Analysis of the business-level strategies – ATA&T Corporation
ATA&T Corporation, the leading US market telecommunication provider, has varied methods or plans that it uses to conduct various functions in its business operations. AT&T as a large corporation is structured into three separate publicly traded companies; a computer company (NCR), a communication service company which still retained the name AT&T and the Lucent technologies. AT&T (Communication Service Corporation) uses much business –level strategies since it has several departments with distinct business operations. The business-level strategies provide guidelines followed by the AT&T owners, managers as well as employees (Davis, 2013).
The following among others are the most distinct business-level strategies in AT&T Corporation: cost-competition, market, operational, technological, and differentiation strategies.
In cost strategy, AT&T is positioned to provide very competitive pricing to the variety of the numerous services that it avails in the US market. It also practices switching costs. This is the AT&T business level strategy that focuses on the products, industrial forces, competitors and the position of the business in the market place. According to head of division, Tobias, this is the business strategy of great concern. In order for the corporation to attain its competitive power, the differentiation business strategy has been integrated with the cost-competitive strategy. AT&T, in its attempt to master its differentiation strategy, has initiated an agreement to sell the iPhone with Apple Corporation. By so doing, it has differentiated itself from its competitors, a factor that contributes enormously to its evident success over the years.
Initially, in AT&T’s market strategy, it was considered the best local and global service provider. It served both the local markets and the global market. This however changed when AT&T came up with a new market strategy to focus majorly on the global markets. It renounced the end of the local market services as an effort to guarantee the future of the business. Analysis of this strategy reveals the strategic plan to address the long term business goals of the corporation. There is adequate channel control coupled with increased and improved customer service satisfaction. AT&T has achieved this adequacy by changing the global customer rules. The market business-level strategy has been favored mostly by the quality branding and promotion practiced AT&T.
In analyzing the AT&T business level strategies, its market strategy guarantees the business profitability which is very critical for the long term success of any business. Its focus on the global markets and the quality as well as satisfactory customer services guarantees its good competitive position, employee development and public responsibility that are all geared towards the firm’s long term success.
Analysis of the corporate –level strategies – ATA&T Corporation
Corporate-Level Strategies on the other hand refers to the specific actions that AT&T takes in order to gain a competitive advantage by selecting and managing a portfolio of the corporation that competes in different product markets. AT&T is focused in providing more reliable, high quality, innovative products and services geared to connecting people with their surrounding world. Through their next generation improved technology with advanced networks, the corporation provides quality new solutions for their consumers as well as businesses. AT&T Corporation offers the most reliable and recommended 4G networks, with the nation’s largest Wi-Fi network with hotspots throughout the United States inclusive. The corporation therefore prides itself on the quality customer care and its exceptional communications and entertainment services to the customers.
AT&T has a corporate mission statement that guides its corporate strategies. ‘We are dedicated to being the world’s best at bringing people together–giving them easy access to each other and to the information and services they want and need–anytime, anywhere.’ From the corporate mission statement, we get the corporation strategies. AT&T therefore has strategies to develop a basis for resource allocation and utilization, serve as a focus for direction, provide for parameters and controls, allowing for translation of the objective and goals and finally ensure a central purpose for the organization (Lucent technologies, 1997).
The most dominating element of AT&T’s grand corporate strategy is the focus on concentrated growth. This revolves around specific market and product combination. This is the most effective and associated with the very least risks. The corporation’s product of interest is communication. In all firms, concentrated growth is the key to both short term and long term success of the firm. AT&T’s realization of growth guarantees its success and domination both locally and globally. With its uniqueness in product combination, it provides variety of communication products to the global customers who enjoy the customer services at highest satisfaction levels.
Product development is another key aspect of AT&T’s corporate strategy. However, analysis reveals that this requires quite a larger amount of risk as well as higher costs of implementation. This corporate strategy focuses mainly on the development of new products for the new increasing markets. It also involves the addition of new features or variations to present available products. For example, the introduction of the internet-access related products. Another corporate strategy is the strategy for the market development both demographically and geographically. Analysis of this strategy reveals that it is also geared towards achieving a concentrated corporate growth.
Concentric Diversification, innovation as well as Strategic Partnership among others are also among the corporate strategies list. In order for the AT&T to continue with the success in the Internet-related activities, it seeks to acquire businesses as well as corporations which relates to it in terms of markets, technology as well as products to partner with, the corporate strategy referred to as concentric diversification. The AT&T Internet presence requires the partnering services of recognized portals such as Yahoo. This will enable the AT&T to expand its customer base. It also needs to acquire the necessary local as well regional ISPs in order to focus and consolidate cable-services alongside enabling synergies which optimize AT&T delivery technology and content provisioning.
Competitive environment analysis
AT&T faces competition from the integrated telecommunications companies for example the Verizon company and cable/broadband providers such as the Comcast and Time Warner Cable companies. Most evidently is the competition between AT&T and Verizon. The two have fully saturated themselves within the market with each trying to outgo the other. They have developed customer loyalty making price wars less of a concern. AT&T Corporation has acknowledged that price is the most concern for an individual customer. It therefore continues to offer very competitive plans for competitive prices. Apart from just customer prices, Firms also compete over increased speed as well as compatibility between the devices. Each firm therefore strives to provide improved connectivity speed with the hope that by doing so, they will increase their market penetration and diversification as customers will be compelled to switch carriers.
AT&T is also faced with stiff wireless competition from other corporations such as Comcast Corporation, Sprint Corporation, T-Mobile and Time Warner Cable. Wireless competition is so stiff to an extent that there is an evident lack of spectrum to meet the basic expansionary needs therefore making it next to impossible for the smaller companies to market their products (Collis & Montgomery, 2005).
In the competitive environment, success lies within the quality of the established and executed business and cooperate strategies. AT&T’s corporate strategy of product diversification has earned it a competitive advantage over its significant competitor Verizon. From 2007 to 2011, AT&T Corporation was the only firm the iPhone was available to. The iPhone overpowered all the phones in the market. The firm therefore enjoyed four years without competition. Another strategy that contributes to the AT&T’s competitive advantage is its technological strategy. AT&T has the best-made technology and product. Unlike Verizon, which uses an old and slower Code Division Multiple Access (CDMA), AT&T uses Global Systems for Mobile communications technology (GSM). There is therefore the advantage of speed and compatibility that is associated by AT&T’s GSM. GSM also provide room for multiple features at ago
AT&T’s business level strategy adapts to the market changes and demands. It adjusts significantly to its market demands. Unlike Verizon, it has a network that is better prepared for the market’s future. The company that is therefore likely to thrive in the long run would be AT&T. its latest strategy to focus mostly on the global market coupled with its product diversification guarantees it a long term success.
AT&T, unlike its competitor, is a fast market cycle corporation. It has used teams staffed with individual members from diverse disciplines to develop new communication products enormously cutting expenses as well as time in the development of products. Because of its strong market power, it will have a competitive advantage still. However, in a slow market cycle, AT&T will not have a competitive advantage over its competitor Verizon, which has resources and capabilities which are very difficult to imitate (AT&T, 1994).