Strategic Plan Presented By:
Brief History
• April 1987
Nextel's predecessor—Fleet Call, Inc.—is founded
• 1993
Fleet Call, Inc. changes name to Nextel Communications, Inc
• 1997
Nextel introduces the Nextel National Network and announces no
roaming fees for customers traveling on the network—a first in the
wireless industry
• 2004
Nextel and Verizon trying to settle dispute over walkie-talkie service
each has to offer
Vision
• The company’s vision is to make Nextel the
first telecommunications company that
draws customers because of – not despite –
the quality of both our network and our
customer service.
Mission Statement
• Our business is wireless communications.
• Our mission is actually to help people talk
less and do more.
• Wireless products and services that help
doers get it done, instantly, anywhere.
• Our mission is to provide high quality,
integrated wireless service that maximizes
customer and investor value.
Guiding Principles
• Strive for 100% customer satisfaction
• Strive for 100% partner satisfaction
• Achieve targeted revenue growth with
a low cost structure
• Achieve win-win results through the
power of teamwork
• Work smart while remaining humble
Company Overview
• Nextel is a Fortune 200 company based in Reston, Virginia.
• Nextel is traded on the NASDQ National Market under the symbol
NXTL.
• It employs approximately 18,000 workers in the U.S.
• We recognizes that people are the company’s biggest asset.
• Diversity and inclusion is our commitment.
• We work hard to create a working environment where all employees,
customers, suppliers, and community partners feel welcome, valued,
and respected regardless of their background.
• Nextel has recently become an International company with service in
Mexico, Canada, and Latin America.
Statement of the Problem
• Nextel recently battled with Verizon over its walkie-talkie
service.
• Walkie-talkie is a service that allows phones to send voice
messages to each other instantaneously.
• Nextel and Verizon have been in court trying to settle a
dispute over Verizon’s announcement of “Push to Talk”.
• Verizon’s “Push to Talk” service is a copy of Nextel’s
Direct Connect walkie-talkie service, which is its major
chief competitive advantage.
• Nextel is accusing Verizon of stealing the slogan “Push to
Talk” and of false advertising.
• Verizon has counter sued, saying that the idea was theirs
first and that it is in fact Nextel that stole the idea.
• If Verizon succeeds, it could potentially take some of the
walkie-talkie service market share from Nextel.
Organizational Analysis
What do we do?
• leading provider of fully integrated wireless
communication services
• largest guaranteed all-digital wireless network in
the country
• only nationwide network with 99.5% uptime
• cover thousands of communities across the United
States
• Nextel and Nextel Partners, Inc. serve 297 of the
top 300 U.S. markets
How do we survive?
• competitive advantage determines the survival
ability of the company
• Nextel’s chief competitive advantage is its Direct
Connect walkie-talkie service
• being threatened by Verizon’s “Push to Talk”
which provides a similar approach to Nextel’s
Direct Connect
• feature is key among competitors’ initiatives to
copy and improve upon
How to stay in the game.
• walkie-talkie feature has helped Nextel to attract
high-value customers
• Nextel is the current leader in Average Revenue
per user
• lower plan prices or expand coverage areas to
remain competitive
• must react effectively to penetration of its market
to remain the leader in this type of service
Strategic Partnerships &
Alliances
• Nextel offers technology and services differentiation
• Strategic partnerships and alliances helps provide end-toend solutions
• Nextel’s goal is to provide each of its customers solutions
tailored to their specific needs
• Provides services for corporations, education, public
safety, and most importantly the public sector
• Complex systems integration
• Enterprise applications development & support
• Hardware manufacturing & support
• Motorola, IBM, Trimble, NASCAR
Broad Environment Issues
Legal and Governmental Issues
• Federal Communications Commission
(FCC)
– Independent United States government agency,
directly responsible to Congress
– Responsible for implementing the competitive
bidding authority for spectrum auctions, given
to the Commission by the 1993 Omnibus
Budget Reconciliation Act.
Legal and Governmental Issues
• What is spectrum?
– Spectrum is defined as the distribution of
wavelengths and frequencies.
• Why is it important to the wireless industry?
– Valuable asset in wireless communications
– Determines the frequency levels that maintain
signal strength and speed of connectivity
Legal and Governmental Issues
• Frivolous lawsuits
– Ownership of overcrowded airwaves have
increased
– Class action lawsuits have been filed on the
basis of health issues such as cancer caused by
wireless device
– Claims that rate structures assesses federal
program cost recovery fees on monthly
customer bills are misleading and unlawful
Legal and Governmental Issues
• FCC designates a range of 800 MHz and
900 MHz to cellular wireless
• 800 range of spectrum is shared with police,
fire, and ambulance systems
• Limits growth and strategy plans
Social Issues
• Concerns about health risks associated with
wireless equipment may reduce the demand
for our services.
