Enterprise Specific Strategic Analysis: Robi Axiata Limited

Business Strategy (W650) Term Paper

Enterprise Specific Strategic Analysis: Robi Axiata Limited

Prepared for A. K.M Saiful Majid Professor & Course Instructor Business Strategy (W 650)

Submitted by Md.Tawhid-Bin-Tarek, MBA 44D, #86 Mustafa S. Salman, MBA 44E, #32

Institute of Business Administration University of Dhaka June 13, 2013

June 13, 2013

A.K.M Saiful Majid, Professor Institute of Business Administration University of Dhaka, Dhaka-1000

Dear Sir: It is our pleasure to submit the report „Enterprise Specific Strategic Analysis: Robi Axiata Limited‟ which has been written for the fulfillment of Term Paper submission on Business Strategy (W650) course. The members of this group have done their best for making this report. They have studied different books on several topics from Strategic Management. Different member has worked on different parts of this report. The individual efforts are summed and the report came into being. We want to thank Sabbir Ahmed, Tawhidur Rahman and Ariful Mannan of Robi Axiata Limited for giving us the interview. The experience of working in this report was excellent. During the preparation of this report, we have learned many important aspects of Business Strategy. The knowledge we gathered during the preparation of this report will certainly help us in personal & professional life.

Sincerely Yours Md. Tawhid-Bin-Tarek On behalf of the students worked towards this report

................ Growth in Telecom Industry in Bangladesh ..... Robi Axiata Limiter: At a Glance ............ Current Stage of Telecom Industry of Bangladesh ............................................................................................................1................ Customer of Telecom Industry in Bangladesh ......................................................................................................... Origin of the Report ....... Methodology ............. 7 a) General Objective .. 15 4................ 17 5..................................................................... 12 3.............1.................................................................................. 8 2.................................... 8 2............ 14 3..... Comment and Findings on Overall Industry Life Cycle Analysis ................. 19 6........................................................3.................................................. Business Model of Robi Axiata Limited .......................................... Strategic Resource and Competitive Position of Robi Axiata Limited ............................. External Environment Analysis of Robi Axiata Limited .................................................................... 15 4......... 17 5.................................2........................................................................................................................................... Scope of the Report .................................................................................... 16 5......... 15 Corporate Level (Axiata) .................. 15 Business Level (Robi) ........3................................... History of Robi Axiata Limited ...........5........ 7 1.1........................................ 15 4................................................................... Shareholders ....... Porter‟s Five Factor Analysis on Robi Axiata Limited .......................................................................................Table of Contents Executive Summary ................. 16 4.....................................3. 20 ............... Limitations of the Report .................1.................................. 14 3...................................... Strategic Features of Robi Axiata Limited ............................................................................................................ 7 1.............. 8 1........... 10 2.... Strategic Group Analysis of Robi Axiata Limited ........... Achievements of Robi Axiata Limited ............................................................................................................1......................................... Introduction .............5. 19 Weaknesses ...............................................................................4..1...................................................................... 12 3...........................................4...................................................................................... Telecom Industry Life Cycle Analysis .................................................................. 8 2................................................................... 6 1... 15 4.......... Mission statement.......................... Evaluation of Vision Statement of Robi Axiata Limited ..................................................................4....... 19 6..............................................................................................................1.................................................................................................................................2.......................................................................... Balanced Scorecard of Robi Axiata Limited ........................ 7 b) Specific Objective ... SWOT Analysis of Robi Axiata Limited ...................................................................2.............. 13 3........................... 15 Corporate Level (Axiata) .......................... 7 1...... 19 Strengths ...3.......................................................... 11 2......................... Principles & Purpose ..........................................................................2.......4...... 15 Vision (Business Level – Robi) .. Identifying the Strategies of Robi Axiata Limited ......................................... 8 1................... 15 4..................................... Vision statement . 9 2.................................................................................................................5............. Objectives of the Report ..............................................................

............ Diversification Strategy of Robi Axiata Limited ....1......................................................................... Value Chain of Robi Axiata Limited .. Competitive Strategies Followed by Robi Axiata Limited ....................................... Comments and Findings on Diversification Strategies ........ Features of Organizational Development . Basic Organogram of Robi ... 24 8................................ 20 Threats................................................................................. 27 Zero Club Feet ...................................... 24 7...................... Key Success Factor (KSF) of Robi Axiata Limited..... 28 10........................................................................ 27 Robir Alo .............................................4.................. Conclusion .................................................. 28 10...........2........ 26 9.............................................................................................................................................................. 28 Basic Computer Training & Internet Corner.............. 23 Core Competencies of Robi ........................ Ethics and Social Responsibility Maintained by Robi Axiata Limited ........................................................................................................................ 28 10................................................ 27 9................................................................................................................................................................................. 23 Distinctive Competencies .............................................................1.......................................2....................................................................... 25 8.............3........ Competence Analysis of Robi Axiata Limited .......... Organizational Development in Robi ................. 27 Pure Drinking Water ...... 21 6.................................................................... 22 6..........................................................1.... Current Diversification Strategies of Robi Axiata Limited .......... 30 .............. Current Scenario of Corporate Social Responsibility in Robi Axiata Limited ......................... 23 Competencies of Robi ................................................. 25 8............................................. 29 11...................................................................................................................2........................................................................................... 20 6.....Opportunities...................

strengths. we analyzed competitive strengths of Robi in the market. external environment analysis of Robi has been done. Different strategies of Robi Axiata has scrutinized in the report. The strategic group of Robi among the 6 operators has also been found out.Executive Summary In the report enterprise based strategy of Robi Axiata Limited has been discussed. We also discussed the current trend of CSR activities of Robi in the report. Robi Axiata is a joint venture of Axiata Berhad and NTT Docomo. In the SWOT analysis. Current organizational organogram and different features of organizational developments of Robi has also described. In the report. threat and opportunity of Robi has been discussed briefly. weakness. Through competence and value chain analysis. . Current strategy of Robi is to provide nationwide coverage with competitive pricing policy.

