Strategic Analysis for Rogers Communications

STRATEGIC ANALYSIS FOR ROGERS COMMUNICATION 39

StrategicAnalysis for Rogers Communications

CompanyOverview

RogersCommunications describes a diversified Canadian public company thatdeals with communications and media. The company operates in the areaof cable television, wireless communications, internet connectivity,and telephone. Besides, the company has mass media andtelecommunications assets (Rogers Communications Inc., 2006).Established in 1960, the company is one of Canada’s leadingcompanies in the wireless industry. The company has its headquartersin Toronto. The chief rival company of Rogers Communication is BellCanada. The company is also in competition with other entities in thewireless industry. The following is a table depicting customers ofthe company in thousands (Hasselt,2007).

Historyof the Company

RogersSr. became the first inventor of alternating current for a radio tubein 1925. This helped in powering of radios through the ordinaryhousehold current. This entailed a breakthrough in technology and akey aspect in popularizing the reception of radio. It was after thisinvention that Rogers Sr. founded the Rogers Vacuum Tube Company inthe same year. In 1961, the company changed its name to Rogers RadioBroadcasting after Rogers’ son took over the company and afteracquiring CHFI and Aldred-Rogers broadcasting. In 1967, Aldred becamebought by Rogers and the name of the entity changed to RogersCablesystems. Later, the company became transformed and took over thename Rogers communications in 1986 (Hasselt,2007). The company has been in the frontline in adopting emergingtechnologies currently, it has gone beyond the wirelesscommunication.

Thefollowing is a table showing the products and services that RogersCommunications deals with

Product/ Service

Details

Wireless

Rogers Communications emerges as the Canada’s leading wireless voice &amp data communications service company, having above 9 million customers under the Fido, Rogers Wireless and chatr brands.

Media

The company leads in television and radio broadcasting, digital media properties, publishing, and sport entertainment.

Cable

It is the leading Canadian provider of cable services. It offers cable television, telephony products, and high speed internet access. The company covers around 3.8 million homes in New Brunswick, Newfoundland, and in Ontario.

Business Solutions

The company provides data networking, Internet Protocol, and business telecom solutions to vast, medium, and small enterprises, career market segments and the public sector.

MissionStatement

Themission of the company is ensuring that its customers stay motivated,informed and in touch with the company’s advanced networks,technologically advanced communication services, and powerhouse mediabrands.

Vision&amp Strategy

Thevision of the company entails to be recognized for leading thedelivery and enablement of flawless, customer-driven communications,transactional experiences, information, and entertainment across anyplace, device, or time. This vision is gsuided by the following longterm strategic objectives

Deliveryof Differentiated End-To-End Customer Experiences

Thecompany focuses on evolving its cross-device integration infacilitating flawless, reliable and easy to use experiences atanyplace, anytime and anywhere through delivering a differentiatedassortment of devices and device-related services. Besides, thecompany focuses on facilitating a greater integration of its mediaassets across screens.

Strengtheningthe Customer Experience

Thecompany is focused on constantly enhancing the experience, whichcustomers have through using its services and products. This is madefeasible through the company making it easier for customers to useits services and products. Besides, the customers’ experience isstrengthened by the company through the company providing tools andresources that customers need in using the products of the companywith confidence. Furthermore, in an attempt to strengthen thecustomers’ experience, the company focuses on being attuned tossthe evolving needs of its customers and continuing the simplificationof the company’s product offerings.

ImprovingProductivity and Cost Structure

Thecompany continues to focus on initiatives that are cost-optimizingand those that lead to the organizational efficiency. The companytargets to realize this through enhancing service delivery,mitigating complexities, managing expenses, working more closely withprimary suppliers, and focusing on fewer, more impactful projects.

DrivingFuture Growth Opportunities

Thecompany continues to create targeted fresh growth areas of itsbusiness, including mobile commerce and video, machine-to-machinecommunications, business communication services, sports, homeautomation, and digital media services.

MaintainingIndustry-Leading Networks

Thecompany looks forward to maintain these networks through reinforcingits fastest and most reliable networks. This is through expanding thecompany’s LTE network to a broader proportion of the Canadianpopulation, enhancing the company’s TV platform with the nextgeneration attributes and functionality, and continuing to augmentbroadband internet speeds.

Expandingthe Service Reach

Thecompany focuses on expanding the reach of its networks and servicesthrough fresh construction and targeted acquisition, whichcomplements the company’s existing platforms. This can be attainedthrough a more broad deployment of services and products and throughexpanding the reach of primary media brands nationally and across thecompany’s digital platforms.

ExternalEnvironmental Analysis

PESTAnalysis

PoliticalFactors

Thepolitical factors concern how and the degree of the governmentintervention in the economy. It entails political stability, orinstability, government policy, tax policy, environmental law, andlabor law amongst others. The Canadian political environment isexceedingly stable, which provides a favorable environment for RogersCommunications. On the other hand, the government policy in Canada isfavorable towards the growth of the broadcasting industry. Thisencourages and supports the existence of the Rogers Communication.

EconomicalFactors

Theeconomic factors are exceedingly critical in determining the mannerin which a given organization will perform in a country. Take, forinstance, in times of recession or hyperinflation, there is aprobability of an organization not performing well since there is alikelihood of prices increasing due to high interest rates and highrates of inflation. Therefore, the performance of an economy isexceedingly vital for the performance of an organization in theeconomy. The Canadian economy is one of the strongest economies isthe world. Since the economic performance of Canada is good, itimplies that Rogers Communications has the capacity of realizingsuccess. Therefore, the economic factors surrounding RogersCommunications provide an excellent environment for the company’sperformance.

