transparent, quantitative results. For the thoroughness of both sustainability programs, I would issue an overall score of B to Coke and B+ to PepsiCo (given its transparency in reporting results over time). In addition, based on the abovementioned issues, I believe Coke should receive B, B+, and D scores in business ethics, social responsibility, and environmental sustainability and Pepsi’s scores would be B, B+, and C-, respectively.
References
Coca Cola. (2023). The Coca-Cola Company 2022 Business & Sustainability Report highlights. https://www.coca-colacompany.com/content/dam/journey/us/en/reports/coca-cola-business-and-sustainability-report-2022-highlights.pdf
David, F. R., David, F. R., & David, M. E. (2019). Strategic Management: A Competitive Advantage Approach, Concepts and Cases (17th ed.). Pearson Education (US). https://reader2.yuzu.com/books/9780135203699
Greenpeace. (2023, April 28). Coca-Cola greenwashes sustainability claims. Greenpeace USA. https://www.greenpeace.org/usa/news/coca-cola-greenwashes-sustainability-claims/
PepsiCo. (2022). 2022 ESG performance metrics – pepsico. 2022 ESG Performance Metrics. https://www.pepsico.com/docs/default-source/sustainability-and-esg-topics/2022-esg-summary/2022-esg-summary-performance-metrics.pdf?sfvrsn=72c2c782_10
Pyzyk, K. (2023, July 6). Pepsico struggles to advance its plastic sustainability goals. Food Dive. https://www.fooddive.com/news/pepsico-esg-report-p…
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Part 1(b) Should be between 300-500 words. In text citations that are at least 2 different websites and based in the United States. This is a discussion response.
Coca-Cola and PepsiCo approach their sustainability goals with the aim of leaving a positive impact on the environment. The companies are focused on reducing their carbon footprint while ensuring that their business practices do not cause adverse effects on the environment. Both companies have sustainable approaches to their packaging solutions because this is one of the biggest factors that enhance pollution in the environment. They both observe sustainable approaches to the packaging of their products such as using recycled materials and ensuring that waste disposal is done in accordance with the law.
Companies are also focused on sustainable agricultural practices that ensure crops are not harmed by their business practices. They make efforts to support agricultural communities around the world because they source crops from different countries. Similarly, there is an effort made to ensure that their practices do not harm the general climate of the regions in which their factories operate (PepsiCo., 2022). This is achieved through the adoption of renewable energy sources and the reduction of emissions to guarantee as little waste as seeps into the natural environment.
However, one key difference in their sustainability approach is that Coca-Cola adopts measures to reduce sugar in their products to promote a healthier population. PepsiCo does not have a solid plan for sugar reduction, but Coca-Cola adopts an approach that ensures their products have the minimum level of sugar required to avert any adverse effects that is causes. PepsiCo adopts a positive value chain that is inclusive in their business practices for their customers, something that is not highlighted by Coca-Cola. The value chain observes the necessary ethical standards required to guarantee their products are safe and inclusive for their customers (The Coca-Cola Company, 2022).
Coca-Cola does receive a grade A for their business ethics, social responsibility, and sustainable efforts because they are committed to their customers as well as their employees. Their business practices are in accordance with existing laws, and they are focused on reducing harmful emissions that damage the natural environment. PepsiCo, too, receives a grade A because their business practices, particularly their approach to agricultural sustainability, have a positive impact on the environments in which they operate. Both companies place a big emphasis on keeping the environment clean while also ensuring that their business practices do not infringe on any existing laws. They place a big emphasis on ensuring that the natural environment remains clean for future generations.
References
PepsiCo. (2022). 2022 ESG Summary Performance Metrics. Harrison, New York.
The Coca-Cola Company. (2022). 2022 Business & Sustainability Report. Atlanta, Georgia.
Part 2. Use the attachment called “Capstone without”.
Develop alternative strategies for your company with the strengths and weaknesses of each.
Possible strategic alternatives
Evaluation of current organizational structure
Recommended changes (if needed) to the structure, culture (including values), processes, rewards, or technology
Include matrices as appendices
The length for this Phase is 12-16 cumulative pages.
https://saintleo.zoom.us/rec/share/RU5Ya2hz8v_Mh9twHAk_TC35CfdUVNbyv21-06nq6MrgaM92wY9w6lZvaZtT0dvl.rYLKVFVUfo_LzpJW?startTime=1691622024000
The video will also help. This is the instructor feedback
*In assignment two, plan to begin outlining this document as your final Capstone submission will appear. Be sure to include assignment one as part of assignment two—and make any revisions you deem necessary to assignment one when submitting assignment two. In other words—each section should build onto the next to make it a seamless read. Include a placeholder for your Executive Summary, Table of Contents (in that order), and build onto your appendices (located at the end after your reference list) where your data charts should be located. Even if sections are empty for now, you will have your headers across the top for this “future” info to be placed. Be sure that your charts/tables/graphs are not broken between pages—and when inputting numbers, always use rows and columns (with lines) to keep your work better organized. Remember that “presentation” is perceived as equally important to content—so keep your data charts consistently formatted—and professional. Make sure that your charts/tables/graphics are closely aligned with verbiage describing them. Never assume that your reader knows what he/she is viewing in data charts. Make sure that your reader has no trouble locating your data charts in the appendices—so in the verbiage section provide a page number that directs your reader to that chart.
Begin thinking about the Power Point presentation that is due in Week Eight (with the finished written sections—all three seamed together)—particularly because you want the PPT to be an extension of the written document—but also creatively shown—being that PPT is a visual program and thereby maximize its features. As discussed in our last Zoom chat, I suggest that you use company “colors” and its logo on select slides. Also, the PPT is where your data charts show up well—and lastly, be reminded this slide show must be substantively narrated by you—so become familiar with how to do this—if you are not already. I will look for the little speaker icon on each slide where I can click and hear your voice. No presenter’s notes needed. Your narrated Power Point does not need to be lengthy—so as discussed prior, use it to point out anomalies or outliers that you feel needs to be brought to the attention of your viewer about your company.
**In your final written document, make sure that you include a section near your conclusion where you as a strategist make recommendations about what your company should do in the future to remain viable and to compete. Remember that your job is not only to perform research and show what “is”, but to interpret this data and turn it into useful information that company leaders can apply into the future to make decisions. This section may the most important one of your study—so be sure to take advantage of this “rare” opportunity to exercise your own analysis about what your company should do as a future strategy—from YOUR informed perspective. **
Keep up the exceptional work—have a good week–and stay well. PLEASE read ALL Announcements/News on the Home Page. You will miss essential information if you do not.