This re port includes aspects of strategic analysis of Robi Axiata Limited which we have been taught in the course.  To scrutinize the ethical issues and corporate social activities followed by Robi. Presently there are six companies in the market.  To discuss competitive resources and strengths of Robi Axiata Limited. The number of mobile user is increasing day by day. Each of them is trying to maintain and increase their market share.  To prepare short and long term strategies of Robi. this study entails the following aspects:  To discuss the strategy and business model of Robi Axiata Limited. Objectives of the Report The objective of the report can be viewed in two forms: 1. Apart from this basic function. Nearly 35 million people own and use mobile phones as an important device and depend on these for their ultimate connectivity.  To describe the internal and external factors that affects the strategy of Robi Axiata Limited. General Objective 2. . This report is a result of strategic analysis of Robi Axiata Limited throughout the whole semester. Origin of the Report Business Strategy (W650) is one of the major courses in MBA Program Institute of Business Administration (IBA). Today. “The Globe is a village” and telecommunication has become a day-to-day necessity of the people. 1. which was earlier costly and not accessible to some extent.  To write down different strategies followed by Robi Axiata Limited. University of Dhaka. telecommunication has already started introducing some diversified areas with the help of its mobile network. Among them Robi Axiata Limited is one of the leading companies in this sector. We have prepared the report titled as “Enterprise Specific Analysis: Robi Axiata Limited”. 1. Mobile phone is becoming a very common measure of communication in our country. The traditional thinking of connecting people through mobile phone is far behind in comparison with the present scenario. Information technology enables telecom companies to provide economic solutions with a very cheap and easily available access. Mobile technology is presently providing various cheap solutions in people's daily life. It is a very attractive market for the mobile connection providers.1. Specific Objective a) General Objective To describe and analyze different strategic aspects of Robi Axiata Limited on an enterprise basis. This term paper serves the purpose of enterprise specific strategic analysis. b) Specific Objective More specifically.2.  To find out the scope of organizational development for Rob.1. It is the capstone of courses where the students apply the learning of pervious 20 courses. Introduction The basic function of telecommunication is to connect people through voice transfer and via Internet.

in the report. From the end of 2004. Interview of some more employees could not be conducted due to their busy schedule.As one of our group mates (Md Tawhid-Bin-Tarek) works in Robi Axiata Limited. 2. an ex-commerce minister. we have interviewed 3 employees of Robi Axiata Limited. Methodology Primary Data To find out the strategic aspects of Robi Axiata Limited. the . But this report only focuses on the strategic issues of Robi Axiata Limited.Different websites related to the telecom sector and online resources. From face to face interview. Credit was given to the then Chief Operating Officer Mr. It started operation on 15 November 1997 in both GSM 900 and 1800 band. commenced operations in Bangladesh in 1997 with the brand name AKTEL. we have collected different unconfidential documents and newsletters through him. Japan. Robi Axiata Limiter: At a Glance 2.  External source. Here. 1. ROBI spent heavily to market its brand all over the media. 1. In the report. There are several other operators under Axiata Berhad group.3. of subscribers. Strategic issues related with the shareholders have not been considered in the report.1. Limitations of the Report During analysis and preparation of report. They all work in Corporate Strategy Division and have expertise in designing and implementing the strategy of Robi Axiata Limited. we have done studies which can be used as a basis of future conclusive research. It was a huge success and the ROBI brand became well established. Vijay Watson who is believed to be the mastermind behind the change and success of ROBI. Secondary Data  Internal sources.2 mobile operator and was placed far behind the industry leader Robi in terms of revenue and no. we only discussed and analyzed certain strategic aspects of business strategies of Robi Axiata Limited but did not give conclusion based on any quantitative analysis. All along through its inception it was ranked as No. Zahiruddin Khan. These are described below:   Some important documents can‟t be extracted due to confidentiality. formerly known as Telekom Malaysia International (Bangladesh). we have got a lot of valuable information regarding the strategies of Robi Axiata Limited. Malaysia and NTT DOCOMO INC. we have faced some limitations.4. Scope of the Report This main purpose of the report is to find out and analyze different strategic aspects of Robi Axiata Limited. outdoor and other marketing mediums. History of Robi Axiata Limited Robi Axiata Limited is a joint venture between Axiata Group Berhad. Robi Axiata.1. Nature of Research Followed in the Report Explanatory research method has been followed in the report. After the entrance of Banglalink.5. Its founding chairman is Late Mr.

