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ISSN 1817-5090

The Cost and Management
Vol. 35 No. 1
Janua!-"e#ua!$ %007 &&. 49-58
Innovation Strategy: A Realistic Example in
Mobile Telecommunication Service
Sa'e (a)*+ ,hmed (at an
Md. Sha*)ul ,lam
,#u Saleh Md. Sohel--.-/aman
Abstract: Innovation is a widely used strategy across industries in many countries.
It is now at the top of the agenda of the mobile telecommunication industry in
Bangladesh. A great deal of experiment is going on right this moment in thi s
industry. This paper will show how innovation strategy has been pursued by two
major players, which has changed the competitive strategy of the competitors.
We are familiar with the term tangible goods with accompanying services!, and
major service with accompanying minor goods and services! where the main
focus goes on physical product and service respectively. In this study we shall
see that how these concepts changes due to the innovative mar"eting strategy of
the mar"et players. We shall also see how the mar"et status of the players changes
as the strategy is implemented. #urthermore, from this study we shall learn how
we can manipulate innovation strategy more effectively. The context of this study
is the developing country. The role of the economy of developing countries i s
becoming increasingly important for the world economy. It is assumed that the
findings and understanding of this research will help the organi$ations in
developing countries to develop their effective business strategy in order to achieve
sustainable competitive advantage.
Keywords: Innovation strategy, competitive advantage, vertical integration,
sustainability, and %&% culture.
No0ada!s se1*2e *s 2ont*#ut*ng to so2*et! and e2onom! than e1e #e)oe. It *s not e32e&t*on
*n 4angladesh$ too. The 2ont*#ut*on o) se1*2e se2to to0ads the e2onom*2 a2t*1*t*es * s
*n2eas*ng gaduall!. In e2ent t*mes$ mo#*le tele2ommun*2at*on se2to *s one o) the ma+o
2ont*#utos *n tems o) e1enues$ em&lo!ments and *n)astu2tue de1elo&ment. 4! natue
se1*2e *s a 2om&le3 2om&os*t*on$ 0h*2h *s 1e! d*))*2ult to a#sta2t$ at*2ulate and standad*.e.
Thee)oe$ se1*2e ogan*.at*ons ae t!*ng to &o1*de moe 1alue to the 2ustomes *n *nno1at*1e
0a!s to ma*nta*n the* 2om&et*t*1e ad1antage. It *s o)ten )ound that the se1*2e &o1*des *n
man! de1elo&*ng 2ount*es do not se1e the* 2ustomes &o&el!. Thee ae se1eal easons
'atan, Alam and (aman
50 The Cost and Management$ Janua!-"e#ua!$ %007
%ar"er 'afij Ahmed 'atan is a )ecturer, %chool of Business, *nited International *niversity +*I*,, -ha"a. &r. &d. %hariful Alam and &r.
Abu %aleh &d. %ohel/*$/(aman are &BA student and 0h.-. %tudent respectively at %chool of &anagement, Wuhan *niversity of Technology,
Wuhan, 1ubei, 0eoples 'epublic of 2hina.
ISSN 1817-5090
#eh*nd that #eha1*o$ su2h as 2onsumes ae not edu2ated and a0ae a#out the* *ght and
&*1*lege$ la2' o) &o)ess*onal*sm )om the )*ms5 s*de$ la2' o) 2om&et*t*1eness and so on. Th*s
s2ena*o *s e6uall! tue *n 2ase o) 4angladesh mo#*le tele2ommun*2at*on *ndust!.
b!ective and Scope
The o#+ e2t*1e o) th*s &a&e *s to h*ghl*ght the &a2t*2e o) *nno1at*on stateg! *n mo#*l e
tele2ommun*2at*on *ndust! *n 4angladesh. ,t the same t*me$ to *dent*)! the 2hallenges and
shot2om*ngs *n the *m&lementat*on o) *nno1at*on stateg! *n th*s se2to. "om the )*nd*ngs o)
th*s stud!$ ogan*.at*ons *n th*s se2to 0*ll #e a#le to )*nd some e))e2t*1e gu*del*nes *n 2on)*gu*ng
the* *nno1at*on s2heme )o the* 2om&et*t*1e ad1antage.
"o th*s stud! ma*nl! se2onda! data and *n)omat*on ha1e #een used. In some 2ases &*ma!
*n)omat*on has #een used to 2la*)! the de2*s*on o) *nno1at*1e s*de. Se2onda! data and
*n)omat*on ha1e #een 2olle2ted )om *ntenet$ ne0s&a&e$ e3*st*ng l*teatue$ maga.*nes et2.
7esonal o#se1at*on has #een a 'e! sou2e )o data 1al*d*t! and el*a#*l*t!. Somet*mes &esonal
*nte1*e0 has #een 2ondu2ted 0*th 1a*ous em&lo!ees o) d*))eent mo#*le &hone 2om&an*es.
Va*ous mass med*a ad1et*s*ng ae 2losel! o#se1ed and ta'*ng the ea2t*on o) 1*e0es )o
2eat*1e ad1et*s*ng.
"oods and Services: ur #erceptions
The d*))een2e #et0een goods and se1*2es *s not al0a!s &e2*sel! 2lea. 8)ten *t *s 1e! d*))*2ult
to ma'e a &o&e d*st*n2t*on #et0een these 2on2e&ts. "o ou 2on1en*en2e *t *s e6u*ed to
)oste a )*m 1*e0 so that the *nte&etat*on and 2omment 2an #e made )om a &at*2ula &o*nt
o) 1*e0. In s&*te o) the 2on)us*on$ the )ollo0*ng de)*n*t*ons ma! &o1*de a sound stat*ng &o*nt
to undestand the 2on2e&t o) goods and se1*2es. In geneal$ goods 2an #e de)*ned as o#+e2ts$
de1*2es$ o th*ngs$ 0heeas se1*2es 2an #e de)*ned as deeds$ e))ots$ o &e)oman2es 94e!$
1980:%4-%9;. I) 0e ae 2lea enough to d*))eent*ate the se1*2e then 0e shall see that se1*2e
*m&eat*1e 9<o))man and 4ateson$ %004; *n 0h*2h the *ntang*#le as&e2ts o) the &odu2t ae
#e2om*ng the 'e! )eatues$ d*))eent*ate &odu2ts 1e! su22ess)ull! *n the ma'et&la2e. Though
out th*s &a&e$ the tem &odu2t 0*ll e)e to #oth the goods and se1*2es.