DON’T FORGET THAT THIS PROJECT WILL BE COMBINED INTO ONE. THE TABLE OF CONTENTS WILL HAVE TO BE UPDATED. USE THE ATTACHMENT TITLES “EXAMPLE OF CAPSTONE PROJECT” AS A GUIDELINE.
Requirements: Read description
Running head: FACEBOOK, INC.: CASE PROJECT1Facebook, Inc.: Case ProjectKathleen N.L. SmithSaint Leo UniversityStrategic Management MBA-599-MBOL1Dr. George ReeleyMay 23, 2021Graduate Studies in Business Academic Honesty StatementMy signature entered below constitutes my pledge that all the writing is my own work, with the exception ofthose portions which are properly documented. I understand and accept the following definition of plagiarism: 1. Plagiarism includes the literal repetition without acknowledgment of the writings of another author. Allsignificant phrases, clauses, or passages in this paper which have been taken directly from source material havebeen enclosed in quotation marks and acknowledged in the text itself as well as in the Reference Page. 2.Plagiarism includes borrowing another’s ideas and representing them as my own. 3. To paraphrase the thoughtsof another writer without acknowledgment is to plagiarize. 4. Plagiarism also includes inadequate paraphrasing.Paraphrased passages (those put into my own words) have been properly acknowledged in the text and in thereferences. 5. Plagiarism includes using another person or organization to prepare this paper and then submittingit as my own work. 6. Plagiarism includes resubmitting previous work, in whole or in part, for a currentassignment without written consent of the current instructor. Saint Leo University’s Core Value of Integrity requires that students pledge to be honest, just, and consistent inword and deed. I fully understand what plagiarism is, and I further understand that if plagiarism is detected inmy paper, my professor will follow the procedures on academic dishonesty set forth by Saint Leo University,the Donald R. Tapia School of Business, and the Graduate Student Handbook.Student Signature: Kathleen Nichole Louise Smith
FACEBOOK, INC: CASE PROJECT2Executive SummaryFacebook, Inc. (FB) was founded in 2004 and is a publicly traded company that provides products that enable interpersonal connections through any device that can connect to the internet (Facebook, Inc (FB) 2021). Firms are often forced to evolve and compete with other organizations in their industry to find success, but internet-based company Facebook hasbeen working to evolve to stay up to date with the evolution of technology. Strategic management is used to evaluate all aspects of an organization to gain a competitive advantageover rivals through finance, marketing, management and more (David, David & David, 2020 p.4). As a social media powerhouse, Facebook must have a strong strategic plan to continue its innovation in a fast-moving industry. Currently the biggest problems Facebook faces is the content on their sites posted by their consumers and cybersecurity. Facebook looks to the future of balancing free speech, while blocking false and hateful information and repelling entities fromstealing data and other personal information from their site.
FACEBOOK, INC: CASE PROJECT3Table of ContentsExecutive Summary………………………………………………………………………………………………………….2Introduction……………………………………………………………………………………………………………………..4History………………………………………………………………………………………………………………………..4Competitors………………………………………………………………………………………………………………….5Leadership……………………………………………………………………………………………………………………5Strategic Elements History…………………………………………………………………………………………….6Vision and Purpose……………………………………………………………………………………………………….7Analysis of Vision and Purpose………………………………………………………………………………………7External Assessment…………………………………………………………………………………………………………8External Factor Evaluation (EFE)…………………………………………………………………………………..8Competitive Profile Matrix (CPM)………………………………………………………………………………….9Analysis of competitive position, opportunities, and threats……………………………………………….9Internal Assessment………………………………………………………………………………………………………..10Internal Factor Evaluation (IFE)……………………………………………………………………………………10Key Financial Ratios……………………………………………………………………………………………………11Current Strategy………………………………………………………………………………………………………….12Recommendations……………………………………………………………………………………………………….12Conclusion…………………………………………………………………………………………………………………….12References……………………………………………………………………………………………………………………..14Appendix……………………………………………………………………………………………………………………….16Appendix A: External Factor Evaluation Matrix (EFE)……………………………………………………16Appendix B: Competitive Profile Matrix (CPM)…………………………………………………………….16Appendix C: Internal Factor Evaluation Matrix (IFE)……………………………………………………..17Appendix D: Social Media Monthly Active Users and Facebook Exodus Survey……………….18Appendix E: Company Worth Analysis…………………………………………………………………………19Appendix F: Financial Ratios for Facebook, Inc……………………………………………………………..19Appendix G: Balance Sheet, Income Statement, & Cash Flows………………………………………..20
FACEBOOK, INC: CASE PROJECT4Facebook, Inc.: Case ProjectIntroductionAs the world moved towards a technologically dominated lifestyle in the early 2000s, there was an open market for wide communication with friends and family that needed to be filled. Facebook, Inc. was founded in 2004 and was able to fill this unique void of communication over the internet. Its original purpose was to connect college students from around the U.S. together to collaborate and exchange ideas or ideologies, but then as interest spread about an application that you connect with people, the idea grew and so did the company. HistoryFacebook’s origins have been disputed on many different levels, including in the courtroom. Founded by Harvard student(s) in 2004, Facebook was created by Mark Zuckerberg (Carlson 2010). Controversial events lead to the uncertainty of who truly founded Facebook, which lead to a rough start for the company. Zuckerberg has been accused of stealing the idea of Facebook from his Harvard colleagues, and settled a lawsuit with his classmates who claim to have come up with the idea for $65 million (Carlson 2010).Facebook, Inc. portfolio includes Facebook, Messenger, Instagram, Oculus and WhatsApp (Investor Facebook 2021). This collection of applications all has a common goal ofbringing people together through social media. Facebook is a site that allows people to share, connect and communicate with others through the online application, this includes Messenger which allows people to communicate easily with each other across other platforms and devices (Investor Facebook 2021). As other social media sites were created and became
FACEBOOK, INC: CASE PROJECT5popular, Facebook worked to acquire new ones that had big potential, Instagram was one of them. Instagram is an application that allows people to take, share and edit photos or videos totheir friends, on a general feed or directly messaging people (Investor Facebook 2021). Soon, leaders at Facebook realized that the messenger attached to Facebook was not filling all the gaps internationally bringing people together which is why WhatsApp was acquired and built up. WhatsApp is a messenger application that people around the world use as a text message app to communicate to anyone in the world (Investor Facebook 2021). WhatsApp functions likes text messaging, but without the additional fees to communicate from other countries. Finally, Oculus is a virtual reality technology that brings an interactive environment to playing games (Investor Facebook 2021). The history of Facebook tells a very specific story of a big social media company that quickly takes over other successful or potentially successful ideas and with their financial resources can make it bigger, better, and more integrated.CompetitorsFacebook is identified as a social media site and lives in the market of social media, technology, and people. Its main competitors can be identified as Twitter, Pinterest, Snapchat,LinkedIn, and YouTube. All these sites provide a type of connection-based resource for people to share information, pictures, articles and more on the internet. More recently, Zuckerberg says that Apple is becoming its biggest competitor, even though Apple is not in the social media market, Apple has created a messaging service in competition with FacebookMessenger (Hamilton 2021). Apple may be the only competition that can keep up with Facebook’s financial position and spend money on R&D or other investments.
