Discussion
The objective of this essay is to evaluate critical issues related to the business of Optus Australia. This paper studies the influencing contextual factors such as organisational structure, environmental forces, business risks that influence the business practice of Optus in Australia. Optus provides a wide range of communication services including mobile service, national and long distance communicational service, business local services, satellite services and TV and digital media services. Optus holds second position in Australia in terms of market share with 20% share (Optus.com.au, 2017). Significant competitors of this company are Telstra and Vodafone in Australia. However, since the ‘vodafail’ period, Optus has not been able to increase its market share significantly.
Optus has made a significant move to enter into the market of streamline entertainment. As Optus is facing serious challenges in the Australian telecommunication market from Telstra, the company needs robust marketing skills and strategy to retain or increase its market position. The aim of the company is thus to enhance market share in domestic economy through customer acquisition. Optus has scope of increasing market share as the telecommunication service market as this market is oligopolistic in nature and hence, the extent of competition can be reduced through strategic business and marketing skill. Optus can regain market share by increasing the scope of employment in Australia. Creation of job is helpful to win trust of the investors and stakeholders.
This part of the essay discusses the contextual factor influencing the business. The objective of Optus is to reap the benefit of new technology and to acquire position in the retail business of this industry with the entry in the market of smart phones. External environment that influence the business are political, environmental, legal, social, economical and technological environment of Australia. As discussed by Basu et al. (2015), political environment helps to evaluate the business environment and the facilities provided by the government in doing business. As mentioned by Ho (2014), political environment of Australia is stable wit resilient economic growth. Business environment is also environment friendly. Government trade policies have made the business environment competitive and facilitate the import and export with global market. Australia has strong political and economic relationship with US, which is helpful to access large market of US. Moreover, open market of Australia makes business easier to perform including favourable tax system (Kremer & Symmons, 2015).
The economic environment of Australia is also stable for business functioning. Inflation rate in Australia stands at the historically low level, around 2%, which restricts product price to rise significantly high. As per 2015 data, Australia is one of the largest mixed market economy with GDP of AUD$1.62 trillion (data.worldbank.org, 2017). Telecommunication and mobile service industry has significant share in GDP where the entire service sector has 68% share of GDP. Free market structure of Australia has four components such as trade, manufacturing, service and financing. Therefore, Optus has ample scope to foster in the economy by increasing market share.
Employee Engagement
The social environment of Australia can be described with culturally diversified population in the country. Australian government has undertaken significant reform for greater enrolment in higher education and to develop business knowledge. Hence, Optus has opportunity to recruit high skilled labour from Australian economy. Although higher minimum wage in Australia that is AUD$17.29 per hour is costly for business, which may is the possible reason of negative impact on the prospective retail business of Optus (fairwork.gov.au, 2017). On the other hand, demand for telecommunication and mobile service is high among Australian people with the growth of the knowledge economy.
The technological factor that can affect business of Optus is progress in the R&D in Australia. There are numerous facilities available for technological up gradation in this country such as export market development grant, innovation investment fund and R&D tax incentives and others, which are beneficial for the service business of Optus (Huntley et al., 2014). The legal factor of Australian business environment includes that the business laws for telecommunication operators. The telecommunication service providers has to abide the Telecommunications Act 1997 (the Act), the Telecommunications (Consumer Protection and Service Standards) Act 1999 (the TCPSS Act) and Chapter 5 of the Telecommunications (Interception and Access) Act 1979 (the TIA Act) (acma.gov.au, 2017).
The environment impacts on the business of Optus include climate change, carbon emission, and energy consumption. Therefore, Optus needs to give first priority to these services in their business. Environment protection initiatives are parts of corporate social responsibilities of the company, which can provide competitive advantage to Optus and may be helpful to retain market share in the Australian telecom market and to win the trust of the stakeholders (Mirvis, 2012). This initiative can increases the confidence of the investors, which is helpful for the gaining more funds to invest in the business and for building infrastructure to provide better service to the customers (Kamarazaly, 2014).
The internal analysis of Optus includes SWOT analysis. Important strength of the company is low cost strategy. The company has great employee satisfaction and customer engagement policies. The company provides reliable service to the customers and have a large number of human capitals. Major weakness of the company is stagnant market share. Optus has greater opportunity to reap the benefit of technological improvement in Australian economy and to regain market share. As opined by Kremer & Symmons (2015), merger and acquisition can increase market share. Increasing competition from Telstra is the major threat for this company.
Customer Satisfaction
Employee engagement is an important part of the business strategy of Optus to fulfil the objective of retaining market share in the face of competition. Optus has taken several steps to satisfy employees, encouraging diversity in the workplace. Optus has taken initiatives of Cafe and food options to build up a little city for the Sydney employees. In order to keep team bonding, Optus managers have taken initiatives to spend time on building community. A session is arranged in order to share the view regarding company, their hobbies, and different aspects of culture. Various events are organised such as project snapshot, Yestival and rideshare programme for enjoyment of employees (Brown, 2015). All initiatives are helpful for employee satisfaction and employee engagement with the work. However, these initiatives are not enough for employee retention. As argued by Ho (2014), higher minimum wage in Australia has financial pressure on the business of Optus, this would have impact on the employment. Therefore, in the view of Truss et al. (2013), business strategy needs to be such as that can reduce overhead cost of the company as well as can bring employee retention. Reform in payroll policy and reward system is necessary for employee retention so that employees can see their career growth in this company. Satisfactory reward policy and performance based reward can reduce employee turnover.
Optus requires to consider the aspect of customer satisfaction in order to ensure sustainability of the business. The Customer Service Guarantee (CSG) Standard is monitored by the Australian Communications and Media Authority. The telephone service providers in the country require to meet the performance standard and to provide financial compensations in case of not meeting the standard. Customer satisfaction segment in this company is important as customers can provide the competitive edge to the company. The aspects that influences the customer service of Optus are call waiting, call burring, call diversion, call number display suppression and call number display (optus.com.au, 2017). These services make difference with the competitors with respect to the performance in the target market.
Conclusion
The essay has provided a clear view of the external and internal business analysis of Optus, while operating in Australia. Telecommunication and telephone service market in Australia is oligopolistic, where three major firms operate in the market. The major two competitors of Optus are Vodafone and Telstra. The objective of Optus is to enhance market share in the Australian market along with fostering retain business in the market of Smartphone. Major concern of the company has not increased for twenty years. Therefore, main focus of Optus is enhancing market share through strategic business modelling, where satisfaction of the stakeholders get first priority. The aim of the company is to enhance customer satisfaction, employee engagement, employee retention and attracting more funds by wining confidence of investors. The paper has focused on the key external and internal factors that can facilitate or detriment the business performance of Optus, have been analysed. It has been studied that Customer Service Guarantee (CSG) Standard is followed by Optus while delivering services to the customers.
References
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Optus.com.au (2017) Customer Service Guarantee. retrieved on 17 April, 2017 from https://www.optus.com.au/aboutoptus/About+Optus/Legal+&+Regulatory/Regulatory/Customer+Service+Guarantee/ci.Customer+Service+Guarantee.Print
Truss, C., Shantz, A., Soane, E., Alfes, K., & Delbridge, R. (2013). Employee engagement, organisational performance and individual well-being: exploring the evidence, developing the theory.
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