and is listed on Malaysia‟s stock exchange (Bursa Malaysia). Covering all 64 districts of the country. has approximately 120 million mobile subscribers in Asia. Robi. the northern and southern most points of Bangladesh and the first to provide seamless coverage along the Dhaka-Chittagong highway. digital network security and flexible tariff rates.Khan & Company was selling its 30% and Vodafone. On crossing 3rd year. NTT DoCoMo sealed a deal with A. Robi marches ahead with innovation and creativity. Banglalink takes the 2nd position by pushing AKTEL into 3rd in 2008. Iran. 2008. (30%)  Axiata Group Berhad Axiata is an emerging leader in Asian telecommunications with significant presence in Malaysia.697 million in April. including its subsidiaries and associates. Together with its unique ability to develop local insights. With aggressive pricing and marketing policy. In addition. quality customer care. 2. Sri Lanka. which provides peace-of-mind solutions in terms of voice clarity. etisalat and NTT DoCoMo were among the potential buyers. Having the local tradition at its core.Khan & Company for US $ 350mln on June 2008. In mid 2008 news broke out that A. Singapore. ROBI has become the first mobile operator to connect Tetulia and Teknaf. CAMEL Phase II & III and GPRS/EDGE service with high speed internet connectivity. Robi is truly a people-oriented brand of Bangladesh. It supports 2G voice. To ensure leading-edge technology.K. Axiata Group Berhad. Its customer centric solution includes value added services (VAS).2. Robi creates distinct services with local flavor to remain close to the hearts of its customers. Robi has the international expertise of Axiata and NTT DOCOMO INC. easy access call centers.competition in telecom market becomes fierce. Robi gained new pace in the market. With its strengths and competencies developed over the years. After months of negotiation. Robi aims to provide the best quality service experience in terms of coverage and connectivity to its customers all over Bangladesh. Robi has now 21. the Malaysian grown holding company has strategic mobile and non-mobile telecommunications operations and investments in India. After the change of the shareholders. Pakistan and Thailand.  NTT DOCOMO INC . Bangladesh and Cambodia. where they want and the way they want.K. Robi now enjoys 98% of population coverage. It has the widest International Roaming coverage in Bangladesh connecting 600 operators across more than 200 countries. It has also improved its technical capability by expanding and renovating its BTS across the country.The deal was completed on September 19. Its GSM service is based on robust network architecture and cutting edge technology such as Intelligent Network (IN). 2010 the company started its new journey with the brand name Robi. 2013. Shareholders Robi Axiata Limited is a Joint Venture company between Axiata Group Berhad (70%) and NTT DOCOMO INC. On 28th March. extensive nationwide network coverage and multiple global partners for international roaming. is there for the people of Bangladesh. Indonesia.43% of the current market share with subscriber base of 21. the people's champion.

Kearney benchmarking exercise in 2009.  Financial Mirror & Robintex Business award 2006 for its excellence in service. NTT DOCOMO INC is listed on the Tokyo (9437). R.3. With cutting edge technology and innovative services. 2. DOCOMO mobile phones have become highly versatile tools for daily life.  Ranked within top 6 global comparable telcos in A. including imode™. corporate social responsibilities and dealership management for the year 2006 in commemoration of WORLD Telecommunication Day 2007.Financial Express Corporate Social Responsibility (CSR) Awards 2006 for contribution in Education. Das Gold Medal for contribution to telecom sector in Bangladesh. has received “Star News HR EXCELLENCE AWARDS FOR INNOVATION IN HR”.  Arthokontho Business Award 2006 for better telecom service provider in Bangladesh.  Bangladesh Mobile Phone Businessmen Association (BMBA) Award 2008-2009 as the best service provider in Bangladesh  The Weekly Financial Mirror –Samsung Mobile & Robintex Business Award 2008-2009 as the best Telecommunication company. DOCOMO is fast becoming a preferred lifestyle choice.NTT DOCOMO INC is the world's leading mobile communications company and the largest mobile communications company in Japan. launched as the world's first 3G mobile service based on W -CDMA in 2001. corporate social responsibilities activities throughout Bangladesh. .  TeleLink Telecommunication Award 2007 TeleLink Telecommunication Award 2007" for its excellence in service.  Crossing 10 million subscribers mark in 2009. including 44 million people subscribing to FOMA™. continuously expanding its role in its users‟ lives. DOCOMO serves over 56 million customers.  Arthakantha Business Award Given by the national fortnightly business magazine of Bangladesh for its excellence in service in telecom sector. the leading mobile phone operator of the nation. Achievements of Robi Axiata Limited  Robi Axiata Limited.  Awarded the prestigious fund grant from GSMA MMU (Mobile Money for the Unbanked) in 2009. Europe and North America.  Cost optimization project saved 2 times of what was projected. Robi received this internationally renowned Management Standard after complying with all requirements.  Desher Kagoj Business Award 2006 for Corporate Social Responsibilities activities.  Beautification Award for exceptional contribution to the Dhaka Metropolitan city from Prime Minister Office on 13th SAARC Summit.T.  Standard Chartered . With the addition of credit-card and other e-wallet functions.  Leading mobile phone service provider Robi has been re-assessed and rewarded with ISO 9001:2008 certification.  TeleLink Telecommunication Award 2005 for its excellence in service for the year 2005. growing globally throughout Asia.  Robi has been conferred the prestigious Frost & Sullivan Asia Pacific ICT Award 2010 for "Emerging Market Service Provider of the Year". the world's most popular mobile e-mail/Internet service.  Financial Mirror Businessmen Award given by the national weekly Tabloid business magazine. poverty alleviation and ecological impact. DOCOMO also offers a wide variety of leading-edge mobile multimedia services. London (NDCM) and New York (DCM) stock exchanges. Primary Health. used by 48 million people.  Deshbandhu C.

