Impact Of General And External Environment Business Essay

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Telecommunication Industry: Now-a-days, whenever we hear anything about telecommunication mostly the name that comes our mind is "Telecom". It is the largest service provider in telecommunications to whole of New Zealand and it has reached every corner of New Zealand through its various products and services. The company's main business is providing telephone lines, selling broadband and mobile connections.

Telecom was established in 1987 and since then the company has excelled in providing different technologies, products and services to its New Zealand customers. Since the establishment, Telecom has taken-over different ventures; most of the projects have turned out to be successful Telecom service, thus becoming one of the largest companies by value on the New Zealand Exchange.

Purpose of the report is

To understanding Organisational Structure, followed by Telecom and its advantages and Disadvantages and also recommending a suggested Structure for improvement

To understand the Purpose of Telecom as an organisation and its management

To understand how external factors influence the operations of Telecom, like its Environment, Organisation, Behaviour and by applying knowledge to a typical and challenging situation

To learn and understand the importance of Ethics and Social Responsibility followed in Telecom

To understand the elements of Planning and Control and applying process to a given situation

To understand how to solve and apply a range of techniques to the given situation

The organisation and Management:

Definition: Management is the act of accomplishing or achieving goals of organization in the most productive and proper manner through planning, organizing, leading and controlling organizational resources.

Planning (Setting up the goals and reaching it with best possible way)

Controlling (Keeping an eye and making correction)

Organising (Assigning the task and use best possible resource)

Leading (Motivating)

Slogan of the Company: Connecting New Zealanders.

Heroes : Dr Paul Reynolds

Impact of General and External environment:

Environment -The introduction of the Video Conferencing technology facilitates cheaper and more frequent contact nationally and internationally between work colleague and clients. The use of Telecom's video conferencing has generally increased each year.

Political - Telecom provides certain specified telephone services on specified terms. Telecom has updated its Kiwi Share Obligations by entering into the Telecommunications Service Obligations Deed in December 2001. The Telecommunications Service Obligation is currently subject to review by the Government. Also government factors which affect the company are Tax policy, Labour laws, environment laws, Trade restrictions, tariffs etc.

Economic - Telecom is one of the largest companies by value on the NZ Exchange. The company employs over 7000 staff in NZ and more than 1600 in different countries. Other economic factors which affect the company are Interest rates, exchange rates and the inflation rates.

Social - The company has a range of social responsibility focused programmes and initiatives. Some are First Foundation - providing funds for NZ students to study further. Other programmes are Disaster relief, internet security etc.

Technology - Two years ago Telecom has faced a huge loss due to its XT network outage from Dec-09 to Mar-10. The mobile service was totally down in Taupo. The network got crashed due to serious hardware failure. As a result of loss of service Telecom has offered a five million dollar compensation package for its customers. On 14 May 2012 the Telecomm has announced live customer trials of Long Term Evolution (LTE) mobile technology in late 2012 in preparation for the evolution of the XT network to 4G. The delisted from the New York Stock Exchange, with the last day of trading 9 July 2012. The CDMA network closed at midnight on 31 July 2012. Simon Moutter's first day as CEO Telecom was 13 August 2012.

Legal - Telecom complies with the following listed few government/legal acts and more -

Consumer Guarantees Act

Fair Trading Act

Employment Act regarding employment rights

Remuneration Act

Companies Act 1992

Health & Safety Act 1992

Situation: Telecom becoming first to provide 4G technology

Telecom is the first company to provide the latest technology in the market to accomplish new goals which were planned through the best possible resources.


An analysis of internal and external environment is vital part of the strategic planning process. Environmental factors internal to the firm usually are strengths (S) or weaknesses (W), and those external to the firm are opportunities (O) or threats (T). An analysis of these four environmental factors is referred to as a SWOT analysis.

SWOT Analysis helps in matching company's resources and capabilities to the competitive environment in which it operates. SWOT Analysis helps a company to know where it stands:

Strength: local owned, largest telecommunication provider

Weakness: Competitors like Vodafone, 2 degree etc

Opportunity: Good Technical Team and new investments

Threat: Financial threat like what happened in the case of Ferrit

Ethics and Social Responsibility

The company expects all its employees and directors to maintain the highest ethical standards. Telecom's Code of Ethics establishes the framework by which Telecom employees (including the CEO and CFO) are expected to conduct their professional lives by facilitating behaviour and decision-making that meets Telecom's business goals and is also consistent with Telecom's values, policies and legal obligations. The Code of Ethics is available to all Telecom employees via Telecom's intranet site.

