Business Essay Sample: British Telecom Evolving Acquisition Strategy for Growth

Published: 2018-02-09
Business Essay Sample: British Telecom Evolving Acquisition Strategy for Growth
Type of paper:  Essay
Categories:  Company Strategy Business Business strategy
Pages: 6
Wordcount: 1648 words
14 min read

In just three years period, the company has been able to shift from a 3 percent contraction trend and managed to change its relative performance with increased profits and revenue collected from its business engagements. Subsequently, the company has been focused towards revolutionizing its customers' service. The convergence between the business's old techniques and the new entrant of EE Brand also set the company's new direction in the industry through a well-motivated business engagement that may lead to its becoming the firm of choice. In 2015, the company's revenue grew by 6 percent while the pre-tax profits increased by 9 percent to reach £3.47 billion. The company's leadership also admitted the significant decline in its revenue before the acquisitions. However, on this note, the company recognized the endorsement of strategic mechanisms based on careful and informed acquisitions to realize new business portfolio with considerable business competitiveness in the local and international market segment (DePamphilis 2009).

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The principal focus on the company’s strength and competitiveness has been the central anchor that has enabled it to spearhead growth amidst swelling competition in the telecommunication industry. In particular, in a bid to focus on the future communication market, the BT Company focus on increasing 4G and other super fast internet coverage in UK by approximately 95 percent with about 12 million facilities having access to the ultrafast internet connectivity as at 2020. The acquisition of the EE Brand is also tapped as the first competitive capacity for the company that would help in realizing its future goals for the UK telecommunication market segment and beyond (DePamphilis 2009). The new advances is also precipitated by increased demand for the telecommunication services not only in the UK but also in the global market segment in which BT seeks to integrate its services in the long-run as shown below.

Through the EE Acquisition, the company realized tremendous business growth with additional revenue of £1bn during its first year of business engagement while demonstrating increased potential for growth in the long-run. The primary focus of the company is to communicate its network. The network service provided by the BT was also considered the best and the fastest in the UK telecommunication market segment. The development of competent performance portfolio by the telecom company is also subject to other divergent focus on creative advertisements that facilitate product entry into the market (Warf 2003). New products that culminate from new acquisitions have also been integrated into the market segment via increased demand for communication service facilitation that would spur new growths into the market.

Enhanced Customer Service

To tap into the swelling demand, BT engaged in numerous advances that saw increased revenue creation. For instance, the launch of BT Mobile and BT sports were focused towards enhancing consumers' experience through an offering of expanded sets of contents and services courtesy of new acquisitions. As at 2016, the company's Sport's audience had increased to about 2.2. Million viewers while its mobile segment attracted about 400200 subscribers following its new launch that had been planned for March 2016 (Scott 2015). These advances were an ideal show of excellence that culminated from the insurgence of new acquisition practices by the company that promoted its capacity to offer exclusive and competent services to its customer base. The new Acquisitions also expanded the prospects of enhanced service delivery via increased capacity to provide communication services in the telecommunication market in general.

Although the company has been able to tap into the telecom market via diversification into different but related communication services and products, it has to continue tapping into its competitive capacities to remain the principle service provider in the industry both in the UK and the global market segment. The company must engage in the progressive improvement of its network and the overall customer service to enhance customers' satisfaction in the long-run. For instance, the company’s leadership acknowledged the fact that a lot need to be done in developing customer experiences matching their expectations through increased investments (Scott 2015). For instance, as at March 2017, the BT Company aimed at having the capacity to respond to 90 percent of inquiries from the new base in the UK. As a result, it would demonstrate new capabilities and abilities to satisfy the client base as established by the company in its business portfolio (Bortolotti & Megginson et al. 2016). In particular, the advances achieved by the firm would be critical in tapping into an increased adoption of new technologies and the internet use globally as shown below.

The company's acquisitions are also crucial in enhancing customer services delivery through increased potential for handling different customer needs that only multi-national corporations can support. For instance, in many cases, a revolution has been noted to occur in the telecom business segment where a majority of customers like in any other business categories wants to serve themselves (Turner & Gardiner 2007). The clearance of service failure is the primary focus of enhancing customers' experience as noted by the company's leadership. Other centers that have been integrated by the firm includes plans to mitigate standard time taken to fix broken lines within a 24 hours period that also enhance its coverage. These are some of the distinct measures taken by the company towards improving their market performance via improved customer service.