SocialFactors

Socialfactors such as the population growth are critical in determining theexistence of an organization in a country since it is these factorsthat determine the availability of customers. The Canadian market hasa well distributed population that has varied likes for the productsand services of Rogers Communications. This offers the company ademand drive for its services and products. This implies that thesocial factors in Canada support the existence of RogersCommunication.

LegalFactors

Thelegal factors are exceedingly critical in determining the continuityof a business. For instance, an organization that does not respectconsumer rights, it is likely to face closure depending on the legalframework. The legal framework may be against the set up of certainbusinesses, which may determine the availability of the givenbusiness. The legal framework in Canada supports the establishment ofthe broadcasting industry, which implies that the legal framework inCanada supports Rogers Communications.

TechnologicalFactors

Technologyis critical in determining the services and products that anorganization presents in the market. Besides, technology issignificant in the production process since it influences the demandfor services and products. Therefore, an organization that appliestechnology in its production is likely to increase the demand for itsservices and products. Rogers Communications applies technology inits production, which is an indication that it is likely to have aproductive existence due to technology.

Oneof the macroeconomic trends that the Rogers Communications hasexperienced entails the increase in the adoption and use oftechnology within the country. The expansion of technology within thecountry has led to the expansion of the company’s LTE footprint(Holmanet al, 2000). This has provided the company with the capacity tooffer superior connectivity to its customers, which is critical inenhancing the company’s performance. Another macroeconomic trendentails the increased use of the internet in the businessenvironment. This has increased the demand for connectivity from theRogers Communications, which has enhanced the performance of theorganization. On the other hand, the increased use of the internet byindividuals has also increased immensely, leading to enhancedperformance of the organization.

FutureOriented 5-Forces Analysis

Thefollowing is a 5-forces analysis of the wireless communicationsindustry in Canada.

  1. Threat of New Entrants

Thethreat of new entrants to the industry is weak to medium. Thebarriers to entry in the industry are marked by various factors. Oneof the factors is high competitive concentration this industry isusually characterized by an exceedingly high competitiveconcentration. Noteworthy consolidation has taken place since thewireless communications came to gain momentum in Canada in the 90’s.The industry commenced with more than 15 regional providers in theearly 90’s however, the industry had shrunk to five nationalproviders by the start of the next century. Further consolidationoccurred with Rogers purchasing Microcell, which made Rogers theleading wireless carrier in Canada. The consolidation and highcompetitive concentration have had an effect of declining rivalry inthe wireless industry and developing a meager number of vastcompetitors. Brand equity is another factor affecting the entry intothe wireless industry. There are only three wireless providers in thenation, which implies that the brand equity has benefited the firmsin the industry since it helps in keeping unknown firms away from theindustry. In brand equity, Rogers Communications has been in aposition to maintain consistent brand equity across the nation. Brandequity is a significant aspect, when the products in the industry arehomogenous in nature. The well developed brand equity of the threemain wireless firms in Canada is perceived to mitigate the threat ofentry. Strategic partnerships are also another key factor leading tobarrier to entry into the wireless industry. The presence of thestrategic partnerships has an impact of mitigating the threat ofentry into the industry since they permit each of the incumbents totake advantage of the capabilities and size of the other partners.Thus, new entrants will not have this advantage unless they becomegranted membership into the existing memberships, or else have thecapacity to immediately create their own. Therefore, the strategicpartnerships available in the industry are a threat to entry of firmsinto the industry.

Technologicalinnovation is taking place all the time in the industry. Forinstance, the development of EVDO technology implies that noteworthyamounts of data can be delivered to the wireless handsets. It isthrough such technology that the door for a wireless television hasbeen opened. New technology is only available to existingcompetitors, but not to new entrants into the industry. This impliesthat new entrants into the industry do not have this advantage.Technological innovations may impact entry into the industry, but theavailability of WiMAX or Wi-Fi networks can significantly mitigatethe cost of developing wireless communications coverage. Thepotential for Wi-Fi and WiMAX IP phone technology is perceived toincrease the threat of entry from new competition. Nevertheless,there are technological limitations to Wi-Fi and WiMAX that limittheir potential of challenging the existing functionality of thepresent wireless networks. Wi-Fi has a limitation in signal securityand strength while the WiMAX has a limited mobility. The significanceof these technologies in lowering barriers to entry will usuallydepend upon their ability to overcome their limitations and thesubsequent degree of adoption in the industry.

Onthe other hand, there is low wireless penetration, which is a signalthat there exists growth potential for the wireless market (Holmanet al, 2000). The growth opportunity serves to augment the threat ofentry into the industry. This would be analogous to an industryhaving few competitors producing noteworthy rents sending a signal tofresh competitors that an opportunity awaits them. The degree overwhich the low penetration impacts the threat of entry is directlydependent on why Canada lags behind the other developed world interms of user adoption. In case it is due to a function of time, thenthere is a speculation that market growth will finally reachsaturation. However, the low degree of penetration may be due to thereasoning that mobility is not of significance as price to someindividuals. As such, the current, low cost and reliable wire-linecommunications present in Canada have probably affected upon theobserved degree of wireless penetration. The penetration rates areprojected to grow, but will not be significant to signal giganticprofit potential for new entrants. This is true if the costs ofoperating networks are noteworthy to the revenue generationpotential. The low market penetration is usually considered to have aweak to moderate effect on lowering barriers to entry.

Highcapital costs are also another factor contributing to the barrier toentry. According to the nature of the wireless technology,significant capital outlay is needed in getting into the serviceprovider business. The vast amount of capital needed in building acompetitive network significantly mitigates the threat of entry. Anew entrant will need to capture sufficient market share ingenerating the revenues needed in supporting the building of acompletely new network. Considering the homogenous nature of theproducts in the wireless industry, it is improbable that a newentrant would capture sufficient market share in order to besuccessful with the existing technology. The new entrant would needto compete on price resulting in mitigated profits, which will makethe industry less attractive to the new entrants. However, this islikely to change in the future, when convergence to a single networkplatform occurs this could mitigate capital costs of developing anetwork. Besides, high fixed costs entail another factor that maylead to barrier to entry into the industry. The Canadian wirelessindustry is usually characterized by high fixed costs (Holmanet al, 2000). This cost mainly includes the cost of operating andmaintaining an extensive wireless network.