Mobile Telecommunication Industry in Bangladesh
4angladesh has 2uentl! s*3 mo#*le &hone o&eatos *n Mo#*le Tele2ommun*2at*on Indust!$
o) 0h*2h )*1e ae *n o&eat*on and the s*3th$ =a*d Tele2om$ *s e3&e2ted to #eg*n o&eat*on *n
,&*l$ %007 9(ahman$ %007;. Though the *ndust! *s elat*1el! ne0 !et the go0th *s mu2h
)aste *n 2om&a*son to othe *ndust*es due to aggess*1e ma'et o*ented #us*ness stateg!
9>ousu) et al.$ %00?;. 4angladesh5s &hone se2tos 0*tnessed a 1%0 &e2ent go0th )om Janua!
%00? t*ll no0$ 0*th the num#es o) uses *s*ng to %% m*ll*on )om 10.8 m*ll*on *n 13 months.
Innovation %trategy3 A 'ealistic 4xample in Bangladesh &obile Telecommunication %ervice &ar"eting
The Cost and Management$ Janua!-"e#ua!$ %007 51
@ameen7hone$ the lagest mo#*le o&eato *n the 2ount!$ ea2hed 10.7? m*ll*on at the end
o) %00? 0*th the add*t*on o) neal! 5.%% m*ll*on 2ustomes *n a !ea$ 0h*le the se2ond lagest
o&eato$ ,'Tel$ a26u*ed ? m*ll*on su#s2*#es$ add*ng some 3.93 m*ll*on to *ts total at the
same t*me.
The th*d lagest o&eato$ 4anglal*n'$ a26u*ed 3.?4 m*ll*on su#s2*#es$ add*ng %.?1 m*ll*on
2ustomes *n the same &e*od$ 0h*le the onl! CAM, o&eato$ C*t!Cell$ a26u*ed neal! one
m*ll*on 2ustomes at the end o) the !ea$ moe than dou#le *ts 4.4 la'h 2ustomes *n %005. The
go1enment-o0ned Teletal' a26u*ed neal! 4 la'h 2ustomes *n %00?.
4angladesh *s &esentl! one o) the to& 10 mo#*le &hone ma'ets *n the ,s*a-&a2*)*2 eg*on *n
tems o) the num#e o) su#s2*#es.
Indust! &eo&le sa*d the num#e o) mo#*le &hone su#s2*#es 0*ll to& 50 m*ll*on *n the ne3t
thee !eas as the stat-u& 2ost as 0ell as 2all ta*)) 0*ll #e 2onstantl! sh*n'*ng #e2ause o) 2ut-
thoat 2om&et*t*on among the o&eatos to 0oo ne0 2ustomes 9(ahman$ %007;.
Table $ %: Ma!or Mobile #hone &et'orks in Bangladesh According to their Market Share
&ame o( the )ompanies Technology *sed Subscribers +Approx,- at the end o( .//0
@ameen7hone 9@7;
,'tel 9Tele'om Mala!s*a;
4anglal*n' 9)omel! She#atel;
7a2*)*2 4angladesh Tele2om 9C*t!Cell;
Teletal' 4angladesh
=a*d Tele2om
10.7? m*ll*on
? m*ll*on
3.?4 m*ll*on
1 m*ll*on
4 la'h
Source: htt&:DDgou&*2tDto&*2 s . ,22essed on 17-03-07
=a*d Tele2om o) the -n*ted ,a# Em*ates *s e3&e2ted to laun2h *ts se1*2e *n 4angladesh *n ,&*l$ %007.
)ompetition in Mobile Telecommunication Industry in Bangladesh
,s ment*oned *t eal*e that @ameen7hone *s the ma'et leade 0*th a&&o3*matel! ?3F
ma'et shae 9htt&:DD&ess.teleno.2om; . "om the ma'et shae and te2hn*2al 2a&a#*l*t! &o*nt
o) 1*e0$ @7 *s 2leal! ahead o) othe 2om&et*tos. ,lthough ,'tel 0as the 2hallenge #ut *ts
a2t*1*t*es 0as not so mu2h theat )o @7. S*n2e the ma'et &a!es des*gned the* stateg! 0*th
tad*t*onal amos thee)oe$ the 2ultue and &a2t*2e o) *nno1at*on 0as not a&&o&*atel!
nutued *n th*s *ndust!. ,'tel t*ed to #e *nno1at*1e and to &o1*de un*6ue 1alue to the
2ustomes #ut *t 2ould not #e e))e2t*1el! su22ess)ul as @7 es&onded *mmed*atel! *n
un2onstu2t*1e 0a!s. E1en somet*mes *n a 1e! negat*1e 0a! 9e.g. net0o' +amm*ng$ &*2e 2ut
and so on;$ 0h*2h 0as to some e3tent uneth*2al$ too. "o e3am&le$ 0hen ,'tel &lanned to
&o1*de augmented se1*2e to 2ustomes$ @7 0ould 2eate an unannoun2ed #a*e *n 2ase o)
2all*ng and messag*ng )om ,'tel to @7 su#s2*#es to 2eate an *m&ess*on that ,'tel5s net0o'
*s not as e))*2*ent as @7. -lt*matel!$ the *nno1at*1e e))ots o) ,'tel 0ee not )ull! su22ess)ul.
The 2om&an! 9@7; used to en+o! almost a mono&ol! unt*l and unless the theat 0as 2eated #!
othe 2om&et*tos.
