The business I intend to study is BskyB (British Sky Broadcasting).

Authors Avatar

Bibliography    

Heinemann AVCE Advanced Business

2001 Census

UNIT 1: BUSINESS AT WORK

The business I intend to study is BskyB (British Sky Broadcasting). British Sky Broadcasting is a leading provider of sports, movies, entertainment and news - whose channels are received by over 10 million people in the UK and Ireland. The start of the first digital television service in the UK, Sky digital, this started a new era in British broadcasting, this remains the most comprehensive and fastest of any digital TV in the whole of Europe, attracting 5.9 million customers at the end of March 2002.

Its ownership type is Public Limited Company and it’s shares are currently available on the FTSE 100

The main benefits of this type of ownership to BskyB are:-

  • They can raise large amount of capital from share issue, which will create a fair amount of income for BSkyB.
  • Benefit from economies of scale, e.g. bulk buying, cheaper borrowing will be a benefit because if you buy in bulk they cost of the products will be greatly cheaper than if you bought them separately.
  • Produce their service at lower unit cost which will make BSkyB are more efficient and profitable company.

The main constraints imposed by this type of ownership are: -

  • Become too large resulting in poor labour relations, which will cause the workforces morale to become largely demoralised.
  • Conflict of interest between shareholders and the Board of Directors, which will result in the company becoming a un-efficient company and also result in a divided company with different views.
  • Possibility of takeover or merger because shares can be bought by anyone this could result in the company going bankrupt because it comes in the wrong hands.

The main objectives of BskyB are.

  • To make a profit
  • To offer a good service
  • To expand
  • To become the market leader

They are important objectives because if BskyB didn’t achieve making a profit the company would go in to liquidation and exist so that objective sets out what they most want to do to become a success and in my opinion they have done that to a great degree of success “This years profitability has increased by 20%” also their revenues have increased by a staggering twenty percent.

Sky’s next objective is to offer a good service they obviously have achieved this by their staggering figures, which are “We have a total of 6.1million subscribers to our service.” There are only 60 million people living in the United Kingdom that roughly means 1 in 6 households currently use their service, which roughly works out as 35% of market penetration. I got these figures from the information booklet that they sent me via the post.

Sky’s next objective is to expand this is very important because if they didn’t expand they could lose out as the market leader and they would not increase on their profits.

Sky’s next objective is to become the market leader they have achieved this with great success “Sky continued to deliver on its financial and operating targets from the year 30th June 2002 and to maintain its position as the market leader in the UK and Ireland.

How successful is it meeting its objectives

I feel that BskyB are Very successfully meeting its objectives

  1. Making a profit – In their last year BskyB made a reported profit of  20% up on their last years profit. I think this is meeting their objective of making a profit. The profit figure is 129 million
  2. Offer a Good service – I feel that BskyB are offering a top quality service. I think this because more and more customers are subscribing to their service. “Our channels are received by 10 million people in the UK alone.” They offer a wide range of services such as a great customer care department which is staffed 24 hours a day this includes taking orders establishing and maintaining accounts, invoicing and telemarketing.

  1. Expand – I feel that BskyB are expanding with great rapidity. I know this because of their new department, which is called the “Procurement department” which is based at Osterley and built last year. Also they have become more interactive expanding their interactive services to the sky subscriber making more information available at the click of a button.
  2. To Become Market Leader – BskyB have been the market leader in Digital services for the last 2 years. They are well and truly beating their competitors who are Cable and Wireless, NTL and BBC i.  This was confirmed when sky announced that they are “still delivering on their operating and financial targets in the year 30th June 2002 and to maintain its position as the market leader in the UK and Ireland.

The main functional areas of the business: -

  • Subscriber Management Centre- this deals with all the new subscribers and the old subscribers of their service which helps the company in dealing with all their subscribers to their service on a, day-to-day basis and any queries, complaints they might have about Sky’s Subscription contracts. They do this by having a call centre based at their main site, which takes calls on queries and complaints.  This functional area helps the customer in becoming very efficient in their customer service and getting a good reputation as a business and becoming the market leader.

  • Procurement Department – This is responsible for leading and supporting the continues through professional and transparent reviews of the various spends across their company. This includes set top boxes and dishes, production equipment, professional services and IT. Sky procurement department act professionally with all internal customers and external suppliers. They work to try and understand the business and the markets their suppliers operate in. The procurement department is an infinite process with many opportunities for commercial and service improvements; this enables BskyB consistent information about their spends. This ties in with the objective about making profit and not going in to liquidation. This department helps the company keep an eye on how much it is spending on its suppliers.
Join now!

   

  • Accounts - This looks after the whole company accounts through out the whole business. This department is the biggest department through out the whole business and employs the most staff to control it. The accounts department is also responsible for keeping records of BskyB’s financial events as they occur. They also have to publish their annual accounts once a year for their shareholders/potential shareholders benefits which helps to achieve the objective of getting as much profit as possible. This department has very strong connections with the procurement department because they need to know how much is ...

This is a preview of the whole essay