Inaddition, high exits costs and large economies of scale alsocontribute to barriers to new entrants into the wireless industry.Costs of exiting the wireless industry are probably quite high. Inorder to be a wireless provider, other than an MVNO, it is arequirement to invest a noteworthy amount of capital in expensive andhighly specialized equipment. In case a competitor desires to exitthe wireless industry, it would be exceedingly cumbersome to sell theequipment to other industries. The high exit costs will likely causea firm to stay in the industry and continue competing even when theoperations are not profitable. This decreases the threat of entry inthe wireless industry. On the other hand, enormous economies of scaleexist in the Canadian wireless industry. With these economies ofscale, the cost of adding a customer is incremental to the entirecapital investment. The large economies of scale minimize the threatof entry significantly from new competitors.

  1. Bargaining Power of Customers

Inthe wireless industry, the market is impacted by the nature ofservices and products offered, distribution of customers, theirdegree of switching from one competitor to the other, and thecompetitors in the industry. In this industry, the bargaining powerof customers is medium to high. This has been affected by homogenousproducts, low-cost, reliable wire-line services, high switching cost,high competitive concentration, and diffuse buyer concentration.

HomogenousProducts

Becauseof the homogenous nature of the wireless products offerings, thebargaining power of consumers is increased. This suggests thatservices can become commoditized in the future. This is especiallytrue for new consumers that are yet to enter into the wirelessmarket. Having little to differentiate one product from another, aneducated consumer can try to lure the providers into pricecompetition through playing one off of the other while seeking thebest deal. Besides, the homogenous nature of products may contributeto the exceedingly low churn rates, which are characteristic of theCanadian wireless market. As new technology becomes implemented,consumer choice is significantly increased, which leads to anincrease in the bargaining power.

Low-cost,Reliable Wire-line Services

Sincecheap and reliable wire-line services are available to moreindividuals than more expensive wireless services, customerbargaining power is increased. This is especially in case customersdo not value the convenience of mobility over that of low cost.

HighSwitching Cost

Theswitching cost of a customer from one service provider to another isquite high. CDMA and GSM handsets are not compatible, which impliesthat switching amid Rogers and Bell requires the purchasing of a newhandset. Significant switching costs have an effect of mitigating thebargaining power of the consumer, especially for those already buyingservice from a provider. However, the wireless number portabilityhave an impact of increasing the customers’ bargaining power.

HighCompetitive Concentration

Thepresent selection of national Canadian wireless providers is usuallylimited, with each of the three main competitors having a minimum of30% of the market by revenue. The high competitive concentrationlimits the bargaining power of the consumer significantly. Because ofthe few number of competitors, consumers will have limited choice.Besides, the limited number of competitors permits the firms to takethe position of price setters instead of price takers.

DiffuseBuyer Concentration

Diffusebuyer concentration limits the consumers’ bargaining power.Customers in the Canadian wireless market are represented by privateresidential users or business they are not geographicallycentralized or organized. Rather, they are spread out across thenation as well as across varied industries and demographics. Thediffuse nature of the customer base makes it cumbersome for them toexert pressure or advocate change on competitors on lowering pricesor improving service. As a consequence, consumer bargaining power ismitigated. Besides, as the degree of wireless subscriber penetrationrises, buyer concentration becomes diluted further, leading to evensless bargaining power.

  1. Threat of Substitutes

Inthe Canadian wireless industry, the threat of substitutes is medium.This is influenced by the nature of the existing traditional servicesand technological innovations. Currently, there are limitedsubstitutes for wireless communications. Nevertheless, technologicalinnovation can provide a substitute. Older technologies for example,wire-line can be considered as a substitute, but they are not idealby considering the omnipresent nature of cellular communication inservice areas.

  1. Bargaining Power of Suppliers

Thebargaining power of suppliers is weak to medium in the wirelessindustry. The bargaining power of suppliers is influenced by thelabors environment, capital markets, and low to moderate equipmentsupplier concentration.

LaborEnvironment

Thelevel of unionization in the wireless industry serves to augment thebargaining power of suppliers. Unions usually offer a strong voicefor labor supply and give them the power of bargaining for betterwages, working conditions and benefits. Besides, organized laboroffers power since services can be withheld from employers throughtaking strike action. Nevertheless, in case union leadership isdisorganized or management is well prepared, the effects of laboraction can be mitigated. Newly, highly skilled workers may be capableof exercising a certain amount of supplier power in the future incase there is demand for their capabilities.

CapitalMarkets

Thebargaining power of suppliers is augmented by the capacity of capitalmarkets of dictating terms to service providers. Bond ratingagencies like Moody’s and Standard and Poor’s are particularlycommanding. The three main firms in the industry have experienceddowngrades, which have indicated the power held by the capitalmarkets.

Lowto Moderate Equipment Supplier Concentration

Equipmentsuppliers to the wireless industry are moderately numerous comparedto the number of service providers. Usually, a low to moderateequipment supplier concentration limits the bargaining power ofsuppliers since numerous suppliers will usually lead to competitionon price because the products are moderately homogenous. As such, theservice providers have several product suppliers to choose from andmay switch from one supplier to the other in an exceedingly easymanner. This has an effect of limiting the supplier bargaining power.On the other hand, lack of supplier bargaining power in this marketcan be provided by the reasoning that service providers are capableof re-branding the equipment with their names or logos, even if theyhave not manufactured the equipment. It is apparent that theprovider’s brand name is more critical in the Canadian wirelessmarket than that of the manufacturer.

