BT as public limited company.

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BUSINESS AT WORK

AVCE- BUSINESS (2003)

E1

INTRODUCTION

When British Telecom (BT) started, it was a public ownership owned by the British Government. But the Government sold the company to become a public limited company and since 1996 the company became a public limited company owned privately by shareholders.

BT is now Europe’s leading telecommunications service provider with 29 million lines in the United Kingdom, a turn over of £2.4 billion in 2002 and has the highest market share of 73% BT employs 250,000 staff in the UK.

BT’s principal activities include local, national and international telecommunication services, higher quality broadband Internet products and services. BT provides four lines, which are BT wholesale, BT Ignite, BT Open world and BT retail.

THE BENEFITS OF BT AS A PUBLIC LIMITED COMPANY

  • They can get loan from any bank in the country
  • They can raise their own capital by selling shares
  • They have voice the market shares
  • They sell share through the stock exchange to raise larger amount of capital.

CONSTRAINTS FACED BY BT AS A PUBLIC LIMITED COMPANY

  • The can lose if government decides to intervene
  • They can lose if the business loses its original shareholders, that is, if large quantities of shares purchased as part of take over bid in the market.
  • Each shareholder has little to say in how the company should run.
  • It is easy for some one to buy enough shares to take over the company.

E2

THE OBJECTIVES OF BT

The main of BT is to provide significantly better services than any of its main competitors by March 2003 at the same time working to bring dramatic improvements in the quality of service delivery.

BT’s aim is to enable its business and residential customers to communicate with the world around them using an extensive product and service portfolio covering voice, data, Internet and multimedia as well as managed and packaged communication solutions. They are trying to reduce the cost through efficiency and improved productivity to meet customers’ needs effectively and there by providing its shareholders with good, sustainable financial returns.

 

BT aim to ensure that all their employees have opportunities to develop their abilities and well rewarded for their contributions of the business. It is also BT’s policy to work with all its suppliers fairly, recognising the mutual benefit of satisfying customers’ need.

BT also aims to fulfil its responsibilities to the communities and environment in which it operates. In order to do this, BT base their strategies around four goals:

  • Making profit
  • Increasing sales and market share
  • Developing staff skills
  • Producing high quality product

The key objective of BT is to make profit. Extra money from this profit will be valuable for BT, as it will provide extra resources for research, development and training. Without profits Bt would not be able to keep its shareholders satisfied and would be unable to pay higher wages to deserving employees or invest in new technology.

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Another important objective of BT is to increase their sales and market share. This obvious goal for a company such as BT operates in an environment where market share is fiercely to battle. The aim is that having a large market share by selling more products, BT can afford to purchase more stocks from its suppliers at a lower cost per unit. This allows BT to lower their prices, which in turn increases sales and profits.

Another key objective of BT is to develop the skills of their employees. By developing employees' skills it increases motivation and improves ...

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