2. Index
• INDUSTRY PROFILE
• COMPANY PROFILE
• SWOT ANALYSIS
• CRITICAL SUCCESS FACTORS
• STRATEGY FORMULATION
• SUMMARY
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3. INDUSTRY PROFILE
• India has the fastest growing telecom network in the world with its
high population and development potential.
• The telecommunications system in India is the 2nd largest in the
world.
• India's public sector telecom company BSNL is the 7th largest telecom
company in world.
• The total number of telephone subscribers in the country stands at
914.59 million, while the overall tele-density has increased to 76.03%
as of Oct 31st, 2011
• Total numbers of mobile phone subscribers have reached 881.40
million as of Oct 2011
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4. Statistics
• The mobile tele-density has increased to 73.27 % in Oct 2011.
• India was purported to overtake China to become the world's largest
mobile telecommunications market by the year 2013. It was also
predicted that by 2013, the teledensity will shoot up to 75% and the
total mobile subscriber base would be a colossal 1.159 billion
• Total Wireless subscriber base increased from 791.38 Million in
February 2011 to 811.59 Million at the end of March 2011,
registering a growth of 2.55%.
• Private operators hold 88.01% of the wireless market share where as
BSNL and MTNL, two PSU operators hold only 11.99% market
share.
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5. Statistics (continued)
• Wireline subscriber base declined from 34.87 Million in February
2011 to 34.73 Million at the end of March 2011.
• The share of Urban Subscriber has increased from 74.87% to 74.97%
where as share of Rural Subscribers has declined to 25.03% from
25.13%.
• The overall wireline Tele-density in India declines to 2.91 with urban
and rural teledensity being 7.26 and 1.04 respectively.
• Number of Internet users in India is the 3rd largest in the world next
only to China and the United States of America.
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6. • Telephone Subscribers (Wireless and Landline): 914.59 million (Oct
2011)
• Land Lines: 33.19 million (Oct 2011)
• Cell phones: 881.40 million (Oct. 2011)
• Monthly Cell phone Addition: 7.79 million (Oct 2011)
• Teledensity: 76.03 % (Oct 2011)
• Annual Cell phone Addition: 227.27 million (Mar 2010 - 2011)
• Projected Teledensity: 1.159 billion, 75% of population by 2013.
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8. India Telecom - Growth Drivers
• Foreign Direct Investment
Today, telecom is the third major sector attracting FDI
inflows after services and computer software sector. At
present 74% to 100% FDI is permitted for various telecom
services. This has helped the telecom sector to grow. Actual
Inflow of FDI in Telecom Sector from April 2000 to
September 2011 is US $12456 in million.
• Declining Mobile Tariffs
• Government Initiatives
• Growing Handset Manufacturing Base
• Value-added Services
• Increased access to services
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9. • The mobile service penetration in the country is currently at 51 per cent and
is expected to grow to 72 per cent by 2016.
• India's current MVAS industry has an estimated size of US$ 2.7 billion. The
industry derives its revenues majorly from the top five to six products such
as game based applications, music downloads, etc, which continue to form
close to 80 per cent of VAS revenues, according to a study on the Indian
MVAS industry by Deloitte.
• The Indian MVAS industry is estimated to grow to US$ 10.8 billion by
2015, with the next wave of growth in subscriptions expected to come from
semi-urban and rural areas, according to Sandip Biswas, Director, Deloitte in
India.
• Mobile Number Portability requests increased from 29.24 million
subscribers at the end of December 2011 to 32.79 million at the end of
January 2012. In the month of January alone, 3.55 million requests have
been made for MNP.
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10. • The mobile handset market's revenues in India will grow from US$ 5.7
billion in 2010 to US$ 7.8 billion in 2016 -"The Mobile Handset and
Smartphone Market in India" by business research and consulting firm
Frost & Sullivan.