  1. Rivalry Among existing Competitors

Intackling rivalry amid existing competitors in the industry, threemain firms will be considered (Rogers, Telus and Bell). On the otherhand, different key success factors will be considered these willinclude size, access to capital, bundling, technological adoption,brand equity, reputation, margins, strategic partnerships, attractingnew customers, spectrum utilization, and keeping customers. Every keysuccessful factor has been weighed in terms of their importance. Thefollowing table shows the ranks for key successful factors for thethree main firms. These key successful factors have been identifiedto affect rivalry and as sources of competitive advantage.

Key Successful Factor

Weight

Rogers

Bell

Telus

Size

3

9

9

3

Access to capital

2

2

4

4

Bundling

3

9

6

6

Technological Adoption

3

6

6

6

Reputation

1

1

2

3

Brand Equity

3

9

9

6

Strategic Partnerships

3

9

9

9

Attracting new customers

3

6

6

9

Margin

2

2

4

6

Keeping customers

3

6

9

9

Spectrum utilization

1

3

3

1

Size

Giventhat every firm has developed the required network in servicing thevast majority of the Canadian subscribers, none of the firms has beenin a position to create a competitive advantage over others wheretheir network is concerned. Rogers Communication has a sizeadvantage.

Accessto Capital

Thissuccess factor has been considered as a relatively significant factorin the success of the firms. Without sufficient funding, the firmswill not be capable of upgrading their networks or keeping pace withtheir competitors as they implement new technology. According toStandard &amp Poor’s ratings, Telus and Bell can be considered tohave investment grade while Rogers would not.

TechnologicalAdoption

Allthe three main wireless firms have taken the significant andnecessary steps in investing in new technology so as to staycompetitive. Rogers and Bell have an advantage over Telus due totheir WiMAX partnership.

Bundling

Thethree firms offer different bundled packages of service to consumers.Bundling is considered of high importance as it offers a mechanismthrough which firms can produce significantly more ARPU and it givesan opportunity for differentiation. However, Rogers has an advantagesince they represent the only true quadruple play provider becausethey can bundle internet, wireless, and telephony.

BrandEquity

Thisis considered to be of moderately high importance. Because of thehomogenous nature of the product offerings from the competitors inthe wireless industry, value of the brand is usually considered asone of the tools for differentiation. Each firm has developed equityin their brand in their home markets before they launched wirelessservices and have maintained the equity. Rogers consistently capturesaround 40% of market share regardless of the province.

Reputation

Reputationis considered to be of relatively importance because it is perceivedthat fewer customers will identify with a firm’s corporatereputation than it will with its branding. Rogers Communicationsranks high in reputation, which is apparent from its corporate socialresponsibility reports.

StrategicPartnerships

Thesepartnerships are considered to be of medium importance due to thecapacity of leveraging other firm’s chief competencies in thesesituations. All the three companies have entered into strategicpartnerships of different types. Because of the different strategicpartnerships that the three companies have, they attained the samescore for strategic partnerships.

Margin

Margincan be considered as an essential aspect since it determines thecompetition that a firm is capable of presenting, when placed amongother firms. The earnings of the company’s in the market usuallydetermine the margin. Comparing the three firms, Rogers is placed atan exceedingly competitive position due to its margin.

AttractingNew Customers

Thecapacity of attracting new customers is considered a key element ofsucceeding in the Canadian wireless industry. Without attractingcustomers, sources of fresh revenues would be limited. As depicted,all the three rivals attract new customers but they do not have asimilar ratio in attracting customers. Of the three firms, RogersCommunications have the vast capacity of attracting new customers.This shows the capacity of Rogers Communications in attracting newrevenues.

KeepingCustomers

Thecapacity of keeping existing customers is considered of importance inattaining success in the Canadian wireless industry. Keeping theexisting customers is a critical aspect since it ensures that anorganization maintains its revenues. Therefore, keeping customersemerges as a key success factor that organizations need to consider.All the firms in the industry seem to keep customers as a way ofmaintaining their performance in the industry.

SpectrumUtilization

Inthis analysis, spectrum utilization is considered of moderately lowsignificance when compared to other key success factors. Althoughunused spectrum does not create revenue, it would be available to thecarrier in the future in case it is needed. In the spectrumutilization, Rogers Communications emerges the second from Bells fromthe three rivals in the wireless industry.

InternalEnvironment

ValueChain Analysis

Valuechain for the Rogers Communications will entail the followingelements

  1. Software and Applications development

Beforebeing offered for sale, most wireless software and applicationsdevelopment is usually done for Rogers by the handset manufacturershowever, sometimes, it may be done by their subcontractors. On theother hand, Rogers has also developed some of its own wirelessapplications, especially in the business market. By considering thehomogenous characteristic of the present products provided bycompetitors in the wireless market, the best alternative ofdeveloping a competitive advantage over competitors is coming up withfresh and innovative ways of utilizing the same equipment. Consumermarket applications are limited because of relatively simple ideassuch as Push-to-Talk, combination of voice and web-browser functions,and wireless television. In partnership with competitors,developments have emerged in thea wireless payment services.Competitive advantage is likely to emerge from how each of thecompetitors utilizes the applications and how thriving they are indoing marketing to customers. Besides, competitive advantage could beenhanced through Research &amp Development expenditure. Presently, R&amp D expenditure is usually related to the equipment manufacturersrather than the service provider. Therefore, there is a need ofassociating the Rogers Communications with the R&ampD expenditure,in the future, as a way of enhancing the competitive advantage of thecompany. Therefore, in the software and applications development, keysuccess factors that the organization should focus on entailsdeveloping strategic partnerships anad bundling.