5% The Cost and Management$ Janua!-"e#ua!$ %007
'atan, Alam and (aman
)onse1uences o( this *neven )ompetition
The *n)luen2e o) mo#*le tele2ommun*2at*on *s mult* )a2eted. It has #e2ome an * nd*s&ensa#le
&at o) u#an l*)e. Ceta*nl! no0ada!s mo#*le tele2ommun*2at*on se1*2es se1e not onl! )o
tad*t*onal 2ommun*2at*on &u&oses #ut also as a ne0 2hannel )o e3*st*ng enteta*nment and
ne0 t!&es o) enteta*nment 9Gona'$ et al.$ %004;. The une1en 2om&et*t*on *n the
tele2ommun*2at*on se1*2e *ndust! o) 4angladesh *s 0o'*ng as #a*e *n &o1*d*ng th*s t!&e
o) 1alue add*ng se1*2es to the 2ustomes. The ad1ese 2onse6uen2es$ *n add*t*on to net0o'
+amm*ng and sudden &*2e 2ut$ ae 1a*ous 2all ates )o s*m*la se1*2e$ &o#lem *n * ntenet
2onne2t*1*t!$ )a*lue to ma'e mo#*le &hone as a means )o enteta*nment 0heeas these ae
1e! 2ommon and )am*l*a all o1e the 0old. Mo#*le &hone net0o' *s not a&&ea*ng 0*th
d!nam*2 )eatues as &e demand o) the s*tuat*on athe the! ae t!*ng to #e moe tad*t*onal
0*th moden te2hnolog!. The se1*2e &o1*des o) th*s *ndust! ae no0 )*ght*ng )o the e3*st*ng
2ustomes *n the same ma'et *nstead o) de1elo&*ng ne0 ma'et and ne0 *nno1at*1e &odu2ts.
The o1eall 2om&eten2! and 2a&a#*l*t! o) th*s *ndust! *s not enhan2*ng due to the la2' o)
ade6uate esea2h and de1elo&ment )o *nno1at*1eness. No 2om&an! *s go0*ng 0*th a &o&e
&otent*al to 2hallenge the ma'et leade. -lt*matel!$ 2ustomes ae #e*ng de&*1ed. <ee the
&o*nt to #e noted that the mo#*le 2all 2hage *n 4angladesh *s one o) the h*ghest *n the 0old.
Th*s *s #e2ause o) the mono&ol*st*2 2om&et*t*on *n th*s *ndust!.
Stepping 2or'ard o( an Emerging )ompany 3 Banglalink
Thee *s a sa!*ng$ *) !ou 0ant to sta! 0h ee !ou ae then un )aste. "o a 0h*le the leade o) the
mo#*le tele2ommun*2at*on *n 4angladesh m*ght ha1e )ogotten th*s sa!*ng. In th*s 2*2umstan2e$
a 2om&an! H 4anglal*n'$ 2ame )o0ad and 2hallenge the leade. The 2halleng*ng 2om&an!
ne*the 0as the ma'et 2hallenge no 0as a 1e! s*gn*)*2ant ma'et o22u&*e.
The 2om&an! 4anglal*n' 0as &e1*ousl! 'no0n as She#a Tele2om. It not onl! 2hanged *ts
name #ut also estu2tued *ts s!stem. The 2om&an! des*gned an *ntegated #us*ness stateg!
#! *n2o&oat*ng *ntenal management s!stem 0*th a )o2us to the e3tenal en1*onment. "o
the* e3&ans*on stateg!$ the! )ollo0ed 1et*2al *ntegat*on *.e. us*ng <( 9human esou2e;
&ol*2! as a #ase o) the* #us*ness stateg!. The! enhan2ed the* <( *n1ento! #! e2u*t*ng a
good num#e o) *ntell*gent and &om*s*ng !oungstes )om 1a*ous a2adem*2 *nst*tut*ons and
as 0ell as )om the* 2om&et*tos. The! &o1*ded 1e! lu2at*1e 2om&ensat*on &a2'age togethe
0*th a 2lea 2aee &ath. 4as*2all!$ these 0ee the gound 0o' )o the* &omot*onal a2t*1*t*es.
S*de #! s*de the! de1elo&ed ne0 &odu2ts to atta2t the 2ustomes.
The* se1*2e &a2'age 0as 6u*te d*))eent and ne0. The! o))eed ne0 SIM 2ad 0*th a mo#*le
&hone set. The! onl! 2haged )o the SIM 2ad not )o the set. ,dd*t*onall!$ )ee s*3 2all*ng
2ads that added an e3ta atta2t*on to the o))e. It 0as eall! allu*ng to the 2ustomes.
S*multaneousl!$ 4anglal*n' also o))eed some o the ne0 1alue add*ng se1*2es. "o e3am&le$
*t de2*ded to 2a1*ng out a n*2he *n the ma'et$ taget*ng the )emale su#s2*#es. IJad*es "*st5
The Cost and Management$ Janua!-"e#ua!$ %007 53
Innovation %trategy3 A 'ealistic 4xample in Bangladesh &obile Telecommunication %ervice &ar"eting
*s the onl! &a2'age a1a*la#le *n the ma'et o))e*ng a s&e2*al edu2ed ate and s&e2*al tal' t*me
e32lus*1el! )o 0omen. 4anglal*n' does not 2ons*de th*s +ust a &odu2t o))e$ #ut moe o) an
a2'no0ledgment o) the 2ont*#ut*on that 0omen o) 4angladesh ma'e to the so2*et! and the
nat*on. Th*s se1*2e *n2ludes hoos2o&e$ t*&s on #eaut!$ 2oo'*ng$ health$ home management$
2h*ld 2ae$ )*st a*d$ and 2*nema and dama s2hedule. The o))e also *n2ludes d*s2ounts *n
sele2ted #eaut! &alos$ #out*6ues$ hand*2a)ts stoes$ de&atment stoes and 2osmet*2 sho&s$
et2. 9000.#angl al * n'gsm.2om;.
