Privatization of Anatolia National Telekom: Note on Valuation of Privatizing Enterprises in Emerging Markets SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
Strategy & Execution
Strategy / MBA Resources
Case Study SWOT Analysis Solution
Case Study Description of Privatization of Anatolia National Telekom: Note on Valuation of Privatizing Enterprises in Emerging Markets
Anatolia National Telekom is a multiparty negotiation simulation patterned after the Turkish government's aborted attempt to privatize its state-owned telecommunications monopoly, Turk Telekom, in late 1997. Provides participants with an opportunity to identify and negotiate complex issues related to the valuation and sale of a state-owned enterprise in an emerging market. Members of each negotiating team are valuing a 20% equity stake being offered by three "selling" teams to three prospective "buying" teams representing different types of foreign investors.
Authors :: Michael D. Watkins, Banu Ozcan, Burkhard Schrage, Paul Vaaler
Swot Analysis of "Privatization of Anatolia National Telekom: Note on Valuation of Privatizing Enterprises in Emerging Markets" written by Michael D. Watkins, Banu Ozcan, Burkhard Schrage, Paul Vaaler includes – strengths weakness that are internal strategic factors of the organization, and opportunities and threats that Telekom Anatolia facing as an external strategic factors. Some of the topics covered in Privatization of Anatolia National Telekom: Note on Valuation of Privatizing Enterprises in Emerging Markets case study are - Strategic Management Strategies, Economy, Emerging markets, Financial analysis, Government, Negotiations and Strategy & Execution.
Some of the macro environment factors that can be used to understand the Privatization of Anatolia National Telekom: Note on Valuation of Privatizing Enterprises in Emerging Markets casestudy better are - – talent flight as more people leaving formal jobs, banking and financial system is disrupted by Bitcoin and other crypto currencies, challanges to central banks by blockchain based private currencies, customer relationship management is fast transforming because of increasing concerns over data privacy, there is backlash against globalization, central banks are concerned over increasing inflation, digital marketing is dominated by two big players Facebook and Google,
wage bills are increasing, supply chains are disrupted by pandemic , etc
Introduction to SWOT Analysis of Privatization of Anatolia National Telekom: Note on Valuation of Privatizing Enterprises in Emerging Markets
SWOT stands for an organization’s Strengths, Weaknesses, Opportunities and Threats . At Oak Spring University , we believe that protagonist in Privatization of Anatolia National Telekom: Note on Valuation of Privatizing Enterprises in Emerging Markets case study can use SWOT analysis as a strategic management tool to assess the current internal strengths and weaknesses of the Telekom Anatolia, and to figure out the opportunities and threats in the macro environment – technological, environmental, political, economic, social, demographic, etc in which Telekom Anatolia operates in.
According to Harvard Business Review, 75% of the managers use SWOT analysis for various purposes such as – evaluating current scenario, strategic planning, new venture feasibility, personal growth goals, new market entry, Go To market strategies, portfolio management and strategic trade-off assessment, organizational restructuring, etc.
SWOT Objectives / Importance of SWOT Analysis and SWOT Matrix
SWOT analysis of Privatization of Anatolia National Telekom: Note on Valuation of Privatizing Enterprises in Emerging Markets can be done for the following purposes –
1. Strategic planning using facts provided in Privatization of Anatolia National Telekom: Note on Valuation of Privatizing Enterprises in Emerging Markets case study
2. Improving business portfolio management of Telekom Anatolia
3. Assessing feasibility of the new initiative in Strategy & Execution field.
4. Making a Strategy & Execution topic specific business decision
5. Set goals for the organization
6. Organizational restructuring of Telekom Anatolia
Strengths Privatization of Anatolia National Telekom: Note on Valuation of Privatizing Enterprises in Emerging Markets | Internal Strategic Factors
What are Strengths in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The strengths of Telekom Anatolia in Privatization of Anatolia National Telekom: Note on Valuation of Privatizing Enterprises in Emerging Markets Harvard Business Review case study are -
Successful track record of launching new products
– Telekom Anatolia has launched numerous new products in last few years, keeping in mind evolving customer preferences and competitive pressures. Telekom Anatolia has effective processes in place that helps in exploring new product needs, doing quick pilot testing, and then launching the products quickly using its extensive distribution network.
Superior customer experience
– The customer experience strategy of Telekom Anatolia in the segment is based on four key concepts – personalization, simplification of complex needs, prompt response, and continuous engagement.
