NUPSPA University

Faculty of Management
Programs and Investments Management, 1st year

Telekom Romania

Case study
- Strategy and projects portofolio-

Prof. coord: Racoceanu Cristina

Team: Balanica Brad-Traian

Enis Ata Ișim
Esienakife Isaiah
Ionita Florentina Laura

Bucharest 2018
 Contents

Chapter 1 - Mission, vision and objectives (Ionita Laura) .................................................................. 3

1.1 Mission .................................................................................................................................. 3

1.2 Vision .................................................................................................................................... 3

1.3 Objectives .............................................................................................................................. 3

Chapter 2 - External and internal environment (Esienakife Isaiah) .................................................... 4

2.1 Telekom SWOT Analysis .......................................................................................................... 4

2.2 STEP/LE Analysis ...................................................................................................................... 5

2.3 Porter five forces Model ............................................................................................................. 5

2.4 Stakeholders Analysis ................................................................................................................ 6

Chapter 3 - Company’s assement based on RBV Theory (Enis Ata Ișim) ........................................ 6

Chapter 4 - Strategy formulation (Balanica Traian) ........................................................................... 7

4.1 Organisation .......................................................................................................................... 7

4.2 Exploring the business........................................................................................................... 8

4.3 Stakeholders .......................................................................................................................... 9

4.4 Financial and information ................................................................................................... 10

Refferences......................................................................................................................................... 12

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Chapter 1 - Mission, vision and objectives (Ionita Laura)

Telekom Romania is present in Romania since 2014, when two big operators of
telecommunications, Telekom Romania Communications (former company Romtelecom) and
Telekom Romania Mobile Communications (former company COSMOTE Romania), have joined
forces in a brand new, dynamic telecommunications. Currently, under the umbrella of a single
company, they provide mobile and fixed communications services complete, innovative and
customized by a broad base of customers, using about 10 million services. (Telekom Romania)
1.1 Mission
The essence of their mission is to ease and enrich people's lives in the long term. They work
continuously to strengthen their status as a leading operator of integrated services market in
Romania, facilitator of digitization in all spheres of business and society, and, at the same time
putting their customers and their experience first. (Telekom Romania)
1.2 Vision
Telekom Romania' vision is to create the no.1 integrated operator in the Romanian market,
with a sustainable position in all segments and geographies capturing fixed-mobile synergies across
the value chain, to deliver customer excellence, with a highly efficient and focused operating
model. (Telekom Romania)
1.3 Objectives
They aim to conduct their business in a responsible way to manage and reduce the impact of
their operations. At the same time, they aim to become more competitive and create prospects for
sustainable growth of their company and the community in which they operate.
For this, they developed a Corporate Responsibility strategy which is based on five pillars:
Strategy and Management
They intend to operate in a responsible way, to assume the potential impact of their
operations and, at the same time, improving their competitiveness, ensuring sustainable growth.
Society
Combining their business success company prosperity and quality of life, not just for people
in local communities, but also for the countries in which they operate.
Environment
Their objective is to minimize negative environmental impacts and, in parallel, to encourage
community members from employees and customers to act responsibly towards the environment.
Employees
Creating a stable job and equitable to facilitate professional and personal development of
their employees.
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Market, customers and suppliers
Exercise a management approach based on transparency and ethics, and, at the same time,
contributing to the responsible operation of the markets in which they operate. (Telekom Romania)

Chapter 2 - External and internal environment (Esienakife Isaiah)

Telekom Romania
Parent Company: Deutsche Bundespost
Category: Mobile Service and internet Provider
Sector: Telecommunication
Tagline/ Slogan: Life is for Sharing/ Romania: Experience together
USP: Deutsche Telekom is the largest Telecommunications Company in Europe and has extended
to Romania by merging with Cosmote Romania but a rebranding from Cosmote to Telekom
Romania.
Segment: Fixed network, wireless & broadband & complex IT solutions to the business customers
in telecommunications and IT industries.
Target Group: Individual users as well as SMEs and MNCs users of telecommunication services.
Positioning: Premier fixed line, broadband and wireless service provider.
2.1 Telekom SWOT Analysis
Strengths:
- Telekom Romania being a part of a large, company has a large Mobile Communication
Customer Base and due to the rebranding is gaining growth;
- Success of Mobile Internet Services across Romania;
- Currently available throughout Romania;
- High brand awareness;
- Over 6500 employees serve the customers;
- Financially very strong owing to services in mobile, land telephony, digital TV etc.;
-Telekom Romania has strong marketing activities through TVCs, print / online ads,
sponsorships etc.

