Empirical Analysis Of Operational Efficiency Of Global Telecommuication Companies

With the saturation of the global telecommunication market, the growth in business revenue and number of users is slowing down. More and more operators are confronted with the necessity of transformation. In order to achieve successful transformation, we must find key indicators which have great influence on the operational efficiency of companies, so as to improve their performance of business management and investment, and enhance their core competitiveness in the world market.In this paper, we covered 15 telecom companies from 2004 to 2007. Specifically, the DEA method was mainly applied in the horizontally and vertically comparative study of the operational efficiency of 15 samples and three regions. Furthermore, the sensitivity analysis method was applied to analyze key factors for the improvement of operational efficiency. Finally, we proposed corresponding measures and suggestions.We found that the average efficiency of all companies was higher in 2005 than in other years. Telecom Italia, Vodafone, BT, NTT, KT, and Telstra were all DEA-efficient for four years, and Verizon, Comcast were DEA-inefficient. The technical efficiency of America was the lowest in three regions, and Asia was the highest except for the year 2004. sensitivity analysis proved that "total assets" and "CAPEX" were two most sensitive factors in the improvement of operational efficiency.Results of the study have important reference value for the improvement of current management process as well as stock investors.