I-&&e Class5 *s the 4anglal*n' e3&e*en2e that *s taget*ng a sl*ghtl! u&s2ale 2l*entele$ o))e*ng a
ange o) se1*2es at a 2om&et*t*1e &*2e. S&e2*)*2all !$ -&&e Class o))es 7u&le Ca&et
teatment$ g*1*ng s&e2*al attent*on 0*th se&aate 2ountes at sales and 2ustome 2ae 2entes
and a ded*2ated hotl*ne. , I#*g SIM5 91000F moe stoage;$ 2ustom*.ed num#es$ *ntenat*onal
oam*ng$ eas! #*ll *n6u*!$ 2all #a2' 2ustome se1*2e$ and stat-u& ass*stan2e ae the &*1*leges
o) th*s &a2'age. , =e# log 9#log; u&dates the 2ustome on ne0 se1*2es$ *n*t*at*1es$ use)ul
t*&s$ and enteta*n*ng *deas. ICall and Contol5 *s a e2ent add*t*on to the I-&&e Class5 &a2'age
allo0*ng su#s2*#es 2ontol and )le3*#*l*t! *n the* usage and e3&ense.
>ello0 7ages se1*2e *s un*6ue to 4anglal*n'$ allo0*ng a22ess to 1a*ed *n)omat*on a#out a*l*nes$
#an's$ hos&*tals$ em#ass*es$ et2. though a ded*2ated num#e. ,dd*t*onall!$ *t o))eed 2hea& and
2on1en*ent e-ma*l though the* net0o' to )*ends and )am*l! all o1e the 0old. 4anglal*n' 0as
the )*st to ma'e the net 1*tuall! )am*l*a *n 2ell &hone *n 4angladesh. =*th the )ee SMS and
lo0-2ost e-ma*l *t 2o1eed #oth the need o) s!n2honous and as!n2honous 2ommun*2at*on. It
also ga1e an o&&otun*t! to *ts 2ustomes to do0nload mus*2$ &la! onl*ne game though mo#*le
&hone. Though *t *s not st*ll 1e! &o&ula due to elat*1el! h*gh 2ost$ *t 0as an added 1alue that
*s o&en to all 2ustomes and *t has an o&&otun*t! to #e &o&ula *n )utue.
In*t*all!$ @7 d*d not ta'e these '*nds o) a2t*1*t*es as se1ee 2hallenge s*n2e these 0ee not )om
the 2hallenge athe )om a )ollo0e. Moeo1e$ @7 0as 6u*te 2on)*dent u&on the* 2om&et*t*1e
ad1antageCun*nteu&ted net0o' se1*2e$ huge 2ustome #ase$ 0h*2h made them to some
e3tent ea2t*1e *nstead o) &oa2t*1e as the! 0ee #e)oe.
81eall$ 4anglal*n'5s #us*ness stateg! 2ould atta2t 2ustomes. =*th*n a )e0 months the*
su#s2*#es *n2eased )om 300$000 to 1.5 m*ll*on. =h*le 2ondu2t*ng th*s esea2h *t 0as e1ealed
that 4anglal*n' 2ould atta2t 2l*entele )om all e3*st*ng se1*2e &o1*des and a*sed *ts ma'et
&os*t*on )om )*)th to th*d. Jeade 2ould eal*.e that a &otent*al theat *s emeg*ng )om 4anglal*n'
0hen the! lost a 2ons*dea#le 2hun' o) the* 2l*entele. E1en though 4anglal*n' 0as )a #eh*nd
!et the! too' th*s &henomenon &ett! se*ousl!. In ode to ta2'le *s*ng theat )om 4anglal*n'$
@ameen7hone *ntodu2ed se1eal ne0 &odu2ts taget*ng s*m*la &odu2ts o) 4an glal*n'.
Innovation 4ar(are3 A Brie( Analysis o( the Situation
4angladesh mo#*le tele2ommun*2at*on 0as an *ntang*#le dom*nant &ue se1*2e *ndust! 0h*2h
deals 0*th the net0o' s!stem onl!. The tad*t*onal thought totall! *gnoed 2onsume da! to
54 The Cost and Management$ Janua!-"e#ua!$ %007
'atan, Alam and (aman
da! l*)e as&e2t and d*d not t! to e3&loe ho0 mo#*le &hone se1*2e 2an #e an *nd*s&ensa#le
&at o) ou da*l! l*)e to #e s&e2*)*2 ho0 *t 2an ma'e l*)e eas! and d!nam*2. The 2onsumes
0ee #e*ng de&*1ed o) gett*ng the o&t*mum 1alue )om the mo#*le tele2ommun*2at*on se1*2e.
4anglal*n' 2ould *dent*)! the ga& #et0een the &odu2t 2on2e&t and *ts ult*mate ut*l*t! o) the
&odu2t. -suall! a 0*nn*ng &odu2t has mult* d*mens*ons so that *t 2an se1e 2ustomes )om
1a*ous s&e2tums. , &odu2t must &osses thee le1el o) *dent*t*es. The )*st le1el *s the essen2e
o) a &odu2tCho0 0el l *t sat*s)*es the 2ustome5 s needs. The se2ond le1el *s the &h!s* 2al
&odu2t$ should *t #e a good o a se1*2e. The th*d le1el *s the &odu2t5s shell. It *n2ludes all
the add*t*onal &odu2ts and se1*2es o))eed 0*th the &odu2t to e32eed 2ustome e3&e2tat*ons
9V*adot$ %004: 155;. I) 2ustome sat*s)a2t*on e32eeds the e3&e2tat*on le1el then the 2ustome
*s del*ghted and onl! then *t *s &oss*#le to eta*n that 2ustome. 8the0*se$ thee *s a &o#a#*l*t!
o) s0*t2h*ng. ,s @7 almost o1eloo'ed the th*d &odu2t le1el$ 4anglal*n' 2on2entated on
th*s ga& and t*ed to )*ll th*s ga&. 4anglal*n' 0anted to a22eleate 2ustome atta2t*on )aste.
To do th*s the! de2*ded to o))e I major service with accompanying major goods! .