Diverse revenue streams
– Telekom Anatolia is present in almost all the verticals within the industry. This has provided firm in Privatization of Anatolia National Telekom: Note on Valuation of Privatizing Enterprises in Emerging Markets case study a diverse revenue stream that has helped it to survive disruptions such as global pandemic in Covid-19, financial disruption of 2008, and supply chain disruption of 2021.
Cross disciplinary teams
– Horizontal connected teams at the Telekom Anatolia are driving operational speed, building greater agility, and keeping the organization nimble to compete with new competitors. It helps are organization to ideate new ideas, and execute them swiftly in the marketplace.
Highly skilled collaborators
– Telekom Anatolia has highly efficient outsourcing and offshoring strategy. It has resulted in greater operational flexibility and bringing down the costs in highly price sensitive segment. Secondly the value chain collaborators of the firm in Privatization of Anatolia National Telekom: Note on Valuation of Privatizing Enterprises in Emerging Markets HBR case study have helped the firm to develop new products and bring them quickly to the marketplace.
Innovation driven organization
– Telekom Anatolia is one of the most innovative firm in sector. Manager in Privatization of Anatolia National Telekom: Note on Valuation of Privatizing Enterprises in Emerging Markets Harvard Business Review case study can use Clayton Christensen Disruptive Innovation strategies to further increase the scale of innovtions in the organization.
Sustainable margins compare to other players in Strategy & Execution industry
– Privatization of Anatolia National Telekom: Note on Valuation of Privatizing Enterprises in Emerging Markets firm has clearly differentiated products in the market place. This has enabled Telekom Anatolia to fetch slight price premium compare to the competitors in the Strategy & Execution industry. The sustainable margins have also helped Telekom Anatolia to invest into research and development (R&D) and innovation.
Strong track record of project management
– Telekom Anatolia is known for sticking to its project targets. This enables the firm to manage – time, project costs, and have sustainable margins on the projects.
Effective Research and Development (R&D)
– Telekom Anatolia has innovation driven culture where significant part of the revenues are spent on the research and development activities. This has resulted in, as mentioned in case study Privatization of Anatolia National Telekom: Note on Valuation of Privatizing Enterprises in Emerging Markets - staying ahead in the industry in terms of – new product launches, superior customer experience, highly competitive pricing strategies, and great returns to the shareholders.
High switching costs
– The high switching costs that Telekom Anatolia has built up over years in its products and services combo offer has resulted in high retention of customers, lower marketing costs, and greater ability of the firm to focus on its customers.
Analytics focus
– Telekom Anatolia is putting a lot of focus on utilizing the power of analytics in business decision making. This has put it among the leading players in the industry. The technology infrastructure suggested by Michael D. Watkins, Banu Ozcan, Burkhard Schrage, Paul Vaaler can also help it to harness the power of analytics for – marketing optimization, demand forecasting, customer relationship management, inventory management, information sharing across the value chain etc.
High brand equity
– Telekom Anatolia has strong brand awareness and brand recognition among both - the exiting customers and potential new customers. Strong brand equity has enabled Telekom Anatolia to keep acquiring new customers and building profitable relationship with both the new and loyal customers.
Weaknesses Privatization of Anatolia National Telekom: Note on Valuation of Privatizing Enterprises in Emerging Markets | Internal Strategic Factors
What are Weaknesses in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The weaknesses of Privatization of Anatolia National Telekom: Note on Valuation of Privatizing Enterprises in Emerging Markets are -
Lack of clear differentiation of Telekom Anatolia products
– To increase the profitability and margins on the products, Telekom Anatolia needs to provide more differentiated products than what it is currently offering in the marketplace.
Employees’ incomplete understanding of strategy
– From the instances in the HBR case study Privatization of Anatolia National Telekom: Note on Valuation of Privatizing Enterprises in Emerging Markets, it seems that the employees of Telekom Anatolia don’t have comprehensive understanding of the firm’s strategy. This is reflected in number of promotional campaigns over the last few years that had mixed messaging and competing priorities. Some of the strategic activities and services promoted in the promotional campaigns were not consistent with the organization’s strategy.
High bargaining power of channel partners
– Because of the regulatory requirements, Michael D. Watkins, Banu Ozcan, Burkhard Schrage, Paul Vaaler suggests that, Telekom Anatolia is facing high bargaining power of the channel partners. So far it has not able to streamline the operations to reduce the bargaining power of the value chain partners in the industry.
