U FONE (TELECOM)

Strategic Management Plan

I n t rodu c t i on:
Ufone GSM is a Pakistani GSM cellular service provider. It is one of six GSM Mobile
companies in Pakistan and is a subsidiary of Pakistan Telecommunication Company. Te
company commenced its operations under te brand name of Ufone from Islamabad on
!anuary "# "$$%. Ufone expanded its coverage and as added ne& cities and ig&ays to its
coverage net&ork. 'fter te privati(ation of PTC)* Ufone is no& o&ned by +tisalat. PTM) is a
&olly o&ned subsidiary of PTC). +stablised to operate cellular telepony. ,uring te year
"$$%* as a conse-uence of PTC).s privati(ation* "/0 of its sares &ere ac-uired by +mirates
Telecommunication Corporation 1+tisalat2. 3eing part of PTC)* te management of Ufone as
also been anded over to +tisalat.
,uring te year !uly "$$4 to !une "$$/* Ufone continued on te pat to success. Te
Company furter expanded its coverage and as added ne& cities and ig&ays. Ufone as
net&ork coverage in more tan 54$ cities* to&ns and across all ma6or ig&ays of te country.
,uring
te year Ufone successfully completed te net&ork expansion of Pase 7 in existing as &ell as
in ne& cities and to&ns &ic amounted to more tan US ,ollar %5$ million. 's a result
te asset base of te Company as increased from 8s. "$ billion to 8s. "5 billion.
EX TE RN AL AN AL YS I S opportunities and
traets
O!! OR TU N IT IE S
Ufone could develop some ne& and innovative services to attract customers and
some of te suggestions are as under &ic &ill elp tem to increase teir revenues9
Tey sould also introduce some International call packages to Middle +astern
countries because tere are lots of Pakistanis &o are living in tose countries so
people &ill definitely be tempted to&ards suc package.
Ufone sould develop some ne& francises in remote areas so tat people &ill get
more and more benefit from it and it &ill elp to increase teir customers.
's in Pakistan :out is almost te 4$0 of te population so Ufone can take
advantage of tis demograpic situation and sould introduce more and more services
and packages tat attracts yout to&ards it.
Ufone sould extend its net&ork coverage area to ;ortern part of te country as &ell
because in tat part not too many companies are giving services and if Ufone give its
service tere ten it &ill definitely attract people and its number of customers &ill
soot like a rocket.
If Ufone enance its voice -uality ten definitely it &ould be prefer more by customers.
Ufone sould import tecnological e-uipments from Cina because tey are giving
te best tecnology at very lo& rates so it &ill not only elp Ufone to be aead
tecnologically but also &ill elp Ufone to decrease its cost.
Ufone can surprise its competitors by introducing <Ufone kiosk=. Tese &ill be 'TM like
macines and tat &ill give "7>our service to Ufone subscribers to load te balance
6ust like tey take money from 'TM.
T"R E A TS
's Ufone is cellular company and tere is cut troat competition among cellular
companies in Pakistan. Tere are four oter companies also &orking in Pakistan
so Ufone &ould ave to face some gro&ing competitive pressures.
In 3alocistan and ?'T' &ere Ufone already as net&ork coverage is in
danger because of critical situation and operation being eld tere. Investment of
Ufone is in danger.
3y te arrival of Cina Mobile Company 1@ong2 in cellular industry of Pakistan te
Ufone and oter companies no& ave to face te severe competition. 's @ong is
introducing some various attractive packages of bot SMS and calls to attract
customers. Ufone ave to develop strategies to counter teir strategy and to
survive in te market.
Te key treat to Ufone is also some adverse Government policies of
implementing
Tax on telecommunication industry tat &ill ultimately affect te revenues.
Telenor is giving iger salary to its employees as compared to Ufone so many of
its skillful and competent employees are going tere. Tat &ill affect te
company.s profitability in te long run.
'noter treat is any ne& company from foreign countries e.g. Arange and
Bodafone.
T"E S T R A T E # Y F O R MU L A T IO N
A N A L Y T I C A L ! R O C E S
E$terna% Factor E&a%uation Matri$ (EFE Matri$)
'e( E$terna% Factor
)ei*t Ratin* )+
Score
E$terna% Opportunities
Globali(ation .%" 7 .7C
Publicity D Marketing .$/ E .%C
Can target Corporate .$C E ."7
,evelop ;e& value 'dded services .%$ 7 .7$
+xtend Coverage to ;ortern 'reas .$4 E .%4
introduced International SMS packages like local SMS D
call
package
.$/ E .%C
develop some ne& francises in remote areas .$C 7 ."7
Introducing <Ufone kiosk=. !ust like 'TM .$4 E .%4
E$terna% Treats
Ald Stable Companies D arrival of Cina Mobile Company .%$ " ."$
PTC) cellular license .$C " .%/
E Price Far .$4 E .%4
Government Interference .%" E .E/
Pressure groups D ealt issues due to to&ers in
residential areas.
.$4 " .%$
TOTAL: ,+-- .+/0
Interpretations:
Total &eigted score for te Ufone external factor is ".#5 &ic are above average. So it
as aggreSssive strategy.