British Telecom as an International Company

The position of BT as the leading communication service provider worldwide was promoted in 2005 through a series of significant acquisitions. For instance, some of the acquisitions included Infonet which is currently called the BT Infonet and one of the leading global managed voice as well as data network services for the corporate clients. Also, BT also acquired the second biggest telecom operators in the Italian market segment called Albacom. The acquisition of the two companies, Albacom and the Infonet formed part of the increased capacity of the BT to provide networked IT services towards its client base of multiple sites organizations worldwide. Besides, for the company to leverage its financial performance further, it acquired one of the biggest financial service providers, called Radianz from Reuters (Turner & Gardiner 2007). The new acquisition of Radianz, on the other hand, is expected to be a measure towards enhancing value-addition to the financial service market segment and a proposed extension of its market diversification prospects.

Besides, the company also expedited openreach approach to business operations. As a result of Telecommunication Strategic Review, BT signed a legally-binding prospect with the Ofcom that would help in creating the competitive regulatory framework for itself and the Uk telecommunication industry in general. Besides, the Openreach was also opened for the business in January, 2006 reporting directly to the Chief Executive Officer of BT. Openreach has been responsible for the management of the access network of UK on behalf of telecommunication industry in general.

Analysis and Recommendations of the Strategic Acquisitions by BT

The acquisitions of various business premises by the BT were largely informed by thorough research precipitated by increased market dynamics in the local and international scenes. In case BT had acquired major mobile phone businesses, it would have been possible to generate more potent communication giants comprising of serious roles in the phone market. This advances would have been a product of increased diversification and a diversion from the pure service industry to a product or commodity market within the telecommunication services sector. However, its integration into the broadband, TV and wireless network carriers was also a significant advancement into championing robust growth into the promising communication industry (Turner & Gardiner 2007).

With the four segments encompassed in the company's remittance, it implied that BT could efficiently operate similarly to the US telecom corporations where they use bundle deals to rope consumers to sign up into either ‘quad play' or ‘triple play' packages. As a result, the advancement would actually raise the pace of growth of BT in the long-run amidst growing technological advancements. As at 2014, there had been the increasingly large number of people watching television programs online. There was a strategic move by the US companies to force individual consumers into paying for the bundled media while maintaining them as their audience for sale to advertisers. The attractiveness of the latter was mainly based on the changing technological advances as well as increased adoption of modern technologies. BT must, therefore, consider updating its technological adoption portfolio to tap into the new wave of growing demand for the online communication capacities.

Reference List

Bortolotti, B., D’Souza, J., Fantini, M. and Megginson, W.L., 2016. Privatization and the sources of performance improvement in the global telecommunications industry. Telecommunications Policy, 26(5), pp.243-268.

Dennis, S., King, B., Hind, M. and Robinson, S., 2000. Applications of business process simulation and lean techniques in British Telecommunications PLC. In Simulation Conference, 2000. Proceedings. Winter (Vol. 2, pp. 2015-2021). IEEE.

DePamphilis, D., 2009. Mergers, acquisitions, and other restructuring activities: An integrated approach to process, tools, cases, and solutions. Academic Press.

Gaughan, P.A., 2010. Mergers, acquisitions, and corporate restructurings. John Wiley & Sons.

Ghanea-Hercock, R.A., British Telecommunications Plc, 2008. Network security system. U.S. Patent 7,418,736.

Hess, M. and Coe, N.M., 2006. Making connections: global production networks, standards, and embeddedness in the mobile-telecommunications industry. Environment and Planning A, 38(7), pp.1205-1227.

Leveridge, P.C., Strange, M.I., Parkinson, D.W., Roberts, D., Kenning, M.J. and Tibbitt Eggleton, R.I., British Telecommunications plc, 2007. Data communications. U.S. Patent 7,233,997.

Scott, M. Feb 5, 2015. British Telecom Giant BT to Buy EE for $19 Billion, New York Times

Trillas, F., 2012. Mergers, acquisitions and control of telecommunications firms in Europe. Telecommunications Policy, 26(5), pp.269-286.

Turner, C. and Gardiner, P.D., 2007. De-internationalisation and global strategy: The case of British Telecommunications (BT). Journal of Business & Industrial Marketing, 22(7), pp.489-497.

Van Kranenburg, H.H. and Hagedoorn, J., 2008. The strategic focus of incumbents in the European telecommunications industry: The cases of BT, Deutsche Telekom and KPN. Telecommunications Policy, 32(2), pp.116-130.

Warf, B., 2003. Mergers and acquisitions in the telecommunications industry. Growth and Change, 34(3), pp.321-344.

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