  1. Content Providers and Developers

RogersCommunication, as a service provider, provides exceedingly meager ifany of its own content. Most of the content is usually provided bymusic entertainment companies, game manufacturers, ring-tonedevelopers and television programmers. The service that Rogersprovides is usually the facilitation of access to the content thathas been developed by others. However, an area of differentiation maybe the development of associations with content providers, whichinvolve some aspect of exclusivity. Therefore, in order to develop akey success factor in this area, Rogers Communications will need tocreate and strengthen strategic partnerships with content providers.This will help the firm in competing effectively with its rivals.

  1. Operators and Service Providers

Serviceproviders and operators represent domestic segment of the Canadianwireless value chain since most applications development andequipment manufacturing and development are usually done in Asia,U.S, and Europe among other regions. Rogers Communications, similarto its rivals, is wholly involved in the building, operating andmaintaining its own national wireless network. This entails designand location of new microwave tower, constructing, operating andmaintaining of main network locations and cellular sites across thenation. This section of the value chain interconnects that of thewire line and IP value chains since the wireless network is joined tothe internet via fiber optic and copper cable installed ad supportedthrough the wire-line section of the telecommunication industry. Itis critical to be ahead of other service providers technologically.Besides, organizations should be actively searching for fresh andinnovative applications in order to add value to consumers. Thisrequires enormous capital investments as fresh technology becomesadopted and substitutes the incumbent technology. Since none of theCanadian wireless companies has its own equipment, each firm workswith equipment suppliers. Due to this, there is a vast deal ofhomogeneity within the market in terms of the equipment. In order torealize a competitive advantage, Rogers Communications needs toconsider bundling since it will help in differentiating the offeringof the organization from that of its rivals.

  1. Marketing and Retail

Competitiveadvantage in this section of the value chain can be derived fromseveral sources such as developing a trusted and recognizable brand,developing advertisement campaigns which attract attention anddistinguish one brand from another, and having adequately vast saleschannels in order to reach most customers. Besides, competitiveadvantage can be derived by Rogers Communications through formingassociations or partnerships with related organizations, services, orproducts. On the other hand, it is exceedingly crucial for Rogers toconsider giving back to the community in which it operates in orderto enhance its corporate social responsibility. Through an enhancedCSR, it will be possible for the organization to increase itscompetitive advantage since most individuals, in the organization’sarea of operation, will identify wait the organization. This iscritical in increasing the sales of the company.

  1. Consumers

Consumersare an integral part of the value chain since they can help theorganization to develop its competitiveness through providingfeedbacks. The organization can enhance its competitive advantagethrough responding to consumers’ demands and feedbacks. On theother hand, through consumers’ surveys, it is possible for the firmto enhance its competitive advantage because it will be capable ofidentifying new areas that the demand of customers is heading. Thiswill ensure a high level of customer service. The high level ofcustomer service will definitely create a competitive advantagethrough the virtue of maintaining customers and keeping existingcustomers happy this makes customers not defect to another provider.

ResourceBased View Analysis

FinancialResources

Financialresources are exceedingly critical to the firm in the development ofcompetitive advantage since it is exceedingly difficult for theorganization to implement its plans without the involvement offinancial resources. Currently, Rogers Communications leads thewireless market in terms of revenue. It has been the trend for quitesome time, which offers the firm a better position of accumulatingthe revenues for use in developing its competitive advantage over itsrivals. Therefore, the financial resources that the firm has can beutilized in the development of competitive advantage against otherfirms in the industry.

BrandName

Brandname is exceedingly critical in adding value to a firm. Usually, abrand name helps customers to identify products or services from acertain firm. An organization can build on its brand throughproviding quality services or products to customers. Through this,customers will become satisfied, which would make them become loyalto the firm to the point of spreading the news of the firm to otherpotential customers. Therefore, through the brand name, it ispossible to create a competitive advantage. Although the firm has awell performing brand name, it needs to market its brand name more inorder to enhance its competitive advantage.

Reputation

Reputationis another element that can lead to a firm to acquiring a competitiveadvantage. However, the reputation has to be positive in order for afirm to acquire a competitive advantage. Take, for instance, a firmthat is known for quality services. There is a likelihood thatcustomers in the region of operation of the firms will always seekthe services of the firm, when in need of the services provided bythe firm. Rogers Communications has a reputation for providingquality services to its customers. However, since reputation comesand goes because it is temporal, it should seek to maintain itsreputation in order to enhance its competitive advantage.

CustomerRetention

Attractinga customer into a business may be sometimes easier compared toretaining the customer because firms do not always stick to thedemands of the customer. A firm should always seek to retain itscustomers since customer retention adds up to the competitiveadvantage of a firm. This emanates from establishing connections withcustomers, which necessitates in understanding their demands better.Therefore, Rogers Communications needs to increase customer retentioncapacity in order to enhance its competitive advantage. This can bedone through offering after sales services or offering discounts.

Leadership

Leadershipconstitutes one of the elements associated with the human resourcesthat lead a firm to acquiring competitive advantage. Leadership iscritical in making a firm acquire competitive advantage since it isthrough the leadership that an organization gains the values thatguides it. Sometimes, the leadership of an organization may not leadan organization in a positive way, making the reputation of theorganization keep low. Low reputation cannot enhance a firm’scompetitive advantage, but will otherwise bring it down. However, inorganizations that have excellent leadership, there is a probabilityof the organizations becoming reputable positively which is aprerequisite for developing competitive advantage. Leadership inRogers Communications should be maintained in such a manner that theorganization keeps its reputation. This will be critical in enhancingthe competitive advantage of the firm.