The su22ess o) the* &odu2t des*gn*ng 0as the &e2*se at*2ulat*on o) the latent demand o)
2ustomes. The* ma+o o))e 0as )ee &hone set 0*th mo#*le &hone net0o' 2onne2t*1*t!. The*
o))es 0ee ne*the the )am*l*a tang*#le goods 0*th a22om&an!*ng se1*2e no ma+o se1*2e
0*th a22om&an!*ng m*no goods and se1*2es. It 0as ma+o se1*2e 0*th a22om&an!*ng ma+o
goods. It 2ould #e 2alled as Ih!#*d5. ,2tuall! *t 0as moe than h!#*d. <!#*d o))e 2ons*sts o)
e6ual &ats o) goods and se1*2es$ )o e3am&le$ &eo&le &aton*.e estauant )o #oth )ood and
se1*2es 9Gotle$ %003:447;. <ee 0*thout one &at anothe &at 2an #e 2onsumed. <o0e1e$
4anglal*n'5s o))e 0as ma+o se1*2e 9net0o'; 0*th a22om&an!*ng ma+o goods 9mo#*le &hone;
and m*no se1*2es 9)ee 2all*ng o&t*on; also. 7e1*ousl!$ an! 2om&an! o) th*s *ndust! d*d not
o))e h!#*d se1*2es o a)oesa*d se1*2es athe o))eed &ue se1*2e. 4anglal*n' 0as the )*st to
*ntodu2e th*s t!&e o) o))e *n 4angladesh. ,s *t o))eed ma+o se1*2es along 0*th ma+o good
and also m*no se1*2es l*'e 0aant! o) the mo#*le &hone$ )ee 2all*ng 2ad and some 2haged
un*ts *n the &hone that 2an #e used )o 2all*ng o messag*ng #e)oe 2hag*ng an!th*ng$ so 0e 2an
2all th*s *nno1at*1e &a2'age as ma+o se1*2e 0*th a22om&an!*ng ma+o goods and m*no se1*2es$
o &ue se1*2e 0*th )o0ad *ntegat*on 0*th ma+o goods and m*no se1*2es.
@7- the ma'et leade ea2ted #e)oe an! se1ee damage. The! de2*ded to neutal*.e ea2h
4anglal*n' o))e$ &odu2t to &odu2t #as*s. The! 2ame u& 0*th moe augmented o))es. The!
&o1*ded e32lus*1e em&has*s on *n)omat*on se1*2e though the* e3*st*ng mo#*le net0o'.
@75s *n)omat*on se1*2e *n2ludes ne0s$ e1ents o) the da!$ tans&otat*on s2hedule$ hoos2o&e$
et2. ,lso a1a*la#le ae ne0s se1*2e$ 2hannel &ogam s2hedule$ e1ent-#ased s&ots u&date.
The su#s2*#e has to s*m&l! d*al a s&e2*)*ed )ou-d*g*t num#e to l*sten to the *n)omat*on.
ICell E-ma*l5 o))es the e-ma*l se1*2e though SMS. It &ossesses almost all as&e2ts o) the standad
0e# ma*l and *s 2om&at*#le 0*th almost all @SM handset. @75s #us*ness solut*on has a un*6ue
o&t*on 2alled IEA@E5 9Enhan2ed Aata (ates )o @lo#al E1olut*on;$ 0h*2h ena#les h*gh-s&eed
mo#*le Intenet and data se1*2es. Th*s *s u& to e*ght t*mes )aste than @7(S 9@eneal 7a2'et
The Cost and Management$ Janua!-"e#ua!$ %007 55
Innovation %trategy3 A 'ealistic 4xample in Bangladesh &obile Telecommunication %ervice &ar"eting
(ad*o Se1*2e;. ,nothe o) @75s unusual se1*2e *s *ts IInsta-Cae5$ an automated se1*2e 0*th
IV( 9Integated Vo*2e (es&onse; s!stem )o all '*nds o) @7 se1*2e-elated 6ue*es. Th*s se1*2e
*s o&en %4 hous a da!$ all the !ea ound. In add*t*on$ Insta-Cae has a geneal *n)omat*on
as&e2t 0hee ta1el$ hotels and estauants$ emegen2! num#es$ hos&*tals and 2l*n*2s$ legal
a*d$ ta3*2a#s *n)omat*on$ and d*st*2t and 2ount! d*al*ng 2odes ae a1a*la#le.
The IV*llage 7hone 7ogam5 o) @ameen7hone *s a un*6ue *n*t*at*1e that &o1*des a22ess to
tele2ommun*2at*ons )a2*l*t*es *n emote ual aeas$ 0hee no su2h se1*2e 0as a1a*la#le #e)oe.
The &ogam allo0s &oo 1*llage 0omen to o0n a V*llage 7hone su#s2*&t*on and eta*l the
&hone se1*2e to he )ello0 1*llages 0h*le &o1*d*ng them 0*th a good * n2ome-ean* ng
o&&otun*t!. It *s adm*n*steed #! @ameen7hone$ *n 2oo&eat*on 0*th @ameen 4an'$ the
*ntenat*onall ! eno0ned m*2o-2ed* t lend*ng *nst*tut* on.
@75s th*s stateg! made a 6u*2' *m&a2t o1e the 2onsumes. 7e1*ous @7 2onsumes 0ho
s0*t2hed to 4anglal*n' some o) them sto&&ed us*ng 4anglal*n' SIM and stated us*ng the @7
SIM 0*th the mo#*le &hone that the! got as )ee 0*th the 4anglal*n' SIM. It eall! sho2'ed
4anglal*n'. In ode to eta*n the* ne0 2ustomes 4anglal*n' *ntodu2ed some ne0 moe
o))es$ )ee te3t messag*ng )o s*3 months e1en the! e3tended th*s )ee messag*ng outs*de the
2ount! at lo2al 2hage.