FACEBOOK, INC: CASE PROJECT6LeadershipThe leadership of a firm is one of the most important aspects for a successful organization. Leaders are invaluable to formulate and communicate new strategic directions toevolve and accelerate a firm’s potential and lead employees to success. Facebook has seven notable leaders, this includes Mark Zuckerberg, the Founder, Chairman and Chief Executive Officer (About Facebook 2021). Under Zuckerberg there is a Chief Operating Officer- Sheryl Sandberg, Chief Financial Officer- David Wehner, Chief Technology Officer- Mike Schroepfer, Chief Product Officer- Chris Cox, Chief Revenue Officer- David Fischer and General Counsel- Jennifer Newstead (About Facebook 2021). Together this leadership team has built and evolved the company as we see today.Strategic Elements HistoryAs Facebook has expanded online, they have also expanded physically to support organization overseas. With an international presence, Facebook must also analyze and create a strategic business in the countries where the firm operates. Facebook has offices in over 80 cities worldwide, 17 global data centers and one headquarters in California, USA (About Facebook 2021). With the evolution of technology and increased presence of smart phones, Facebook has had to evolve to stay ahead of trends and ways people can communicate to each other no matter where they are. Facebook has worked hard in research and development, but many of their strategic elements of their history has been the companies they have acquired and becoming a publicly traded company. In 2011, Facebook created Messenger, this app brought messaging on Facebook to the world of instant messages (About Facebook 2021). Including a way to message others while not logged into Facebook.com was very important for
FACEBOOK, INC: CASE PROJECT7development. Months later, in 2012 Facebook announces the acquisition of Instagram, one of the only other social media platforms on the market, soon after the acquisition Facebook also announced their initial public offering to become a publicly traded company (About Facebook2021). These two moves in 2012/ 2013 increased Facebook’s value in the public market. Facebook, Inc. integrated and continued to build Instagram to become a popular social media site used particularly for sharing photos and videos. Continuing to build out their profile, Facebook announced their acquisition of WhatsApp, Oculus to their portfolio in 2014 (About Facebook 2021). Vision and PurposeVision and Purpose statements allow the business to state what they want to become and their purpose to the consumer. “A clear vision provides the foundation for developing a comprehensive mission statement” (David et al 2020 p. 45). Facebooks vision statement is “People use Facebook to stay connected with friends and family, to discover what’s going on in the world and to share and express what matters to them” (About Facebook 2021). A mission statement declares what the organization’s business is or their reason for existing (David et al. 2020 p. 47). The quality of the mission statement reflects objectives and strategies of the organization without being specific, but also appeals to the organization’s stakeholders. Facebook’s mission statement “Give people the power to build community and bring the world closer together” (About Facebook 2021). Overall, Facebook’s uniqueness lies with its consumers. “Facebook’s principles are to give people a voice, build connection and community, serve everyone, keep people safe and protect privacy and to promote economic opportunity” (About Facebook 2021). These principles in addition to the vision and mission statement give the company purpose.
FACEBOOK, INC: CASE PROJECT8Analysis of Vision and PurposeFor the vision statement to be good and impactful it must include the following characteristics, clear, futuristic, concise, unique, and inspiring (David et al 2019 p. 47). Facebook’s vision statement concise, being one sentence long. Futuristic refers to the continuation and new connections made on the site, while also being up to date with information around the world, but it speaks on the individual instead of the company. Uniqueness would come with the factor of limited competition and inspiring is to be able to learn more about yourself through expression. Overall, the vision statement lacks clarity, what type of industry thefirm is in or strives to become and futuristic in terms of what the firm’s trying to accomplish. Overall mission statements give an idea of motivation or direction of the company, it sets the tone of the entire organization. Characteristics of a mission statement include, broad in scope,concise, inspiring, identifies unity, reveals social and environmental responsibility, attracts customers, but most importantly includes nine components (David et al 2020 p. 48). These nine components include “customers, products or services, markets, technology, concern for survival/growth/profits, philosophy, distinctive competence, concern for public image, or concern for employees” (David et al 2020 p. 48). Facebook’s mission statement lacks most of thecharacteristics listed above, but their goal, must like their product is to put something in the hands of consumers to make a difference in the world while bringing everyone together.External AssessmentExternal Factor Evaluation (EFE)Acknowledging external forces are vital to an organizations success since no industry lives in a bubble. The external forces in business include 5 categories, “(1) economic forces; (2)
FACEBOOK, INC: CASE PROJECT9social, cultural demographic, and environment forces; (3) political, governmental, and legal forces; (4) technological forces; and (5) competitive forces” (David et al 2020 p. 67). As stated inFacebooks EFE in appendix A on page 16, all five are apparent in the social media industry. External factors that are important also need to be actionable, quantitative, comparative, and divisional (David et al 2020 p. 67). Actionable factors in the EFE can be found in both opportunities and threats. These are the more heavily rated factors like targeting new audiences (O), expansion via acquisitions (O), data breeches (T) and regulation of harmful information (T).Quantitative is information that can be put into numbers like diversifying portfolio (O), advertising trends (O), competition (T) and digital tax (T). Comparative is taking this information and finding ways to evaluate it over time and divisional is specifically relating to Facebook, instead of the company and its subsidiaries. High quality factors will result in a strongexternal evaluation and strategic assessment.Competitive Profile Matrix (CPM)To have a good idea of a company’s position in the industry, it is important to compare them to other firms, the competitive profile matrix assists with this. “This comparative analysis provides important strategic information regarding a firm’s competitive advantages or disadvantages in a given industry” (David et al 2020 p. 82). Facebook’s CPM is in appendix B on page 16. This matrix compares Facebook to Twitter and YouTube. Overall, Facebook produced the strongest standing out of the three with a 3.25 CPM score while YouTube was remarkably far behind at a 2.8. It is difficult to compare the other competition in the industry since each has their own unique social media market and the most comparable social media to what Facebook does is Instagram, which is owned by Facebook.