StrategicPartnerships

Formingof strategic partnerships is an exceedingly significant considerationfor the firm since strategic partnerships have the capacity of makingthe firm be in a position to provide its services with ease. AlthoughRogers Communications has created several strategic partnerships, itstill needs to continue creating more strategic partnerships in orderto enhance the competitive advantage of the firm.

Culture

Theculture that a firm adopts is critical since it usually determinesthe values that govern the firm. It is these values that drive orfail to drive the firm towards attaining a competitive advantageagainst its rivals. Rogers Communications is usually guided by thevalues of customer focus and innovation. These values form theculture of the firm and are critical in ensuring that the firmacquires competitive advantage. The firm should continue supportingcultural values that enhance its competitive advantage.

SWOTAnalysis

Strengths

Currently,Rogers Communications is the only true nationwide GSM cellularprovider. This offers the firm a competitive edge over itscompetitors in the market. The firm’s GSM service has aninternational standard, making it best suited for global roaming. Forany individual seeking to travel, the GSM reaches numerous users.Currently, it services around one billion. On the other hand, the GSMpermits users to access the internet as they call. Another strengthof Rogers Communications is diversification. The firm operates insports, media and telecom. The diversification of this organizationhelps in attracting revenues from different areas. The organizationalso commands strength in a huge customer base. It is the leadingwireless provider in Canada, which implies that it has a strongcustomer. This is beneficial in attracting revenues to theorganization. In addition, the organization has a strength inenhanced financial performance from media and telecom assets. Thefinancial strength is critical since it can help the organization tocompete effectively against its rivals.

Weaknesses

Therates in the Canadian wireless are amid the highest in the globe. Inan attempt to enhance prices and service through competition, thefederal government licensed four fresh operators. This has increasedthe competition leading to lower profit margins. On the other hand,Rogers is feeling the impact of the slowness of the economy RogersShopping Network has been in a constant decline due to economic downturns. Besides, the organization has an over-dependence on theCanadian market that is almost reaching saturation. In addition,compared to other few players, the organization has a limited globalpresence.

Opportunities

Theorganization has an opportunity of growing sin the TelecommunicationsServices across the entire Canadian region. On the other hand, thelaunching of Wi-Fi Smartphone is critical in capturing the market.Rogers can gain vast market share in case it decides to follow thesuit of the American carriers and provide unlimited plans. Inaddition, the organization can capitalize on the 4g market so as tobe in control of the swiftest market in Canada.

Threats

Rogers,just like other wireless providers, do not provide any unlimitedplans in Canada. This implies that in case there is a new entrant inthe Canadian market that can emerge and provide unlimited plans,there is a possibility of subscribers switching to the new entrant.However, in case the Canadian firms chose switching to unlimitedplans, an increase in mobile traffic could be transferred to them.Because of the increased traffic, the wireless providers would needto enhance their networks in handling the increase. The currenteconomic down turn also presents a threat to the organization sincefamilies facing tough financial times may end up switching to cheapercarriers. Besides, there is a threat of the regulatory authorityimposing a TV-tax that may increase the monthly subscription, whichmay mitigate the number of cable TV customers.

CoreCompetency Assessment

VRIOAnalysis

Resource &amp Capabilities

Valuable

Rare

Inimitable

Nonsubstitutable

Competitive Consequence

Financial Resources

Yes

Yes

Yes

No

Can create a competitive parity

Brand name

Yes

Yes

Yes

No

Can create a temporary competitive advantage

Reputation

Yes

Yes

No, but requires capital and long time in creating it

Yes, but to segmented and sometime brings negative issues in the market

It creates a temporary competitive advantage

Customer retention

Yes

Yes

No

Yes

It creates a competitive parity

Leadership

Yes

Yes

No

Yes

It is critical in creating competitive parity

Strategic Partnerships

Yes

Yes

No

Yes

It is critical in the establishment of competitive parity

Culture

Yes

No

No

Yes

It is critical in the establishment of competitive parity

KeySuccess Factors

Thereare different success factors that can be associated with the RogersCommunications. The success factors are as discussed in the followingparagraphs

StrategicPartnerships

Formingof strategic partnerships is critical success factor to theorganization in a developing competitive advantage. Strategicpartnerships entail forming beneficial partnerships with suppliers ofnetwork equipment and other organizations that area in the industry.Forming strategic partnerships will help in developing competitiveadvantage. The service that Rogers provides is usually thefacilitation of access to the content that has been developed byothers. However, an area of differentiation may be the development ofassociations with content providers, which include some aspect ofexclusivity. Therefore, in order to develop a competitive advantage,Rogers Communications will need to create and strengthen strategicpartnerships with content providers.

Entering4g Market

RogersCommunications has been in the 3g market, which is not competentenough to serve the customers in terms of performance. It is alwayscritical to ensure the satisfaction of consumers in order to makethem identify with the organization. Although the organization hasdone a lot in the area of customer satisfaction, it still offersunlimited plans to the customers. It is critical for the organizationto enter the 4g market, which will be of benefit to the customers andthe organization. One of the benefits that customers will gain by theorganization entering the 4g market is that they will be capable ofaccessing the fastest service in the market since 4g has a higheruploading and downloading speed compared to the 3g. The other benefitwould be satisfaction using the service. On the other hand, theorganization would benefit by having an increased number of customersbecause they will tend to identify with the organization due to thefast service. Therefore, entering into the 4g market will help thefirm in developing its competitive advantage.

Bundling

Bundlingis a critical consideration in the wireless industry since all themain firms in the industry consider it. Bundling is considered ofhigh significance as it offers a mechanism through which firms canproduce significantly more ARPU. Besides, bundling gives anopportunity for a firm to differentiate its services from that of itscompetitors. Rogers has an advantage since it represent the only truequadruple play provider because it can bundle internet, wireless, andtelephony. This makes bundling a key success factor to theorganization.