They have planned to increase brand awareness through various point of sales promotions. given the high usage of voice and non voice services by these customers. They are focusing on high value customer segment which they expect will grow as Bangladesh population becomes more affluent with their value-added services. content download. 2. ring back tones. developing additional services and further expanding their presence as one of the largest provider of internet access in Bangladesh. MMS. as well as to continue their product and service innovations through continued investment in their network and products. They plan to continue increasing their revenue from non voice services. Instead of focusing on a high-end. electronic recharge systems and scratch cards through a network of nearly 100 third-party distributors.4.  Reassessed and rewarded with ISO 9001:2008 certifications 2012. They intend to increase their focus on high value business segment customers. create a strong channel of communication between Robi and subscribers and obtain better market data to allow them to be more dynamic and responsive to the market. Internet access and BlackBerry services. They have also plan to reduce their operation and maintenance expense by.  Continue to expand their comprehensive distribution network Robi new distribution model is to push sales to retailers by distributing their SIM cards.  Continuously grow subscriber base Robi‟s strategy is to grow their subscriber base. among other things. using solar power. information services. .  Increased revenue from non voice services Robi is offering a wide-range of non voice services. Identifying the Strategies of Robi Axiata Limited Robi Axiata Limited's strategy is to effectively become the number 1 telecommunication service provider in Bangladesh.  Increased Brand Awareness and reinforce brand values Robi intend to support their brand by undertaking brand refreshment exercises from time to time. connectivity. niche market. while seeking to limit declines in APPM. including SMS. accelerate distribution of product.  Achieve capital and operational efficiencies to improve profit margins and cash flow generation Robi‟s strategy is to continue to exercise strong discipline over their operating costs and capital expenditure to achieve improved efficiency and productivity in their operations and leverage their existing capacity. improve inventory management. games. Crossed the landmark of 2 crore (20 million) subscriber base in 2012. Their objectives under this new distribution model are to improve their product availability throughout the country with the establishment of more points of sales.  Focusing on high value customer Robi strive to provide superior network coverage. in particular Internet access and selling of high quality smart phones with Robi SIMs. by increasing the availability of their products and services throughout the Bangladesh and by aiming to improve customer retention. quality and reliability. controlling service agreement pricing and lobbying to reduce the SIM tax. provide better support to their customer base. it pursued a low tariff strategy designed to compete directly market leaders like Robi and Banglalink.

5.  Roaming. both structurally and in terms of overall size.  Different Advertising Materials. . Business Model of Robi Axiata Limited The business model of Robi Axiata Limited is described below: Key Partners  Axiata Group Berhad  NTT Docomo  Ericsson  Huawei  NSN Key Activities  Telecommunication Service  Broadband and Mobile Internet  International Roaming Key Resources  Base Stations and Other Network Infrastructure.  Experienced & Talented Workforce.2.  Corporate. Telecom Industry Life Cycle Analysis Industries evolve over time. The industry life cycle is measured in total industry sales and the growth in total industry sales. The industry structure and competitive forces shape the environment in which businesses operate. Value Proposition  Low Price.  Robi Walk in Centers.  Recent Promotions like a) Gechang.  Prepaid & Postpaid. b) Deshpremik c) Hut Hat Chomok d) Joy 21 Customer Relations  Customer Service  Walk in Centers  Corporate Assistance  Assistance Through Phone/Email Customer Segment  For the People who Wants to Ignite His Inner Talent  Both Male & Female  Every Age Group Channels  Newspaper  TVC/FM Radio  Billboards  Social Networks Cost Structure of Robi Operational & Network Maintenance Cost Marketing and Advertising Cost Product and Offer Development Cost Sponsorship Cost in Different Occasions Revenue Streams of Robi Charging (Scratch Card and itop-up) for service Charging for internet service E-advertisement in Robi Portal Network Infrastructure Sharing Figure 1: Business Model of Robi Axiata Limited 3. The industry structure and competitive forces change throughout the life cycle.

Government should create an environment and principles for profit. Except teletalk though their local names are Grameenphone. Except teletalk though their .Figure 2: Industry Life Cycle 3. Robi. Banglalink. At present there are six mobile operators in our country. At present there are six mobile operators in our country. According to the number of subscribers and profitability Grameen phone Ltd is in the top position among six operators. Airtel. Besides these government should preserve consumer‟s right. There is no doubt that their key objective is to earn profit. They have invested a lot and also they have more plans for investment.1. Growth in Telecom Industry in Bangladesh Market Share 2% 2% 6% GP 18% Banglalink 44% Robi Airtel CityCell TeleTalk 28% Figure 3: Market Share of Operators in Bangladesh There is many ups and down in the mobile phone industry in Bangladesh. Citycell but their main companies are the world‟s famous and big organization. According to the number of subscribers and profitability Grameen phone Ltd is in the top position among six operators.

local names are Grameenphone. Current Stage of Telecom Industry of Bangladesh Figure 5: Industry Life Cycle Position of Robi Axiata . Besides these government should preserve consumer‟s right. 3. Banglalink. Aktel. Government should create an environment and principles for profit. Warid.3. Customer of Telecom Industry in Bangladesh 35 30 25 20 15 10 5 0 GP Banglalink Robi Airtel Dec 2009 Dec 2010 Mar 2011 Figure 4: Number of active mobile subscribers (in millions) 3. There is no doubt that their key objective is to earn profit. They have invested a lot and also they have more plans for investment. Citycell but their main companies are the world‟s famous and big organization.2.

