INTRODUCTION

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.

BSNL’s POSITIONING IN TELECOM INDUSTRY

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

FIG 1 - STAKEHOLDERS IN BSNL’s STRATEGIC MANAGEMENT

 Minist
Minist
ITU, ryry
ofof
ITU, Comm
Intern
Intern Comm
unicati Other
Other
Others ational
ational unicati
Othersteleco onon
&& Private
Private
–– teleco ITIT operat
mm operat
media,
media, orsors BSNL’
BSNL’
genera industr s s
genera industr
y
l l y custom
custom
public,
public, ersers
&&
channe
channe BSN consu
consu
l l BSN mer
LL mer
partne
partne organi
organi
IT,IT, Manuf
Manuf
BSNL
rs, BSNL
rs, zations
zations
Insura
Insura acture
acture
Emplo
PCOs Emplo
PCOs nce,
nce, rsrsofof
yees
etc &&
yees
etc Railwa
Railwa teleco
teleco
labor
labor ys,ys, mm
unions
unions Regula
Regula Bankin goods
Bankin goods
tors,
tors, g etc.
g etc.
TRAI
TRAI industr
industr
y using
y using
teleco
teleco
mm
backbo
backbo
nene

BSNL’s SWOT ANALYSIS

The changing external environment for BSNL can be well captured by the
Potter’s model diagram which shows that the industry structure has become bit
unfavorable (Pl. refer exhibit- 1)
In such an 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
• Pan-India reach
• Experienced telecom service provider
• Total telecom service provider
• Huge Resources (financial & technical pool)
• Huge customer base
• Most trusted telecom brand
• Transparency in billing
• Easy deployment of new services
• Copper in last mile can be used for easy
broadband deployment
• Huge Optical Fibre network and associated
bandwidth
OPPORTUNITIES
• Tremendous market growing at 20 lac
customers per month
• Untapped broadband services
• Untouched international market
• Can capitalize on public sector image to
grab government’s ICT initiatives
• ITEB service markets
• Diversification of business to turn-key
projects
• Leveraging the brand image to source funds
• Almost un-invaded VSAT market
• Fuller utilization of slack resources
• Can make a kill through deep penetration
and low cost advantage
• Broaden market expected from convergence
of broadcasting, telecom and entertainment
industry
WEAKNESSES
• Non-optimization of network capabilities
• Poor marketing strategy
• Bureaucratic organizational set up
• Inflexibility in mindset (DOT period
legacies)
• Limited number of value added services
• Poor franchisee network
• Legacy of poor service image
• Huge and aged manpower
• Procedural delays
• Lack of strategic alliances
• Problems associated with incumbency like
outdated technologies, unproductive rural
assets, social obligations, political
interference,
• Poor IT penetration within organization
• Poor knowledge Management
THREATS
• Competition from private operators
• Keeping pace with fast technological
changes
• Market maturity in basic telephone segment
• Manpower churning
• Multinational eyeing Indian telecom market
• Private operators demand for sharing last
mile
• Decreasing per line revenues due to
competitive pricing
• Private operators demand to do away with
ADC can seriously effect revenues
• Populist policies of government like
“OneIndia” rates