Background
Verizon is one of the largest communication technology companies in the world. We operate America’s largest 4G LTE wireless network and the nation’s premiere all-fiber broadband network. Verizon’s main operations are as a cable provider, Internet provider, and cell provider.
Problem Statement
Even though Verizon wireless division has seen good growth and market share, they are expected to contribute even more to the overall company’s success. The expectation is to continue to reduce expenses and increase sales and market share in the coming year. The main problem is how to continue growing market share and expanding coverage areas across the country.
Objectives
Evaluate the current market share and determine where the opportunity for growth is.
Evaluate areas across the country that are currently not serviced by Verizon wireless and expand to those areas.
Offer competitive prices and services to grow customer base
Alternatives
The diversity of Verizon and the services it offers allows us to offer numerous creative alternatives as solutions to our complex problems. The following alternatives will relate to the mobile/cell division and the services within. The current marketing plan utilizes television advertisement, radio, mailers, billboards, and print ads to drive the business. To not only generate new business but also to take customers from our competitors, we must improve our current customer service, evaluate our current pay scales and benefits, and our employees.
After applying a K.T. decision analysis, we have come up with the top 3 alternatives. “The K.T. decision analysis (KTDA) is an algorithm for choosing between different alternative solutions to find the one that best fulfills all the objectives.” Each one of these alternatives was determined to be a “Go” within the analysis. Listed below is the process used to determine our choices in alternative solutions to the problem statements listed above. Table 1.1 lists our immediate musts and wants in accordance with the problem statements. Table 1.2 lists out the top 5 alternatives that were used and we then assessed which alternatives satisfied the musts. Table 1.3 shows how we applied the wants to each of the alternatives that met the criteria to determine the top 3 alternatives to proceed with.
Table 1.1
MUSTS
Increase market share by 10%
Expand current coverage areas
WANTS
Improve employee morale
Improve customer service
Reduce payroll
Table 1.2
Alternative Solution: Reduce prices of phones and services Offer more bundles with added savings Eliminate package deals to focus on services Reduce coverage areas and concentrate on major cities Eliminate incentives and reduce benefits
Musts
1. Increase market share by 10%
2. Expand current coverage areas
GO
GO
GO
GO
GO
GO
GO
NO GO
GO
NO GO
Table 1.3
Alternative Solution: Reduce prices of phones and services Offer more bundles with added savings Eliminate package deals to focus on services
Musts 1.
2. GO
GO GO
GO GO
GO
Wants Weight Rating Score Rating Score Rating Score
1. Improve employee morale
2. Improve customer service
3. Reduce payroll 8
6
4 5
9
2 40
54
8 4
8
2 32
48
8 5
4
3 40
24
12
Total= 102 Total= 88 Total= 76
The first alternative I would recommend to increase market share and expand the current coverage areas is to reduce the prices of phones and services offered. In order to make this work to maintain margins, we will need to increase our overall volume. By offering better prices on both phones and services we will entice customers to join our network and expand our customer base.
A second alternative would be to offer more bundled packages of phones, tablets, and services to expand add-on sales. This alternative would also be attractive to new customers or the competitor’s customers, especially when entering new markets.
Another alternative is to eliminate cell phone price deals and concentrate on the wireless services we offer. Allow the phone manufacturers to deal with adding their own incentives and how to market their products, and let Verizon concentrate on improving and streamlining their mobile services. By offering better services, we can reduce our inventory costs and re-invest this saved money in R&D and marketing to help increase our overall market share and strive to improve our overall customer satisfaction.
Consequences
The next step is to look at the potential adverse consequences of each alternative solution. We are determining the overall threat of applying the alternatives to our problem statement. Table 2.1 will show the probability of occurrence, the seriousness if it occurs, and the overall threat. This allows us to re-evaluate our alternative solutions to determine which one is the best fit as a solution to our problem statement.
Table 2.1
Adverse Consequences A. Probability of Occurrence B. Seriousness If It Occurs Threat
Reduced prices
1. Increase demand
2. Lower employee morale
3. Loss of quality
TOTAL
6
7
4
8
7
6
48
49
24
121
Bundled packages
1. Limited inventory
2. Low demand of certain items
3. No custom option
TOTAL
8
6
4
9
7
6
72
42
24
138
Eliminate package deals
1. Loss of income from phones
2. Reduced customer satisfaction
3. Reduced company profits and earnings
TOTAL
3
7
5
7
8
9
21
56
45
122
Solutions
The alternative solution I would recommend following up with would be to offer more bundled packages of phones, tablets, accessories, and services. This risk tolerance of this would be low with the ability to keep margins close and the opportunity to increase sales along with enticing more potential customers to join our network therefore increasing our market share. Bundled packages will also prove to be beneficial when entering new markets. To maximize costs and improve the overall financial outlook for the company, I would also recommend pairing up all divisions of Verizon communications to maximize growth.
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