Vision statement  Corporate Level (Axiata) To be leading mobile operator in Asia  Vision (Business Level – Robi) To be a leader as a telecommunication service provider in Bangladesh 4. There are still limitless opportunities in data-dependent services. future depends a lot on how the big players and the regulatory bodies can cope up with the fast changing nature of this sector. 3. Comment and Findings on Overall Industry Life Cycle Analysis Even though the telecom services are in mature state. ethical. The adoption of such can still cause potential growth of this industry.      Mission statement Corporate Level (Axiata) To expand our presence in the region by addressing the unfulfilled communication needs of our local populations with affordable and innovative product and service To develop an operational excellence model to maximize growth and margin in a competitive environment To be the leading mobile operator in South East Asia by 2015 Business Level (Robi) Robi aims to achieve its vision through being number ‘one’ not only in terms of market share.2. Being passionate and creative in all we do . but also by being an employer of choice with up-to-date knowledge and products geared to address the ever changing needs of our budding nation 4. ownership No matter what they do in order to realize their purpose. total number of telecom subscribers have crossed 10 crore. There are 6 players in an oligopolistic market and the network infrastructure covers almost the whole country (99% of it). Principles & Purpose Robi Axiata Limited employees hold themselves accountable to the following guiding principles of the organization. Being respectful towards everyone 2. open  Functional: Simple. 4.  Emotional: passionate. Strategic Features of Robi Axiata Limited 4. As such. creative.3.4. transparent. they hold themselves accountable to the following overarching guiding principles of their organization: 1. respectful. Being trustworthy by action.1. there is really no option to increase revenue from voice service alone anymore. Moreover.Currently the telecom industry in Bangladesh is in its mature stage.

mission and goal. In both cases. the company wants to be the market leader in its operational region. 4. Mission & Strategy Learning & Growth • Up-to-date products and knowledge Business Process • Develop and operational excellence model to maximize growth and margin Figure 6: Balanced Score card of Robi Axiata Limited . Keeping things simple in the way we do things Being ethical & transparent Demonstrating individual and collective ownership Practicing an open culture in communication and interaction 4.5. 4. and for that the company needs efficient team.3. each of the SBUs needs to be the market leader in their own region. And as a part of that. Robi operate in Bangladesh and they set the vision to be the leader in Bangladesh telecom market. they will achieve this target by employing best talents. Axiata wants to „develop an operational excellence model to maximize growth and margin‟. Evaluation of Vision Statement of Robi Axiata Limited The organization is headed by its Chief Executive designated as Managing Director entrusted with overall responsibilities of business direction of the organization and leading dynamically towards the attainment of its vision. And that has been reflected in Robi‟s mission. Robi‟s vision directly relates with the corporate vision.4. 6. 5. Since Axiata operates in Asia. And to attain that target. Robi‟s mission says. Balanced Scorecard of Robi Axiata Limited Financial • A Joint Venture company • Not involved in capital market Customer • Low cost provider Vision. In the second point of corporate mission. that‟s why they said they want leadership in Asia.

Wireless Internet providers such as WiMax based companies. The availability of substitute‟s product is very low. Companies can have their own tariff plan within the range fixed by the government (minimum BDT 0. competitive substitutes exist at the present moment that can pose a threat to the industry.25. 100% profit sharing and 100% ownership possibility. German and many other multinational supplier companies have already established their business in the market. even they are using different plans for different set of people. Customers are also very sensitive about the cost. Government is also taking new initiatives for taking care of foreign investment by establishing organization like BBBF.  Interpretation of industry analysis from Porter’s 5 Forces Model From Porter‟s five forces model analysis we found the telecom industry of Bangladesh is as follows: . If one company gives any offer another company gives more attractive offer within a very short period of time. Bangla Lion and Qbee also can be a substitute. so customer can‟t avoid the better deal available to them. which show the power of the customers in the industry. it is safe to say that no direct.  Bargaining power of Customers Bargaining power of customers is high in Bangladesh. entry is relatively restricted at the moment on the government regulatory fronts. Government does not interrupt the strategy making of a company as long as the strategy does not create any uncompetitive environment. External Environment Analysis of Robi Axiata Limited 5. Keeping the price low and product differentiation with a quality service can be a crucial strategy to capture the market immediately.00 excluding VAT).1. But in Telecom industry government keeps a very close eye and not gives any new company come to the industry very easily.BDT 2. It gives easy entry facilities and many friendly options to the foreign investment like tax free time frame. since licenses must be acquired from BTRC and BTRC reserves the right to issue licenses when and to whom they see fit.5. At present companies not only giving offer with different tariff but also providing different handsets with their offers. However. innovative products and quality service at low price. So we can sense rivalry among competitors is high. Nowadays we see customer‟s uses more than one operators‟ SIM. Some giant Swedish. Porter’s Five Factor Analysis on Robi Axiata Limited  Potential New entrants Bangladesh government mostly welcomes foreign investments. substitute‟s products exist in the form of government land lines and some upcoming PSTN operators. The six big companies are trying to grab as much market share as they can through network coverage. So the bargaining power of the suppliers is low.  Substitute’s product In Bangladesh telecom industry. However.  Rivalry among competitors Bangladesh Telecom industry is growing very fast.  Bargaining power of suppliers Many big telecom related suppliers are present in the market.