"om the data and *n)omat*on$ *t 0as e1ealed that the *nno1at*on stateg! o) 4anglal*n' 0as
#ased on the ma+o &h!s*2al &odu2t togethe 0*th ma+o se1*2e &a2'age and SMS se1*2e. No0
SMS )a2*l*t! *s 6u*te *m&otant to man! 2onsumes. 4e2ause o) that Kall )oms o) te3t
2ommun*2at*on shae the a#*l*t! to 2a&tue$ stoe and eas*l! et*e1e the 2ontent o) the
2ommun*2at*on #oth s!n2honousl! and as!n2honousl!. Th*s &o1es to #e 2u2*al *n man!
so2*al sett*ngs 0hee the &o*nt o) the 2ommun*2at*on *s to 2on1e! a &hone num#e to 2all o an
addess at 0h*2h to meet. =h*le th*s *s also &oss*#le 0*th 1o*2e messages$ e1*e0*ng *s mu2h
moe d*))*2ult due to the e&hemeal natue o) soundL 9<a&e and Ta!lo$ %005: %89;. SMS
2ultue *s #e2om*ng 1e! &o&ula. Not su&*s*ngl!$ SMS *s hea1*l! used )o esta#l*sh*ng and
ma*nta*n*ng #oth )*endsh*&s and omant*2 elat*onsh*&s 94eg$ et al.$ %003:433-440;. Mo#*le
&hones and SMS )oste a &at*2ulal! stong sense o) *nt*ma2! )o teenages #e2ause *t allo0s a
2ont*nuous 2onne2t*on to )*ends outs*de o) &aental 2ontol 9"anham and S0am$ %00?:%;.
Aes&*te the shot message length o) SMS and *m&o1e*shed te3t *n&ut me2han*sms o) most 2ell
&hones$ te3t messag*ng *s the dom*nant )om o) mo#*le 2ommun*2at*on )o !oung adults *n
mu2h o) Euo&e and ,s*a 9@*nte and Mage!$ %003: 441-448;. ,s 4anglal*n' o&eates *n
4angladesh ma'et that #elongs to ,s*an ma'et$ *t 0anted to ta'e th*s ad1antage to ega*n *ts
2ustomes. ,)te that *t &o1*ded o&&otun*t! )o *ts 2ustomes to e-ma*l though mo#*le &hone
all o1e the 0old 0*th m*n*mal 2ost. It *s also ment*ona#le that KEma*l ena#les as!n2honous
2ommun*2at*on. Asynchronous 2ommun*2at*on *s t*me *nde&endent$ su2h that the &eo&l e
2ommun*2at*ng ae not e6u*ed to es&ond *mmed*atel! to ea2h othe 9<a&e and Ta!l o$
5? The Cost and Management$ Janua!-"e#ua!$ %007
'atan, Alam and (aman
Though almost e1e!th*ng 0as go*ng smoothl! )o 4anglal*n'$ gaduall! *t )a2ed some &o#lems.
Its ma*n &o#lem 0as *nteu&ted net0o'. 8n the 2onta!$ the ma*n 2om&et*t*1e ad1antage
o) @7 0as *ts un*nteu&ted net0o' s!stem. <o0e1e$ 4anglal*n' 2ould susta*n man! o) *ts
2ustomes 0*th *ts *nno1at*1 e stateg! and manag*ng that ta2t)ull!. ,nd *n the mean t*me the!
ae also t!*ng to *m&o1e the* net0o' 2onne2t*on #! *m&ot*ng some de1*2es that 2an *m&o1e
net0o' 2onne2t* 1* t!.
4ut one #lo0 2ame 0hen dual SIM s!stem that ena#les us*ng t0o SIM *n one mo#*le &hone 0as
*ntodu2ed. 4e)oe th*s some 2ustomes 0ho 0anted to use @7 and 4anglal*n' s*multaneousl!
2ont*nued us*ng 4anglal*n' as 'ee&*ng t0o mo#*le set 0as not 2on1en*ent. So$ 4anglal*n' got
some &e)een2es. 4ut a)te the *ntodu2t*on o) Aual SIM$ a th*n ele2ton*2s de1*2e that 2an #e
set *ns*de the mo#*le set$ man! mo#*le uses stated to use that. Mostl! the! 0ee on l*ne 0*th
@7 and 0hen the! needed to send SMS the! s0*t2hed to 4anglal*n' as SMS though *t 0as )ee
at that t*me. Though dual SIM mostl! 0as used *n the u#an aea$ *t ma! #e ea2hed at the ual
aea due to ma'et*ng a2t*1*t*es. So$ 4anglal*n' )a2ed a #*g theat )om the ele2ton*2s *ndust!
not )om the @7 o othe tele2ommun*2at*on 2om&an*es and *t 0as une3&e2ted )o the 4anglal*n'.
8nl! t*me 0*ll sa! 0hat stateg! *t ta'es to o1e2ome th*s o#sta2les.
"o all these '*nd o) tele2ommun*2at*on se1*2es$ se1*2e &o1*des need stong mo#*le net0o'.
In*t*all! 4anglal*n' 2ould not eal*.e the *m&otan2e o) te2hn*2al 2a&a#*l*t! )o an! stateg* 2
mo1e. 8n the othe hand$ @7 had a 1e! stong and u&dated mo#*le tele2ommun*2at*on
net0o'. Thee)oe$ @7 2ould 2ounte 4anglal*n' su22ess)ull!. -lt*matel!$ 4anglal*n'5s &odu2t
and &*2e #ased *nno1at*on stateg! 2ould not *n)luen2e 2onsumes as the! e3&e2ted. The!
2ould undestand the ne2ess*t! o) a 2a&a#le net0o' and e3&anded the* ange all o1e the
4angladesh$ !et *t 0as #*t late. @7 *n the mean t*me$ 2a&*tal*.e on the* 2oe 2om&eten2!
9mo#*le tele2ommun*2at*on stateg!;. , 2om&eten2! 2annot #e a susta*na#l e 2om&et*t*1e
ad1antage *) the 2om&et*tos 2an 2o&! *t eas*l!. Com&et*t*1e ad1antage *s a 2om&an!5s a#*l*t!
to &e)om *n one o moe 0a!s that 2om&et*tos 2annot o 0*ll not mat2h. M*2hael 7ote
uged 2om&an*es to #u*ld a susta*na#le 2om&et*t*1e ad1antage 97ote$ 1980;. 4ut *n eal 0old
)e0 2om&et*t*1e ad1antages ae susta*na#le. ,t #est the! ma! #e le1eagea#le. , le1eagea#le
ad1antage *s one that a 2om&an! 2an use as a s&*ng#oad to ne0 ad1antages$ su2h as M*2oso)t
has le1eaged *ts o&eat*ng s!stem to M*2oso)t 8))*2e and so on. In geneal$ a 2om&an! that
ho&es to endue must #e *n the #us*ness o) 2ont*nuousl! *n1ent*ng ne0 ad1antages #! stateg!