High cash cycle compare to competitors
Telekom Anatolia has a high cash cycle compare to other players in the industry. It needs to shorten the cash cycle by 12% to be more competitive in the marketplace, reduce inventory costs, and be more profitable.
Aligning sales with marketing
– It come across in the case study Privatization of Anatolia National Telekom: Note on Valuation of Privatizing Enterprises in Emerging Markets that the firm needs to have more collaboration between its sales team and marketing team. Sales professionals in the industry have deep experience in developing customer relationships. Marketing department in the case Privatization of Anatolia National Telekom: Note on Valuation of Privatizing Enterprises in Emerging Markets can leverage the sales team experience to cultivate customer relationships as Telekom Anatolia is planning to shift buying processes online.
Ability to respond to the competition
– As the decision making is very deliberative, highlighted in the case study Privatization of Anatolia National Telekom: Note on Valuation of Privatizing Enterprises in Emerging Markets, in the dynamic environment Telekom Anatolia has struggled to respond to the nimble upstart competition. Telekom Anatolia has reasonably good record with similar level competitors but it has struggled with new entrants taking away niches of its business.
Increasing silos among functional specialists
– The organizational structure of Telekom Anatolia is dominated by functional specialists. It is not different from other players in the Strategy & Execution segment. Telekom Anatolia needs to de-silo the office environment to harness the true potential of its workforce. Secondly the de-silo will also help Telekom Anatolia to focus more on services rather than just following the product oriented approach.
Capital Spending Reduction
– Even during the low interest decade, Telekom Anatolia has not been able to do capital spending to the tune of the competition. This has resulted into fewer innovations and company facing stiff competition from both existing competitors and new entrants who are disrupting the industry using digital technology.
Products dominated business model
– Even though Telekom Anatolia has some of the most successful products in the industry, this business model has made each new product launch extremely critical for continuous financial growth of the organization. firm in the HBR case study - Privatization of Anatolia National Telekom: Note on Valuation of Privatizing Enterprises in Emerging Markets should strive to include more intangible value offerings along with its core products and services.
Skills based hiring
– The stress on hiring functional specialists at Telekom Anatolia has created an environment where the organization is dominated by functional specialists rather than management generalist. This has resulted into product oriented approach rather than marketing oriented approach or consumers oriented approach.
Workers concerns about automation
– As automation is fast increasing in the segment, Telekom Anatolia needs to come up with a strategy to reduce the workers concern regarding automation. Without a clear strategy, it could lead to disruption and uncertainty within the organization.
Opportunities Privatization of Anatolia National Telekom: Note on Valuation of Privatizing Enterprises in Emerging Markets | External Strategic Factors
What are Opportunities in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The opportunities highlighted in the Harvard Business Review case study Privatization of Anatolia National Telekom: Note on Valuation of Privatizing Enterprises in Emerging Markets are -
Harnessing reconfiguration of the global supply chains
– As the trade war between US and China heats up in the coming years, Telekom Anatolia can build a diversified supply chain model across various countries in - South East Asia, India, and other parts of the world. This reconfiguration of global supply chain can help, as suggested in case study, Privatization of Anatolia National Telekom: Note on Valuation of Privatizing Enterprises in Emerging Markets, to buy more products closer to the markets, and it can leverage its size and influence to get better deal from the local markets.
Buying journey improvements
– Telekom Anatolia can improve the customer journey of consumers in the industry by using analytics and artificial intelligence. Privatization of Anatolia National Telekom: Note on Valuation of Privatizing Enterprises in Emerging Markets suggest that firm can provide automated chats to help consumers solve their own problems, provide online suggestions to get maximum out of the products and services, and help consumers to build a community where they can interact with each other to develop new features and uses.
Reforming the budgeting process
- By establishing new metrics that will be used to evaluate both existing and potential projects Telekom Anatolia can not only reduce the costs of the project but also help it in integrating the projects with other processes within the organization.
Reconfiguring business model
– The expansion of digital payment system, the bringing down of international transactions costs using Bitcoin and other blockchain based currencies, etc can help Telekom Anatolia to reconfigure its entire business model. For example it can used blockchain based technologies to reduce piracy of its products in the big markets such as China. Secondly it can use the popularity of e-commerce in various developing markets to build a Direct to Customer business model rather than the current Channel Heavy distribution network.
