Ericsson: A telecommunications service provider
For this coursework, the company named Ericsson is chosen. Ericsson is a company that is a world leading provider of telecommunication equipment and related services for mobile and fixed network operators globally. The coursework will start with a brief description of the company presenting an overall picture of its service business in a general level. Moving further, we will consider a situation in which the company is going to start for a new venture and how will they work to achieve their new goals and objectives. Finally the work considerations of the operation manager for this new project will be analyzed and lastly the management and the main role strategies of the new operational system will be explained.
What is Ericsson?
Ericsson was established in 1876 in Stockholm with its original name as Telefonaktiebolaget LM Ericsson. The company is a leading provider of telecommunication services and equipments to the mobile and fixed line operators. Also the Ericsson also invests a lot of money every year in Research and development and also furnishes open standards and systems. Ericsson has a strong and clear customer base (Hales & Tidd, 2009). The reason for such a strong customer base is that the company always strives to provide its customers as much benefit as possible. The company maintains high customer relations for having end to end capabilities for its solutions, and it has the ambition to take end to end responsibility towards customers. Thus it would not be wrong to say that Ericsson in every sense is advanced and has more experience in the field of services in comparison to other manufacturing firms.
The company has well developed organizational structure in which the CEO and the Executive Vice President are appointed by the board of directors. The CEO after consulting the executive vice president, is responsible for the daily management. Their major tasks are to establish long-term visions, to form strategies and policies and maximize the group’s business.
The portfolio of Ericsson includes three major service areas:
Managed Services: the company for a longer period of time has been providing comprehensive managed service solutions. This service includes the outsourcing network operations.
Systems Integration: system integration is very important for every organization. The reason is that the company has to procure several equipments from different suppliers.
Consulting Services: being a telecommunication company, the company has to provide support to its customers in relation to planning, decision making etc.
Service development process
The units of Ericsson are very close to different customer markets. These units make use of various individual services, products or probably a combination of both to make proposals to the prospect (consumer). If they are successful to make a customer sign the contract, they are the main areas who are responsible for the profits to the company. Though these market units are responsible for profit and loss for each contract but the company itself is also responsible for the profit and loss for any individual product or service (cook, 1979).
Since telecommunication services are currently the need of the hour round the globe. Thus it is important for the company to make some alterations or bring some new policies so that the company could experience stable growth and higher profits. However this could be attained only by increased sales and building a strong customer base.
Today every customer all over the world wants to have something that fulfills his needs in the cheap and the best manner. And as stated earlier telecommunication service is requisite by every person as of now. Hence the Ericsson could follow a new business policy, which will result in procuring higher profits. Here we could suggest that the company should go for opting the policy of “Low-price Market Leadership”.
Telecommunication service market is a price driven market and in order to thrive in a price driven market, the company has to be a low price leader (Tyler, 1999). The company is required to offer the lowest price for the products that are of quality which results in high consumer value. Consumers always try to find which is cost effective and in that case the low price leader becomes the winner.
The low price leadership strategy is such strategy that uses technical or operational advantages to dominate in competitive pricing markets. The low price leader always competes on value not price (Ericsson, 2013). Since the Ericsson group is so experienced in the field of telecommunication, no doubt the company would be providing quality service. Thus providing the service at the lowest price is the biggest challenge posed towards the company.
However it is not important to compete on price, the company also has to compete over the quality. In case the competitor is providing a service at a cheaper rate, the customer will go towards him (Sirilli & Evangelista, 1998). However, if the quality of service provided by the competitor is not up to the mark, then there is no use of selling the service at a cheaper rate. Thus the company has to strive for high quality services.
The company can employ better equipments and machines so as to make their service better off. For instance, the basic service of telecommunication company is to provide support and network. Thus the company can employ some more better networking equipments so that the quality of the network will be at its best and the customers will enjoy using the services of the company.
Quality as mentioned above, should be placed at the top of the performance objectives. Quality is discussed largely in terms of its meaning ‘conformance’ (Slack, 2010). The quality management principles are based on the following standards:
Customer Focus: every organization is dependent on its customers. Thus it is the duty of the managers of the company to understand the current and future customer needs, should meet customer requirements and should work in order to go beyond the expectations of the customers.
Leadership: leaders are the people who make way in the organization for smooth functioning. They establish the purpose and the direction of the organization.
Involvement of people: none of the organization is able to work without the involvement of the people in the organization. People are the essence of every organization and their full involvement helps to gain benefits for the organization (ISO, 2012).
Process approach: it is easier to achieve the desired results efficiently if everything is managed as a process.
System approach: Identifying, understanding and managing interrelated processes as a system contributes to the organization’s effectiveness and efficiency in achieving its objectives.
Continual Improvement: the improvement of the organization’s overall performance should be sustainable and it should not be short term. The continual improvement should be of long term.
For every organization it is important to grow and in order to develop, it is important for the company to make frequent strategies and plans to be on the top of the industries. In our case study, the Ericsson is a world leader in providing telecommunication services to the people round the globe. But being a leader, the company has to use several strategies frequently. The reason is that the market today is very competitive. One shortcoming in the work may result in the deterioration of the position of the company. Hence here we assumed that the company is going to employ the market strategy of low price leadership. To achieve the low price leadership it is important for the company to keep its prices low but the company is not allowed to compromise with its quality. Thus the operational manager has to use the method of quality management in order to attain their objectives for the new strategy used.
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