FACEBOOK, INC: CASE PROJECT10Analysis of competitive position, opportunities, and threatsAs the internet has become more accessible, Facebook, Inc. has evolved and taken newactions towards threats and opportunities. Facebook, Inc. has been involved with spreading false information, fighting with freedom of speech and Congress evaluating how to initiate regulation of online social media content. Facebook has been actively taking initiatives towards promoting safety and expression, protecting privacy and security, preparing for elections, and responding to COVID-19 (About Facebook 2021). “We work to limit the spread of misinformation and give you context to make your own decisions on what to read, trust and share” (About Facebook 2021). While executives are actively trying to fix their tainted reputation, Facebook is still a prime target for cybercrime based on the type of activityon the website by millions of users. These issues will require strategic management initiatives to fix Facebooks reputation and elevate the company’s status as the most attractive place to communicate and disseminate information. Facebook will need to continue to work to diversify its business. Forecasting from managers can help take these external opportunities and threats and predict how the firmshould react in the future, that is why a strong external analysis that includes all the right factors is important. Diversifying will decrease market risk exposure via competition. Facebook will also need to continue negotiations with governments like China, Iran, North Korea, and Russia to open markets where they have little to now presence due to the country’srestrictions.
FACEBOOK, INC: CASE PROJECT11Internal AssessmentInternal Factor Evaluation (IFE)The goal of an internal assessment is to reveal key strengths, weaknesses that is vital for managers to formulate strategies that use the strengths to overcome or improve on the weaknesses (David et al 2020 p. 113). Facebook’s IFE is located at appendix C on page 17. Just like in the EFE, it is important for this analysis to be actionable, quantitative, comparable, and divisional to help managers develop a strategic plan. Facebook’s strengths section has a higher weight than the weaknesses because Facebook is in a unique market with little competition, primarily because Facebook has acquired most viable competition that has come on the market. Based on the charts located in appendix D on page 18, Facebook and its subsidiaries are the mostused social media sites, while they have also experienced consumers leaving their site due to security concerns. Key Financial Ratios Financial ratios are important to evaluate an organizations financial situation during a certain time. “Financial ratios are examined based on (1) how they change over time, (2) how they compare to industry norms, and (3) how they compare with key competitors” (David et al 2020 p. 258). Overall, Facebook is an incredibly successful company. When analyzing the company worth for Facebook and Twitter, the two financially are almost incomparable. Visit appendix E on page 19, to view the company worth of the two companies. After reviewing Facebook’s income statement and balance sheet, they are in good financial standing, go to page 19 to view their financial ratios in appendix F. Analyzing the Wall Street Journal breakdown of the income statement and balance sheet located in appendix G on page 20, Facebook has a steadyincrease year over year of total assets but has experienced a decline of net income since their last
FACEBOOK, INC: CASE PROJECT12quarterly report in December 2020 (WSJ Markets 2021). Viewing Facebook’s net operating cash flow, their capital expenditures are down 4.27 billion, while free cash flow has increased by 7.97 billion (WSJ Markets 2021). This indicates that Facebook has spent less money acquiring, upgrading, or maintaining physical assets, which allows Facebook to use the moneyelsewhere, this may have been a result of the COVID-19 pandemic.Current Strategy Facebook’s current strategy is to continue to develop and integrate other businesses they have acquired. Analyzing Facebook’s quarterly earnings, Founder and CEO Mark Zuckerberg stated, “We will continue to invest aggressively to deliver new and meaningful experiences for years to come, including newer areas like augmented and virtual reality, commerce and creator economy” (Investor Facebook 2021). Facebook, Inc. will try and create new market demand for their acquired businesses, differentiating their products like what was mentioned during the quarterly earnings meeting. RecommendationsWhile Facebook has an overall strong external and internal assessment, Facebook heavily investing in research and development will be integral to increase its capabilities to counter cybercrime that targets and victimizes their social media users. Between false information about the elections, Russian hacks, and other spread of hate on its site, Facebook will need to continue to develop its internal regulations and policies. Working on integrating its other apps to all sites will also be helpful to keep people connected and provide additional value to the consumer.
FACEBOOK, INC: CASE PROJECT13ConclusionFacebook, Inc. continues to expand and evolve almost every day. Most companies seem to play a game of catch up with technology, while Facebook’s goal is to lead the way on bringingpeople together through communication, personal experiences and overall sharing of life. In the U.S., as Facebook evolves, they are faced with two very big obstacles, potential regulation of free speech and regulation by the federal government. Along with the potential problem of Facebook, Inc. operating as a monopoly and acquiring all companies that emerge, Facebook’s strategic management must evolve as problems arise on their social media sites.
FACEBOOK, INC: CASE PROJECT14ReferencesAbout Facebook (2021). Facebook, Our Mission. Facebook, Inc. Retrieved from https://about.facebook.com/company-info/Carlson, N. (2010). At Last- the full story of how Facebook was founded. Business Insider. Retrieved from https://www.businessinsider.com/how-facebook-was-founded-2010-3David, F. R., David, F. R., & David, M. E. (2020). Strategic Management: a competitive advantage approach. (17th ed.) Pearson Education. Facebook Investor Relations (2019). FAQs. Facebook, Inc. Retrieved from https://investor.fb.com/resources/default.aspx#:~:text=Founded%20in%202004%2C%20Facebook’s%20mission,express%20what%20matters%20to%20them .Facebook, Inc. (FB) (2021). Nasdaq GS Facebook, Inc. (FB). Yahoo! Finance. Retrieved fromhttps://finance.yahoo.com/quote/FB?p=FB&guccounter=1&guce_referrer=aHR0cHM6Ly93d3cuZ29vZ2xlLmNvbS8&guce_referrer_sig=AQAAANdzOVUkAk3WODu71fpTAUOz1HlcOPtpjbyHxm8w8GiCmkOQmJFJ5hq6WiVgGcq6i5UyGfqsGrJKZzWmb5xirWFlwBfGRr4eZHdylc_PgiZheQ3DYBsbBj2Tkp4ydU9thG27EIUdXdPJXHo_5JD3779mlH21b9x-_PC6E1npiL_THamilton, I.A. (2021). Mark Zuckerberg says Apple is becoming Facebook’s biggest competitor. He also accused Apple of misleading users on privacy and abusing its dominance. Business Insider. Retrieved from https://www.businessinsider.com/mark-zuckerberg-apple-facebook-competition-2021-1