• India is the second largest mobile handset market in the world and is
set to become an even larger market with unit shipment of 208.4
million in 2016 at a CAGR of 11.8 per cent from 2010 to 2016,
according to the study.
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11. COMPANY PROFILE
•BSNL is a state owned telecommunication company in India formed on 1st October
„2000, is one of the largest & leading public sector units providing comprehensive range
of telecom services in India.
•BSNL has about 43.74 million line basic telephone capacity, 8.83 million WLL capacity,
72.60 million GSM capacity, 37,885 fixed exchanges, 68,162 GSM BTSs, 12,071 CDMA
Towers, 197 Satellite Stations, 6,86,644 RKm. of OFC, 50,430 RKm. of microwave
network connecting 623 districts, 7330 cities/towns & 5.8 lakhs villages .
•It is the largest provider of fixed telephony and fourth largest mobile telephony provider
in India, and is also a provider of broadband services.
• It has footprints throughout India except for the metropolitan cities of Mumbai and New
Delhi, which are managed by Mahanagar Telephone Nigam (MTNL)
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12. •Before 2000, BSNL was known as the Department Of Telecommunications. During this
period, BSNL was the only telecom service provider in the country.
•The corporation tasted competition for the first time after the liberalization of Indian
economy in 1991.
•Access Deficit Charges has been slashed by 20% by TRAI, on April 1, 2009. The
reduction in ADC may hit the bottom lines of BSNL.
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13. SERVICES
Universal Telecom Services
Fixed wireline services and landline in local loop (WLL) using CDMA Technology
called bfone and Tarangrespectively. As of June 30, 2010, BSNL had 75% marketshare
of fixed lines.
Cellular Mobile Telephone Services
BSNL is major provider of Cellular Mobile Telephone services using GSM platform
under the brand name Cellone & Excel (BSNL Mobile). As of June 30, 2010 BSNL has
13.50% share of mobile telephony in the country
WLL-CDMA Telephone Services
BSNL's WLL (Wireless in Local Loop)service is a service giving both fixed line
telephony & Mobile telephony.
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14. SERVICES
Internet
BSNL provides Internet access services through dial-up connection (as Sancharnet
through 2009) as Prepaid, (NetOne) as Postpaid and ADSL broadband. BSNL held
55.76% of the market share with reported subscriber base of 9.19 million Internet
subscribers with 7.79% of growth at the end of March 2010.
Intelligent Network (IN)
BSNL offers value-added services, such as Free Phone Service (FPH), India Telephone
Card (Prepaid card), Account Card Calling (ACC), Virtual Private Network (VPN), Tele-
voting, Premium Rae Service (PRM), Universal Access Number (UAN).
3G
BSNL offers the '3G' or the'3rd Generation' services which includes facilities like video
calling,mobile broadband, live TV, 3G Video portal, streaming services like online full
length movies and video on demand etc.
IPTV
BSNL also offers the 'Internet Protocol Television' facility which enables watch
television through internet. 13
15. SERVICES
FTTH
Fibre To The Home facility that offers a higher bandwidth for data transfer. This idea
was proposed on post-December 2009.
Helpdesk
BSNL's Helpdesk (Helpdesk) provide help desk support to their customers for their
services.
VVoIP
BSNL, along with Sai Infosystem - an Information and Communication Technologies
(ICTs) provider - has launched Voice and Video Over Internet Protocol (VVoIP). This
will allow to make audio as well as video calls to any landline, mobile, or IP phone
anywhere in the world, provided that the requisite video phone equipment is available at
both ends.
WiMax
BSNL has introduced India's first 4th Generation High-Speed Wireless Broadband
Access Technology with the minimum speed of 256kbit/s. The focus of this service is
mainly rural customer where the wired broadband facility is not available. 14
16. COMPETITORS
BSNL competes with other mobile operators throughout India.
•Aircel
•Airtel
•Idea
•MTNL
•MTS
•Reliance Communications
•Tata DoCoMo
•Tata Indicom
•Uninor
•Videocon
•Virgin Mobile
•Vodafone.
