Business Strategy (BMGT3001S)

CHINA MOBILE

Submitted by: Jared Chan

Bachelor of Business Studies (BBS)
Word count: 1290
For Dr. Shawn Wong, 22 August 2016

Table of Contents

Introduction 3
Business Strategy

3,4

Strategic Issues

4,5

Strategy Management
Conclusion

References

Introduction
China Mobile Limited was founded in Hong Kong on September 1997. Since then, China
mobile was the leading telecommunications service provider in China and currently has the
worlds largest mobile customer base according to Chen (2015).
The organisation has operations in 31 provinces, autonomous regions and directly
administered municipals like Beijing, Shanghai and Tianjin. As Hong Kong is part of the
special administrative region of China, China mobile also operates there. The organisation
also owns 100% interest in its 43 major subsidiaries such as MIGU Company Limited and
China Mobile (Suzhou) Software Technology Company Limited.
Furthermore, China Mobile owns 99.97% of China Mobile Group Device, 92% of China
Mobile Finance and 66.41% of Aspire Holdings Limited. In addition, the organisation has a
workforce of more than 430,000 and maintains its leading position with a customer base of
more than 825 million. Information available from their website (China Mobile Limited,
2016).
Business Strategy
Since the start of China Mobile, their strategy has been changing from time to time to keep up
with globalisation and to have a competitive advantage over their competitors. The evolution
of China Mobile strategy from 2001 to 2005 was focused on service and business leadership,
which meant that China Mobile was aiming to be a world class communication organisation
and a telecommunication expert. From 2006 to 2010, the organisations strategy changed to
leapfrog strategy and from 2011 to 2016, they have adopted the sustainable development
strategy was is aimed at international leadership with sustainable development.
The three goals that China Mobile aims to achieve by adopting this strategy is first, a
healthier and more stable China Mobile, second, more satisfied stakeholder ship and thirdly,
an information enhanced future. The aim of the first goal is to sustain its stable economic
growth, having strict corporate governance, maximising risk control and fulfilling
responsibilities. The aim of the second goal is to continue to provide reliable services, create
harmonious communities, improving on employee satisfaction as well as having a friendlier
environment. The third aim is to accelerate the achievement of future innovations while
creating a wireless experience where sharing information between urban and rural areas
can be as easily achieved.
3

By identifying key factors in regards to the businesss sustainability, the organisation was
able to minimise risk and maximise their development abilities. In addition, the initiation of
stakeholder involvement was also implemented to further improve the sustainable
development strategy. While adopting the sustainable development strategy, China Mobile
has to identify the key external and internal factors to achieve their goal. For China Mobile,
recognising risk and opportunities are important factors to assists them for future growth. By
doing so, acquisition of strategic resources and strengthening of core competencies and
abilities is a crucial part of the sustainable development strategy that China Mobile has
adopted.
Strategic Issues
Although, having a good strategy, the organisation is bound to face issues in regards to
sustainability. The two key sustainability issues are:
1. Issue benchmarking
During the benchmarking phase, China Mobile starts making analysis on four key
areas. First, international standard analysis, which mainly focuses on the ISO 26000
framework. This framework is a guidance for all types of organisation on social
responsibility or anything related to social responsibility. Second, benchmarking
industry best practices. China Mobile benchmarked themselves with 11 other
companies with high sustainability performance to recognise what they are doing
right and what needs improvement. Third, analysis is done on existing policies as well
as the opinion of the public about their organisation. The analysis is done to have an
unbiased view of the organisation. Lastly, stakeholder perception mapping survey is
done to further understand their perception on responsibilities, expectations and also
to gain suggestions on how to further improve.
2. Issue mapping
Issue mapping is to focus on important factors of the business operations on various
stakeholders as well as the considerations of sustainability opportunities and risks. In
terms of seizing opportunities and controlling risk, there are 5 key factors.
1. Employee
In order to seize opportunities, improving on independent innovation is an
effective way of creating new ideas and opportunities for China Mobile. China
Mobile has to support employee development and training as well as provide them
4

with sufficient welfare and healthcare systems. Promoting employee involvement

in decision making and protecting employee rights are effective ways of
controlling risks in regards to internal factors.
2. Shareholders and Investors
In terms of shareholders and investors, China Mobile has to optimise the return of
investment as well as strengthen shareholder engagement for example, holding
more dialogues to address issues that may arise. To reduce risk, prevention of
corruption is one of the main priority and China Mobile has taken steps to
improve

corporate

governance

for

example,

monitoring

organisational

performance as well as maintaining an effective governance infrastructure.

3. Customers
Building a wireless city construction within the urban and rural areas would be a
great opportunity for China Mobile to have good publicity. This will also help
them get more customers as they have a wider range for wireless networks. To
reduce the risk, network stability is an important factor as customers would
always want good connectivity as well as fast network speeds for their
communication purposes. Customer service has to be robust and protecting
customer rights is a must to prevent the risk of customers losing trust in the
organisation.
4. Value Chain Partners
Expansion of industry development, cooperation and value sharing is crucial for
China Mobile to seize opportunities. The need for responsible value chain partners
is a must to meet customers needs and to reduce risk of having a bad reputation
of not meeting customers needs.
5. Community and Environment
Supporting of charity or charitable events as well as volunteering their services,
China Mobile will be able to show customers that they care about the community.
China Mobile should also develop or use green applications for environmental
protection. Thus, lowering energy consumption and improving resource
efficiency.
Strategy Management

China Mobiles management system is made of four key departments. The four departments
work closely together to achieve the organisations strategic goals. The four departments are
namely strategy management, implementation management, performance management and
communications management.
The strategy management department acts in accordance with the organisations strategic
goal. The department creates the vision, goals, values and focuses on implementation
strategy. By doing so, the organisations sustainable development strategy begins with them
as the department transforms the strategy into specific work requirements for the whole
organisation. The implementation management department focuses on spreading the
awareness of the strategic goals that the strategy management department has implemented.
Best practices are also explored and documented for the organisation as well as
implementation of the strategic initiatives.
The performance management department implements objective performance rating systems
as well as target areas for improvements to further enhance the sustainability performance.
The communications management department sets up communications platform for
customers as well as stakeholders for an effective two way communication channel. This will
allow the organisation to respond to requests in a timely manner. Thus, building a more
positive relationship between the organisation and its stakeholders and customers.
Conclusion
Since the founding of China Mobile Limited, the organisation has used different strategies to
stay ahead of its competitors and keep up with the changing need of its customers,
stakeholders and the ever changing market. Therefore, using the right strategy for the right
situation is very important for China Mobile to stay as the market leader in the area of
communications.
By adopting the sustainable development strategy, China Mobile is capable of staying ahead
of its competitors. Although the use of such strategy is effective for China Mobile, there are
key issues that must be addressed in order for China Mobile to have a more robust strategy.

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