Telecom Industry

(Critical Success Factor Analysis)

: Presented by
Suja George
Sujit Kumar
Sushant Deshpande
Upendra Tripathi
Varun Mittal

: Presented on
Nov 12, 2013
Group 3
Oct 2012 MBA F&B)
(Batch

Agenda
Introduction
Measurement of CSF
Steps to identify CSF
Telecom Industry
Bharti Airtel
Reliance Communication

Introduction

Critical Success
Factors are those
few things that
must go well to
ensure success
for a manager or
an organization.

Critical Success Factors

A need or want
You must be visible
The right price
Continuity of supply
Expected performance
It is a value proposition and the answer to 'Why would customers choose us?'

Measurement of CSF

Customer
Factors
Customer Satisfaction

Financial
Factors
Profitability

Liquidity

Timeliness of delivery
Quality

Product Innovation
Timeliness of new
product

Dealer & distributor

Marketing & selling

Learning
and
Growth

Skill Development
Employee morale

Sales

Competence

Steps to identify CSF

1. Establish
business's or
project's
mission and
strategic goals.

2. For each
strategic goal,
ask "what area
of business or
project activity
is essential to
achieve this
goal?

3. Evaluate the
list of
candidate CSFs
to find the
absolute
essential
elements for
achieving
success

Steps to identify CSF contd.

4. Identify how
you will
monitor and
measure each
of the CSFs

5.
Communicate
your CSFs
along with the
other
important
elements of
your business
or project's
strategy

6. Keep
monitoring and
reevaluating
your CSFs to
ensure you
keep
progressing
towards your
aims

Telecom Industry

Telecom Industry

Wellestablished
players

To stay
ahead of the
competition,
mobile
operators
will need to
focus on CSF

Continuous
evolving
technology

Commoditi
sation of
telecom
services

Nationwide
network

Improved
competitive
scenario

High
capital
investment

Wide
variety of
choices
available to
customers

Controlled
licenses

Lowest
tariffs in
the world

Critical Success Factors

Economies of Scale
Cost per unit decrease with increase in size
Sustainable growth

To support economies of scale

Network Service Reliability

Determines the customer preference
Churn Rate

Companys high acquisition cost v/s customers

low switching cost

Bharti Airtel

Bharti Airtel - CSF

Cost Optimisation
Outsourcing non-core activities leads to improved
affordability
Sustainable Growth

VAS and Diversified portfolio

Network Service
Wide presesnce: 22 telecom circles & 20 countries
Technology innovation
Churn Rate

Customer service and attractive retention plans

Bharti Airtel - CSF

Outsourcing non core activities

Network management Nokia, ZTE, Ericsson,

Huawei
Information technology outsourcing -IBM
Call centers / customer service Nortel, Avaya,
Cisco, IBM Daksh
Distribution 1.4 m retail outlets
Towers / passive infrastructure Indus Tower ,
Bharti Infratel

Result is 87% nationwide coverage with 31%

revenue market share and 22% customer

market share

Bharti Airtel - CSF

Diversified Portfolio

Mobile & Data Services (2G and 3G)

Telemedia Services (3.3 mn CB; presence in 87
countries; ARPU of 15.1$/m)
Digital TV (8.6 mn SB; ARPU 3.2$/m)
Tower Infrastructure Services (BIL holds 42% stake
in Indus Towers with avg. tenancy ratio of
~1.93/tower)
Subscribers base increased from 40.6 mn to 50.6
mn from Q2FY13 to Q2FY14

Reliance Communication

Reliance Comm - CSF

Economies of Scale
Sole operator with all-India telecom license leading to affordable call
charges
First operator to introduce free incoming calls
Sustainable growth

DAE programme: Recruited 50000 retailers to sell reliance

connections

Network Service
CDMA: 21 telecom circles
GSM: 8 telecom circles
Churn Rate

Introductory call charges @ Re 0.40

High switching cost: Handsets @ Rs. 500 with 3 year built-in contract
Reliance - Reliance free calls

Wireless Market Share

Source: TRAI website (June 2012)

Strength Assessment

Strength Assessment
Critical Success
Factor

Bharti Airtel
Weight

Reliance Comm

Score

Weighted
score

Score

Weighted
score

0.30

1.2

1.2

0.10

0.5

0.5

0.40

1.6

1.2

Churn Rate

0.20

0.6

0.6

Total

1.00

Economies of
Scale / Cost
optimisation
Sustainable
Growth
Network Service
Reliability

* 5 is highest, 1 is lowest score

3.9

3.5

Thank You