The Code of Ethics addresses:

Conflicts of interest

Receipt of gifts

Corporate opportunities


Expected behaviours (including fair dealing)

The proper use of Telecom's assets and information, compliance with law and Telecom policies.

Delegated authority

Reporting issues regarding breaches of the Code of Ethics legal obligations or other Telecom policies

Organisational Culture:

Telecom internal culture is considered the employees are really very satisfied with Telecom's norms values, artefacts (tangible signs) and behaviour of members of the other organisation. By conducting the survey of the sales employees in Telecom that 90% of the employees of Telecom to took the Training most effective, The major components of Telecom culture are:

They believe in creating an environment where talented individuals can shine.

There breadth of operations means they can offer a multitude of opportunities tailored to your career aspirations.

People can specialise by working in there area of expertise and broaden there skills by moving between business units.

Fresher can get a chance to work on some of the biggest and most exciting projects in New Zealand with most experienced people.

Basic approach is the development of employees no matter what their goals. This is addressed in a number of ways like.

Performance management: All employees develop their own individual performance plan with their manager. This will help to facilitate ongoing discussion and tracking to help ensure goals are met.

Career Planning: They wholeheartedly encourage the movement of people within the telecom group.

All vacant roles are advertised internally before being opened to the wider market.

They have clear plans detailing the skills and experience required for all roles within the group.

Identify likely career steps within the group to help the people think about where they are going.

3. Training and Development Programmes: Telecom has a number of Development and training programmes to help ensure their employees so that they can able to perform at their best; these cover areas such as Managing people, managing money and Influencing people.

Purpose of Planning and Control:

One of the most important part or foundation part of any successful organisation is planning and controlling the things. Well every management has different planning and it's differing to the organisation to organisation. In Telecom the management realize that organisation plan must provide the blueprint for the company control system. The objectives, missions, goals, strategies and plans change and then controls should be change also.

The organisation (Telecom) standards of the control systems are derived from previous years budgets rather than from current objectives of organisation plans Which is also referred BYO That's Beat year Ago as The result is that employees at lower levels are simply given "numbers to make" based on factors of which they have little knowledge and over which they have practically no influence.

The most interesting and exciting part they have made the charts and hook up in main notice board of every department like Finance, HR, Sales, Technical etc..

Finance: The Last budget was some 1 million dollars and we have used 1.2 million dollars, So they have to come with some strong plan, so that they shouldn't cross the budget limit but before find the root cause. (Its not true amount as no organisation leaks its budget information and its just rough figure)

Human Resource: The last year they hired 100 people, Out of them 50 promoted, 25 didn't show progress 15 left and 5 are fired. So the plan must be focussing rest 50% who hasn't done well.

Operations: Behind the best service is the best team. The consultants are drawn from the top of their class, experienced leaders in their specialist fields.

They have proven success in turning service operations into profit centres.

That may come from consolidating several sites into a single, centrally controlled site or implementing multiple sites in diverse locations.

Their collective knowledge and experience will improve their sales and customer service delivery.

The Team would answer the question about:

Strategic Business Planning

Budgeting and Finance

People Management

Professional Development and Training

Operations Management

Technology and Support

Information Management:

The contact are powered by the most highly equipment and most high rated technology and its Contact Centres are continuously challenged by change in the marketplace and pressure to maintain performance. To meet these challenges, management must periodically conduct an in-depth analysis of its Contact Centre operations.

Looking from outside your business, we can analyse objectively and recommend improvements through:

Operational reviews

Process development

Performance measurement

A world-class Contact Centre gives your company a competitive edge by strengthening customer loyalty; boosting sales and stimulating repeat business. Our team will advise how you can ensure your technology works for your business by improving service and efficiency through:

Infrastructure review and recommendations

Technology planning

Process or Relationship between Planning and Control


Establish Standards

Measure and Compare

Evaluate Results

Feedback and Coach

Take corrective Action.


Establish objective

Determine objective


Schedule task

Allocate Resources

Communication and co-ordinate

Provide Incentives

Analysis of Planning and Controlling and issues face by the managers:

Complacency: Individuals either do not see signs of danger/opportunity or avoid them. They are lazy in taking their decisions or taking too much of time in thinking.

