Page 17 - MCOM MODEL ANSWER 2

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Updated SWOT Analysis : APPENDIX 1

Strengths Weaknesses

1. Technology coverage 1. Declining performance in Sadimba and overall (e.g.

2. Brand and market leading position poor ROE at 23% compared to V-Mobile of 56%)
2. Rising debt burden and gearing, sliding share price
3. Market share is 1st or 2nd in all key markets
and market capitalisation
4. Africa and middle east experience
3. Bureaucratic and high cost operating structure and
5. International acquisition experience
need to transform operating model(Shared Services
6. Size and scope allows lower costs per unit
Center)
4. Interim Group CEO/need for security of tenure
and stability for the Group CEO position and
resignations of key executives.
5. Declining performance and projected failire to
meet 2016 financial targets
6. Schedule slippage and cost overruns on the SSC
Project.
Opportunities Threats
1. Growth in telecommunications services (mobile 1. Security situation and harsh regulation (fine of
money, e/m commerce, etc). US3.9 billion) in no. 1 market, Nakolia.
2. Shifts from voice to data/internet and cloud- 2. Political risks and strategic uncertainty in Ilania
based services 3. Boycott, lost sales and brand damage from Shared
3. Other digital opportunities e.g. broadcast/TV/Big Services Center decision
data 4. Mobile growth is nearing maturity overall
4. Strategic agreements allowing entry into key 5. Intense competition in key markets
digital service areas such as money transfer, big 6. Growing shareholder pressure to find other forms of
data, cloud computing digital revenue to deliver growth.
5. Global trend of industry consolidation to release 7. Deteriorating relationship with the Government of
synergies Nakolia
6. Mobile operator license bid opening in Chininsia 8. Sliding share price and poor handling of the fine
(Due Diligence for this deal and potential leading to loss of investor confidence and possible
offer) hostile takeover.
7. Acquisition of CloudNet and grow other digital 9. Ethical issues in relation to provision of the S$58
revenues billion fine as well as possible bribery and
8. Mobile market still in growth phase in Africa and corruption in the appointment of law firm could
Middle East where MCOM is dominant. damage our reputation.
9. Our Group Legal and Negotiation Strategy
has opened 2 new options to reach a
negotiated settlement of the fine situation in
Nakolia (Option 1 and 4 to withdraw have
always been open to us).

Developed by The CharterQuest Institute for 'The CFO Case Study Competition 2016'
www.charterquest.co.za | Email: thecfo@charterquest.co.za