*nno1at*on. Stateg! *nno1at*on *s sh*)t*ng a 2o&oat*on5s #us*ness stateg! *n ode to 2eate
ne0 1alue )o #oth the 2ustome and the 2o&oat*on 9Jhonston and 4ate$ 1980: 4$ 11$ %78;.
,s no stateg! lasts )oe1e so 2om&an! must 'ee& go*ng on *n*t*at*ng stateg! *nno1at*on and
thus ga*n a 2om&et*t*1e ad1antage.
8) 2ouse$ @7 had stateg*2 &lann*ng #ut *t 0as not *nteested *n stateg! *nno1at*on. 4anglal*n'
too' that ad1antage #! *n*t*at*ng stateg! *nno1at*on and thus ga*ned a 2om&et*t*1e ad1antage
o1e @7 )o the t*me #e*ng. ,ga*n 4anglal*n' 2ould not a2h*e1e as the! e3&e2ted due to the
la2' o) ade6uate te2hnolog*2al 2a&a#*l*t!$ la2' o) a#*l*t! to man*&ulate e3*st*ng 2a&a2*t! and
not to #e 2ae)ul a#out the loo&holes o) the* #us*ness stateg!. The o))e made #! 4anglal*n'
The Cost and Management$ Janua!-"e#ua!$ %007 57
Innovation %trategy3 A 'ealistic 4xample in Bangladesh &obile Telecommunication %ervice &ar"eting
0as eas! to 2o&!. S*m*la &odu2ts 0ee also o))eed #! othe 2om&et*tos l*'e ,'tel$ C*t!2ell
et2. In )a2t$ @ameen7hone mo1ed )uthe #! lean*ng )o m the m*sta'es o) 4anglal*n'.
)reative 'ar(are: In an advertising sector
,d1et*s*ng se2to o) an *ndust! *s a 1e! *m&otant se2to. Ceat*1e m*nd and esult o) 2eat*1*t!
*s the ma*n 0ea&on o) th*s se2to. No0ada!s 0e ae 2losel! o#se1*ng the se1ee 2om&et*t*on
among the mo#*le 2om&an*es. In th*s a2e &om*s*ng 2om&an! 4anglal*n' *s 2leal! ahead. The*
1a*ous mass med*a ad1et*sements ae 0ell a22e&ted and ha1e #e2ome &o&ula. The! t! to
o))e a 1e! 2lea message to the &eo&le. <o0 te2hnolog! a2t as a 2atal!st o) 2hang*ng &eo&le5s
l*1es ae ensued #! th*s 2om&an!. I-in Badaler pala! 9&hases o) 2hang*ng l*)e;$ Bhashar janna
Bhalobsa! 9lo1e )o language; o) 4anglal*n' ae 0ell a22e&ted and &eo&le ae a#le to undestand
the 2lea message o) th*s ad. 8n the othe hand @7 t*es to elate the* ad 0*th &eo&le5s &o#lems.
,s e3am&le$ +ust a 2all then !ou 0*ll get a med*2al hel&. 4us*ness solut*on$ &a2e hunt ae
anothe 0ell a22e&ted ad o) @ameen 7hone Com&an!. ,'tel *s l*ttle #*t lag #eh*nd than othe
2om&an*es$ es&e2*all! *n ad1et*s*ng se2to. 4es*des these the* one ad on tele1*s*on 2hannels
9call whole month and save some portion of money for the next month ; *s a#le to 2ut a &os*t*on
o) &eo&le5s m*nd. The &a2*)*2 4angladesh tele2om 92*t! 2ell; also 2on2entates on e))e2t* 1e
ad1et*s*ng methods. The* I1ello tunes5 9a &a2'age o))e o) tunes 0h*2h 2eates a &s!2holog*2al
em&has*s on m*nd; *s a22e&ted #! the su#s2*#es. ,nothe &a2'age o))e o) C*t! 2ell l*'e It'.1399D
-5 9named 5sab pai! *.e. all *n one &a2'age; *s a#le to 2a&tue the ma'et.
,ll 0a)ae *n 2eat*1e s*de ae #less*ng to the su#s2*#es. Su#s2*#es ha1e the *ght to 'no0.
4! e3et*ng 2eat*1e e))ots Tele2ommun* 2at*on Com&an*es t! to 'ee& su#s2*#es u& to date.
"om the a#o1ement*oned d*s2uss*on 0e 2an see that stateg! *nno1at*on *s a tool o) 2om&et*t*1e
ad1antage )o the ogan*.at*on that 2an 2ont*#ute to the *ndust! go0th and ult*matel! sat*s)!
the 2ustomes. It 2ont*#utes not onl! to the go0th o) that *ndust! #ut also that o) othe
elated *ndust*es. <o0e1e$ the most 1*tal as&e2t o) the s2ena*o *s the *n2eased 2om&et*t*on
and go0*ng e3&e2tat*ons o) the 2onsumes. (*1al! among the 2om&an*es o) th*s *ndust! has
2eated a lot o) )a2*l*t*es )o the 2ustomes. It has o&ened the doo o) &o1*d*ng geate 1alue
though *nno1at*on that 0*ll hel& to *n2ease the sat*s)a2t*on le1el o) the 2ustomes *n )utue.
The *llustat*ons o) th*s stud! ma'es us )am*l*a 0*th the tele2ommun*2at*on se1*2e *ndust! o)
4angladesh and the &*2tue ho0 *t #e2ame h*ghl! 2om&et*t*1e *ndust! )om a less 2om&et*t*1e
se2to. =*th the go0*ng 2om&et*t*on$ the o1eall 2ustome sat*s)a2t*on le1el *s also *n2eas*ng.
