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Excerpts Contd...
Competitiveness
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Telefónica de España's plans to enhance its competitiveness involved improving
the quality of its services by using practices like Six Sigma and improving
process and development of online capabilities. By December 2001, Telefónica de
España had a quality system in place, that was in compliance with UNE-EN-ISO
9001: 2000 standards According to del Rey, "Competitors can attract people on
price for about three months or so. We try to have the clients for a long
period, forever. Quality is our differentiator and over time people realize that
our price is more or less the same as that of the competitors. It is our belief
and our bet that quality will keep customers with us in the long run."...
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Commitment
In order to improve commitment, Telefónica de España reorganized the market and
customer segments and came up with a set of values to bring forth change in
attitude.
Customer Segments
For each of the customer segments - households, SOHO, SMEs and large
corporations, Telefónica de España had different products to offer. For basic
households, the company offered basic voice services. These accounted for 84% of
the total household customers as of 2005. Connected digital households accounted
for 14% of the household customers and the services provided for this segment
included voice services and medium speed broadband Internet. The services
provided for Advanced Digital households included voice along with broadband and
digital home services like Imagenio, Internet TV, and video communications...
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The Results
In the first year after implementing the business transformation
program, Telefónica de España was able to reverse the trend of
decreasing EBITDA. The EBITDA, which had been going down from 1997 to
2000, showed a positive trend and began growing by the year 2001. In
1997, EBITDA stood at € 5,537 million. It went down to € 5,251 million
in 1998, € 4,958 million in 1999, and to € 4,448 million in the year
2000. In 2001, it grew by 1.9% to € 4,508 million. Telefónica de España
attributed the growth to price discounts, new packages, reduction in
operating expenses, and tariff increases... |
Exhibits
Exhibit I: Telefónica SA - Principal Subsidiaries
Exhibit II: Telefónica De España - Financial Performance
Exhibit III: Telecom Market in Spain
Exhibit IV: Telefónica De España Subsidiaries
Exhibit V: Services Offered by Telefónica De España
Exhibit VI: Telefónica - Corporate Values
Exhibit VII: Telefónica De España - Financial Performance (2001-05)
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