ACKNOWLEDGEMENTS

All praises and thanks are for Almighty ALLAH Who is the source of all knowledge and wisdom endowed to mankind and to the humanity as a whole. Then, we would like to thank my parents and family without whom we would not have reached at this level. I would particularly like to thank my Course Instructor Ms. Saira Ibrahim for many insights she provided us throughout the course of Strategic Management.

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Table of Contents

CASE……………………………………………………………………………………………………….4 ABSTRACT..............................................................................................................................................29 EXECUTIVE SUMMARY.......................................................................................................................31 EVALUATION OF MISSION AND VISION STATEMENTS................................................................33 Mobilink’s Vision....................................................................................................33 Mobilink’s Mission .................................................................................................33 Evaluation of Mission Statement...........................................................................34 Re-vised VISION STATEMENT.................................................................................34 Mission Statement after Evaluation.......................................................................35 SWOT........................................................................................................................................................36 STRENGTHS........................................................................................................... 36 WEAKNESSES........................................................................................................37 OPPORTUNITIES.....................................................................................................38 THREATS................................................................................................................ 38 ANALYSIS...............................................................................................................................................39 Matrices on Microsoft Excel .................................................................................40 RECOMMENDATIONS & CONCLUSION............................................................................................56 BIBLIOGRAPHY.....................................................................................................................................58

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MOBILINK GSM
CASE
STRATEGIC MANAGEMENT PRESENTED TO MS. SAIRA IBRAHIM 11/27/2010 3|Page

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MOBILINK GSM - 2010 ML
www.mobilinkgsm.com MOBILINK Mobilink, a subsidiary of the Orascom Telecom Holding, is Pakistan’s leading cellular and Blackberry service provider. Mobilink currently has more than 31.6 million subscribers. Mobilink maintains market leadership in Pakistan through cutting-edge, integrated technology, the strongest brands, competent employee strength of 4,500 and the largest portfolio of value added services in the industry, a broadband carrier division providing next generation internet technology as well as the country’s largest voice and data network with over 8,000 cell sites. Mobilink housing Pakistan’s largest distribution and contact centre networks and an unparalleled 6,500 kilometres fibre optic backbone, Mobilink has already invested over US $3.3 billion in Pakistan to date and provides countrywide connectivity, customer services and international roaming in over 140 countries. In Pakistan, the Pakistan Mobile communications Ltd (Mobilink) started its operations in 1994 and, until early 2001, had a market share of 40%. In April 2001, OTH took over management control of Mobilink from Saifullah Group and Motorola. As the market leader even today, Mobilink serves more than 32.203 million subscribers, representing a market share of 32.47% (as of June 2010; PTA Statistics). The company is also the official cellular partner of the Pakistan Cricket Board. As a responsible corporate citizen, Mobilink also offers a range of socially inclusive products and services dedicated to enhance access to information. Through Mobilink Foundation founded in December

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2007, the company supports education, health and environmental initiatives and promotes sustainable business practices. Mobilink offers exclusively designed tariff plans that cater to the communication needs of a diverse group of people, from individuals to businessmen to corporate and multinationals. To achieve this objective, they offer both post-paid (Indigo) and prepaid (JAZZ) solutions to our customers. Compared to their competitors, both the post-paid (Indigo) and prepaid (JAZZ) brands are the largest brands of their kind in the Pakistan cellular industry. In addition to providing advanced voice communication services that makes the lives of millions that much easy, they also offer a host of value-added-services to their prized customers. At the same time, Mobilink places high importance to its coverage, 10,000+ cities and towns nationwide as well as over 140 countries on international roaming service. ORASCOM TELECOM HOLDING S.A.E Orascom Telecom Holding S.A.E. (OTH) is part of the Orascom group of companies began its journey in 1976 and Orascom Telecom Holding S.A.E. (OTH) was established in 1998. Since then it has grown to become a key player in the telecommunication market. Orascom entered the domain of Information Technology and Telecommunications by exchanging and distributing IT and telecom equipment in Egypt. OTH had exceeded 99.1 million subscribers as of August 2010. OTH is considered among the largest and most diversified network operators in the Middle East, Africa, and South Asia. Orascom Telecom is a leading mobile telecommunications company operating in six emerging markets having a population under license of 430 million with an average penetration of mobile telephony across all markets of approximately 40%. Weather Investments S.p.A. (Weather), a major share holder 51.7% of ‘Orascom Telecom’ has joined hands with VimpelCom Ltd, a Russia based company. This partnership led to 20.0% economic interest and an 18.5% voting interest in the enlarged VimpelCom group.

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OTH through Mobilink has positioned itself as a leader in the region for its diverse GSM operations with various GSM support and Internet operations. One of OTH's main strategies is to create its own non- GSM subsidiaries to act as a backbone of support for its regional GSM operations. OTH has achieved this by dedicating financial, technical and management resources for supporting its subsidiaries. This includes network support and installation of GSM operations, equipment procurement, handset procurement and distribution companies, Value Added Services, and Internet Operations. OTH is dedicated to providing the best quality services to its customers, value to shareholders and a dynamic working environment for its more than 15,000 employees.

EXHIBIT 1 WEATHER INVESTMENTS AND VIMPELCOM LTD PARTNERSHIP After this recent transaction on October 10, 2010, VimpelCom become the fifth largest mobile platform in the world by subscribers, with: • operations in a total of 20 countries in Europe, Asia, Africa and North America with approximately 850 million people living within the coverage area • pro forma net operating revenues of US$21.5 billion for the year ended December 31, 2009 • pro forma EBITDA of US$9.5 billion and an EBITDA margin of approx. 44% for 2009

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The combination of VimpelCom with Weather will lead to substantial value creation for shareholders, both in the short and long term. The Transaction will substantially increase the scale of operations and will create a new global telecom player with over 174 million mobile subscribers. About VimpelCom VimpelCom Ltd. consists of telecommunications operators providing voice and data services through a range of wireless, fixed and broadband technologies. The VimpelCom Ltd. group is headquartered in Amsterdam and has operations in Russia, Ukraine, Kazakhstan, Uzbekistan, Tajikistan, Georgia, Armenia, Kyrgyzstan, Vietnam and Cambodia, covering territory with a total population of about 345 million. VimpelCom Ltd. operating companies provide services under the "Beeline" and "Kyiv star" brands. VimpelCom Ltd. is listed on the New York Stock Exchange under the symbol "VIP". About Weather Weather Investments S.p.A. is a leading international telecommunications company offering mobile, fixed, Internet and international communication services to 123 million subscribers in Algeria, Bangladesh, Egypt, Greece, Italy, Pakistan, Tunisia and North Korea. Weather's subsidiary Orascom Telecom Holding has an indirect equity ownership in Globalive Wireless which operates mobile services in Canada. Weather Investments operates through its subsidiaries Orascom Telecom Holding S.A.E., Wind Telecomunicazioni S.p.A. and Wind Hellas Telecommunications S.A. Weather is owned 72.65% by Weather Investments II S.a.r.l. (which is itself owned by the Sawiris family) and the balance by certain financial investors. MOBILINK MISSION, VISION AND VALUES  Mobilink’s Mission Statement “To be the unmatchable mobile system of communications in Pakistan, providing the best value to its customers, employees, business partners and share holders”.
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 Mobilink's Vision “To be the leading Telecommunication Services Provider in Pakistan by offering innovative Communication solutions for our Customers while exceeding Shareholder value & Employee Expectations”.  Mobilink's Values

Total Customer Satisfaction Customers are at the heart of our success. They have placed their trust and confidence in us. In return, we strive to anticipate their needs and deliver service, quality and value beyond their expectations.

Business Excellence We strive for excellence in all that we do. We aspire to the highest standards and raise the bar for ourselves every day. This commitment to delivering world-class quality translates into unmatched service and value for our customers and all stakeholders.

Trust & Integrity At Mobilink, we take pride in practicing the highest ethical standards in an open and honest environment, and by honouring our commitments. We take personal responsibility for our actions, and treat everyone fairly, and with trust and respect.

Respect for People Our relationships drive our business. We respect and esteem our employees and all stakeholders. We believe in teamwork, empowerment and honour.
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Corporate Social Responsibility As the market leader, we recognize and fulfil our responsibility towards our country and the environment we operate in. We contribute to worthy causes and are dedicated to the development and progress of the society.

TELECOM INDUSTRY PAKISTAN The economic downfall has hit almost every industry globally and telecom industry is also a prey to it. However it is still not a total downfall in the South. Worldwide the industry is going thru recession and the mergers and acquisitions. Revenues are down and companies globally are focusing on market consolidation. Expansion is rare and telecom industry is into cost cutting cycle. Telecom sector is vital to economy as it provides the prime services that an economy needs for rapid growth, development and modernization. As the economy grows demand for telecom services increases to conduct the increased number of economic transactions in the expanded economy. But as of economic crises and high inflation in Pakistan the growth is negative. There is also an increasing concern for security in Pakistan and inconsistent and adhoc decisions from regulatory authorities. The concern is also the sudden change in governmental trade policies. The telecommunication industry of Pakistan suffered broad and deep damages to infrastructure due to the floods of 2010. The current damage assessment estimates a loss of approximately Rs.4.148 million, just from cellular operators, according to an estimate by the government. This figure represents the sites which are totally damaged and are non-operational and the cost incurred to repair/recover the damaged sites have not been included. The actual damage cost will be considerably higher than this number.

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This disaster has left a mark on the already struggling telecom industry of Pakistan. Going forward, the industry cannot afford to ignore catastrophic events like these. They need to take natural disasters into account and plan for them. ORGANIZATIONAL STRUCTURE EXHIBIT 2

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DIVISIONS All the divisions especially the north and central severely suffered due to flood 2010. On the whole, the telecommunication industry of Pakistan suffered broad and deep damages to infrastructure due to the floods of 2010. The current damage assessment estimates a loss of approximately Rs.4.148 Million, just from land line and cellular operators, according to an estimate by the government. This figure represents the sites which are totally damaged and are non-operational. However, the costs incurred to repair/recover the damaged sites have not been included. The actual damage cost will be considerably higher than this number. The categories of damage to Mobilink includes (mainly in Central and Northern Division):
• • • • • • •

Erosion of boundary walls and tower bases. Equipment damage due to water accumulation inside the site.(BSS, Trx, Power etc) Feeder cables damage due to settlement of cable bridge foundation support. Fibre cable Cuts on backbone and local fibre cables. Microwave Backhaul disruption Short circuits and power system damage including Generator damage In rare cases tower foundation settlement issues have occurred.

Mobilink has further divided all it departments on geographic bases northern, southern and central.

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EXHIBIT 3 Geographic Region Northern Division Southern Division Central Division Total Sales $ (M) 3.353 4.229 2.476 10.06 Sales % (7.10) (5.34) (5.16) -17.60 Profits $ (M) 0.753 1.129 0.377 2 % Profit (9.74) (3.37) (13.12) (26.23)

Regional Sales and Profits  Northern The northern region includes Islamabad, Khaibar Paktunistan and Azaad Kashmir area. Islamabad is a very profitable region of Mobilink. After Karachi and Lahore, Islamabad is the next maximum profit generating city for Mobilink. Khaibar Paktunistan is the region with lots of scope and resources for Mobilink yet not generating a lot of profit, mainly because of culture backwardness of Khaibar Paktunistan.  Southern The south region includes the whole of Sindh and Balochistan. Karachi is the highest profit generating city of Mobilink. Balochistan’s low revenue generation is mainly due to security reason. Security is also a concern for Karachi and other cities yet citizens of Karachi have buffered themselves to this issue.  Central

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The central region includes parts of Punjab and Lahore city is the most profitable region of Central. The battle between Lahore and Karachi is lifelong for Mobilink. The security is also a concern for central region like southern people here are also buffered to it. EXHIBIT 4 TELECOM COMPANIES Mobilink Ufone Telenor Warid Zong MARKET SHARE %
32.47%

19.50%
23.00% 16.03% 9.00%

Market Share Comparison PRODUCTS & SERVICES JAZZ Jazz is Mobilink’s prepaid service which provides a bouquet of benefits in the form of fun services, attractive services call rates and network reliability. The packages that Jazz offers are:

Jazz Budget: Offering remarkable rates and package features, it is the best way to stay in touch with millions of Mobilink family members in Pakistan. The major target market are the teens and younger age group people who wants to stay connected. Happy Hour only charging 0.4/30seconds. Jazz One: One network, one nation, one rate … one brand, Jazz! Introducing Jazz One, this proves that it pays to be part of the biggest network in Pakistan. Based on the premise of simplicity, Jazz One truly brings our promise of freedom to life. The freedom to call anyone, anytime, anywhere at the lowest rates ever. Jazz Ladies - First: It is a package designed especially for ladies. From sizzling recipes to tips on looking best are all an SMS away. Remarkably low calls rates.

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Women around the globe love to talk for hours on end, and Jazz understands this need to the fullest, thus introducing its brand new revolutionary offer, where all women can talk for as low as Rs. 5 / hour! This enticing new offer is surely every woman's dream come true, bringing forth a product that will now satiate their desire to talk more and more for hours. There also offering recipes, tips for forever young, shopping discounts and etc.

Jazz Easy: It is the most affordable package that provides access to the best rates to call across Pakistan. Jazz Easy customers can not only enjoy calling at amazingly low call rates for Mobilink numbers, they also benefit tremendously from the fabulous rates to call on any other network. Jazz Octane: It offers call and message rates to all networks at a very lowest rate. They also have an option of late night calls on all Mobilink numbers. In this tariff plan subscribers can also avail the international facilities as well but all services for only 3 favorite numbers. Jazz International Roaming: Jazz subscribers now have the convenience to carry their Jazz connections while traveling to some of the most popular countries worldwide. Jazz connects their customers across the globe giving a one stop solution to international communication needs. Offering via promotions of Jazz Share, Advance and Load.

MOBILINK INDIGO: Mobilink Indigo is the ultimate post-paid service which helps you explore the next level of personalised and value driven services that come together as the indigo experience. It offers a range of highly competitive post-paid packages offering great value for their customers’ money. These include packages for more SMS-savvy individuals, while also offering more high-end packages which provide a combination of bulk free minutes, free data offering and the best call rates in the industry. The offer voice and SMS bundles italk and isms for weekend and late night communication and SMS bundles to any network any time. Indigo is now offering Bill payment viz cell phone and Business on the Go and Citi Mobile Credit Card.

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MOBILINK BLACKBERRY Mobilink introduced BlackBerry Services in Pakistan in 2005. BlackBerry from Mobilink provides users with a secure, wireless access to a full suite of business and social networking applications including Push Email, Phone, SMS, Internet Access Organizer Features, Social Networking – Face book, G Talk, MSN Messenger Etc. Today Blackberry usage soars in Pakistan especially Karachi, Lahore and Islamabad. MOBILINK WORLD Mobilink World is the latest offering of Mobilink with International SMS chat service, Ring tune club, CricVideo, Mind Reader, EDGE Technology, Corporate SMS, Holy Sayings, SMS Game Time, SMS Scheduler, Mobi Greetings, Mobi Safe and Bolo SMS. This offer is basically to target corporate sector International Chat Service, Scheduler, Mobi Safe – retrieving cell numbers from a different cell or lost cell. Web Portal is also offered with Mobilink world for corporate sector. MOBILINK INFINITY Mobilink Infinity WiMAX is the broadband service which helps you connect with the outer world wherever the subscriber is. Through this service the customers can easily enjoy being online and stay connected at all times. It provides total internet and communication solutions. INTERNAL FACTORS MANAGEMENT In this highly competitive era, more of bureaucratic style of management is followed in Mobilink. Through as shown by upper management is the decentralized style of decision making much of the decisions are made at the top level and managers plus line managers are just told to implement. The hiring firing is highly based on upper management decisions as well as
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appraisals and promotions. Much of performance measurement is done only for procedure purpose. The CEO and President of Mobilink GSM was Mr. Zohair Khalique who is replaced by Mr. Rashid Khan. Change of leadership brought change of strategy. He started cost-cutting in many of the Mobilink’s departments. Budget allocation to department are now strictly monitored and no resource wastage at all. Employees were previously served quite lavishly but a change in strategy has been seen by reducing their non-financial benefits. Cut on bonuses and increments until 2009 and tight aboard training budget for employees. Many of training programs are now conducted within Pakistan instead of sending valuable employees aboard. STRATEGIC BUSINESS DEPARTMENT This is where all Mobilink's business plans are set to meet the goals and objectives of the company. This department sets the planned activities and aims of Mobilink so that all efforts are converted into results. It deals directly with Mobilink's alliances in the most professional way to ensure excellent long term business relations. PROJECT MANAGEMENT DEPARTMENT All Mobilink's projects are managed here by a highly knowledgeable business - oriented team. The Project Management Department is responsible for allocating the projects' tasks to the respective department and then delivering the project to the third parties once done. The merger of Mobilink and LinkDot.net was recent major project for PM department. The issue of identical IDs for employee is current faced in the company many of Mobilink employees and LinkDot.net employees have similar name hence same IDs, this is creating a confusion for the ID recognition software. Hence, employee attendance, time of arrivals and other within company communication is difficult.

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OPERATIONS & CUSTOMER CARE DEPARTMENT The departments where all day to day issues are dealt with high professionalism in order to ensure all the services are operating smoothly. The operations department deals with all the region's operators to make sure that all our third parties are being served with high efficiency. The customer care department recently faced the issue that the customer care service at night time from Karachi was shifted to Lahore and Islamabad. Due to Sindhi callers, the call centre based in Islamabad and Lahore couldn’t handle the calls due to the communication barriers. Thus, call centre was again shifted to Karachi which handled all the Sindhi callers. Rests of the callers were handled by the call centre in Lahore and Islamabad. ENGINEERING & INFORMATION TECHNOLOGY DEPARTMENT The company cannot provide cutting edge technology without the best IT personnel. Therefore, Mobilink recruits only the best IT experts from all over the world. The IT infrastructure is 100% reliable for the fact that we use high tech solutions with clustering and load balancing facilities to maintain applications and data solutions. The IT department faces the issue of mismanagement due to extensive network within the country which is resulting in poorer coverage in the country. Budgeting is another concern, previous major portion of budget was for engineering and IT department but now more budgets are being allocated to sales and marketing department. FINANCE & ACCOUNTING DEPARTMENT: This department ensures that Mobilink meets its fiscal and fiduciary responsibilities. The Accounting Division handles payrolls, accounts receivable and payable, and responds to any related issue from the mobile operators and third party companies. The Finance Division works with the Business Department to manage Mobilink's budget, implement sound financial policies and handle all treasury functions.

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The Finance and Accounting Department faced issue of capital acquisition, being private limited company Mobilink has to go for debt financing and current high interest rates due to economic downturn. They have to do serious pondering when they decide about costing. FINANCIAL DATA EXHIBIT 5

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ADMINISTRATION & HR DEPARTMENT: Mobilink's HR department ensures that only and only the highly skilled are recruited. It also establishes and maintains healthy internal communications and provides sufficient training to everyone with respect to Mobilink's ethical and professional standards. Mobilink believes in educating people to use technology and sense the responsibility to keep their departments informed and competent to the latest trends. That is why they heavily invest in training their employees. Though with the recent cost cutting strategy there is severe cut on the employee training budget. MARKETING & SALES Mobilink along with its competitors are having a price war. They are competing with one another on lowest call and message rates. Fighting a price war is the current competitive advantage with decline in disposal income in Pakistan that all the telecom companies are trying to win on this competitive advantage. Since the entry of Zong, Mobilink has started concentrating on marketing their brand and services. Previously they concentrated on employee benefits. More concentration is now being paid to do the effective marketing of Mobilink and more budget is allotted to the sales and marketing department. FRANCHISE OPERATIONS Mobilink launched software called SIEBAL couple of months back in all its franchises and at customer care centres. Initially the software worked well yet the software had issues when connecting with dial-up connection so forth the franchises in small towns and villages could not connect to the software. The software was to facilitate the franchises in the issues related to SIM and Mobilink service connections. The company reverted back to the old software. CSR AT MOBILINK

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Mobilink plays an active role in supporting the community and social development of Pakistan. Their Corporate Social Responsibility goes with charity and donations whereby they take into full account the impact on the society as whole and the natural environment. They recognize that an educated, healthy society is Pakistan’s key to ensuring sustainable development and they do their best to give back to the community they operate in and for this purpose they have created Mobilink Foundation. The Mobilink Foundation is a grant-giving organization, which provides support for the local community not only financially but also through dedicated volunteer hours. The establishment of the Mobilink Foundation in December 2007 is a reflection of the commitment of Mobilink and its employees to benefit the community in which they operate. INDUSTRY FACTORS Fuelled by recent rapid adoption in developing countries, mobile communications have propped up the industry’s top line. But now with these markets saturating, communications revenue growth as a whole is beginning to stall, and content connectivity revenues have not risen quickly enough to compensate. Although increase in mobile internet usage offers a glimmer of hope, the telecom industry faces some serious questions: where will future growth come from? How will the industry evolve? With Call blockage service offered by all telecom companies except Mobilink. According to PTA 3 Million people in Pakistan are still using Illegal SIM’s. This is a serious issue within the industry as prevailing competitors have found solution to it yet Mobilink has done nothing to it.

COMPETITORS

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Considering developments and increased competition in the telecommunications market of Pakistan, a more liberalized economy, the Mobilink management has to think of how to direct a company into more customer oriented operation, how to operate the company on sound economic principles and how to streamline the company’s image by issuing a communication strategy to support the business strategy of One Company – One Profile. Mobilink is looking for ways to organize and manage the company to comply with the high quality of services demanded by the customer. Mobilink is working on how to compete with an increasingly competitive telecommunications environment. EXHIBIT 6 TELECOM COMPANIES Mobilink Ufone Telenor Warid Zong NUMBER OF SUBSCRIBERS
32,203,000 18,368,074 18,329,428 15,774,299 4,446,024

CELLULAR SUBSCRIBERS %
32.56% 19.47% 23.72% 16.97% 7.27%

Subscribers Comparison • TELENOR

Telenor Pakistan is 100% owned by the Telenor Group, an international provider of high quality voice, data, content and communication services in 14 markets across Europe and Asia. Telenor Group is among the largest mobile operators in the world with over 179 million mobile subscriptions and a workforce of approximately 40,000. At the end of October 2010 it had a reported subscriber base of 23.84 million, and a market share of 23% making it the country's second largest mobile operator within 5yrs of launching its services in 2005.

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.Telenor Pakistan acquired 51% of Tameer Micro finance Bank in November 2008. In 2009 it launched ‘Easy paisa’ to become Pakistan’s first telecom operator to partner with a bank to offer mobile financial services across Pakistan. A nationwide network encompassing 8,000 plus cities and 2,500 employees and the subscriber growth is 9.9%. • UFONE

Ufone subsidiary of PTCL was established to provide cellular services across Pakistan. Ufone is currently providing quality services across Pakistan. Ufone currently lowered their calling rates across other networks as low as 2.50/min which is currently the cheapest prepaid rates available in the market. Ufone with the backend support of PTCL always provides quality services to its subscribers. Ufone claims to have 3 million subscribers and still growing. Ufone is one of the best cellular companies in Pakistan with reliable network and coverage to over 100 key cities and prominent highways. • WARID

Abu Dhabi Group led by Sheikh Nahayan Mabarak Al Nahayan operates Warid. Warid started it services in Pakistan May 2005. Since then Warid Telecom successfully launched the services covering 28 cities with a total population of around 32 million people. Ufone with the backend support of PTCL always provides quality services to its subscribers. • ZONG

China Mobile is the world's largest telecom operator having a customer base of over 300 million customers, its network routes 700 million text messages every day and handles 250 million calls every hour. China Mobile's first overseas subsidiary, China Mobile Pakistan (CMPak) is a 100%
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subsidiary which has the license to offer and operate voice, data and all value added services in the entire country. The pioneering overseas set up of China Mobile came through acquisition of a license from Millicom to operate a GSM network in Pakistan. The first international brand of China Mobile is Zong being launched in Pakistan So far CMPak has invested more than US$ 700 million in the telecom sector in Pakistan and an additional US$ 800 million will be invested till the end of year 2008. • PTCL

Pakistan Telecommunication Company Limited (PTCL) is the largest telecommunication company in Pakistan. This company provides telephony services to the nation and still holds the status of backbone for country's telecommunication infrastructure despite arrival of a dozen other telecoms including telecom giants like Telenor and China Mobile and Mobilink locally. The company consists of around 2000 telephone exchanges across country providing largest fixed line network. GSM, CDMA and Internet are other resources of PTCL, making it a gigantic organization. The Government of Pakistan sold 26% shares and control of the company to Etisalat in 2006. The Government of Pakistan retained 62% of the shares while the remaining 12% are held by the general public. PTCL also provides fixed line service through its countrywide CDMA based WLL (Wireless Local Loop) network, under the Vfone brand name. In the cellular segment, the second largest cellular provider in Pakistan, Ufone, is also a wholly owned subsidiary of PTCL. FUTURE OUTLOOK Mobilink is attempting effectively managing its labour costs, as well as continue to introduce new and contemporary product lines to complement its existing product lines. The economic downfall and high inflation has been of major concern.

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The company is continuing to introduce new product lines to follow trend of market while maintaining quality and tradition. The possibility of dilution of the brand is always present, with the in the current scenario of the deal between VimpelCom and Orascom. The company is trying to maintain an iconic status of its brands but it is either going to be Mobilink-Telenor merger or something better for the telecom industry. The merger leads to better relationship with neighbouring country Russia and narrower domination by Arabs in the telecom sector. Mobilink is also planning to takeover Warid in December 2010. So Mobilink is going through several changes, let’s see how it shapes the future of telecom industry. It is early to predict but a better and brighter future of Pakistan can be forecasted. REFERENCES 1. www.mobilinkgsm.com.pk 2. www.orascomtelecom.com 3. www.ufone.com 4. www.telenor.com.pk 5. www.zong.com.pk 6. www.pta.gov.pk 7. www.telecompk.com 8. www.ntcpk.com

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MOBILINK GSM
ANALYSIS
STRATEGIC MANAGEMENT PRESENTED TO MS. SAIRA IBRAHIM 11/27/2010 29 | P a g e

ABSTRACT

Mobilink GSM is a premier cellular company which has 10 million subscribers nationwide. Mobilink has the advantage of being the pioneers of introducing cellular networks in Pakistan. Orascom took the hold of Mobilink in 2001, it managed to make Mobilink grow five-fold in just 18 months in terms of subscribers. Mobilink’s greatest competition came in the form of two new operators; Telenor & Warid that launched their services in 2005. Nevertheless, Mobilink maintained its leadership in market with a share of approximately 56.2% of the total mobile subscribers in Pakistan. As of December 2005, Mobilink served approx 11 million subscribers. The major milestone for 2005 is considered to be the launch of BlackBerry services in Pakistan. Following the launch of Zong in 2008, the telecom industry became even more competitive. In market with huge operators like Telenor, Warid, Ufone & now Zong, Mobilink’s recognition remained the same having the highest top of the mind brand awareness. Besides generating revenues & services, Mobilink has also played a role as a socially responsible corporate entity. Mobilink has made number of contributions in charities like Shaukat Khanam Memorial Trust, Umeed-e-Noor ,blind cricket for special people, donated cash to the President’s Flood Relief Fund, worked for the welfare and education of special children, sponsored events like Quaid-e-Azam National Gold Polo Championship. Mobilink has also promoted Pakistan’s art & culture in an international forum.

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EXECUTIVE SUMMARY
Mobilink, a subsidiary of the Orascom Telecom Holding, is Pakistan’s leading cellular and Blackberry service provider. Mobilink currently has more than 31.6 million subscribers. Mobilink maintains market leadership in Pakistan through cutting-edge, integrated technology, the strongest brands, competent employee strength of 4,500 and the largest portfolio of value added services in the industry, a broadband carrier division providing next generation internet technology as well as the country’s largest voice and data network with over 8,000 cell sites. Orascom Telecom Holding S.A.E. (OTH) is part of the Orascom group of companies began its journey in 1976 and Orascom Telecom Holding S.A.E. (OTH) was established in 1998. OTH through Mobilink has positioned itself as a leader in the region for its diverse GSM operations with various GSM support and Internet operations. In order to do the analysis of Mobilink GSM, we have gone through three stages which are the Input Stage, the Matching Stage and the Decision Stage. The first tool of Input Stage is EFE Matrix which tells us that Mobilink GSM is a flourishing company with having a total weighted score of 3.25. It indicates that Mobilink is responding in a very positive way to the existing threats and opportunities in the telecom industry. In our CPM we can see that most weights are assigned to Technology and Innovation and Price Competitiveness which are 0.150 respectively. The competitors we used to do the CPM analysis are Telenor and Ufone. Overall Mobilink GSM is strongest, indicated by the total weighted score of 3.440, closely followed by Telenor with the total weighted score of 3.360 and Ufone at 2.810. Overall, Mobilink GSM has received a 3.13 total weighted score, which on 1 - to - 4 scale is quite good but still has room for improvement in factors such as low motivation and low employee morale due to cost – cutting programs and employee termination and call blockage service is still not being offered though all the competitors have taken this step.
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In the Matching Stage, SWOT is an important tool which helped us develop four types of strategies: SO, ST, WO, and WT strategies. We matched the key external and internal factors and produced feasible alternative strategies that would take Mobilink GSM a higher step. Mobilink GSM’s vector is drawn in the Competitive quadrant of the SPACE Matrix. With the help of BCG, the differences among divisions in terms of relative market share position and industry growth rate have become clear. The South Division, North Division and Central Division lie in the second quadrant Stars which represents the organization’s best long – run opportunities for growth and profitability. The IE Matrix tells us that South Division is in the quadrant I which is described as grow and build which means it is in strong position. Central and North Division fall between quadrant I and II which indicates that these divisions are above average. The last tool of Matching Stage, GSM indicates that Mobilink is in the quadrant I which means that it is in an excellent strategic position. The final tool we have used in Decision Stage is QSPM in which we considered two main strategies which are ‘Improve service and gain market share via adopting MVNO, MVNE & UTMS technology’ having a total attractiveness score of 7.75 and ‘Backward integration over their infrastructure ventures and suppliers to reduce cost and expenses’ (TAS = 6.39). By total attractiveness scores of 7.75 VERSUS 6.39 that the analysis indicates the first strategy is the best option to opt for. Based on the results, the economic down turn in Pakistan and Intense competition in the industry has really taken its toll on Mobilink. Though Mobilink is at a strong financial position, it has not been performing up to the mark since last three to four years. Thus Mobilink must adopt innovative information technology. It is important to deliver good quality and reliable service and it is highly essential to retain its customers in the competitive environment.

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EVALUATION OF MISSION AND VISION STATEMENTS

MOBILINK’S VISION

“To be the leading Telecommunication Services Provider in Pakistan by offering innovative Communication solutions for our Customers while exceeding Shareholder value & Employee Expectations”.

MOBILINK’S MISSION

“To be the unmatchable mobile system of communications in Pakistan, providing the best value to its customers, employees, business partners and share holders”.

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EVALUATION OF MISSION STATEMENT

Customers Products or Services Markets Technology Concern for Survival, Growth and Profitability Philosophy Self – Concept Concern for Public Image Concern for Employees

Yes Yes Yes No No Yes Yes No Yes

‘providing best value to its customer’ ‘mobile system of communications’ ‘in Pakistan’ ‘providing best value’ ‘unmatchable’ ‘providing bets value to its employees’

RE-VISED VISION STATEMENT

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The Mobilink’s original vision statement is quite good. It clearly states that what are the aims of Mobilink and what is their target to achieve. Therefore, we have left the Mobilink’s vision statement untouched. It doesn’t need any changes.

MISSION STATEMENT AFTER EVALUATION

We anticipate consumer need and deliver outstanding products and services that improve people's lives.

Delighting customers with a wide range of products and services in the communication industry with the best people and improved quality via virtual and innovative technology through providing growth opportunity.

We are dedicated to provide the highest possible level of value to our customers, employees, community and investors.

Mobilink being friend of nature is working toward creating a prosperous society and tidy world.

Contribute to meet global standards at competitive price and committed to act in highest ethical manner with the rights and dignity of others.

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SWOT

STRENGTHS
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Largest Market Share & Highest number of Subscriber in Pakistan Blackberry usage soars Strong Brand Image, Indigo leading Postpaid brand and Mobilink Jazz singular pioneer pre-paid brand; & sweep two super brands award 2009 & Pioneers with GSM Technology Wide Network Coverage of 10,000 cities in Pakistan and over 100 countries with International Roaming Engineering and Technological stability at Mobilink along with competent employees Current ratio of company to meet its obligations improved in 2009 to 1.18 from 0.93 Concern for society and adapt to work environment needs; active CSR and only cellular operator to be awarded 6th Environmental Excellence Award by NFEH ISO 9002 Quality Management System Certification for Billing, Engineering Departments and CS Contact Center First mobile operator in Pakistan to offer extensive GPRS Roaming and BlackBerry Roaming services & Best extensive Network Infrastructure; optical network and Satellite links Declining Sales and EBIT by 13.5% but exponential growth in Revenue in first 3 quarter of 2010 Only cellular service in Pakistan to provide coverage on the M2 motorway and implementation of full intelligence network (IN) platform from Siemens
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   

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for the prepaid platform Mobilink's Short Message Service Center allows Vehicle Tracking and Fleet Management services Largest Call Center in Pakistan, which is there to assist the customers 24 hours Total Assets Turnover and Fixed Assets Turnover had been low for 3yrs, in 2009 TAT & FAT is 0.09 and 0.22 respectively In 2009, Mobilink ranked in top 100 telecom companies worldwide - 3rd among the 'Brands punching above their weights' ahead of Airtel, Tata Indicom and Reliance Continuous and latest employee training approaches Effective and Rapid Communication within Management Partnership with MCB to offer all banking services to Mobilink customers via their handsets

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WEAKNESSES
           Service issues with customers - average to below average service Mismanagement due to large network Huge Expenses incurred, high cost of material and other expenses High Tariffs as compared to competitors & expensive service quality both call rates and SMS Call Blockage service still not offered Sort of bureaucratic style of Management; biasness by intermediate bosses ARPU for pre-paid declined from 1.8 to 1.6 but for post-paid inclined to 1.3 from 1.2 Customer Retention No clear strategic direction of Orascom Low employee Morale; due to recent cost cutting program and employee job termination Extensive Organizational Structure
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OPPORTUNITIES
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Promotional Packages Sponsorships for local and International events Changing Marketing Mix Investment and Development Opportunities Improved Customer Service and Value Added Services Economic Influx both globally and locally Global Telecom Industry on Growth, both supply push and demand pull, pursuit of expansion Adoption New Technology; Mobile Wallet and Gift Cards Merger with VimpelCom; Opportunity to be Global 5th Largest Telecom Company Local handset manufacturing Adaptation to UTMS- 3G technology up coming in Pak Adopting to MVNO and MVNE services Exchange Rate Fluctuation

THREATS
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Intense Competition – Telenor, Ufone, Warid & Zong Inconsistent and Adhoc Regulatory Environment and Adverse Trade Policies of Pakistan Market Saturation of Subscribers Increasing maintenance cost Skilled labor attracted to competitors via better benefits High Tax Rates Price war between brands in telecom industry Natural Disaster; like the recent flood caused huge losses and the previous
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earthquake Political Instability and Security Concern

ANALYSIS

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Matrices on Microsoft Excel

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RECOMMENDATIONS & CONCLUSION
Based on the results, the economic down turn in Pakistan and Intense competition in the industry has really taken its toll on Mobilink. The continuous decline in market share and subscriber base
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suggests that the company has not been performing well in last 3-4years. In actual fact, the company's financial conditions are good even in economic down turn yet have been incurring huge expenses, which they are considering via cost cutting on their major nonessential costs. However it shows a slight improvement which can also be a result of the recent re-structuring, re-engineering and cost cutting approaches by the company. We would recommend the company the following recommendations:

Maintaining leadership in the market requires innovative organizations willing to reengineer to succeed.

IT fusion with the business means restructuring and remodeling to understand the role IT would play to meet the business objectives and a clear strategic direction including revision of firm’s vision and mission statements.

Constructing websites is not about content; it is about understanding what adds value and how humans interact with information. Their website Mobilink Infinity has nothing useful for customers or for any other stakeholder.

Knowledge management is a plan that companies need to develop as part of their initial business process modeling

It is not wrong for large firms to try to adapt to successful processes implemented by other firms and merger of Orascom-VimpelCom is go for future of Mobilink Telenor both as well for Pakistan.

From analysis, the merger of Orascom – VimpelCom is good for the two giants of telecom in Pakistan as well as for Pakistan Economy. Let’s see how the deal proceeds as for now the dispute is over the merger of Orascom Algeria Venture where the Algerian Government wants to nationalize it. Previous in April 2010, Orascom had talks with merger to MTN – South African Telecom yet deal did not proceed.
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Mobilink is also planning for acquisition of Warid Telecom by 2011, which means gaining market share and subscribers as well have to compete at a larger extent with other competitors. The Strategies Mobilink should focus on are:

Adopting Innovative Technology; mobile wallet and gift cards– Product Development Global Expansion in Emerging Markets – Market Development Concentrate on providing better and reliable service – Market Penetration Concentrate on consumer retention and gaining market share – Market and Product Development & Penetration Backward Integration over venders for reduction in infrastructure maintenance cost and other expenses.


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BIBLIOGRAPHY
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www.mobilinkgsm.com http://www.zumbeel.net/beta/news/details.php?rev_param=6874

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http://www.zumbeel.net/beta/news/details.php?rev_param=6993 http://www.zumbeel.net/beta/news/details.php?rev_param=7039 http://www.zumbeel.net/beta/news/details.php?rev_param=7136 http://www.zumbeel.net/beta/news/details.php?rev_param=7160 www.orascomtelecom.com www.ufone.com www.telenor.com.pk www.zong.com.pk www.pta.gov.pk www.telecompk.com www.ntcpk.com

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