FACEBOOK, INC: CASE PROJECT15Investor Facebook (2021). Facebook Reports First Quarter 2021 Results. Investor Facebook. Retrieved from https://investor.fb.com/investor-news/press-release-details/2021/Facebook-Reports-First-Quarter-2021-Results/default.aspxStatista (2021). Facebook – Statistics & Facts. Retrieved from https://www.statista.com/topics/751/facebook/#topicHeader__wrapperWSJ Markets (2021). Facebook, Inc. FB (U.S.: Nasdaq). Wall Street Journal. Retrieved from https://www.wsj.com/market-data/quotes/FB/financials
FACEBOOK, INC: CASE PROJECT16AppendixAppendix A: External Factor Evaluation Matrix (EFE)External Factor Evaluation Matrix (EFE)OpportunitiesWeightRatingWeighted Score1.Diversify Portfolio0.0220.042.Increasing Integration via Other Apps0.0230.063.Expansion of Existing Platforms0.0330.094.Target New Audiences (Gen Z)0.1020.205.Expansion via Acquisitions0.1030.306.Advertising Trends0.0120.027.Campaign by internet companies to reach places that have no internet0.0210.028.New Markets (Virtual Reality, Agumented Reality)0.1030.309.Commerce0.0230.0610.Creater Economy- help influencers make more income, increasing 0.0130.03ThreatsWeightRatingWeighted Score1.Regulation in USA0.1020.202.Infringing on Free Speech0.0220.043.Monopoly Market with Acquisitions0.0320.064.Competition0.0330.095.Bans in Several Countries (China, Iran, N. Korea and Russia)0.0210.026.Data Breaches0.2030.607.Digital Tax (UK and EU)0.0420.088.Tainted Reputation0.0220.049. Regulation of Harmful Information0.1040.4010.Cancel Culture0.0120.02TOTALS1.002.67Appendix B: Competitive Profile Matrix (CPM)Weight RatingScoreRatingScoreRatingScore0.0540.2030.1540.200.1020.2020.2030.300.1040.4030.3010.100.0520.1010.0510.050.2040.8020.4030.600.1040.4030.3020.200.1530.4520.3030.450.0730.2120.1440.280.0330.0930.0940.120.1030.3020.2040.400.0520.1020.1020.100.0040.0040.0040.001.003.252.232.80Customer LoyaltyMarket ShareProduct QualityTop ManagementCritical Success FactorsFacebook, Inc.Competitive Profile Matrix (CPM)TwitterYouTubeEmployee DedicationFinancial ProfitAdvertisingMarket PenetrationBrand ReputationRange of productsR&DTotalsPrice Competitiveness
FACEBOOK, INC: CASE PROJECT17Appendix C: Internal Factor Evaluation Matrix (IFE)Internal Factor Evaluation Matrix (IFE)StrengthsWeightRatingWeighted Score1.Market Dominance- Monthly active users 2.85 billion, increase 10% year-over-year0.1040.402.Strong Brand0.1040.403.Loyal Customer Base -Daily active users 1.88 billion, increase 8% year-over-year0.0440.164.World’s Best Employer0.0330.095.Focus of Research and Development (R&D)- Capital expenditures= $4.42 billion0.1030.306.Direct Distribution to Consumer0.0530.157.High Integration Among Apps0.0520.108.Viable Business Model0.0330.099.Strong Products0.0330.0910.Adversising growth- 30% increase year-over-year0.0530.15WeaknessesWeightRatingWeighted Score1.User Privacy Concerns0.0510.052.Spreading Fake News0.0510.053.Stalled Growth in Rich Countries0.0320.064.Most Revenue Growth Driven By One Product (Instagram)0.0320.065.Low Diversification in products0.0410.046.Negative impacts of online advertising on user experience on app0.0510.057.Ads primariy source of revenue0.1020.208.Imitatable products or services0.0410.049.Stagnent innovation0.0320.0610.00.0000.00TOTALS1.002.54
FACEBOOK, INC: CASE PROJECT18Appendix D: Social Media Monthly Active Users and Facebook Exodus Survey(Statista 2021)(Statista 2021)
FACEBOOK, INC: CASE PROJECT19Appendix E: Company Worth AnalysisCompany Worth Analysis Stockholders’ Equity$133,657,000,000Net Income x 5$47,485,000,000(Share Price/EPS) x Net Income$252,244,226,221Number of Shares Outstanding x Share Price$743,904,000,000Method Average$294,322,556,555Competitor Information BelowCompany Worth Analysis Stockholders’ Equity$7,970,082Net Income x 5$340,000,000(Share Price/EPS) x Net Income-$2,699,194,030Number of Shares Outstanding x Share Price$42,452,534,700Method Average$10,025,327,688Appendix F: Financial Ratios for Facebook, Inc.Liquidity Ratios202020192018Current Ratio67%67%67%Quick Ratio45%45%45%Profitability RatiosGross Profit Margin81%82%83%Operating Profit Margin38.01%34%45%Profit Margin81%83%83%Return on Total Assets18%14%23%Return on Stockholders Equity27%24%22%Earnings Per Share10.09$ 6.43$ 7.57$ Price-Earnings Ratio27%32%17%Financial Ratios for Facebook, Inc.
FACEBOOK, INC: CASE PROJECT20Appendix G: Balance Sheet, Income Statement, & Cash Flows(WSJ Markets)(WSJ Markets)
FACEBOOK, INC: CASE PROJECT21(WSJ Markets)
Table of contents
INTRODUCTION
Alexander Graham Bell’s groundbreaking development of the telephone is where AT&T, a trailblazing power started. The Bell Telephone Company, founded in 1877, quickly changed its name to the American Telephone and Telecommunications sector, Telegraph Company (AT&T), laying the groundwork for the country’s first long-distance telephone network. Throughout its long history, AT&T has remained a significant player in the ever-changing telecommunications sector, influencing the growth of the market and the convergence of technologies. AT&T skillfully restructured and diversified its services, embracing the digital era while foraying into the computer, information, and wireless communication realms, despite obstacles such as a mandatory separation in 1984. Under the inspiring direction of Randall L. Stephenson, who held the positions of Chairman and CEO of AT&T from 2007 to 2020, the company experienced exceptional growth and expansion and successfully positioned itself in the media and telecommunications industries. This study delves into AT&T’s fascinating journey, examining its historical turning points, rival companies vying for market supremacy, and the transformative leadership that shaped its trajectory to become a global conglomerate providing all-encompassing telecommunications and entertainment services.
History
The creation of the telephone by Alexander Graham acted as the impetus for Thomas Sanders and Gardiner Hubbard to donate money to his fledgling telecommunications business. In 1877, this company adopted the name Bell Telephone Company. The American Telephone and Telegraph Company (AT&T) was founded by the Bell Telephone Company as a subsidiary that same year, laying the groundwork for the first long-distance telephone network in the country. Since then, AT&T has been a significant force advancing the ongoing technological fusion in the telecommunications sector, significantly influencing its growth.