•Loop Mobile
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18. Customer Market Share (CMS) June 2011
• Bharti Airtel is the market leader both in terms of Revenue Market Share (RMS) and
Customer Market Share (CMS). Bharti is followed by RCom and Vodafone.
Service Provider wise Wireless Market Share (CMS) June 2011
Bharti 19.87%
Reliance 16.82%
Vodafone 16.62%
Idea 11.17%
BSNL 11.00%
Tata 10.68%
Aircel 6.81%
Uninor 3.09%
Sistema 1.38%
Videocon 0.84%
MTNL 0.65%
S Tel 0.39%
Loop 0.37%
HFCL 0.16%
Etisalat 0.15%
100.00%
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19. • Private operators hold 88.01% of the wireless market share where as BSNL
and MTNL, two PSU operators hold only 11.99% market share.
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20. • BSNL and MTNL, two PSU operators hold 82.61% of the Wireline market share.
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22. MISSION
•Be the leading telecom service provider in India with global presence.
•To provide world class State-of-art technology telecom services on
demand at affordable price
•To Provide world class telecom infrastructure to develop country's
economy
•Leveraging technology to provide affordable and innovative products/
services across customer segments
•Providing a conducive work environment with strong focus on
performance
•Building effective IT systems and tools 21
23. OBJECTIVES
• To be the Leading Telecom Services provider by achieving higher rate of growth so as
to become a profitable enterprise.
• To provide quality and reliable fixed telecom service to our customer and thereby
increase customers confidence.
• To provide customer friendly mobile telephone service of high quality and play a
leading role as GSM operator in its area of operation.
Strategy for:
• Rightsizing the manpower
• Providing greater customer satisfaction
• Contribute towards:
• Broadband customers base of 20 Mn in India by the end of 2011-12 as per broadband
policy 2004.
• Providing telephone connections in villages as per Government policy.
• To leverage the existing infrastructure of BSNL for facilitating implementation of other
government programmes and initiatives particularly in the rural areas.
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26. STRENGTHS
Service in Rural Areas
Experienced telecom service provider
Total telecom service provider
Huge Resources
Huge Optical Fibre network and associated bandwidth
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27. WEAKNESS
Poor marketing strategy
Bureaucratic organizational set up
Inflexibility in mindset (DOT period legacies)
Limited number of value added services
Legacy of poor service image
Huge and aged manpower
Procedural delays
Lack of strategic alliances
Problems like outdated technologies, unproductive rural assets, social obligations,
political interference,
Poor IT penetration within organization
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28. OPPORTUNITIES
• Tremendous market growing at 20 lakh customers per month
• Under tapped broadband services
• Untouched international market
• Can capitalize on public sector image to grab government‟s ICT initiatives
• Leveraging the brand image to source funds
• Fuller utilization of slack resources
• Can make a kill through deep penetration and low cost advantage
• Broaden market expected from convergence of broadcasting, telecom and
entertainment industry
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29. THREATS
• Competition from private operators
• Keeping pace with fast technological changes
• Market maturity in basic telephone segment
• Multinational eyeing Indian telecom market
• Decreasing per line revenues due to competitive pricing
• High bargaining power of customers
• Private operators demand to do away with ADC can seriously effect
revenues
• Policies of government like “OneIndia” rates
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30. Critical Success Factors
• the limited number of areas in which satisfactory results will ensure
successful competitive performance for the individual, department, or
organization
• activities required for ensuring the success your business. Critical
success factors may change over time, and may include items such as
product quality, employee attitudes, manufacturing flexibility, and
brand awareness
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31. CRITICAL SUCESS FACTORS
• Industry CSF’s resulting from specific industry characteristics;
• Strategy CSF’s resulting from the chosen competitive strategy of the business;
• Environmental CSF’s resulting from economic or technological changes; and
• Temporal CSF’s resulting from internal organizational needs and changes.