Low interest rates
– Even though inflation is raising its head in most developed economies, Telekom Anatolia can still utilize the low interest rates to borrow money for capital investment. Secondly it can also use the increase of government spending in infrastructure projects to get new business.
Redefining models of collaboration and team work
– As explained in the weaknesses section, Telekom Anatolia is facing challenges because of the dominance of functional experts in the organization. Privatization of Anatolia National Telekom: Note on Valuation of Privatizing Enterprises in Emerging Markets case study suggests that firm can utilize new technology to build more coordinated teams and streamline operations and communications using tools such as CAD, Zoom, etc.
Developing new processes and practices
– Telekom Anatolia can develop new processes and procedures in Strategy & Execution industry using technology such as automation using artificial intelligence, real time transportation and products tracking, 3D modeling for concept development and new products pilot testing etc.
Changes in consumer behavior post Covid-19
– Consumer behavior has changed in the Strategy & Execution industry because of Covid-19 restrictions. Some of this behavior will stay once things get back to normal. Telekom Anatolia can take advantage of these changes in consumer behavior to build a far more efficient business model. For example consumer regular ordering of products can reduce both last mile delivery costs and market penetration costs. Telekom Anatolia can further use this consumer data to build better customer loyalty, provide better products and service collection, and improve the value proposition in inflationary times.
Finding new ways to collaborate
– Covid-19 has not only transformed business models of companies in Strategy & Execution industry, but it has also influenced the consumer preferences. Telekom Anatolia can tie-up with other value chain partners to explore new opportunities regarding meeting customer demands and building a rewarding and engaging relationship.
Use of Bitcoin and other crypto currencies for transactions
– The popularity of Bitcoin and other crypto currencies as asset class and medium of transaction has opened new opportunities for Telekom Anatolia in the consumer business. Now Telekom Anatolia can target international markets with far fewer capital restrictions requirements than the existing system.
Increase in government spending
– As the United States and other governments are increasing social spending and infrastructure spending to build economies post Covid-19, Telekom Anatolia can use these opportunities to build new business models that can help the communities that Telekom Anatolia operates in. Secondly it can use opportunities from government spending in Strategy & Execution sector.
Identify volunteer opportunities
– Covid-19 has impacted working population in two ways – it has led to people soul searching about their professional choices, resulting in mass resignation. Secondly it has encouraged people to do things that they are passionate about. This has opened opportunities for businesses to build volunteer oriented socially driven projects. Telekom Anatolia can explore opportunities that can attract volunteers and are consistent with its mission and vision.
Building a culture of innovation
– managers at Telekom Anatolia can make experimentation a productive activity and build a culture of innovation using approaches such as – mining transaction data, A/B testing of websites and selling platforms, engaging potential customers over various needs, and building on small ideas in the Strategy & Execution segment.
Threats Privatization of Anatolia National Telekom: Note on Valuation of Privatizing Enterprises in Emerging Markets External Strategic Factors
What are Threats in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The threats mentioned in the HBR case study Privatization of Anatolia National Telekom: Note on Valuation of Privatizing Enterprises in Emerging Markets are -
Learning curve for new practices
– As the technology based on artificial intelligence and machine learning platform is getting complex, as highlighted in case study Privatization of Anatolia National Telekom: Note on Valuation of Privatizing Enterprises in Emerging Markets, Telekom Anatolia may face longer learning curve for training and development of existing employees. This can open space for more nimble competitors in the field of Strategy & Execution .
Increasing international competition and downward pressure on margins
– Apart from technology driven competitive advantage dilution, Telekom Anatolia can face downward pressure on margins from increasing competition from international players. The international players have stable revenue in their home market and can use those resources to penetrate prominent markets illustrated in HBR case study Privatization of Anatolia National Telekom: Note on Valuation of Privatizing Enterprises in Emerging Markets .
Environmental challenges
– Telekom Anatolia needs to have a robust strategy against the disruptions arising from climate change and energy requirements. EU has identified it as key priority area and spending 30% of its 880 billion Euros European post Covid-19 recovery funds on green technology. Telekom Anatolia can take advantage of this fund but it will also bring new competitors in the Strategy & Execution industry.
Shortening product life cycle
– it is one of the major threat that Telekom Anatolia is facing in Strategy & Execution sector. It can lead to higher research and development costs, higher marketing expenses, lower customer loyalty, etc.