FinancialResources

Inmost of the undertakings, financial resources are required infacilitating the accomplishment of the undertakings. Sometimes, anorganization may need financial resources in tackling an issue thatwill help in adding a competitive edge to the organization. In such ascenario, financial resources act indirectly in the attainment of acompetitive advantage. It is exceedingly difficult to establish andaccomplish certain acts in an organization without financialresources. Therefore, financial resources are exceedingly critical inthe attainment of success. Hence, it can be considered a key successfactor for Rogers Communications.

Leadership

Theleadership of any organization is exceedingly significant indetermining the way that an organization is run. The running of anorganization is critical as it can determine the success or failureof the organization. The key for an organization to attaining acompetitive advantage over other advantage is having a successfulleader, who embraces the culture of success. For instance, through aleader creating a culture of innovation in an organization, it islikely that the organization will be competitive.

TechnologyAdoption

Technologyis a significant consideration in the wireless industry. Without theuse of technology, it would become exceedingly difficult to serve thecustomers in the market. Technology keeps on changing, which makesthe adoption of new technologies a consideration of immenseimportance. In case a firm in the industry does not adopt theemerging technologies, it will be difficult to meet the demands ofcustomers since as the technology changes, the demands of customerskeep on changing. Therefore, technology adoption is a success factorto the Rogers Communications since through technology adoption, theorganization will be capable of serving and meeting the emergingdemands of consumers better than any other organization in theindustry.

Attractingand Keeping New Customers

Customersemerge as a crucial part of any business since without customers itis remarkably difficult to attain the chief aim of a business.Businesses are usually established with the primary aim of makingprofits. Without customers, the organization will not be capable ofattracting revenues, which implies that the organization may end upclosing its operations. Therefore, it is critical for the RogersCommunications to attract and keep new customers since through thisthe firm will have a strong customer base that is critical indeveloping competition against its chief rivals.

Reputation

Theperception of an organization by the society is exceedingly vital itdetermines the attractiveness of the organization. This implies thatan organization that has a good reputation will usually becomeattractive to the majority of individuals in the society, which iscritical in the attainment of success. In order for an organizationto become recognized in the society, there is a need for theorganization to have an excellent corporate social responsibility.This implies that the organization must build its CSR through beingparticipatory in the different needs of the individuals in its areaof operation. This can be through participating in community projectsand charities. Through such participation, the organization willlikely grow its customer base through reputation and may use suchcustomer base against its rivals. Therefore, reputation is a criticalsuccess factor for the Rogers Communications as it already engages inCSR activities.

Innovation

Innovationis one of the primary values that guide the Rogers Communications.Innovations cannot be excluded from the Canadian wireless marketsince customers’ needs and demands keep on changing emanating fromtechnological changes experienced in the industry. Therefore, a firmin this industry needs to be innovative in order to attain success.Since Rogers Communications is guided by the tenet of innovation,this is a success factor since it will be capable of meetingcustomers’ demands better than its rivals.

KeyIndustry Pressures

PoorEconomic Performance

Thewireless industry is faced by pressure of poor performance of theeconomy. The economy is usually considered as a critical externalfactor that affects the performance of business. When the economicperformance is good, businesses are likely to perform excellently.However, when the economic environment is not favorable, it isexceedingly difficult for businesses to perform well. This is becausethe economic environment affects businesses in terms of interestrates and inflation rates. In the Canadian market, the economicenvironment has not been favorable, which has negatively impacted thefirms in the industry (Rogers &ampOverDrive,2013). Due to poor economy performance, some consumers have not beenin a position to afford paying the monthly subscription to the firmsin the industry. This has led to a decline in the number of customersseeking subscriptions, a move that has led to a decline in therevenues of the industry. The problem of decreased industry’srevenues is likely to persist in case the economic environment doesnot get better soon.

RegulatoryAuthority

Anotherkey pressure affecting the industry entails the regulatory authority.The regulatory authority is proposing the imposition of a TV-tax.This will likely have the impact of increasing the monthly bill ofcable TV. This is likely to have an effect on the industry since thenumber of subscribers in the entire broadcasting industry is likelyto decline, which will lead to reduced revenues in the industry.

GenericStrategy

Thegeneric strategy that can be recommended for the RogersCommunications entails the use of differentiation strategy in theindustry. The differentiation strategy is suitable for the firmbecause it is easier to employ due to the diverse needs of consumers.Besides, the strategy is suitable for this firm since there are fewcompetitors following a similar differentiation approach in theindustry. In addition, the differentiation strategy is suitable forthis firm because product innovation and technological change arefast-paced in the industry, where the firm operates (Conklin,2010).

Discussionand Analysis of Strategic Direction

Forthe Rogers communications to realize the differentiation strategy,the firms will need to go in a certain direction. The followingparagraphs discuss the different areas that the organization shouldconsider going into in order to realize the strategy

  1. Technological Leadership

Inthe industry, where Rogers Communication operates, technologicaladvancement emerges as a prerequisite for attaining success. Throughtechnological advancements, the firm will be capable of meeting theemerging demands of customers. Meeting customers’ demands iscritical in ensuring that customers do not seek another firm in theindustry for the same services, emanating from the satisfaction thatthey will obtain from the firm. Therefore, technological leadershipis a critical consideration of the firm since it will make the firmmore desirable to customers compared to other firms in the industry.

