Improving the competitiveness of the organization in the field of telecommunications

Bc. Guram Turkiia

Master's thesis

Abstract:

The main objective of the thesis is to develop measures to improve the competitiveness of PJSC Rostelecom. Evaluate the competitive environment of the telecommunications market. Explore the internal and external environment of PJSC Rostelecom. Make a forecast and prove the effectiveness of the proposed measures. The object of research in the final qualifying work is the Russian provider of digital services and services of PJSC Rostelecom. The subject of the study is the assessment and improvement of the competitiveness of organizations in the field of telecommunications. The paper presents the coefficients of financial stability, the analysis of the liquidity of the balance sheet, the assessment of the probability of bankruptcy based on the two-factor Altman model. The paper presents the share of staff turnover among employees of different ages and genders. The assessment of the organization's activities is based on SNW, PEST and SWOT analysis. The compiled solutions for improving competitiveness are analysed to assess financial efficiency. Results of the work: by studying the external and internal environment of PJSC «Rostelecom», its strengths and weaknesses, opportunities and looming threats, which made it possible to develop measures aimed at improving the competitiveness of the organization. The analysis of the information base consisting of domestic and foreign sources allowed us to conclude that to date none of the existing approaches to assessing the competitiveness of organizations has found wide application in the practice of economic analysis and cannot be considered completely universal. It follows from this that there is currently no single methodology for the global assessment of the competitiveness of the enterprise. This is due to the fact that the proposed approaches have a number of disadvantages. The methodology for constructing most of the existing methods is based on the same type of algorithm, which begins with determining all possible factors that affect the activities of the organization. These factors are considered in more detail, modeled and investigated the possibility of their influence or use using various methods. But the system of factors of competitiveness of companies is open, and many elements of this system are fuzzy. The Literature Review presents the characteristics of the telecommunications sector, the factors determining the level of competitiveness of an organization in this industry are noted. The leading providers in Russia with significant market shares were identified, which is required to conduct a comprehensive analysis of PJSC Rostelecom in a competitive dynamic environment. At the present stage of development of the telecommunications sector, consumers need a constant high-quality connection, timely service and the ability to choose tariffs at an affordable price. Today, large providers have a large number of tools with which they find new customers, attract existing consumers of services and retain subscribers who have decided to abandon their services. From this it follows that there is active competition and the adoption of an incorrect or untimely management decision can lead to a decrease in the competitiveness of the organization and, as a consequence, an outflow of subscribers and a decrease in profits. The number of competitiveness factors is inexhaustible, and therefore, no matter how comprehensive its list is, it will not be complete and universal. Analyzing each organization according to one template set of factors, then the study will be ineffective or may even lead to incorrect management decisions. As a result, all existing lists of competitive factors are very conditional, so they cannot be used to assess the competitiveness of all organizations. The main competitive strategy of the enterprise is based on deep and accurate quantitative and qualitative characteristics of resources, market sales, increased competition, as well as economic prerequisites and possib

Abstract:

le limitations. It should also be borne in mind that for a qualitative analysis of the competitiveness of an organization, it is necessary to take into account not only the most common factors, but also only those that are currently operating in the market. In Practical Part general information about PJSC Rostelecom was studied, including the history of creation, mission, principles and organizational structure of the company and a typical branch. Advantages were noted in the organizational structure and management features were considered. PJSC Rostelecom has been operating in the telecommunications market since 1992, now the company has 13.5 million subscribers, of which more than 100 thousand are in the Tver region, and its main activities are providing telecommunication services: •provision of communication services in accordance with the received licenses; •transmission of information via trunk and intra-zone communication networks; •leasing of transmission lines, linear, group and network paths, tonal frequency channels, channels and means of audio and television broadcasting, data transmission channels. In the Practical Part a detailed analysis of the financial and economic condition of the organization and its changes in the period for 2019-2021 is carried out. Conclusions were drawn and recommendations were made on the basis of the considered balance sheet changes, the study of the liquidity of the balance sheet, the solvency of the company, the probability of its bankruptcy, financial stability coefficients were calculated and vertical and horizontal analyses of the balance sheet and the report on financial results of PJSC Rostelecom were carried out: •the value of non-current assets increases by columns (from previous to future periods for 2019-2021), this indicates the favorable development of PJSC Rostelecom and its chances and prospects for further growth, as these include communication towers, highways, networks and other facilities necessary to increase coverage and the number of connections; •the firm has attracted a fairly large amount of borrowed funds, >30% of accounts payable are listed in the Liability, and the negative side is the increase in the level of loans in dynamics; •the assessment of financial stability coefficients showed that most of the indicators are close to the normative value; •a study of the probability of bankruptcy of PJSC Rostelecom using Altman's two-factor model showed that the probability of bankruptcy is not only less than 50%, but continues to remain at a low level for the past 3 years. •the analysis of the liquidity of the balance sheet showed that all coefficients, with the exception of the absolute liquidity coefficient, do not correspond to the normative value and their change has a negative direction. The data on the personnel of the organization were studied, staff turnover and decisions aimed at reducing it were considered, as well as an analysis of the use of labor resources was carried out: •the number of dismissed employees in 2019-2021 grew by 23% and was significantly higher than the number of employees hired which led to a decrease in the average number of employees by 7%; In the third paragraph of the chapter, PEST-, SNW- and SWOT-analyses were carried out. The strengths and weaknesses of Rostelecom PJSC were studied, as well as environmental factors that form opportunities and threats for the development of measures to improve the competitiveness of the organization presented in the chapter were analyzed. In Results and Discussion a table was compiled with measures to improve the competitiveness of PJSC Rostelecom, developed on the basis of the analysis conducted in the Practical Part. The measures were proposed after the correlation of the various strengths and weaknesses of the organization with the threats and opportunities operating in the market, and the search for their relationship. A table was compiled with the content of the effectiveness and possible positive effect that can have a significant impact on the organization's activities. The possibilities of their implementation were evaluated with the company's available capabilities and resources. One of the events was considered from the point of view of Rostelecom PJSC as a client ordering a service from an information and analytical center with the definition of the characteristics of the study. The expediency of introducing and modernizing the IVR voice service was considered. The work revealed a lack of towers to maintain the quality of Tele2 communication services, which were recommended for bundling with home Internet, television and telephony services. New packages have been proposed for consideration, as it is necessary to increase their attractiveness for both existing and potential subscribers. Also, bundling serves as a good opportunity to promote services that were not previously in demand, but may appeal to customers after the start of use. A table was compiled with criteria for evaluating the effectiveness of the proposed measures. At the end of the chapter, the economic justification for each event is given. It showed that the measures have high efficiency and their implementation is appropriate to increase the competitiveness of PJSC Rostelecom. It follows from this that the measures proposed on the basis of the analysis and the assessment of their effectiveness are a complex multilateral process. If you approach this with negligence, the quality of the analysis results and the solutions developed will not only not increase the competitiveness of the organization, but can also lead to a negative effect: deterioration of reputation, a decrease in market share and financial losses. The conducted research leads to the conclusion that increasing the competitiveness of an organization is a multi-level economic category that serves as the main foundation for evaluating the effectiveness of an organization's activities in terms of production, work or services, as well as a general indicator of the effectiveness of the management system of this economic entity, including the adoption of a number of measures to systematically improve goods or services, the constant search for new sales channels, new consumer groups, improvement of services, image and advertising.

Keywords

competitiveness analysis, efficiency of the company, competitiveness of the organization, competitive advantages, telecommunications

Language used: English

Date on which the thesis was submitted / produced: 4. 4. 2023

Thesis defence

• Date of defence: 25. 5. 2023
• Supervisor: Ing. David Křížek, Ph.D.
• Reader: Jiří Novosák, Bc., externi

Czech University of Life Sciences Prague

Faculty of Economics and Management

Master programme:
Economics and Management