we found it a very competitive but certainly not an attractive market for new company because if a new company is interested to enter into this market it has to come up with a big challenge and high risk. eg:  Brand reputation  Geographical coverage Product/service level quality  Relationships with customers Competitive Rivalry. eg:     Buyer choice Buyers’ size/number Change in cost/frequency Product/service importance  Volumes. eg:  Number and size of firms  Industry size and trends  Fixed vs. eg:     Entry ease/barriers Geographical factors Incumbent’s resistance New entrant strategy  Routes to market Supplier Power. JIT scheduling Product and Technology Development. New Market Entrants. variable cost bases  Product/service ranges  Differentiation Buyer Power.Potential New entrants Rivalry among competitors Threat from Substitute Products Bargaining Power of Suppliers Bargaining Power of Customers Restricted High Very Low Low High After analyzing on telecom industry of Bangladesh. So Robi has still great potential to do good business in this industry. eg:     Alternatives price/quality Market distribution changes Fashion and trends  Legislative effects .

Banglalink and Robi are in close range in terms of coverage. we have considered two variables. . Citycell has a decent price range but still not better than other 4 operators.1. These are: 1. Robi and Banglalink have a close price offerings in the market. Outstanding market share Loyal customer base. Price Range and 2. In terms of price offerings. sponsorship etc. But Airtel and Robi have lowest price offerings in the current telecom market. posturing.1. Airtel and Teletalk have the lowe st coverage service in the market. Network Coverage. Teletalk is in higher range. SWOT Analysis of Robi Axiata Limited  Strengths        Strong Capital base. the strategic group map of telecom industry is: High Teletalk Price Citycell Airtel Robi GP Banglalink Low Low Network Coverage High Figure 9: Strategic Group Analysis of Robi Axiata Limited 6. Considering the variables.Figure 8: Porter‟s Five Factor Analysis for Robi Axiata Limited 5. In terms of network coverage. Strategic Group Analysis of Robi Axiata Limited For strategic group analysis of Robi Axiata Limited. Citycell has also a very good network for “Zoom” service. Experienced management team. Strategic Resource and Competitive Position of Robi Axiata Limited 6. Robi is leading the way. Diversified funding sources. Diversified business exposure Strong brand image to customers through advertising.

Increased Cross Boarder Communication. Robi is using diversified network equipments throughout the network which reduces dependency on only one vendor (unlike GP). New International Gateway. Competitors are bigger threats. Growing middle class population. Developing advertising strategy with less output. Main competitor has a congested network due to unplanned customer growth.  Weaknesses         Not enough credentials for prevention of external issues. Good relationship with retailer. Declining Prices for Handsets. Lack of customer support operations. Lack of effective brand positioning measures. Products with very long life cycle. Coherence of brand image with culture of Bangladesh.  Opportunities             New technology like 3G. So. Robi does not have coverage in all rural areas which creates dissatisfaction among the subscribers. Economic Growth of Bangladesh: New and Better Interconnect Agreement: Increasing Demand for Telecom Services. it is very difficult to take out profit from operation.   Offerings of diversified products.  Threats       More Rigid Government Upgraded Technology Used by Competitors Political Instability Devaluation of Taka Risky Position of Valuable Resources No Cooperation from Government . Flexibility of Mobile Phone. Lack of service production unit. Average revenue on customer life cycle is equal to the SIM tax.

Huawei. Ericsson etc. Motorola. Scratch Cards And Network Provider Technical Marketing Sales and Supply Chain Alliance and Collaboration with Mobile Set Vendors. Supplier Related Value Chain Company’s Own Value Chain Forward Channel Value Chain Suppliers of SIM Cards. Corporate and PCO Figure 10: Value Chain Analysis of Robi Axiata Limited The supplier related value chain is a very critical factor for the success of the telecom companies. who jointly work with the mobile operators to provide user friendly and better attribute sets. scratch cards all over the country. who provide and maintain the network and the infrastructure.2. Value Chain of Robi Axiata Limited The company value chain consists of the value chain of its‟ own as well as the value chains of its suppliers and its distributions channel allies engaged in getting its products or services to its end users. the handset providers like Nokia. Forward channel of Robi are those allies and collaborating partners like the distributors and dealers who distribute the SIM cards. Sony Ericsson etc. Distributors or franchises Consumers.6. Siemens. . Siemens. The competitiveness in end users market requires that the company managers understand the entire value chain system for delivering a product or service to end users of the company‟s own value chain. The suppliers are mainly the network providers like Nokia.

Robi provides network coverage in 64 permitted districts of Bangladesh. Robi Customer Care Centers. Key Success factors of Robi are listed in the following figure. Key Success Factor (KSF) of Robi Axiata Limited Company‟s key success factors are their means to prosper in the market place. like. •Strong Infrastructure and Wide Network Coverage. Financial KSFs •Strong balance sheet to be able to invest in network expansion. Figure 11: Key Success Factor of Robi Axiata Limited . •Expert.3. •Being the low cost provider in the market. •Better Product Quality and Broad Product Line. talented and motivated workers to provide better customer service. faster delivery and high quality sproduct. Technology Related KSFs Distribution Related KSFs Infrastructure and Network Related KSFs Marketing Related KSFs Skills and Capabilities Related KSFs •Strong network of dealers/ wholesale retailers. •Faster and Efficient Customer Service.6. KSF includes product attributes. competencies. and market achievements with the greatest impact on future competitive success in the market. •Technological Innovation: Robi is the 1st Bangla SMS Service Provider in the market. Robi Touch Points etc.

