CS: Vodafone Strategic Review

1. Rating: 7
2. Summary
1. Founded in 1984
2. 7th largest telecom company globally
1. competitive but profitable industry, little room for error
3. Industry best: America Movil
4. Graph on growth rate (vertical), return on assets (horizontal)
5. GBP 45.8B
6. 367.5 M
7. 52 countries
8. Net profit margin: 17.2%
9. increase in leverage and revenue from 2007-2011
3. Business strategy
1. CEO:
1. Whent: Joint Venture in Malta in 1989
2. Gent: aggressive international expansion (45B pound loss)
3. Sarin: align organizational structure with strategy. Not effective. Financial performance suffered. (2006-2007) Pursued growth in India
4. Colao: Focused on increasing shareholder value. Consolidated into 2 regions. Became single worldwide supplier to corporates. This strategy was effective. Share price increased by 23% but by 2011 there was a decline in growth.
5. "do not let spacious plans for a new world divert you energies from saying what's left of the old one" -WC
2. SWOT analysis:
1. strength: size (also a weakness if they become inflexible to market opportunities) Can they innovate faster then the competition? Their competition has innovated better than they have.
3. Ansoff Matrix
1. Emerging markets: moved into India. M-Pesa (created in Kenya) was a positive example of innovation
4. Future challenges:
1. avoid being a commodity. Software R&D is crucial (ecosystem creation for differentiation)
2. keep long term debt in line
3. portfolio management appears strong. continue to divest unrelated/low-growth  businesses. Manage Verizon- get bigger stake or sell off to fund emerging market growth.
4. Avoid over-leverage
4. Financial performance
5. M&A strategy
1. after a period of intense acquisitions, beginning to consolidate
6. Porter's theory of global competition:
1. "When a firm's competitive position in one country in significantly influenced by its position..."