– Alleged to pose health risks including cancer
due to radio frequency emissions from these
devices.
Social Issues
• People are busy and on the move
– Allows customers to communicate freely
without slowing down
Economic Issues
• Recent decline in economy has began to
slow the demand for wireless technology
• Technology is always changing causing
overhead costs to increase
• Stiff competition
SWOT
Analysis
Internal Strength:
Internal Weakness
•The first one with Walkie-talkie
•Sponsor of Wiston Cup
•Best Website Award
•Highest Per United Revenue
•CEO- Tim Donahue
•Not enough Advertisement(Not creative)
•Walkie talkie is restricted
•Walkie-talkie is not useful with the it is in a
long run
•Too small of a market we have
External Opportunity
External Threat
•Rest of the World
•New Advertisements
•Provide a bigger selection of phone
•3 G technology
•Competition
•Not being the strongest
•A lot of phone models we do not have
•Not enough market share
Strength
•
•
•
•
•
The first one with Walkie-talkie
Sponsor of Wiston Cup
Best Website Award
Highest Per United Revenue
CEO- Tim Donahue
Weakness
•
•
•
•
•
Not well Known
Not enough Advertisement(Not creative)
Walkie talkie is restricted
Walkie-talkie is not useful with the it is in a long
run
Too small of a market we have
Opportunity
• Rest of the World
• New Advertisements
• Provide a bigger
selection of phones
• 3 G technology
Threat
• Competition
• Complains about customer service
• A lot of phone models we do not
have
• Not enough market share
Strategy Formulation
Growth Strategy
• Price
• Differentiation
• Focus
Pricing Strategy
The prices of our calling
plans will be geared
toward the competitive
nature of our industry.
Calling Plans
Nextel National Power Plans
Plan
Monthly
fee
Anytime Night
Minutes and
Weekend
Minutes
Long
Distance
Direct
Connect
Nextel
$45.99
National
Power
500
500
Unlimited Included
Unlimited
Nextel
$55.99
National
Power
800
800
Unlimited Included
Unlimited
Technology and Service
Differentiation
•
•
•
•
•
iDEN™ technology
Digital Cellular
Direct Connect ® Service
Nextel Mobile Messaging
Nextel Online®Service
Product Innovation
• Personalized to
customers needs
• Java technologyenabled
• Enhanced with
latest business
tools
The iBoard
• Compiles email
• Manages address
books and calendars
• Java-enabled
applications
• From a wireless phone
and keyboard
The Handheld Blackberry
• Versatile
• Powerful
• Portable
Nextel Worldwide
Our customers will have the freedom to travel the
world knowing that our network is continuous in
global satellite mode.
Focus
Target Audiences:
 Enterprise
 General Business
 Vertical Markets
Vertical Industry
- Computer services
- Construction and building trades
- Education
- Field sales and service
- Financial services
- Government/Public sector
- Healthcare
- Hospitality
- Manufacturing
- Professional services
- Real estate
- Retail
- Transportation and distribution
Service Area
Nextel’s Market Share
Market Share of 6 Largest U.S. Firms
Nextel
10%
T-Mobile
10%
Verizon
30%
Sprint PCS
13%
AT&T
Wireless
18%
Cingular
19%
Customer Service
Trouble!!!
• Extra Charges
• Bad attitude
• Never call back after they promised
Human Resource Department
• Human resource Department will work with
line managers as an advisor.
• Bring in older workers
• More training
HR work with line manager
• Monitor and find out what exactly went wrong
• Serve as an advisor
• Avoid turf war between department
Older Workers
• Bring in experience younger people don’t
have
• Good communication skills which takes
years to develop.
• Good sense of Ethics which younger
workers have not yet developed.
• Loyalty.
Training
• If necessary, employees will go through the
training they need in order to provide
excellent customer service.
• New workers will work with senior workers
for around 6 hours a month in order to
improve quicker.
Accounting Recommendations
• Adopt SFAS No. 142. “Goodwill and Other
Intangible Assets”.
– Not required to amortize goodwill and
intangible assets with indefinite useful lives
• FCC Licenses for Spectrum
• Capitalize on global market
• No International Accounting Standards in
place
Finance Recommendations
• Stay Focused on Mission and Vision
because of its value of people
• Do not focus on competitor’s plans for
generating revenue
– Example: Verizon’s Push to Talk Service
• Continue to balance disciplined financial
management with smart strategic
investments
Marketing Recommendations
• Differentiation in product lines to fit
different market segments
• Expansion into currently untapped markets
• Differentiation from competitors through
technological advancement
READY. SET. DONE.