Weaknesses:
- Stiff competition means limited market share growth for Telekom Romania;
- Limited global penetration as compared with other leading brands.

Opportunities:
- Increasing Demand for 4G Technologies across the world;

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 - Acquisition of smaller brands can strengthen the presence of Telekom Romania;
- Growth in Telecommunications Services for consumer as well as enterprises;
- Adoption of newer technologies can boost business for Telekom Romania.
Threats:
- Global economic slowdown can affect business operations;
- Competitive aggression can reduce margins for Telekom Romania;
- Government regulations or strict guidelines can decline the business presence, example
user data protection, and user’s privacy laws;
- Availability of internet base communication system like WhatsApp and Skype.
Competition:
RCS & RDS, UPC Romania, Orange Romania, Vodafone Romania, WhatsApp and Skype,
Facebook Messenger.

2.2 STEP/LE Analysis

Sociological: Income distribution, labor / social mobility, lifestyle change, demographic
change.
Technological: New invention & development, change in mobile development, change in
information technology.
Environmental: Environmental regulation & protection.
Economic: Economic growth or crises, inflation, interest rate.
Political: Political stability / instability Romania is vital, Government attitude toward
business.
Legal: Change in telecommunication laws can affect business, change in employment law.
Ethical: Business value and practice.

2.3 Porter five forces Model

1. Threat of new entrants: Low = Telekom already have a significant share of the market.
2. Threat of substitutes: High = The competition is high, there are other options to choose
from.
3.Bargaining power of customers: Low - Medium = Telekom offers some of the cheapest
service.
4.Bargaining power of suppliers: Labor = Low because the unemployment rate is high.
5. Industry rivalry: Medium – High = The industry rivalry are Vodafone, Orange, RDS &
RCS, UPC and these company offer great services as much or maybe debatably better, there is a
high level of competition from their rivalry.

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2.4 Stakeholders Analysis
Investors: High = Key decisions & influence.
Public authorities: High = Legal, policies and laws operation.
Customers: Medium =Telekom offers some of the most affordable option, which keeps
them in this competition.
Media: Medium – High = It can influence the perception of consumers.
Employees: Medium – High =Unemployment is still high.
Suppliers: Low =Most suppliers are SEM smaller than Telekom and rely on such company
to survive.

Chapter 3 - Company’s assement based on RBV Theory (Enis Ata Ișim)

Resources
Telekom has segments of Broadband, Fixed Networks, Mobile Communications and
Business.
Tangible Resources
Within the market, Telekom has a number of resources.
Telekom’s hotspot network is one of the tangible asset. These hotspots can be used
byanyone who has a WiFi enabled laptop / handheld computer and does not need to be a Telekom
cellular subscriber. This WiFi hotspot network serves as both a revenue generator for the company
but also serves as a marketing tool since hotspot consumers are exposed to advertising saturated
splash screen upon logging on.
One of Telekom’s biggest tangible resources is the company’s ability to avail itself to
theresources of Telekom’s parent company, T-Mobile.
Another tangible resources of Telekom is that their franchises, offices, franchised shops, and
another partnerships that they made with numerous of sector.
Intangible Resources
The cellular industry has long been plagued with customer services issues. Common
complaintscenter on the perception that companies go out of their way to get new customers, but
once those customers sign contract they are no longer important. Despite this industry perception,
Telekom has,in the past few years, built up a reputation of providing excellent customer service.
Telekom was awarded the J.D. Powers award in 2004, 2005 and 2006 for best wireless retail service
provider. Telekom strength in customer service, and the company's resulting reputation, is a vital
resource to the company in that it provides Telekom with a strong customer retention tool.

