The telecommunications industry in Australia.

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Student ID: 13460378

Subject Name: Management Foundations

Subject ID: MG102A

Tutor: Fiona Garrood

Date of Submission: 9th April 2003

Essay Question

Study the recent history of one Australian organisation in the category of “strugglers” or “failed organisations”.  Provide some background about the organisation before analysing and describing how and why it failed, linking your discussion to management concepts and theories covered in this unit.  For instance, problems of corporate governance and ethics might be linked to Unit 4, while issues of strategy can be linked to the concepts of Unit 6.  Outline some of the lessons you have learnt in this analysis, again linking your conclusions to the theory of management (that is, support your “lessons learnt” by indicating their consistency or otherwise with the recommendations or views of other writers in the field).

Table of Contents

  • Executive Summary……………………………………………….3
  • Essay…………………………………………………………….4-8
  1. Introduction…………………………………...4
  2. Body………………………………………...4-7
  3. Conclusion………………………………….7-8

  • Bibliography……………………………………………………….9

Executive Summary

One. Tel limited founded on 28th February 1995, provided two main business services. Fixed lines, sold in the United Kingdom and Australia, which was leased through the Telstra network and mobile operations, a service through a new Australian network constructed and financed by Lucent Technologies.

Almost 48% of the telecommunications industry was dominated by Telstra, Optus 33%, Vodafone 18%, AAPT and Hutchison (Orange) shared the remaining (Davidson and Griffin 2003, p.563). With the majority of the telecommunications industry in Australia driven by Telstra investors could see that telecommunications was in demand, providing One.Tel with the opportunity to dominate a sector of the market.

For an organisation to dominate an industry not only must the industry be in demand, its behaviour should comply with corporate governance. Corporate governance refers to the broad range of policies and practices that boards of directors use to (1) manage themselves and (2) fulfil their responsibilities to investors and other stakeholders. It also refers to the listing rules of the Australian Stock Exchange (ASX). The success of an organisation heavily relies on its ability to comply within its corporate governance, and accounting standards which is an important element to a successful organisation. Accounting Standards have two main functions (1) they prescribe certain accounting treatments and (2) they set out certain disclosure requirements.

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Essay

The past decade corporate governance has been the subject of increasing stakeholder attention and scrutiny. In response to the collapse of One. Tel in 2001, shareholder and media attention has proven the need for companies to revise and reform their corporate governance policies and practices.

February 28 1995, introduced Australia to a new telecommunications company, One. Tel Limited. Displaying outstanding performance in its early years One. Tel was soon to become the investor’s hot trade.  Unfortunately, May 30, 2001 One. Tel’s staggering growth became the shareholders sudden nightmare bringing both director’s Murdoch and Packer to the ...

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