For some 25 plus years I have been accustomed to using the (NSW) June Long Weekend as the 'dead line' for producing the next financial year's operating plan in terms of monthly P&L and month by month operational decisions relating to acquiring personnel, releasing 'new' products/services and estmating what changes have to be made to current products/services over the coming 12 months to meet what I would guess to be what other companies that affect our company's activities might do.
I seldom get many of these issues right and, as I said a couple of days ago, planning can no longer be done a year ahead, in any real sense, and is basically done, at least by people like me, on a 'rolling basis' with many decisons being made each day as the flow of real (or what I perceive to be real) information about competitors, marketplaces and government decision making becomes clear in their various implications to what Exetel is currently doing or is planning to do in the near future.
However the banks always want to see business plans as do various other people (including shareholders and directors) and in the dangerous world of small business the legal protections of sensibly based written business plans and even more sensible cash flow, revenue and profit forecasts are essential elements of remaining in business.
So I completed the 'final' Exetel Australia and Exetel Sri Lanka business plans in terms of the key month by month financials of revenue, profit and cash flow for each of the months of the FY2009 financial year around 3.30 am this morning. It all makes eminent sense and, given some supplier decisions that need to be made over the next 2 - 3 days, will not be changed in any significant way before being circulated to Exetel's directors and shareholders.
They key issues I addressed in preparing next year's plan were:
1) A change in ADSL2 supplier - or the adding of a second ADSL2 supplier to replace Powertel/AAPT.
2) The discontinuance of 'ADSL1' as a major revenue earner for Exetel Australia or the drastic reduction of ADSL1 supply costs.
3) The impact of adding a Layer 2 HSDPA service in terms of operations and support (as well as revenue impact)
4) The implications of increasing the VoIP services by a factor of ten
5) Providing services in New Zealand
6) Providing services in the European Union
7) Providing services in Sri Lanka
8. Changing the Exetel Australia revenue sources from Residential 80% and Corporate 20% to Residential 60% and Corporate 40%
My view of what 'competitors' might do to influence any of the decisions that we might make has become very strange compared to previous 'Exetel' years. This change is that up until the current financial year (and definitely not figuring in the planning done for the current financial year 12 months ago) is the fact that there are unlikely to be any 'competitive' actions that would influence (either positively or negatively) what a small company like Exetel plans to do in FY2009 - except those by Telstra.
In previous years I never considered that Telstra was even vaguely a competitor in what Exetel would try and do while the actions of some other much smaller companies than Telstra were important - in varying degrees.
Right now my view is that no other company offering services in the marketplaces/product sets in which Exetel is involved can affect anything Exetel plans to do in any way - and as we move further away from other communications company offerings we cease to be 'in competition' with companies we once might have regarded as being, in some ways, competitors. My judgement/guesswork if you wish to be less than kind, is that companies such as iiNet, Internode, TPG, iPrimus, AAPT et alia have nothing newer or more different to offer than they already do and their different and differing capacities to innovate are almost zero at these 'blind alley' stages of their various corporate lives - at least in any sense of negatively or positively influencing Exetel's actions and initiatives which increasingly diverge from those companies objectives.
Optus Retail could make life more difficult for Exetel than it already does but I think it's much easier to guess at their likely future 'announcements' and I don't think that Exetel will be as affected as in the past.
However Telstra's actions, together with it's inactions, could make life very, very hard for Exetel in the coming twelve months and not least because Telstra's future actions are becoming even harder to guess at than in previous years. My issues with Telstra Retail are:
1) What will they sell 'ADSL1' at come July 1st 2008 or, perhaps, June 15th? My guess is that they will drop the prices of "ADSL1" substantially and increase the speed of "ADSL1" at the same time.
2) What will they reduce the price of "ADSL2" to by August 1st 2008? My guess is by up to 50% on their current "web based plans" and something greater than that on their "promotional offers".
3) What will they reduce their data over 3G prices to over the next six months? My guess is they'll reduce them by around 50%.
4) Will they be persuaded to actually build some sort of ADSL replacement network in some reasonable time frame?
There are other considerations but those are the four main ones.
Perhaps I'm completely incorrect - I hope that is the case - but if I'm not then perhaps you can see why I'm of the opinion that nothing anyone else does, other than Telstra, matters.
Anyway it's going to be, as always, a difficult 12 months but hopefully a satisfying one for both Exetel and Exetel's customers.