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32. • Rockart and Bullen presented five key sources of CSF’s:
• The industry,
• Competitive strategy and industry position,
• Environmental factors,
• Temporal factors, and
• Managerial position
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33. The IndustryCritical success CSF’s common to all companies operating within the same industry.
factor Industry’s set of characteristics define its own CSF’s Different
each organization has its own unique goals so while there may be
some industry standard – not all firms in one industry will have
identical CSF’s.
Some trade associations offer benchmarking across possible common
CSF’s.
Competitive strategy and The nature of position in the marketplace or the adopted strategy to
industry positionCritical success gain market share gives rise to CSF’s
factor Differing strategies and positions have different CSF’s
A firm’s current position in the industry (where it is relative to other
competitors in the industry and also the market leader), its strategy,
and its resources and capabilities will define its CSF’s The values of an
organization, its target market etc will all impact the CSF’s that are
appropriate for it at a given point in time.
Environmental FactorsCritical Economic, regulatory, political, and demographic changes create CSF’s
success factor for an organization.
These relate to environmental factors that are not in the control of the
organization but which an organization must consider in developing
CSF’s Examples for these are the industry regulation, political
development and economic performance of a country, and population
trends.
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34. Temporal FactorsCritical short-term situations, often crises.
success factorCritical one-off CSF’s resulting from a specific event necessitating theirinclusion.
success factor
Critical success factor
Managerial PositionCritical An individual role may generate CSF’s as performance in a specific
success factorCritical manager’s area of responsibility may be deemed critical to the success of an
success factor organisation. In organizations with departments focused on customer
relationships, a CSF for managers in these departments may be customer
relationship management.
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35. CSF OF BSNL
•NETWORK COVERAGE AND HUGE INFRASTRUCTURE
•LOYAL CUSTOMER BASE
•GOVERNMENT POLICIES ON ICT INITIATIVES AND
SUBSIDIES.
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36. STRATEGY FORMULATION
• Clear technology strategy
• Customer Orientation Strategy
• Extensive use of IT
• Shorten the purchase-decision cycle
• marketing strategy needs to be redefined and should focus around Value Added
Services
• Overhaul its Human Resource Management strategy
• Restructuring of organization
• Immediate implementation of CDR based billing.
• Revenue generation through Value Added Services(VAS)
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37. 1.CLEAR TECHNOLOGY STRATEGY
•BSNL should go in for innovative products based on convergent technology in order to
acquire dominant market position.
•This can be achieved by –
• Replacement of all the outdated technologies immediately,
• Redeployment of unutilized capacities should be considered first.
• Early deployment of cost effective wifi/wi max technologies
• Increasing the capital investment in convergent technologies even if it renders certain
in use technologies redundant.
•In spite of cost implications the alternatives of scaling/upgrading of existing
technology should not be considered since it will not yield the desired results. Instead
the focus should be on achieving dominant market position through large-scale
deployment of new technology
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38. 2.CUSTOMER ORIENTATION STRATEGY
It will retain existing customers as well as to attract new customers by
• Creating a Service-Oriented culture within the organization.
• Introducing flexible Registration Terms so that new customers are attracted.
• Educating the customer about services in detail and respective tariff structure
• Introducing service at door-step.
• A successful loyalty programme becomes the driving force in customer relationship
management strategy
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39. 3.EXTENSIVE USE OF IT
•It will improve operations but can add to greater customer satisfaction. Despite being a
technology intensive organization IT penetration in BSNL is not high.
• Presently, the use of IT in BSNL is restricted to –
• DQ (Directory Enquiry), IVRS (Interactive Voice Response System)
• Accounting and billing systems
• Commercial & Fault Repair System package
• Telephone Directory on CD ROM and on the Internet.
•BSNL should create intra-BSNL IT network connecting all the SDCAs (short distance
charging area)through VPN network for the organization‟s own use to improve efficiency
and transparency.