Defensive avoidance: Individuals either deny the importance of a danger/ opportunity or deny any responsibility for taking action the manager fearing too much on taking decision or avoiding to take a decision.

Panic: Individuals become so upset they frantically seek a way to solve the problem. Managers always take a rash decision in hurry.

Deciding to decide: Decision makers accept the challenges and follow an effective decision-making process.

Organisation Structure:

Functions of Management in telecom

Telecom is based on "Divisional Structure" also called "Product structure" as Telecom has different products and services to provide. Telecom's business units (a brief) are listed below

Telecom Retail

Gen i


Telecom Wholesale


Each division within the Telecom divisional structure contains all the necessary resources and functions within it. Each business is aligned with Group's overall objectives and strategies. Each business works to an annual business plan which sets out financial targets and the research, development and resources required meeting or exceeding the plan. Performance is reviewed monthly and adjustments to spend, activity and resources are made where necessary.

The board and management are committed to ensuring that Telecom maintains international best practice governance structures and adheres to the highest ethical standards. The management ensures that the Telecom business and support groups

Identify risks that relate to the achievement of their business objectives;

Assess those risks and determine if they are acceptable under existing controls or whether additional treatment is required;

Respond appropriately to the risks, based on that assessment

Monitor and report on the current status and the effectiveness of their controls.

The management provides quarterly, half year and yearly reports to the board and the internal and external stakeholders. Management plays an important role in business planning, investment analysis, project management and operations management.

Analysis of Organisation Structure:

Newton Third laws states that every action there is equal and opposite reaction. Medicine which gives relief, also have some side effect. The same thing goes on with Organisation Structure it has some advantages and disadvantages too which is listed below.

Advantages and Disadvantages of the Divisional Structure


The divisional structure focuses the attention of employees and managers on results for the products and customer

Divisional structure is flexible and responsive to change, because each unit focuses on its own environment. Coordination among different functions within the division benefits from singleness of purpose.


The major disadvantage of divisional structure is duplication of activities and resources. Instead of a single marketing or research department, each division maintains its own.

The structure loses efficiency and economies of scale; and a lack of technical specialization, expertise, and training can result. Interdivisional coordination may suffer, and employees in different divisions may feel that they are competing with one another

C. Issues faced by Management

There was failure at a number of levels from Telecom, including poor strategy, poor execution, and most important poor governance -

The idea behind the venture was great and it could have turned into a success but didn't seem to happen. While there were opportunities to make it successful, the prosecution was flawed. The problem was that the proffered solution could not offer anything of value neither to the customers nor to the retailers. The problem was that for an aggregator site like Ferrit to work properly the retailers had to get their own websites in order, and once they had them in order there was no need for Ferrit. The business model was fundamentally flawed. It relied on taking a commission from retailers for directing traffic to their sites, charging them big commission. The flaw was that the retailers can simply set up their own sites and buyers can easily find them using Google.

Understanding the Term Leadership, Motivation and Delegation:

Description of Leadership:

The organization leaders in the telecom practice bring broad strategy and organization skills, as well as specific expertise in areas such as Group/Operating Company organization design, talent management and leadership development, innovation, and merger management and cultural change. Global team of Telecom has extensive experience working in mature and emerging markets, with recent engagements with Australian Companies. And it is a self-organizing - better, a self-leading - group may sound terrific. But if you're an Share holder or involve in top level management, you're likely to have some valid reservations about surrendering the fate of your investment and goals to that process. Leader of Telecom I mean the top level management directly or through the medium of professional executive management, to direct and control the operation of that process. This is accomplished through placing a distinct and separate authority at the top of the organization, in order to manage the otherwise self-directing leadership that exists naturally within it. Its driven perfectly by leaders like Dr. Paul Reynolds, Mark Ratcliffe, Chief Operating Officer for Technology, who recently appointed as CEO of Telecom's.

That authority at the top is not leadership as commonly understood. Rather, it is command. It gives legitimate expression to the superior role of management over the inferior function of leadership.

As Telecom which is the largest telecommunication company which has very diverse culture, it has a great impact on leadership style. According to my study and interview Telecom Company has adopted combination of two styles i.e. Democratic and Laissez-fair.


Internal and external factors that stimulate desire and energy in people to be continually interested in and committed to a job, role, or subject, and to exert persistent effort in attaining a goal.

