Total Peripherals Group - Free Essay

The world has welcomed a new phase of inevitable technological advancement and changes which can be praised for the developments in each state’s economy, political and social structures. Technology has connected people worldwide through business and social platforms, which have encouraged individuals to meet people of common interest, thus bonding to their advantage. Telecommunication companies worldwide have taken a significant role in linking people in every state and supporting their economic course by employing most people as others remain as beneficiaries of the projects (Khanmohammadi et al., 2019, p.60). Australia being part of the first world countries has empowered its technological basis through telecommunication companies like Total Peripherals Group (TPG), which intrigues the urge to study and analyze its operations. TPG is an IT and Telecommunication Company based on consumer and business internet services as it further is operations to mobile telephone services. TPG was founded in1986 serving Australia, New Zealand, and Singapore resulting from a merger between David and Teoh. It leads as the largest mobile virtual network operator but the second largest internet service provider in Australia. The organization serves millions of people who use their services daily, which accounts for its wide margin of annual profits and revenue, amounting to A$495 billion averagely and employing over 5000 people.

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PESTEL Analysis

TPG serves effectively dedicated to its objectives, making it a key figure in political, economic, social, technological, environmental, and legal state strategies. The PESTEL analysis gives extraordinary measures to evaluate the operational level of TPG Company as it offers a detailed analysis of factors that impact the organization's macro environment. Frequent changes in the macro-environment factors can affect players in the telecommunication industry, and TPG is not exceptional. Various sustainability issues emerge from this model that work either to the advantage or disadvantage of an organization and its daily operations. Political factors play a vital role in impacting the country's TPG profitability, which raises the challenge of geopolitical uncertainty. This organization's presence in several countries means that it has exposure to diverse political environments that subject it to some political risks (Mindess, 2019, p.15). The only guarantee to achieve success in such diversified political environments is to acquire a healthy experience of the system risks where one analyzes numerous factors before investing in the market. The Political factors that lead to uncertainty in achieving the purposed business objectives involve political instability that undermines the importance of telecommunication services to develop a state's economy. Military invasion in the country is an inevitable risk when a service does not serve their best of interest, which puts the telecommunication network in jeopardy of losing its investments to a country's military crisis. Geopolitical uncertainty can further emerge from taxation rates and incentives that render the organization in complete fear of minimal profits the state consumes its significant gains through tax. The predictable industry change from this perspective can be associated with instilled fear to any growing telecommunication company to extend its services to other countries or maintain its operations locally to keep away from the governments' interruption, which will lead to a low economy and minimal profits.

Technological factors can further be used to give explain a sustainable challenge is poses on the TPG telecommunication sectors as technology is massively disrupting industries in most states. Most companies either embrace the former and outdated technological measures as they find the frequently changing ones expensive to acquire compared to their profit margin or the companies that develop dominate the market. This factor's sustainability issue can be considered a disruptive technology that exposes TPG to match its standards to the rapidly growing rate of technological advancements (Khanmohammadi et al., 2019, p.60). The analysis of the speed at which technology disrupts an industry is vital to direct the essential adjustments that are required to be made to ensure profitability. The slow pace in technological growth can buy enough time for a company to adjust as a high disruption rate rarely gives a company time to cope, thus minimizing and limiting their daily operations. TPG faces technological factors as a challenge since its venture across foreign borders meets different operating technology levels, which they have to cope with to establish their telecommunication roots. The influence of these technological factors and challenges can only work to better the company's ability in the future market or completely shatter the hope of an upcoming organization to cope with the market's advancements.