However, the government ordered AT&T to divide into eight different businesses in 1984 over worries about monopolistic behavior. As a result, AT&T continued to operate its long-distance network but stopped offering local exchange services. Seven Regional Bell Operating Companies (RBOCs) were subsequently founded. Despite the split, AT&T took advantage of the chance to reorganize and expand beyond traditional telephone operations. Bell Labs and NCR Corporation were two important purchases that helped the firm enter the computer and information services market.
As mobile phone technology developed in the ensuing decade, AT&T focused its efforts on wireless communication. This project entailed buying several wireless providers, including Cingular Wireless, which resulted in the firm changing its name to AT&T Mobility. As a result, AT&T increased its telephone services to satisfy cellular customers.
More recently, by purchasing Time Warner Inc. in 2018, AT&T expanded its services to include entertainment. Because of these purchases, AT&T now controls essential media companies, including HBO, Warner Bros., and CNN. As a result, AT&T’s leading media company, WarnerMedia, was founded. AT&T is a multinational conglomerate offering various telecommunications services, including Internet, digital television, wireless and wired voice and data, and home security services. The business also provides enterprise solutions designed for companies looking for cybersecurity, cloud computing, and telecommunications services.
Competitors
As competitors continue to flock to the competitive market, AT&T, a major player in the telecommunications sector, has had to contend with fierce rivalry. Verizon Communications Inc. stands out as a severe rival among these rivals. Verizon is an American company that offers Internet, landline, and wireless communication services. Verizon’s 5G and expanding 4G LTE networks represent a severe threat to AT&T’s advantage in the market. In particular, Verizon has attracted a sizable customer base with its reputation for dependability and performance.
Comcast Corporation is another strong rival for AT&T in the media space. Direct rivals of AT&T’s offerings are Comcast’s cable and internet services. The company’s services include Internet, home phone, and cable T.V. Comcast Corporation bundles its services to achieve an advantageous market position, particularly in areas where AT&T offers U-verse services, including cable T.V., by utilizing its extensive network infrastructure.
Charter Communications Inc., the second-largest cable operator in the United States, competes against AT&T on an equal footing in the broadband and cable T.V. industries. Charter offers subscribers Internet, T.V., and phone services under the Spectrum brand. The corporation recently focused on improving network stability and investing in the client experience to get a larger market share.
Additionally, Google Fiber’s arrival into the market has presented AT&T with a fresh obstacle. In a few U.S. cities, Google Fiber, a division of Alphabet Inc., provides high-speed fiber optic internet services to thousands of subscribers. Despite having less coverage than AT&T, Google Fiber competes in the gigabit internet service market, maintaining a long-standing connection that continues to draw new customers. To stay in the lead in the market, AT&T had to strengthen its fiber service options and increase the reach of its gigabit services.
Leadership
AT&T has had several CEOs throughout its lengthy history, each instrumental in its development. Notably, AT&T has accomplished notable feats under the leadership of Randall L. Stephenson, who took the positions of Chairman and Chief Executive Officer in 2007. Stephenson’s leadership showed vision and transformation during his term, which he held until 2020. He firmly believed in setting and achieving challenging goals to foster an environment of innovation and long-term growth inside the business. Under his leadership, AT&T saw impressive expansion and diversification, successfully adjusting to a business environment characterized by frequent and quick technical change. Stephenson carefully positioned AT&T to obtain a competitive edge in the telecoms and, later, the media industries, stressing the value of embracing technology and digital change.
Additionally, Stephenson’s leadership style was marked by the development and support of powerful leadership teams, which promoted a climate of cooperation and inclusion. Recognizing the importance of varied viewpoints in moving the company ahead, he actively announced open communication among employees at all organizational levels. The corporation’s success was further aided by Stephenson’s forceful leadership style, which embraced strategic thinking and showed a readiness to take calculated risks in line with AT&T’s long-term organizational goals.
Strategic element history
The visionary vision of AT&T’s founders, Thomas Sanders and Gardiner Hubbard, who saw the potential of Alexander Graham Bell’s creation of the telephone, lies at the heart of the company’s strategic path. A national communications network was first strategically established with the founding of the Bell Telephone Company in 1877, which paved the way for AT&T’s future expansion and market dominance. The business started intentionally extending its scope and broadening its offerings in the same year it established the American Telephone and Telegraph Company (AT&T) as a subsidiary.
Due to antitrust concerns, the U.S. government forced AT&T to undergo a significant separation in 1984, a turning point for the company. Due to this tactical choice, seven Regional Bell Operating Companies (RBOCs) were established, taking over local exchange services while AT&T continued to operate its long-distance telephone network. Although the split initially presented difficulties, AT&T seized the chance to restructure and reinvent itself beyond its core telephone business.
AT&T entered the computer and information services market with smart acquisitions of businesses like Bell Labs and NCR Corporation, setting the groundwork for developing into a more diverse technology and communication solutions provider. Through this strategy transformation, AT&T was able to foster an innovative culture within the company while adapting to the terrain shaped by ongoing technology advancements.
As mobile phone technology advanced, AT&T strategically purchased wireless carriers like Cingular Wireless because it saw the importance of wireless communication. In addition to increasing its phone services, this action resulted in the company’s rebranding as AT&T Mobility, placing it as a significant player in the cellular communications market.
In recent years, AT&T’s strategic priorities included the media and entertainment industries. With the strategic expansion of AT&T’s products with the purchase of Time Warner Inc. in 2018, notable media brands like HBO, Warner Bros., and CNN were added, leading to the creation of WarnerMedia, the company’s primary media subsidiary. This tactical choice helped AT&T establish itself as a global corporation offering various media and telecommunications services ((Ryan Van Wyk, 2020: February 6).
AT&T has embraced technology and digital transformation as crucial elements of preserving a competitive edge throughout its strategic journey. The company’s ability to adapt, visionary leadership, and willingness to take calculated risks have all been crucial in determining its history and maintaining its sustained leadership in the media and telecommunications sectors, which are constantly evolving.
Vision and purpose
Vision
AT&T’s vision is to be an internationally recognized innovator in bringing together individuals and organizations, influencing the direction of communication and entertainment. Through excellent entertainment experiences, cutting-edge technologies, and seamless connectivity, the company hopes to empower people, organizations, and communities worldwide. By pushing the limits of technology and embracing digital transformation, AT&T sees a world where everyone can remain connected, informed, and entertained, opening up opportunities for growth and enhancing lives globally.
Purpose
Through cutting-edge communication and entertainment technologies, AT&T aims to forge meaningful connections and enrich people’s lives. The business is dedicated to providing quick, secure, and dependable connectivity so customers can stay in touch with their loved ones, access information, and accomplish their objectives. AT&T improves how people communicate, work together, and prosper in a world that is becoming more linked by fostering innovation and offering top-notch customer experiences. Its objective is to benefit society, spur innovation, and alter how people conduct themselves and interact with one another.
