TRANSFORMING VERIZON: A PLATFORM FOR CHANGE Harvard Case Solution & Analysis

Transforming Verizon: A Platform for Change Case Study Solution

Abstract

The company Bell Atlantic changed its name to Verizon Communication which was founded in the year 2000. The company primarily deals with providing communication services through wireless and wire line networks across many countries. The services include the high-speed internet services such as 4G and 3G, phone services and TV service.In the year 2011, Verizon Communication had earned a revenue of around $106 billion and around 160,000 people were employed in the company dealing with 140 countries.

The CEO Ivan Seidenberg and his predecessor Lowell McAdam took various initiative for bringing the change in the company. The changes which Verizon took for transforming are the Partnering with Google and Motorola for competing with the Apple iPhone,bringing changes to the culture,shared Success, Credo Awards, and Process Changes.

Introduction

The company Verizon Communication was founded in the year 2000 in which the company Bell Atlantic changed its name. Originally, Bell Atlantic was established in the 1983 but due to its breakup by the government action and the acquisition of GTE Corporation led to the creation of Verizon Communication. The company is highly recognized worldwide and has earned the reputation for providing excellent customer service. The company primarily deals with providing communication services through wireless and wire line networks across many countries. The services include the high-speed internet services such as 4G and 3G, phone services and TV service.

In the year 2011, Verizon Communication had earned a revenue of around $106 billion and around 160,000 people were employed in the company dealing with 140 countries. However, it was shown that the company primary deals in the U.S as there are 94 million subscribers and daily serves around 100 million customers. The company faces severe competition as there are many competitors offering the same services such as time warner, AT&T Wireless, T-Mobile and many others.

For further expanding the company, Verizon Communication has taken various steps such as acquiring companies like MCI and other. Also, the company had initiated in forming a partnership with the companies like Google and Motorola to offer better handsets along with better communication services. The acquisition with the MCI in the year 2005 which provided the company the opportunity for targeting global markets.

However, the company had been experiencing a decline in its wire line business since many of the customers had shifted to wireless phones which had resulted in  a decrease in the revenues. There were two types of culture in Verizon belonging to different segments which are wireless and wire line. The company had changed its copper lines to fiber which has overall improved its communication service and also launched the 4G mobile networks. The acquisition with the MCI has also helped in gaining a new business unit which the International Internet Protocol backbone (IP) that caused the company in providing its services to other countries.

Background

The global telecommunication has been significantly increasing throughout the years but it is observed that the wire line and landline had been shifting towards the digital and wireless services. Most of the people now prefer to use a smart phone for communicating rather than talking on telephones. The number of the wireless customers doubled during the years 2003 – 2010 as there were around 159 million in 2003 and further increased to 290 million in 2010.

The market had been significantly changed since the Apple launched its first smartphone in the market in the year 2007. Almost one-third of the wireless customers in the United States owned a smartphone and more customer had started to use smartphones. The total revenue was generated by the telecommunication industry was around $610 billion in the year 2010. However, the market has been changing as a customer are shifting towards the communication services within the smartphones.

Many telecommunication companies have taken initiatives for bringing innovation in the wireless by allowing the users to download ringtones, music, GPS, and games. Others are introducing 4G internet services and watching TV through smartphones. Overall, the market for the telecommunication industry has been becoming a highly competitive market in which many of the companies are bringing innovative changes for attracting the customers.

Analysis

For analyzing the current performance of Verizon for the year 2011 and also analyzing the communication service industry, we use the porter 5 forces for analysis which are the bargaining power of supplier and customers, the threat of new entrants and substitute products and competitive rivalry. The analysis would help in further evaluating the effectiveness of the initiatives which the company had taken to improve the company performance and what further action it could take to attracting more customer and creating differentiation from its customers(Martin, 2017 ).

TRANSFORMING VERIZON A PLATFORM FOR CHANGE Harvard Case Solution & Analysis

 

 

Porter 5 forces

Bargaining power of buyers

The bargaining power of buyers in the communication is high as there are many companies providing the same and better services. The switching cost for the buyers is low as they could easily switch to another service which is inexpensive and has better features of Verizon. Many of the customers are price conscious when buying communication services in which they tend to prefer buying cheaper produces while offering best services. Many of the companies are engaged in offering promotional sales for their services and running program which causes the customer to switch to other product. The brand image and reputation of the company also highly influences on the bargaining power as people prefer to use services which have high recognition in the country. The service like 4G, GPS system, and many others also influence the bargaining power of buyers. With the competition, increasing gives the customer more options for choosing the best services.................

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