the pace of network expansion of Robi is very gold.  Innovations Innovation is one of the main features of Robi. . It has got a good variety of Value Added Services (VAS) to the customers. Through the advertisements. It is the first operator that brings GPRS and bangla SMS in Bangladesh. It now covers 97% of the total population in the country. Human Resource department has established standard criteria for recruiting employees in Robi. These innovative approaches contribute to the success of Robi in a large extent.  Positive Corporate Social Responsibility Activities Corporate Social Activities of Robi receives a positive response from the customers. But in three years. “Deshpremik” advertisement also receives positives response from the customers. In recent times. The marketing strategies of Robi is always linked with our culture which is absent in most of the operators in the country. Robi revived the legacy of “Jamdani”. Robi is for those people who has inner talents and wants to excel in life. AKTEL (former Robi) was considered as Chittagong based mobile operator.  Effective Advertising Policy Robi‟s advertising policy is somewhat different than other competitors. Robi has expanded in all the districts of Bangladesh and established nationwide network which is one of the core competencies of Robi.  Providing Different Services Robi has provided basic telecommunication in a smooth way. First insurance policy for prepaid customer is another brainchild of Robi. Competence Analysis of Robi Axiata Limited  Competencies of Robi  Ensuring Nationwide Coverage Robi has now coverage in all 64 districts of Bangladesh. Before 2010. It also provides broadband and mobile internet services in the country. Employees of Robi can do social activities sponsored by Robi which will be considered as a business tour. It has also distributed old desktop computers to the remote schools in Bangladesh.  Standard Recruiting Policy Robi has the viewpoint to recruit the best and most talented persons from the potential candidates.  Branding and Market Position Robi is positioned in Bangladesh with the slogan “Ignite the power within”.  Core Competencies of Robi  Rapid Network Growth In recent times. It has setup water treatment plants in all the major railway stations of Bangladesh.6.4.

Competitive Strategies Followed by Robi Axiata Limited We know that there are five competitive strategies in the current market. As in the 3 rd position in the telecom market.  Distinctive Competencies  Closeness to Bengali Heritage and Culture Robi is distinctive in the activity that it is always close to Bengali culture and heritage. 7.  Employee Centric Management Team Robi has a very experienced and employee centric management team. Robi‟s aggressive low pricing strategy has brought them a considerable part of market share recently. Robi‟s management team believes that the prime factor for success in the industry is to recruit talented and potential employees and create positive environments for outstanding performance. Robi follows overall low cost provider strategy Robi . It is the first operator to establish network in Saint Martin‟s Island. Robi is the only network in the country that uses booster technique to ensure long coverage in the coastal areas and in the sea. The main reason behind the success is the employee centric thinking of management team. Aggressive Pricing Policy Robi‟s package is the lowest packages in the current market. the southernmost part of Bangladesh. Operators like Grameenphone and Banglalink has employee dissatisfaction issues whereas employee satisfaction level of Robi is much higher.  Boosting Network Coverage in Coastal Areas Robi is the first operator to provide network coverage from Taknaf to Tetulia. The brand logo and alpona is a clear indication that Robi is the brand that is more close to the hearts of Bengali customers.

Malaysia and NTT DOCOMO INC.  Low Switching Cost Buyers can switch from one operator to other operator in a very low cost in Bangladesh. 8. Only Citycell uses CDMA technology for the coverage.1.  Customer Base The growth of customer in telecommunication industry of Bangladesh is very large.Figure 12: Generic Competitive Strategy Followed by Robi Axiata Limited The main reasons behind Robi‟s position in the low cost provider strategy segment are:  Vigorous Price Competition In the current market. commenced its operation in 1997 under the brand name Aktel among the pioneer GSM mobile telecommunications service providers in Bangladesh.Khan & Company was selling its 30% and Vodafone. there is lot of benefit for the customer if they buy new SIM. Customer has the preference for the operator which has lowest tariff. From January.  Standardized Products Basic telecommunication service (GSM) is standardized in the country. So there has not been any major difference in the basic service scheme of telecommunication in our country. Airtel is the 2nd operator in terms of customer growth whereas Robi is in the 1st position. Current Diversification Strategies of Robi Axiata Limited Robi Axiata Limited is a joint venture company between Axiata Group Berhad. Though the coverage scenario of Airtel is not that good. etisalat and NTT DoCoMo were among the potential buyers. Such measure from newcomer makes a signal for Robi to go for low cost strategy.K. One SIM now costs 100-150 taka whereas operators have to pay large amount of SIM tax for that. In mid 2008 news broke out that A. 2010 the company started its new journey with the brand name Robi. Moreover.  Buyers’ Usage Pattern Most of the buyers use telecommunication service for the same purposes: voice call and internet use. price competition is very high. . Diversification Strategy of Robi Axiata Limited 8. on 28th March. 2011 to April. formerly known as Telekom Malaysia International (Bangladesh).88% growth in terms of subscriber base. 2013.  Strategy of Newcomers Airtel is the last operator to enter the market of Bangladesh. Japan. In the year 2012. it is best for Robi to capture the market share with favorable mobile tariff. Robi Axiata Limited. Later. There has not been any major deviation of buyer behavior in this regard. it has used low price as a introductory strategy to build a customer base. This huge amount of customers is price sensitive and chooses the operator with low tariff. In that case. telecom industry experienced 43.