Five Forces Analysis

Porter provides a perfect strategic management tool that aids in analyzing the underlying levers of profitability to every operating company in the market. Five forces analysis gives a critical description and comparison of every business entry's external environment offering precautious alternatives to handle the challenges that threaten a business (Orlov et al., 2017 p.8015). TPG managers can use Porter's tool for their advantage to understand how the five forces influence the business and develop a strategy to enhance a competitive advantage to the TPG organization ensuring long term profitability in the telecommunications sector. Over the years, TPG has shown consistency in business by redefining its strategies, which has boosted its position to serve as the best and largest telecommunication service provider in Australia. Michael Porter lists the five forces that shape business profitability strategy as the threat of new entrants, bargaining power of suppliers, bargaining power of buyers, threat from substitute products, and rivalry among the existing players. Porter's framework gives a new ideology on approaching strategic decisions than just mere analysis of market competition. The TPG managers have an exceedingly great chance to use the five forces analysis to gain a strategic position and explore profitable opportunities in the telecommunications industry, establishing the organization at great lengths.

The five forces have equal chances to create an impact of sustainability to any business in a competitive phase. The new entrants to provide alternative telecommunication services bring innovation and a unique perspective of carrying out operations that put pressure on TPG operations to maintain their position in the market (Al-Arafati, 2016, p.439). A possible response from an existing organization to cope with innovations is that they may reduce prices for their products and services, which in return reduces profitability. Another counter plan would be reducing costs and providing new value propositions that would entice the customers to hold their loyalty to the TPG organization. Despite the extended effort for the TPG to manage its challenge, they must create a barrier that will safeguard their competitive advantage to remain ahead in profitability.

The introduction of new products in the market engages new customers. Equally, it gives a customer a reason to remain loyal to TPG services as the new products may be of low quality that will add advantage to the existence of TPG. The organization may further be lured to build economies of scale to enable it to reduce the set costs per unit. The new players are somewhat discouraged by the existing companies like TPG. They establish building capabilities and spend more money on research to acknowledge the business opportunity available in the market (Al-Arafati, 2016, p.438). This existence of established companies shatters the window for extraordinary profits but instead forces the new entrants to abide by the elderly organizations' standards in the market.

Strategy Canvas

TPG has faced market competition from its numerous rivals like Telstra and Optus telecommunication companies who equally produce similar services and products which jeopardize the business stability and profit margin in the long run. The competition has not only risked all the TPG operations but, at some level, offered a success opportunity to compete effectively under numerous advantageous factors. Several factors have critically contributed to TPG success in the competitive market, one being their price range. TPG provides a wide range of products and services that have dominated the market for long thus, any new entrant in the market struggle to gain customers’ influence of their existing products. TPG quickly levels their prices to adjust any competition over products and services, considering that they have been operational for long in the market compared to the young companies who seek public favor and interest. The long service and experience have given a higher advantage to explore the market interest and benefits compared to newly operating organizations in the telecommunication sector (Song et al., 2017, p.280). TPG further operates under the technological advantage of the fact that they can afford and adopt any technology advancement that passes the market to their advantage compared to companies who struggle with their profitability margin. The technological advantage helps rectify possible weaknesses in the products, which is the only guarantee of offering a quality advantage. Quality is TPG's best opportunity to account for their success as their products benefit from time in the market; thus, they have endured error critics and been modified to better versions, which are now attractive in quality through speed and frequency to the customers.

Blue Ocean

The blue ocean strategy pursues differentiation and low cost to create a new space, which leads to new demand over a product or services. It ensures a business makes and seizes the uncontested market space, which turns the competition in the market irrelevant. This approach holds the notion that the industry players on the cards to construct market boundaries and structures since they are not freely given. The market is not tainted with competition as the industries are not in existence today. The demand is easily created than fighting over in the existing market gap as the only way to grow competing companies and ensure a rapid profitability rate. The blue ocean ensures that the competition is irrelevant as the rules are not yet set, and there are no existing market standards to rely on (Raut et al., 2019, p.15). It instead puts its weight on more profound potential found on unexplored market space as it is deep and of great power in terms of profitability growth. TPG explores new areas of development by first studying the consumer behaviors that give the opinion on what product or service to better in quality and price or make a new product that satisfies the desired of the unserved consumers in the market. The market spaces identified in the strategy canvas for TPG include the quality of products. When the quality of the work is changed for the better, the specified new area remains without any competition. The TPG managers use blue ocean strategy as their personal and powerful tool that makes their undertakings iconic and impactful to their course.