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Capabilities
Companies integrate their resources into their operations and strategies in order to establish
capabilities. Based on its available resources, Telekom has built up several capabilities which have
served the company well. Telekom has been shown to be very effective in its marketing activities.
The company also has significant name brand recognition within the business world through
its hotspot WiFi network. Telekom’s capabilities in terms of customer service are also of great
strategic value to the company. In recent years customer retention has become a significant concern
in the cellular industry. Telekom has placed significant strategic importance on strengthening and
protecting its customer service capabilities.
Strong Focus on Customer Service
Telekom’s commitment to providing high-quality customer service is of great strategic
importance to the company. This commitment is a means of distinguishing Telekom from its
competitors when prices and technology (from a layman’s perspective) are not wildly different
within the wireless industry. Value is created by Telekom ability to distinguish itself from its
competitors in an area other than price. Telekom focus on customer service provides value to the
customers (in terms of services received) and value to the company (in terms of customer retention
and positive public exposure).
Targeting the Youth Market
Telekom has been successful in positioning itself as the carrier of choice for the youth
market. Telekom use of spokes people who are highly popular within the youth market along with
Telekom lower than average rates have enabled the company to successfully target the youth and
young adult demographic. This market provides significant value to the company for a number of
reasons. The youth / young adult target market is much more likely to rapidly upgrade their existing
handsets. This targetmarket is also much more likely to adopt new services. As innovative company
Telekom is pursuing the needs of the market so Youth Market can be targeted by them.
To sum up, Telekom has very strong resources and capabilities which keeps their retention
of customers very low and increasing the brand reputation.

Chapter 4 - Strategy formulation (Balanica Traian)

Strategic Planning

4.1 Organisation

Visioning

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 Become the number 1 integrated operator in the Romanian market, with a sustainable
position in all segments and geographies, capturing fixed-mobile synergies across the value chain,
to deliver customer excellence, with a highly efficient and focused operating model.
Values and principles

Honest and ethical conduct; Customer delight and simplicity;

Disclosure of information; Respect and integrity;

Compliance with law; Team together;

Internal reporting; Best plece to perform and grow;

Accountability for compliance. I am T-Count on me.

Culture
Telekom has created a culture of integrity, respect and tolerance of personal abilities and
lifestyles. In the area of diversity, they introduced flexible working conditions, family services, they
advocated for more women at the top management, they employ people from over 50 countries
which results in a ethnic diversity and they have a flexible internship for the students so they can go
to class and still gain experience from Telekom.

4.2 Exploring the business

Sources of major change arising from PEST/LE
Political:
 European Union;
 Increased regulation;
 Ethnic conflict, nationalism and militant fundamentalism;
 The increasing importance of China on the world stage.

Economic:

 Integration of world financial markets;

 Relations between euro and other currencies;
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  Fast and increasingly transparent access to information worldwide;
 Reduction in transaction costs.

Environmental:

 Climatic change
 Increased electricity usage
 Increased risk of disease through more mobile human and animal populations
 Ecological damage caused by the reliance on energy sources that are effectively non
renewable.

Social:

 Ageing populations in most of the industrialised world;

 Growth in mass migration and refugee populations;
 Challenges to welfare provision and educational systems;
 Changing consumer needs and expectations.

Technological:

 Speed and capacity of communication;

 Increased consumer sophistication due the widespread use of computers and internet;
 New mobile and wireless applications;
 Biological and genetic discoveries and applications.
4.3 Stakeholders

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Stakeholders Demands/needs/expectations Strong/weak?

Customers Reliable products and services at a competitive price Medium

Media To be informed of everything about the company Medium-High

Suppliers Long term contracts Low

Communities and NGOs Jobs and business opportunities Medium

Employees Good salaries and incentives Medium-High

Investors Profit and predictability High

Public Authorities Compliance of the laws High

4.4 Financial and information

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Refferences

https://www.telekom.ro/despre-noi/responsabilitate/
https://www.telekom.ro/images/Rapoarte_CR/Raport_de_sustenabilitate_2016_Telekom.pdf
Telekom Romania. Connected to sustainability. Measuring our progress. (2018 May 12).
Retrieved from
http://www.responsabilitatetelekom.ro/wpcontent/uploads/2017/06/Telekom_report_full_E
N_2.compressed.pdf
Telekom Romania external environment and competitors. (2018 May 12). Retrieved from
http://www.business-review.eu/featured/telekom-romania-has-still-widest-coverage-in-
romania-says-ancom-data-85850
Telekom Romania stakeholders. (2018 May 12). Retrieved from
http://www.responsabilitatetelekom.ro/en/stakeholder-engagement/
Telekom Steeple environment:(2018 May 12). Retrieved from
https://www.telekom.ro/images/docs/files/pdf/fix/Telekom%20_Suppliers_Code_of_Condu
ct.pdf

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