Analysis of vision and purpose
The Vision
AT&T’s vision demonstrates the organization’s lofty goals and tactical course. AT&T wants to expand its reach and power globally by establishing itself as a leader in linking people and businesses. The vision shows a dedication to embracing technical development and the digital revolution to influence communication and entertainment in the future. AT&T exhibits a customer-centric approach by putting the needs and pleasure of its customers first by concentrating on empowering people, organizations, and communities with seamless connections and cutting-edge solutions. Additionally, the focus on extraordinary entertainment experiences emphasizes AT&T’s understanding of the value of entertainment and leisure in people’s lives, emphasizing its commitment to supplying exciting content. The vision establishes a distinct and motivating course for AT&T’s development and growth in the dynamic media and telecommunications sectors.
The Purpose
AT&T’s dedication to generating value for its customers and the global community clarifies its core objective. These technologies for communication and entertainment are intended to promote deep connections and enhance people’s daily lives. The goal of AT&T is to make people’s lives better by giving them access to information, opportunities for education, and possibilities for both personal and professional progress. The company’s focus on innovation and the customer experience is a prime example of its commitment to ongoing improvement and meeting changing customer expectations. The company’s business objectives are tied to broader social responsibilities, and this goal emphasizes the company’s beneficial contributions to society. AT&T’s activities are guided by its purpose, which serves as a compass. This keeps the business focused on its main objectives: servicing customers and positively impacting the world.
In conclusion, AT&T’s vision and mission are compatible with the organization’s strategic objectives and customer-focused business model. The organization’s purpose affirms its dedication to empowering people and enhancing lives through cutting-edge communication and entertainment products. At the same time, the vision sets a compelling trajectory for the company’s growth and influence. Together, they offer a distinct and motivating framework for AT&T’s ongoing success and influence in the media and telecommunications sectors.
EXTERNAL ASSESSMENT
External factors evaluation
Since no industry functions in a vacuum, acknowledging external forces is essential for the success of any firm, including AT&T. These outside factors affecting the telecommunications sector fall into five categories: economic, social, cultural, demographic, and environmental influences; political, governmental, and legal; technological; and competitive.
We need to identify and examine the significant external factors that impact AT&T’s performance and strategic perspective to build an external factor evaluation (EFE) for the corporation. As seen in the example, these elements should be quantifiable, comparative, and divisional. The opportunities and threats that AT&T faces, such as developing markets (O), an increase in mobile data usage (O), tightened regulations (T), and escalating competition (T), would all be considered actionable variables. Data that may be measured, such as increases in digital service revenue (O), capital investments in network infrastructure (O), customer satisfaction scores (O), and shifts in consumer preferences (T), are examples of quantitative factors.
Comparative factors include tracking the evolution of these quantitative variables and comparing them to market trends and rivals. Given the particular strengths and limitations of AT&T’s activities, divisional considerations would be specific to those operations. We can develop an EFE that offers a thorough strategic assessment of AT&T’s external environment by selecting high-quality elements and allocating suitable weights. To maintain AT&T’s success and competitive edge, practical strategies that take advantage of opportunities and handle difficulties in the telecommunications sector would benefit from this study.
Competitive profile matrix
A Competitive Profile Matrix (CPM) can be created to compare AT&T with its main rivals to acquire insightful information about its competitive position in telecommunications. The CPM is a tactical tool that enables a comparative examination of enterprises’ industry-specific competitive advantages or disadvantages (Winseck,2019: July).
We would choose a group of significant telecom rivals for AT&T’s CPM, including Verizon, Comcast, T-Mobile, and Sprint. Based on the sector’s critical success factors (CSFs), the matrix would compare AT&T’s performance against those of these rivals. These CSFs could include network coverage, service dependability, client satisfaction, competitive pricing, novel offerings, and technical improvements.
We would rate each company’s performance on each CSF using a scale, often from 1 to 4 or 1 to 5. The rankings would show how each business compares to others in its sector. We would determine the final weighted score for each organization after allocating weights to each CSF depending on their relative value.
The CPM would show clearly where AT&T is in terms of competition with its main rivals. AT&T can discover its strengths and weaknesses and pinpoint the areas where it excels or falls short of its competitors by comparing its overall weighted score with its rivals.
Overall, the Competitive Profile Matrix provides a strategic understanding of AT&T’s competitive position in the telecoms sector, assisting the business in exploiting its advantages and addressing any competitive disadvantages to retain or strengthen its market position. Please be aware that the precise rivals and CSFs utilized in the CPM would depend on the market conditions and competitive environment during the analysis.
Evaluating competitive position, opportunities, and threats
AT&T, a significant participant in the telecommunications sector, faces various opportunities and dangers as the internet landscape changes, necessitating strategic management actions to strengthen its image and competitive position. Even though AT&T has a long history of offering telecommunications services, it must adapt to the evolving digital world and deal with several issues to keep its market-leading position.
The rising demand for data services and connectivity presents opportunities for AT&T. There are:
There are numerous potentials for AT&T to provide cutting-edge solutions and tap into new revenue streams due to the rise in mobile internet usage.
The spread of connected devices.
The Internet of Things (IoT).
Additionally, introducing 5G technology creates opportunities for faster data transmission and better client experiences, positioning AT&T as a supplier of cutting-edge connectivity services.
However, in this changing environment, AT&T also confronts specific threats. AT&T’s market share is threatened by fierce competition from rival telecom behemoths like Verizon, Comcast, and T-Mobile. Furthermore, regulatory adjustments and potential governmental involvement may impact the company’s operations, pricing, and marketing plans. A strong strategy for protecting client data and guaranteeing network security is required due to the constantly shifting nature of cybersecurity threats.
AT&T must concentrate on strategic initiatives to exploit opportunities and counter threats. The corporation should prioritize customer-centric initiatives by encouraging privacy, security, and service safety. AT&T can increase customer trust and loyalty by proactively addressing worries about data breaches and ensuring that laws are followed. Additionally, AT&T must spend money on R&D to stay on top of technological advancements and be at the forefront of connection developments.
AT&T must strategically diversify its business outside primary telephony offerings. AT&T’s 2018 acquisition of Time Warner Inc. moved toward extending its offerings to include entertainment content through Warner Media as the industry converges with media and entertainment. AT&T may decrease market risk exposure and expand its revenue streams by further diversifying its portfolio and entering emerging industries like the Internet of Things (IoT) and cloud services.