Co1petiti&e !ro2i%e Matri$ (C!M)
Competitive profile matrix is an essential strategic management tool to compare te firm &it te
ma6or players of te industry. Competitive profile matrix so& te clear picture to te firm about teir
strong points and &eak points relative to teir competitors. Te CPM score is measured on basis of
critical success factors* eac factor is measured in same scale mean te &eigt remain same for
every firm only rating varies. Te best ting about CPM tat it include your firm and also facilitate to
add oter competitors make easier te comparative analysis. EFE is used to collect competitive
intelligence information from external from external environment .It not focuses on internal
issues .where as CPM is little different from EFE it is also consider the internal issues and
the best feature of CPM that it allow to compare the competitor critical success factor with
your
organization.
C: Co1petiti&e !ro2i%e Matri$ (C!M)
MO3ILIN
'
TELENO
R
4ON# UFONE
Critica%
Success Factor
(CSF)
)ei*
t
Ratin
*
)
+
Sco
Ratin
*
)
+
Sco
Ratin
*
)
+
Sco
Ratin
*
)+
Sco
re
Market sare
$.%$ E $.E
$
E $.E
$
% $.%
$
7 $.7$
Gro&t rate $.%" E $.E
/
E $.E
/
% $.%
"
E $.E/
?inanci
al
strengt
$.%E E $.E
#
E $.E
#
E $.E
#
E $.E#
Management $.$# E $."
5
E $."
5
E $."
5
E $."5
Coverage $.%% E $.E
E
E $.E
E
E $.E
E
E $.EE
CCS $.$4 " $.%
$
" $.%
$
" $.%
$
E $.%4
'dvertising
Marketing
$.$4 E $.%
4
E $.%
4
" $.%
$
E $.%4
3rand ;ame $.$4 " $.%
$
E $.%
4
" $.%
$
E $.%4
Product Guality $.$4 E $.%
4
" $.%
$
E $.%
4
E $.%4
Price $.%$ E $.E
$
" $."
$
E $.E
$
E $.E$
Customer
)oyalty
$.$4 " $.%
$
" $.%
$
" $.%
$
E $.%4
Global
+xpansion
$.%$ E $.E
$
E $.E
$
" $."
$
E $.E$
TOTAL: ,+-- .+5
6
.+0
6
.+.
7
8+,-
Interpretation:
' Ufone GSM Telecom Company is dominating in te industry as compared to local players.
Tere are several competitors like Mobilink GSM* Telenor and @ong etc but above
competitors are te ma6or ones.
CPM scores for Ufone so&ing aggressiveness as compared to te Mobilink GSM* Telenor and
@ong.
Ufone GSM is number one company &it in te local environmentH it is basically leading te
industry in te follo&ing aspects9
Product design.
8esearc and development
Persistence in product -uality.
Trained Manpo&er.
Moreover* Mobilink GSM is resides at te second number and leading industry in effective
management style.Ten Telenor GSM comes at number E
rd
&it leading position persistence in
-uality and market segmentation and finally @ong is last one.
I
STA#E: .
N9
MATC"IN# STA#E
O ppo r tu n i ti e s (O) (SO) S tr ate * i e s ()O) S tr ate * i e s
Globali(ation
Publicity
Can target corporate
+xpand
Increased coverage D
francises
+nance coverage D
market sare
'c-uisition
;e& value added
service
s
Covering ;ortern 'reas
;e& Product 1Ufon kiosk2
Penetration
Penetration
'c-uisition D Make
te post paid package
more attractive
Increased loyalty D
brand image
'ttract ne& customers
T r eat s (T) (ST) S tr ate * i e s ()T) S tr ate * i e s
Ald Stable Companies
'ttractive Packages 3y
Competitors
Price Far
Government Interference
Pressure groups D
ealt issues
Cost )eadersip
Penetration D co
branding &it oters
like banks
Market )eader
Introduce ne& packages
D
service
,o&nsi(ing
Interpretation
s:
C r i t i c a % R e * i o n i s
) O +
U f o n e G S M T e l e c o m c a n i m p o r t n e & t e c n o l o g y t o reduce its
cost of production. Company can tus be able to penetrate in te market and capture more
sares by improving -uality of goods and services* and provision of goods at lo&er prices.
C o n c %u s io n s a n d R e c o 1 1e n d a t io n
Ufone is "
nd
largest cellular company in Pakistan. More committed to&ards
gro&t.
Telecom industry is most gro&ing industry of Pakistan and still uge investment re-uired for
coverage. Te market also as strong competition after te entrance of Cina Mobile Company.
Competitors are iring professionals to entertain te consumers &ic is resulting tecnological
implementation and value added services. Consumer searces good service &it lo&est call
rates* altoug companies are minimi(ing call rates. Tis &ill result more gro&t in te market.
Ufone bring ama(ing packages to attract te customers. Ufone promote teir product troug
TB commercials* ;e&spaper* 8adio* Internet etc. Te coice of people is Ufone because
Ufone price level is lo& and affordable tat every one can say
<It.s all about U=
Ufone could develop some ne& and innovative services to attract customers to increase
teir revenues as &ell as it customers9
It sould introduced International SMS packages
Ufone as strong financial position D more competitive advantages ten oter
cellular companies so it sould more focus on its strategies.
It sould pay more attention to&ards postpaid services