Case ID: 905M33     Solution ID: 37115     Words: 1724 Price $ 45

Strategic Crossroads at Matav Case Solution


Matav turned into a generally solid market player by the year 2000 after the mastery of Telecom market by 80 percent. In any case, the legislature of Hungary made protected alterations keeping in mind the end goal to expand rivalry bringing about the requirement for an approach change in the guide of Matav. Two principle systems have recommended which can remove Matav from the present condition of junction i.e. advertise advancement and item improvement. Showcase improvement can be exceedingly compelling for the organization in the present time, which can be executed by the day and age required for the usage. Here and now usage incorporates procurement of Montenegro Telecom while long haul execution arrange incorporates development of the organization into the market of Bulgaria and Serbia.

What is Matav's Strategy? Has it been successful or not?

Matav, being the Hungarian Telecommunications Powerhouse had secured their foothold in most of the communications market in Hungary, including business services, residential services, Internet and Mobile. The next step that Matav took in implementing their strategy was to split their vast company into smaller business units which could manage their market independently and sufficiently. International expansion was on the cards as well. Belonging to a greater European powerhouse, they had all the man power and resources to help them step into a new, less visited, European country where the telecommunications prospects were bright. I personally think that there was no other option but to expand their foothold in the rest of Europe and keep the domestic growth ascending with the introduction of new technologies. The fixed-line business was decreasing as it is and the competition had reached a saturation point. The strategy hasn't been as successful as late since, the domestic competition has increased, Matav are losing a foothold in the fixed and mobile market, contrary to the fact that they still are the number one Telecomm Company in Hungary. 

Does Matav have any competitive advantages in its domestic markets?

Matav, off late, has faced a lot of domestic competition because the East European Market has seen a heavy increase in the small telecommunications companies' bracket. These small companies enter the existing markets and offer low price incentives which inevitably increases competition in the price war. Matav is a telecommunications powerhouse. It has the infrastructure, the ability, the foresight, and the manpower to match any competition the foreign companies can offer. Matav is a well-established integrated communications company and has footholds in all the four markets of residential, business, internet and mobile. They already have a lot of customer market in the Hungarian environment. Familiarity with the local policies, business and customers makes Matav even more powerful when it comes to dealing with competition.

Do Matav's international expansion plans make sense? Why?

Matav was taken over by a European Telecommunications giant. The line was clear. Since the domestic market was completely overwhelmed by Matav, the only logical place to expand further was another European company. Matav is already an integrated telecommunications powerhouse. There is no new market it can create or develop within its own country to sustain development for it. There has to be competition and scope for expansion by introducing new technology into third world countries.

If you were a member of the strategy group, what would you recommend to Andras Balogh?

If I was a member of the Andras Balogh team, I would recommend continuing what the company was doing. On top of that, I would ask him to fix his gaze more upon the local market since lately, the competition was increasing drastically. Even if the international expansion makes sense, the company should not lose its foothold in the domestic market. Since the infrastructure and the manpower already existed, new technologies should be researched and implemented since, if someone else comes up with it, we don't want to fall behind the market. A new research division should be created which could work in collaboration with the German giants to implement and try new technologies. This team should constantly be in process of innovating and researching new technologies. They should also keep a watch on the new emerging technologies in the markets across the world. Another division should constantly keep check on the local market and try and implement and provide the existing customer base enough to hold on to Matav for the next generation of technologies. This division should constantly help provide information to both the research divisions and the international division about the needs and demands of the local market and what to expect. The international division should concentrate solely on expansion and should set up local divisions to help understand the local market. It should also make sure all the international markets communicate with each other.

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Excel Calculations

Questions Covered

1- Executive Summary

2- Key Issue/Decision Point 

3- Recommendations

4- Implementation Plan