AT&T’s expansion in overseas markets, particularly those with restrictive policies on telecommunication services, depends on its ability to negotiate with governments and regulatory authorities. AT&T can explore expansion potential and broaden its worldwide reach by comprehending and adjusting to the distinct requirements of each area (Ryan Van Wyk, 2020: February 6).
To confront external difficulties, seize opportunities, and remain a top telecommunications and media giant, AT&T must take a proactive and all-encompassing strategic strategy. Strategic management strategies will be essential in determining AT&T’s future performance and maintaining its influence on the telecommunications industry as the business navigates the changing digital world.
INTERNAL ASSESSMENT
IFE, or internal factor evaluation
The Internal Factor Evaluation (IFE), an internal assessment tool used by AT&T, seeks to pinpoint organizational essential strengths and weaknesses. This information is crucial for managers to create effective strategies that build on organizational strengths and solve drawbacks.
Strengths
Due to several advantages, AT&T can maintain its lead over the competitors in the telecommunications sector. Since AT&T has been around for a while, the business has built up a sizable customer base and a solid reputation. The company has a competitive advantage due to its extensive network infrastructure and nationwide reach (Winseck, 2019: July), enabling it to serve many clients and organizations effectively. With its wide range of Internet, digital television, home security, wireless and wired phone and data services, and Internet services, AT&T is a comprehensive solution provider in the telecommunications industry. By acquiring businesses like HBO, Warner Bros., and CNN, AT&T has increased its clout in the media and entertainment sector (Andre Fuetsch: 2019, April 3).
Weaknesses
Despite its many advantages, AT&T has several flaws that must be addressed to realize its full potential. Verizon, Comcast, and T-Mobile are the main competitors of AT&T in the telecommunications sector, and each poses significant difficulties. The market dominance and pricing strategy of AT&T may be put to the test by this battle. Regulatory worries and future governmental actions may also impact AT&T’s operations in the telecommunications industry, necessitating proactive compliance activities. Due to its size and range of functions, the firm may need help to efficiently manage complicated business areas and preserve a consistent corporate culture.
Key Financial Ratios
Financial ratios are essential for evaluating AT&T’s current financial performance and health. When assessing these ratios, experts consider historical trends, industry benchmarks, and comparisons to significant competitors.
The financial outcomes of AT&T are at the other end of the scale. The company’s diverse revenue stream includes Internet, media, and wired/wireless services contributions. Looking into At&T’s financial qualities, it is very lucrative and liquid. It is important to consider industry standards and competition financial performance.
Current strategy
AT&T strives to offer complete telecoms and entertainment solutions through its robust network infrastructure, technological know-how, and media acquisitions. With WarnerMedia, the corporation hopes to increase its presence in the media and entertainment sector while retaining its position as a top supplier of landline and wireless phone and internet services.
The study of emerging markets and technologies, such as the Internet of Things, cloud computing, and cyber security, has become a primary priority for AT&T.
To better serve its customers and keep its position as a top telecom provider, AT&T strongly emphasizes innovation and digital transformation. The firm also routinely examines legislative developments and bargains with governments to strengthen its position in international markets and lower entry barriers.
Recommendations
AT&T should utilize its robust network infrastructure and brand recognition to acquire and keep customers to strengthen its competitive position, seize opportunities, and counter threats. The organization should support an innovative culture, invest in cutting-edge technologies, and diversify its line of products and services through strategic alliances. Proactive regulatory compliance and improved business unit management will make operations more efficient. Enhancing total customer satisfaction and becoming global will boost market presence. Maintaining a competitive edge requires vigilance in observing rivals and tackling cybersecurity issues. Resource allocation and financial stability will be optimized with regular financial performance reviews. By implementing these suggestions, AT&T may position itself for future growth and success in the media and telecoms sectors (Winseck,2019: July).
CONCLUSION
In the changing telecommunications and media sector, AT&T encounters both opportunities and problems. The company is well-positioned for further expansion thanks to its strengths, which include a strong brand reputation, vast network infrastructure, and a broad portfolio. However, strategic management activities are necessary due to fierce rivalry, complex regulatory requirements, and the need for innovation. AT&T can keep its competitive edge by building on its advantages, investing in cutting-edge technology, and improving the customer experience. Proactive regulatory compliance, improved business unit management, and worldwide expansion will further strengthen its position. Success will be long-lasting if competitors are closely watched, and cybersecurity issues are addressed. AT&T may allocate resources wisely and make informed judgments by conducting routine financial performance analyses. By implementing these strategic suggestions, AT&T will better negotiate the rapidly changing business environment, build its reputation, and maintain its position as the top telecoms and media giant.
REFERENCES
Andre Fuetsch, A. C. (2019, April 3). Opening Up for 5G and Beyond: Open Source and White Box Will Support New Data Demands. Retrieved from https://about.att.com/innovationblog/2019/04/open_source_and_white_box.html
Build the best network – global reach and consistency. (2020, January 24). Retrieved from AT&T Offer Information Library, Global Portfolio, Facts & Stats: http://marketing.iw.att.com:6200/portfolio/global/facts/index.jsp
Cisco. (2020). Cisco Annual Internet Report (2018 – 2020). Retrieved from https://www.cisco.com/c/en/us/solutions/collateral/executive-perspectives/annual-internet-report/white-paper-c11-741490.pdf
Denga, E. M., Vajjhala, N. R., & Rakshit, S. (2022). The Role of Digital Marketing in Achieving Sustainable Competitive Advantage. Digital Transformation and Internationalization Strategies in Organizations, 44-60.
Feigenbaum, J. J., & Gross, D. P. (2021). Organizational frictions and increasing returns to automation: Lessons from at&t in the twentieth century (No. w29580). National Bureau of Economic Research.
Hitt, M. A., Ireland, R. D., & Hoskisson, R. E. (2019). Strategic management: Concepts and cases: Competitiveness and globalization. Cengage Learning.
Ryan Van Wyk, V. N. (2020, February 6). Accelerating Software Defined Network Deployments. Retrieved from https://about.att.com/innovationblog/2020/02/accelerating_sdn.html
Tyagi, K. (2020). Merger control in the telecom industry: a landscape transformed. Journal of Business Strategy, 41(6), 3-9.
Winseck, D. (2019, July). Ready, fire, aim: Why digital platforms are not media companies and what to do about them. In International Seminar “Communication and Cultural Digital Platforms” (post IAMCR Conference 2019), Carlos III University of Madrid, July (Vol. 12).
APPENDIX
Appendix A: Revenue
PER YEAR IN BILLION KRW (₩)
Appendix B: External Factor Evaluation Matrix (EFE)
Appendix C : Competitive Profile Matrix (CPM)
Appendix D: Internal Factor Evaluation Matrix (IFE)
Appendix E: Financial statement
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