Motivation results from the interactions among conscious and unconscious factors such as the

(1) Intensity of desire or need,

(2) Incentive or reward value of the goal, and

(3) Expectations of the individual and of his or her significant others.

In Telecom they motivate their employees by recognition to their work,

Putting up their name on Notice boards

Sending Emails and making awareness of the employee's work

Promoting them

Increase in salary

Incentive and also

By taking to Rugby matches.

Issues related to Motivation:

Well the topic goes back to the basis which described by Maslow in his motivational theory. Here and in every organisation issues would be same like depends person to person what he actually want rather than one common goals. The differences would be..

Physiological Needs


Social Needs



Analysis of Leadership its styles with theories and references:


Authoritarian leaders, also known as autocratic leaders, provide clear expectations for what needs to be done, when it should be done, and how it should be done.

There is also a clear division between the leader and the followers. Authoritarian leaders make decisions independently with little or no input from the rest of the group.

Decision-making was less creative under authoritarian leadership and it is more difficult to move from an authoritarian style to a democratic style than vice versa. Abuse of this style is usually viewed as controlling, bossy, and dictatorial.

3 main Disadvantages of Autocratic or dictatorial leadership are as follows:

a) One way communication without feedback leads to misunderstanding, and communications breakdown.

b) An autocratic leader makes own decisions which can be very dangerous in this age of technological and sociological complexity.

c) It fails to develop the worker's commitment to the objectives of the organisation.

At present, no leader wants to adapt autocratic leadership style except in militaries and some small businesses.

Democratic Leadership:

Democratic leaders make the final decisions, but they include team members in the decision-making process. They encourage creativity, and team members are often highly engaged in projects and decisions.

There are many benefits of democratic leadership. Team members tend to have high job satisfaction and are productive because they're more involved in decisions. This style also helps develop people's skills. Team members feel in control of their destiny, so they're motivated to work hard by more than just a financial reward.

Because participation takes time, this approach can slow decision-making, but the result is often good. The approach can be most suitable when working as a team is essential, and when quality is more important than efficiency or productivity.


The work been assigned to a particular person.

Here in Telecom they don't overburden the work to one or two employees but instead they divide and Split the work by knowing person Capability of meeting the Deadlines.

Issues in Delegation and Management Relationship:

The employee will lose interest in the job and if force on it.

The job may be done but not to its best.

Horse play will come in picture if the delegation not proper not to the right person.

Team Structure and Dynamics (Roles, Leadership and Performance):

Definition: In any organizations, company, work place community groups and sports all use teams to accomplish goals. The dynamics of teams determine if these goals will be met in an efficient manner. Identifying team dynamics and understanding positive and negative outcomes that may occur due to the dynamics will assist you to achieve team efforts or A Group of people that share and work towards accomplishing a common goal are referred to as a team. The dynamics of a team depend on each team member. Unseen forces that exist in a team between different people or groups are called team dynamics and can strongly influence how a team reacts, behaves or performs. Many factors influence team dynamics, such as personalities of team members, how the team operates, how the team views itself and the team's organization.

Management Team

Designing Team









Analysis of Team Structure:

Telecom requires certain senior people (the CEO, CFO, Group General Counsel, Group Company Secretary and the General Manager Investor Relations) and in some cases the chairman, to discuss whether information is material prior to its release.

Telecom has appointed a Disclosure Officer (currently the General Manager Investor Relations) who, together with the Group General Counsel, is responsible for ensuring that all material information is lodged as soon as practicable simultaneously with the NZSX, ASX and NYSE. The Disclosure Officer ensures that such information is published Telecom's website where appropriate, with further dissemination through broadcast emails to news agencies and other market commentators. Disclosure practices are monitored by the Disclosure Officer.

Telecom has also appointed certain executives as authorised spokespeople who are required to ensure that all proposed public comments contain information already in the public domain or information which is not material. Management is responsible for ensuring compliance with the policy. Telecom's website contains media releases, quarterly financial information, current and past annual reports, dividend histories, notices of meeting, a list of shareholders' frequently asked questions and other information about the company. Telecom web casts its investor and analyst briefings over its website where appropriate. Full participation of shareholders at the annual meeting is encouraged. Telecom web casts its annual meeting live. Shareholders have the opportunity to submit questions prior to each meeting and are given the opportunity to ask questions of the chairman, directors and auditors at the meeting. Each web cast is archived on the Telecom website after the meeting along with a copy of the minutes of the meeting.