CHAPTER ONE

Exploring the marketing strategy and its effect on organizational performance

Case Study; Africell, Sierra Leone

By:

1. Alimatu Kamara 19612

2. Georgette Kargbo 20427

3. Hawanatu Kamara 20387

4. Iyatunde Williams 20218

5. Josephine M. Bokon 20362

SUBMITTED TO THE DEPARTMENT OF BUSINESS ADMINISTRATION AND

ENTREPRENEURSHIP, INSTITUTE OF PUBLIC ADMINISTRATION AN
MANAGEMENT (IPAM). FOR PARTIAL FULFILMENT TO STUDY OF DEGREE IN
BUSINESS ADMINISTRATION

2020

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 1. INTRODUCTION

1.1 Background

In today’s competitive business environment, organizations must map out their plans on how to
sustain their business performance, their competitive advantage and increase their probability.
Thompson, Strickland and Gamble (2007) argued that the main objective of any strategy in an
organization is to improve its financial performance, strengthen its competitive position and to
outdo its rivals. To obtain effective firm performance within the scope of sustainable competitive
advantage, decisions on shaping firms competitive strategies will be one of the main issues for
organizations. This is because the formulation and implementation of competitive business
strategies that will improve performance are one of the competent methods to achieve the firm’s
sustainable competitive advantage. Therefore, the effect of competitive strategies on the firm
performance is a major issue to policy makers and has been playing an important role to refine
the firm performance for a long time (Porter, 2008). The telecommunication industry is growing
and is becoming intensely competitive. As such, every organization needs to adopt strategies
which will enable it to have a competitive edge over the other players in the market. As
competition intensifies, many businesses continue to seek profitable ways in which to
differentiate themselves from competitors (Porter, 2008). Strategies concern the purpose and
objectives of the organization. They are the things that organizations do, the paths they follow
and the decisions they take in order to reach certain points or level of success. Influences such as
economic restructuring, intensified competition, government regulations, and technological
advances have resulted in heightened environmental turbulence and uncertainty for small
business firms (Covin & Slevin, 2010).

A competitive strategy, from a business level perspective, is the achievement of competitive

advantage by a business unit in its particular market. According to Ansoff and McDonnell (1990)
competitive strategy is a distinctive approach which a firm uses or intends to use to succeed in
the market. Sidorowicz (2007) views competitive strategies as more skill-based and involving
strategic thinking, innovation, execution, critical thinking, positioning and the art of warfare.
Competitive strategy specifies the distinctive approach which the firm intends to use in order to
succeed in each of the strategic business units. Competitive strategy gives a company an
advantage over its rivals in attracting customers and defending against competitive forces.

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Competitive strategy consequently aims to establish a profitable and sustainable position against
the forces that determine industry competition (Porter, 2008). In the context of Sierra Leone, the
study titled exploring the effect of strategic issue management on organizational performance.
The main purpose of this study was to explore the links between strategic issue management
activities and organizational performance.

In Sierra Leone, four main companies provide telecommunication services in the country. These
include; Africell, Airtel, Qcell and Sierratell. They provide a range of products and services
which include Land-line,GSM, roaming services, top-up services, data messaging, MMT, voice
services, and security services, 3G/4G, GPRS and much more. These services are all geared
towards growth and competition. They use a lot of strategies to gain sustained competitive
advantage (Ali & Dhaha, 2013). Africell is a holding company of telecommunication operations
with headquarters in London, United Kingdom. The company was founded in 2001 and has a
core strategy to “connect and empower local communities”. Africell's current portfolio spans
across West, Central, and East Africa namely; Uganda, Democratic Republic of Congo, The
Gambia, and Sierra Leone. Having established themselves as the number one telecommunication
provider in The Gambia and Sierra Leone and a strong challenger in the Democratic Republic of
Congo and Uganda, Africell is one of the fastest-growing mobile telecommunication operators in
Africa today, with a total of more than 12 million active subscribers.

Africell Sierra Leone launched its operation in 2005 and now covers more than 76% of the
population. In Sierra Leone, Africell has been the market leader since 2009, with more than 4
million active subscribers and a growing footprint of 3G and 4G services respectively. Africell's
growth is driven by data revenues, with 20% of customer recharges being for data products, a
rate which is trending upwards.