The de&*2t*on e1eals ho0 stateg! *nno1at*on *n a de1elo&*ng 2ount! 2an also #e su22ess)ull!
a&&l*ed. It *s ment*ona#le that 0hat *s *nno1at*on hee ma! not #e *nno1at*on at othe &la2es
as *t 1a*es )om t*me to t*me and &la2e to &la2e. ,nd also *nno1at*on *s a 2ont*nuous &o2ess.
,s thee *s a )ea o) #e2om*ng toda!5s *nno1at*on o#solete tomoo0 so to #e *n the &o2ess o)
58 The Cost and Management$ Janua!-"e#ua!$ %007
'atan, Alam and (aman
stateg! *nno1at*on !ou ha1e to nutue *mag*nat*on to )oste 2eat*1*t! *n !ou ogan* .at* on.
Moe than se1ent!-)*1e !eas ago$ Cal Jung 0ote:
KThe d!nam*2 &*n2*&le o) )antas! *s &la!$ 0h*2h also #elongs to the 2h*ld$ and as su2h a&&eas
to #e *n2ons*stent 0*th the &*n2*&le o) se*ous 0o'. 4ut 0*thout th*s &la!*ng 0*th )antas!$ no
2eat*1e 0o' has e1e !et 2ome to #*th. The de#t 0e o0e to the &la! o) *mag*nat*on * s
*n2al2ula#leL 9Jung$ 19%1;.The &o2ess o) nutu*ng *mag*nat*on *n1ol1es the ado&t*on o) a
&h*loso&h! that *n2o&oates as&e2ts o) &la!Cthe &eo&le *n ou ogan*.at*ons must ha1e the
o&&otun*t! to e3tend and e3e2*se themsel1es$ to e3&loe and lean. The 2hallenge )o us *s *n
&o1*d*ng d*e2t*on to th*s e3&loat*on 9,IM$ ,ustal*a$ %004;. ,s 4angladesh *s a &o&ulous
2ount!$ so *) a 2om&an! goes though th*s &o2ess *t 2an ga*n a lot )om esult*ng stateg!
*nno1at*on and the &o)*t 0*ll not 2eta*nl! #e small.
4e!$ J. J. 91980;$ KSe1*2es Ma'et*ng *s A*))eentL$ Business, Vol. 30 9Ma!-June;: %4-%9.
4eg$ S.$ ,. S. Ta!le$ (. <a&e 9%003;$ KMo#*le 7hones )o the Ne3t @eneat*on: Ae1*2e Aes*gn )o TeenagesL 9*n 7o2eed*ngs
o) ,CM SI@C<I;: 433-440.
"anham$ S. and G.7. S0am 9%00?;$ K<!&e ,0aeness$ M*2o Cood*nat*on$ and Smat Con1egen2e though Mo#*le @ou&
Te3t Messag*ng ,6 7o2eed*ngs o) the 39th <a0a** Intenat*onal Con)een2e on S!stem S2*en2es 9Ta2' 3$ &. 59a;.
@*ugn*$ S. 9%004;$ KNutu*ng Imag*nat*on: "oste*ng Ceat*1*t! *n >ou 8gan*.at*on$L *n ,ustal*an Inst*tute o) Management$
Innovation and Imagination at Wor" 9S!dne!: M2@a0 <*llM %
@*nte$ (.E. and M. Eld*dge 9%001;$ K! do tngs lu1 % t3t msgNL 9*n &o2eed*ngs o) Se1enth Euo&ean Con)een2e on
Com&ute-Su&&oted Coo&eat*1e =o' ECSC=;: %19-%38.
@*nte$ (.E. and E. Mage! 9%003;$ K=an%tl'N : E1e!da! Te3t Messag*ng$L 9*n 7o2eed*ngs o) ,CM SI@C<I;: 441-448.
<a&e$ (. J. and 7. ,. Ta!lo 9%005;$ KThe Ins*de Te3t: So2*al$ Cultual and Aes*gn 7es&e2t*1es on SMSL 9S&*nge;: %89.
<o))man$ G. A. and J. E. @. 4ateson 9%004;$ 4ssentials of %ervice &ar"eting 9Ne0 >o': Thom&sonM %
htt&:DD&ess.teleno.2omD7(D%00?07D10?5034O5.htm . ,22essed on %1-03-07.
Johnston$ (.E.$ J. and J. Aouglas 4ate 91980;$ KThe 7o0e o) Stateg! Inno1at*onL 9,M,C8M -- ,me*2an Management
,sso2*at*on;$ P: 4$ 11$ %78.
Jung$ C. 919%1;$ 0sychological Types$ QNe0 Jese!: 7*n2eton -n*1es*t! 7ess 9Tanslated #! < @old0!n 4a!nes$ 19%3;R.
Gona'$ ,.$ J. Teutlo)) and M. =el*n-4ege 9%004;$ 4nterprise 7uide to 7aining Business 8alue from &obile Technologies $
9<o#o'en$ Ne0 Jese!: =*le! 7u#l*sh*ng$ In2;.
Gotle$ 7. 9%003;$ &ar"eting &anagement 9Ne0 Jese!: 7ent*2e <allM 11
7ote$ M.E. 91980;$ 2ompetitive strategy3 Techni9ues for Analy$ing Industries and 2ompetitors 9Ne0 >o': "ee 7ess;.
(ahman$ S. 9%007;$ K4angladesh has 2uentl! %% m*ll*on mo#*le su#s2*#es *n %00?$L 7oogle 7roups3 Bangladesh Information
: Tech +IT, 7roup $ a1a*la#le at htt&:DDgou&*2tDto&*2s . To&*2 No. 97. ,22essed on 17-03-
V*adot$ E. 9%004;$ %uccessful &ar"eting %trategy for 1igh/Tech #irms 94oston: ,te2h <ouseM 3
000.#anglal*n'gsm.2om . a22essed on 05D03D%007.
>ousu)$ (.J.$ -. ,n+al*n$ ,.S. M. Sohel--.-/aman and S. ,nam 9%00?;$ K Inno1at*1e C(M *n 4angladesh$L The "*)th =uhan
Intenat*onal Con)een2e on E-4us*ness$ Integat*on ,nd Inno1at*on Though Measuement and Management$ Vol. II: