Bharat Sanchar Nigam Ltd (BSNL), the corporate version of erstwhile DOT, came to existence on
1st October 2000. Ever since the formation of BSNL, the Indian telecommunications scenario has been
transforming itself into a multi-player, multi-product market with varied market sizes and segments.
Within the basic phone service the value chain has split into Basic services, long distance players, and
international long distance players.
To understand and suggest – how strategic management can help BSNL – the first thing
is to understand the Telecom industry environment and the stakeholders involved. Apart from
having to cope with the change in structure and culture (government to corporate), BSNL has
had to gear itself to meet competition in various segments – basic services, long distance (LD),
and International Long Distance (ILD), and Internet Service Provision (ISP), and Mobile
services. With the advent of competition the private operators have been impacting the
strategic matrix by influencing regulatory bodies, adopting intelligent media strategies, and by
targeting the creamy layer of customers. While, political control over the public sector remains
a contentious strategic issue in the country; with the formation of a company, the internal
strategy of the BSNL board will be of gaining considerable autonomy. Labour unions are
powerful internal stakeholders, as are the middle managers/ other staff that have the primary
responsibility for customer care. The following stakeholders diagram gives an insight about
the changing telecom industry environment for BSNL
Environment BSNL definitely requires to redefine its strategies. What is required is to identify the
potential opportunities and threats implied by this changing environment for the BSNL. In changing
trends, situations, and events gaining an accurate understanding of BSNL’s strengths and limitations will
help in better strategic management of organization. The SWOT analysis for BSNL is as follows –
BSNL – SWOT ANALYSIS
STRENTHS WEAKNESSES
OPPORTUNITIES THREATS
Having analysed the external environment and assessed the internal strengths and weaknesses of
BSNL, the key issues can be summarized as follows:
1. innovative products based on convergent technology in order to acquire dominant market
position. BSNL can achieved by –
Replacement of all the outdated technologies
Redeployment of unutilized capacities should be considered first.
Early deployment of cost effective Wi fi/Wi max Technologies
Migrating to NGN (Soft Switch) on large scales, which will unable seamless integration of
upcoming technologies.
Increasing the capital investment in convergent technologies even if it renders certain in use
technologies redundant.
2. BSNL should initiate Customer Orientation Strategy to retain existing customers as well as
to attract new customers by –
3. Extensive use of IT can not only improve operations but can add to greater customer satisfaction.
Despite being a technology intensive organization IT penetration in BSNL is not commensurate.
Presently, the use of IT in BSNL is restricted to –
6. Diversification strategy BSNL should have strategic alliance with content providers,
international long distance operators and cable operators as a. Turnkey projects for
providing total solutions to corporates /governments should be undertaken as a business
proposition by entering into partnerships.
7. marketing strategy needs to be redefined and should focus around Value Added
Services, building strong distribution chain and differential treatment to
premium/corporate customers.
8. Human Resource Management BSNL need to overhaul its Human Resource Management
strategy and should focus on –
Tie up with top business schools in India for training their managers at various levels.
Redeploying its manpower from bigger cities to smaller ones
Coming out with VRS/CRS for manpower above the age of 50.
Creating value through employee motivation and should develop reward and
punishment system
Effective knowledge management within organization
Preventing manpower churning
The VRS/CRS scheme is likely to be opposed by the unions and the implementation may be difficult
in the politicized environment. However, rightsizing the organization is of paramount importance for
the long run interests.
9. Restructuring of organizational on business type model BSNL’s organization structure
still remains more or less functional in structure. The with each product/segment
considered as a separate business will help in
a. Better management
10. Revenue Maximization Strategies: The telecom sector is the most competitive sector post
liberalization. This has resulted in a movement from growth based business model that
emphasized growth in numbers or even ARPU to profit-based model where the success is
measured by margins. BSNL as part of the transition has to adopt both cost reduction and revenue
enhancement measures, which would directly impact profitability. The key concerns for BSNL for
effective revenue realization are –
SUMMARY
BSNL should change its very strategy of acting as follower to that of leader. Instead of
reacting to other operators move it should start acting proactively. BSNL should adapt
greater standardization and flexibility in systems. Only then new service rollouts will be
faster, and ideas will be converted into revenue streams. The overall strategy of BSNL can
be of concentrating on the mobile and broadband business in near future and to immediately
phase out loss making businesses like telegraph, VSAT communication etc. BSNL can
leverage on its pan India reach and economies of scale to achieve overall cost leadership. At
the same time capital investments can be made in next generation networks where stress
should be on Wi-Max, content based data service and VOIP. Emphasis on organizational
restructuring coupled with customer orientation and operational efficiency can help BSNL
find place in Asian Telecom market.