  1. Providing a Full Range of Services

Inthe Canadian wireless industry, none of the firm is capable ofoffering unlimited services to customers or subscribers (Rogers &ampOverDrive,2013). This implies that customers are not fully satisfied by theservice providers in the industry. The Rogers Communications shouldconsider providing unlimited services to the subscribers as a way ofincreasing the satisfaction of customers in the Canadian market.Through providing unlimited services to customers, customers arelikely to associate themselves with the organization in order toobtain satisfaction. This will also be an immense advantage since thecustomers are likely to migrate from other firms to RogersCommunications (Singhal&amp Dearing, 2006). This will be critical in ensuring that theorganization leads in offering the service to a great number ofcustomers. Therefore, in ensuring that the differentiation strategyworks in the firm, the firm will need to consider providing a fullrange of services.

  1. Superior Services

Customersare usually satisfied by a firm that provides superior services.Superior services are sometimes costly, but help in maintaining thebrand name of the firm. However, it is not always that offeringsuperior services to customers will attract high prices. A firm canbe in a position to offer quality services at a considerable price.In order to realize a successful differentiation, Rogerscommunications would need to offer superior services than its rivals.Superior services can be realized through the firm constantlycarrying out innovations (Conklin,2010). Through constant innovations, there is a likelihood ofdeveloping superior services than all the firms in the industry thiswill have an impact of attracting more customers to the firm as theyattempt to seek satisfaction from the superior services.

  1. Service Reliability

Whenthere are few service providers in a market, there is a probabilityof the firms providing unreliable services. This is due to a lack ofsufficient firms acting in the market. This is the same case that isin the Canadian wireless market, where there are few firms in theindustry implying that competition is not stiff. Because of the fewfirms in the industry, there is less competition that makes the firmsnot reliable in providing services since they feel that they are theonly firms with the capacity of offering the services. In order forthe differentiation strategy of the Rogers Communication to work,there is a need for the firm to consider offering reliable servicesto its customers. This will enhance the customer satisfaction makingcustomers migrate to the firm.

  1. Reputation

Reputationis also a critical aspect, when the firm will be considering adifferentiation strategy (Conklin,2010). In order for the differentiation strategy to be successful,Rogers Communications will require to enhance its reputation. Thefirm can enhance its reputation through taking part in differentcommunity development projects and helping the needy in the society.This will help the firm in building its brand, which is critical inattracting different customers to identifying with the firm.Therefore, building of the firm’s reputation emerges as asignificant consideration for the differentiation strategy.

Recommendations

Fromthe analysis of both the internal and external environment of theRogers Communications, it will be advisable for the company to adoptthe differentiation strategy. There are different opportunities thatthe firm can take advantage of through the differentiation strategy.For example, there is an opportunity of the firm providing unlimitedservices in the market. It is possible for the firm to achieve takethis opportunity through the differentiation strategy. Besides, thereis an opportunity of realizing growth in the industry through thefirm carrying out constant innovations, which is one of thedifferentiation strategies that the firm is capable of employing. Irecommend that the firm should follow the differentiation strategysince it is the only strategy that works best in the economicsituation presented. On the other hand, the differentiation strategywould be suitable for the firm since the firm has different keysuccess factors that can be enhanced in promoting the differentiationstrategy. Therefore, the firm should not hesitate in adopting thedifferentiation strategy as it will help the firm in attaining aleading position and augment the revenue level of the firm.

Conclusion

RogersCommunications deals with communications and media. The companyoperates in the area of cable television, wireless communications,internet connectivity, and telephone. Besides, the company has massmedia and telecommunications assets. The firm is facing threat ofexistence due to the economic environment. The current economic downturn presents a threat to the organization since families facingtough financial times may end up switching to cheaper carriers.Besides, there is a threat of the regulatory authority imposing aTV-tax that may increase the monthly subscription, which may mitigatethe number of cable TV customers. On the other hand, the firm has athreat of existence since it does not provide unlimited services.This implies that a new entrant into the industry, which has thecapacity of providing unlimited services, can overtake the firm andtake over the customers of the firm. In order to increase itscompetitiveness in the industry, Rogers Communications should adoptthe differentiation strategy. The differentiation strategy willentail the firm going into a certain direction such as takingleadership in technology through technological advancements,providing reliable services, offering unlimited services, providingsuperior services, and engaging in activities that enhance CSR.Through technological advancements, the firm will be capable ofmeeting the emerging demands of customers. Meeting customers’demands is critical in ensuring that customers do not seek anotherfirm in the industry for the same services, emanating from thesatisfaction that they will obtain from the firm. Through constantinnovations, there is a likelihood of developing superior servicesthan all the firms in the industry this will have an impact ofattracting more customers to the firm as they attempt to seeksatisfaction from the superior services. Therefore, thedifferentiation strategy emerges as the best and suitable alternativefor the Rogers Communications to take in ensuring that it remainscompetitive in the industry.

References

Conklin,W. (2010).&nbspApplyingDifferentiation Strategies: Teacher`s Handbook for Grades K-2.Huntington Beach: Shell Education.

Hasselt,C. (2007).&nbspHighwire act: Ted Rogers and the empire that debt built.Mississauga, Ont: J. Wiley.

Holman,P., Scott, L., Kafka, S., &amp Dominion Bond Rating Service.(2000).&nbspThewireless industry in the U.S. and Canada.Toronto: DBRS.

Plunkett,Jack W., Balan, Andreea, Brison, Brandon, Jordan, Daniel P., &ampKolber, Maria. (2008).&nbspPlunkett`sWireless, Wi-Fi, RFID and Cellular Industry Almanac 2009.Plunkett Research Ltd.

RogersCommunications Inc. (2006). 2005Annual Report.Toronto: Rogers Inc.

Rogers,T., &amp OverDrive, Inc. (2013).&nbspRelentless:The True Story of the Man Behind Rogers Communications.New York: HarperCollins Canada.

Singhal,A., &amp Dearing, J. W. (2006).&nbspCommunicationof innovations: A journey with Ev Rogers.New Delhi [u.a.: SAGE.