1.2 Statement of the problem

The telecommunication business in Sierra Leone, as many other countries in the world has in the
recent past been among the most competitive industry in the economy. Initially, there were only
two players but the entry of two other operators made the industry very competitive. The firms
employ various competitive strategies to survive in the industry. Whether these strategies
facilitate them in achieving this and even making the firms more effective is an area that this
paper explores. Studies done on competitive strategies are noted to have given attention to

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circumstances other than Sierra Leone and in particular the mobile telecommunication business.
Precisely the study set out to identify the competitive strategies adopted by firms in the mobile
telecommunication industry in Sierra Leone (Specifically Africell SL) and thereafter examine the
relationship between these strategies and the firm performance in the industry.

1.3 Objectives of the study

General objectives

The general objective of this study is to determine the effect of competitive strategies on
organizational performance of telecommunication companies in Freetown, Sierra Leone.

Specific objectives

1. To determine the effect of cost leadership strategy on organizational performance of

Africell Sierra Leone.

2. To investigate the effect of market focus strategy on organizational performance of

Africell Sierra Leone.

3. To examine the effect of strategic alliances on organizational performance of the Africell

Sierra Leone.

4. To assess customers response to the implementation of marketing strategies.

5. To assess the impact of marketing strategies on the performance of Africell Sierra Leone

1.4 Significance of the Study

The relationship between marketing strategies and business sustainability needed further
investigation for Telecommunication Company’s survival because Telecommunication have
been able to expand local economies by offering service provisions and employment
opportunities. The study goal was to determine the pattern of Telecommunication survival in the
competitive economy; interpreted through interviews with staff and customers. The researcher's

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intent was to understand the effect of marketing strategies on Telecommunication Companies,
having entered into the competitive economy and how its affect their performance.

1.5 Justification of the Research

The relationship between market orientation of a firm and its performance has been studied in
many sectors across continents; researchers have been able to establish a positive relationship
between the two (Linus, 2006; Kalla, 2005; Ruekert 1992; Narver and Slater 1990). However
none of these studies have focused on the telecom sector in Africa and for that matter Sierra
Leone. Again there has not been an attempt to empirically mediate the relationship with internal
communication to further offer a robust model for such a study. Although research abound in the
area of mediated outcome of internal communication and staff engagement on organizational
performance, this research throws further light on the importance of internal communication on
staff engagement and hence performance in the telecom sector of Sierra Leone. The telecom
service sector has become very competitive over the past four years and it is becoming evident
that the people factor will be a critical differentiator for superior performance. This research will
contribute to the body of knowledge that stresses the important role staff play in service
organization in general and for Sierra Leonean telecommunication sector. The work will benefit
the management of Afriell Sierra Leone by given them the first hand information on the market
oriented practices adopted and its effect on company business performance.

More so the staff would come up with suggestions that would help in the modification of the
internal communication strategy so the company could benefit from the outcomes of effective
internal communication and how it links to performance in general.

1.6 Scope of the Study

The study was conducted in Afriell Sierra Leone. However it focused on managers in the
company since they had in-depth understanding of issues under consideration. The issues were
market orientation with focused on customer orientation, competitor orientation and inter-
functional coordination, internal communication and business performance.

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1.7 Limitation of the Study

To give stronger measure of performance of the organization, measures like financial measure
(profitability, return on assets or return on investment)or shareholder return should have been
used (John et al 2010). However the lack of access to such reports of the company of study, the
researchers used business performance based on perception of managers. This is one of the
limitations of the work. John et al (2010) however added that depending on the purpose of the
report a suitable measure of company performance may be used. Managers by virtue of their
position had clear picture of market performance of Afriell Sierra Leone, hence their responses
on market would be reliable.

Another limitation of the study is the inability to do a comparison of the level of market
orientation of the telecommunication companies in the sector. That would have thrown more
light on the effect of level of market orientation on company performance. In the same vein such
study would have reveal other possible variables that affect company performance. However
these areas offer room for further research in the future.

1.8 ORGANIZATION OF THE STUDY

The study is organized into five chapters. Chapter one presents the general introductions,
problem statement, objectives and research questions. Chapter 2 contains literature review. This
has a theoretical framework on which the study is based. It also reviews different literature in the
areas of marketing strategy and telecommunication. Chapter 3 is about methodology. It explains
the research type adopted, sampling methods, tools used for data collection and methods of data
analysis. Presentation and discussion of research findings are contained in chapter 4 of the study
and chapter 5 gives conclusions and recommendations of the study