•Instead of integrating the existing segment specific software, it is recommended that
standard integrated packages should be considered.
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40. 4.SHORTEN THE PURCHASE-DECISION CYCLE
•BSNL should redefine procurement processes to shorten the purchase-decision
cycle, which is critical in project implementation to any telecom service provider.
•BSNL should enter in long term supply contract with world-class players to come
out of mantra of tendering process.
• This will help BSNL to counter the strategy of its competitors to stall the very
procurements of critical items.
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41. 5. BSNL’S MARKETING STRATEGY NEEDS TO BE REDEFINED
• It should focus around Value Added Services, building strong distribution chain and
differential treatment to premium/corporate customers
• Marketing is going to be the key to success – BSNL should come out with a variety of
schemes for the end subscriber, both commercial and residential.
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42. 6.HUMAN RESOURCE MANAGEMENT
• It has a vast manpower of 2,82,690 as per march 2011.
• To meet the technological challenges, employees need to be trained for technology
up-gradation, modernization, computerization etc in a targeted manner.
• Though different training programs are being run in various training centers of
BSNL to impart technology based training, they seem to be outdated in the fast
changing competitive environment and with formation of corporate.
• The dynamics of transition from a lethargic government organization to a
professionally running company requires tremendous up gradation in Human
Resources.
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43. • There are various aspects of managing an organization that many employees
even at top levels in BSNL are unaware of.
• At one hand the competition has brought in the requirement to learn
professional skills in fields like Marketing, HRD, Finance etc. ,
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44. BSNL need to mend its Human Resource Management strategy and should focus on –
• Tie up with top business schools in India for training their managers at various levels.
• Redeploying its manpower from bigger cities to smaller ones
• Coming out with VRS/CRS for manpower above the age of 50.
• Creating value through employee motivation and should develop reward and
punishment system
The VRS/CRS scheme is likely to be opposed by the unions and the implementation
may be difficult in the politicized environment. However, rightsizing the
organization is of paramount importance for the long run interest.
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45. 7.RESTRUCTURING OF ORGANIZATION
• BSNL‟s organization structure still remains more or less functional in structure.
• Restructuring of organisation can with each product/segment considered as a
separate business will help in
• Better management
• Improved segmental efficiencies
• Improved organizational communication
• Better performance monitoring
• Develop focus on revenue
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46. 8.REVENUE GENERATION THROUGH VALUE ADDED SERVICES(VAS)
•The major chunk of these revenues have come from basic services and only recently the
revenues from cellular business (to the tune of Rs 3000 cr. per annum) . Moreover ADC
(Access Deficit Charge) and inter-connect charges income have decreased due to influence
of TRAI.
• With continuous decrease in long distance call rates and growth of private network the
revenues from ADC and inter-connect charges will eventually disappear.
•BSNL should realize that the basic services market and revenues from it are also shrinking
and it is necessary for a telecom service provider like BSNL to concentrate on increasing
revenues through VAS.
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47. • While many of the operators in India and outside are generating more than 25% of
their revenues through VAS, BSNL cannot attribute even 5% of its revenues to
VAS. I
• In order to succeed the strategy of BSNL should be built around strengthening its
VAS like SMS, MMS, broadband content generation etc. and marketing them.
BSNL can also go for large-scale tie-ups with content providers.
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48. SUMMARY
•BSNL should change its very strategy of acting as follower to that of leader.
•Instead of reacting to other operators move it should start acting proactively.
• The overall strategy of BSNL can be of concentrating on the mobile and broadband
business in near future and to immediately phase out loss making businesses like
telegraph.
•.BSNL can leverage on its pan India reach and economies of scale to achieve overall cost
leadership.
•At the same time capital investments can be made in next generation networks where
stress should be on Wi-Max, content based data service and VOIP.
•Emphasis on organizational restructuring coupled with customer orientation and
operational efficiency can help BSNL find place in Asian Telecom market.
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