High dependence on third party suppliers
– Telekom Anatolia high dependence on third party suppliers can disrupt its processes and delivery mechanism. For example -the current troubles of car makers because of chip shortage is because the chip companies started producing chips for electronic companies rather than car manufacturers.
Consumer confidence and its impact on Telekom Anatolia demand
– There is a high probability of declining consumer confidence, given – high inflammation rate, rise of gig economy, lower job stability, increasing cost of living, higher interest rates, and aging demography. All the factors contribute to people saving higher rate of their income, resulting in lower consumer demand in the industry and other sectors.
Technology acceleration in Forth Industrial Revolution
– Telekom Anatolia has witnessed rapid integration of technology during Covid-19 in the Strategy & Execution industry. As one of the leading players in the industry, Telekom Anatolia needs to keep up with the evolution of technology in the Strategy & Execution sector. According to Mckinsey study top managers believe that the adoption of technology in operations, communications is 20-25 times faster than what they planned in the beginning of 2019.
High level of anxiety and lack of motivation
– the Great Resignation in United States is the sign of broader dissatisfaction among the workforce in United States. Telekom Anatolia needs to understand the core reasons impacting the Strategy & Execution industry. This will help it in building a better workplace.
Barriers of entry lowering
– As technology is more democratized, the barriers to entry in the industry are lowering. It can presents Telekom Anatolia with greater competitive threats in the near to medium future. Secondly it will also put downward pressure on pricing throughout the sector.
Aging population
– As the populations of most advanced economies are aging, it will lead to high social security costs, higher savings among population, and lower demand for goods and services in the economy. The household savings in US, France, UK, Germany, and Japan are growing faster than predicted because of uncertainty caused by pandemic.
Increasing wage structure of Telekom Anatolia
– Post Covid-19 there is a sharp increase in the wages especially in the jobs that require interaction with people. The increasing wages can put downward pressure on the margins of Telekom Anatolia.
Trade war between China and United States
– The trade war between two of the biggest economies can hugely impact the opportunities for Telekom Anatolia in the Strategy & Execution industry. The Strategy & Execution industry is already at various protected from local competition in China, with the rise of trade war the protection levels may go up. This presents a clear threat of current business model in Chinese market.
New competition
– After the dotcom bust of 2001, financial crisis of 2008-09, the business formation in US economy had declined. But in 2020 alone, there are more than 1.5 million new business applications in United States. This can lead to greater competition for Telekom Anatolia in the Strategy & Execution sector and impact the bottomline of the organization.
Weighted SWOT Analysis of Privatization of Anatolia National Telekom: Note on Valuation of Privatizing Enterprises in Emerging Markets Template, Example
Not all factors mentioned under the Strengths, Weakness, Opportunities, and Threats quadrants in the SWOT Analysis are equal. Managers in the HBR case study Privatization of Anatolia National Telekom: Note on Valuation of Privatizing Enterprises in Emerging Markets needs to zero down on the relative importance of each factor mentioned in the Strengths, Weakness, Opportunities, and Threats quadrants.
We can provide the relative importance to each factor by assigning relative weights. Weighted SWOT analysis process is a three stage process –
First stage for doing weighted SWOT analysis of the case study Privatization of Anatolia National Telekom: Note on Valuation of Privatizing Enterprises in Emerging Markets is to rank the strengths and weaknesses of the organization. This will help you to assess the most important strengths and weaknesses of the firm and which one of the strengths and weaknesses mentioned in the initial lists are marginal and can be left out.
Second stage for conducting weighted SWOT analysis of the Harvard case study Privatization of Anatolia National Telekom: Note on Valuation of Privatizing Enterprises in Emerging Markets is to give probabilities to the external strategic factors thus better understanding the opportunities and threats arising out of macro environment changes and developments.
Third stage of constructing weighted SWOT analysis of Privatization of Anatolia National Telekom: Note on Valuation of Privatizing Enterprises in Emerging Markets is to provide strategic recommendations includes – joining likelihood of external strategic factors such as opportunities and threats to the internal strategic factors – strengths and weaknesses. You should start with external factors as they will provide the direction of the overall industry. Secondly by joining probabilities with internal strategic factors can help the company not only strategic fit but also the most probably strategic trade-off that Telekom Anatolia needs to make to build a sustainable competitive advantage.
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