Khan & Company and Mr. former Chairman of ROBI and Managing Director of A. This is a diversification into related business and given their resources and capabilities. which is cost reduction in certain value chain activity. After months of negotiation NTT DoCoMo sealed a deal with A. 30% 70% Figure 13: Current Ownership of Robi Axiata Limited Mr. it is an appropriate strategic fit in R&D and technology activity. Salahuddin Kasem Khan.The deal was completed on September 19.K. . To summarize. The diversification in related business also resulted in economies of scope.K.K. They have diversified their business into Bangladesh through a joint venture between Axiata Group Berhad and NTT DOCOMO INC. the corporate strategy of Axiata Limited is shows how to exploit the advantages offered by competitive edges successfully. Comments and Findings on Diversification Strategies Axiata Limited has been diversifying their business with a vision of becoming the leading telecom service provider in South East Asia by 2015. Chairman A.Ownership Axiata Group Berhad NTT DOCOMO INC. 2008 8.2.Khan & Co Ltd represented the sellers.Khan & Company for US $ 350mln on June 2008. AK Shamsuddin Khan.

Sylhet. These facilities with capacity of treating 5000 liters of water per hour are helping thousands of passengers. Robi has also been conducting a wide range of activities like blood donation camps. Robi in collaboration with Bangladesh Railway and the global organization WaterAid has set up water treatment plants at Kamalapur railway station and Airport railway station in Dhaka and also in the railway stations in Chittagong.  Zero Club Feet On the health front.1. the program was concentrated in nine districts under Chittagong division aimed at treating over a thousand clubfoot children. Ethics and Social Responsibility Maintained by Robi Axiata Limited 9. In 2012. safe drive campaign for the employees etc. primary health check-up sessions.9. Rajshahi and Khulna. The notable program in this field had been the treatment of hundreds of clubfeet children. . Current Scenario of Corporate Social Responsibility in Robi Axiata Limited Picture 1: CSR Activities of Robi Axiata  Pure Drinking Water The landmark activity in the health front is the installation of purified drinking water supply facilities at key railway stations in the country.

1. Whereas. This is facilitating the students with the window of opportunity to log on to internet and thus to the vast reservoir of information and knowledge. 10. People in these areas. Right and access to information play a key role in augmenting knowledge. Basic Organogram of Robi Basic Organogram of Robi is shown below: Managing Director Chief Technical Officer Chief Financial Officer Chief Marketing Officer Chief Human Resource Officer Chief Strategy Offficer Figure 14: Basic Organogram of Robi Axiata Limited There are departments and units under the concern CXOs. particularly in the off-grid region. Robi has installed computer corners at 72 colleges in far flung regions.  Basic Computer Training & Internet Corner In today‟s world. information technology plays a dominant role in all aspects of our life. At the same time. Robir Alo In remote rural areas of Bangladesh. Specialists and officers are in the bottom level of the hierarchy. This has not only infused a new lease of life amongst the poor villagers but that their carbon footprints have also been decreased significantly besides facilitating them with savings from buying fuels or candles. Organizational Development in Robi 10. Robi has intervened in this aspect and provided solar panels to 590 of homes in remote villages in Kurigram. This is adding value to the government‟s vision of creating digital Bangladesh by 2021. Considering this. depend on kerosene or wax candles to meet their demands for light to beat darkness. In the decision making policy. Rangpur. Robi has established Internet Corners at all divisional libraries. CXOs and the Vice Presidents (VP) and Executive Vice Presidents (EVP) designs the business strategy of Robi. electricity is rarely available. . General Managers (GM) and Managers look after the functional strategies.

EVPs) Functional Strategies (GMs and Managers) Operational Strategies (Specialists and Officers) Figure 15: Decision Making Hierarchy of Robi Axiata Limited 10. It has strong focus on recruiting the talented employees and retaining them by fair evaluation and compensation policy. Robi encourages employees to take part in social activities fixed by them. employees of Robi are in high spirit to implement the strategies taken by the management.Business Strategies (CXOs.  Emphasis on Cross Functional Activity To perform better as a company. Whole travel and operational cost is borne by Robi and this activity adds value in employee evaluation. Features of Organizational Development  Creating a positive Atmosphere As stated earlier.2. cross functional team KPI has been included to ensure communication between different functions and achieve the target. management of Robi Axiata Limited is employee centric. Besides doing CSR activities. . But due to positive environment and management measures. Organizations like Grameenphone are recently facing issues like employee dissatisfaction and conflict between managers and executives.  Establishing Philanthropic Attitude among Employees Positive perception towards a brand always helps a business to flourish. In annual Performance Management System (PMS). every department in the company must perform better. Robi management has recently emphasizes on cross functional activities for better performance. Robi focuses on increasing the moral of the employees towards the welfare of the society. VPs. The working atmosphere of Robi is considered as one of the bests among the MNCs in the country.

It is estimated that in 2015 Robi will surpass Banglalink and become 2nd largest operator. . At present. It is very important for Robi to design a suitable short and long term business strategy to gain more market share.11. Robi is expanding its network and coverage in a very good pace. Conclusion As a major telecommunication service provider. Robi has established itself in a good position in the market. The future success of Robi will largely depend on efficiently Robi implements favorable strategy and execute them.