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1. Introduction
Telecommunication service embraces many areas, including landline and mobile phone serv-
ices, data and multimedia distribution via regular, cable or satellite links. The main characteristic
of telecommunication sector is a relatively small number of big companies. It requires big invest-
ment, particularly for the introduction of new services and technologies.
In telecommunication sector creation and improvement of strategy in following areas is important:
x Strategic goals achieving, with emphasize on:
– consolidation of existing markets for telecommunication services,
– convergence of the landline and mobile phone services,
– introduction of value-enhancing projects,
x Operational excellence, including quality, BE, innovative products, etc.
European telecommunication sector is still growing at the steady rate. Mobile phone services
have become the largest segment in telecommunication services with share of 49%1. In Tab. 1 is
presented selected top telecommunication operators in EU in 2003.
1
Trends and drivers of change in the EU telecoms sector: Mapping report, Foundation for the improvement of
living and European Working Condition, Dublin 2005. www.eurofound.eu.int
90 Zora Arsovski, Slavko Arsovski, Goran Markoviü, Igor Milanoviü, Maja Dabetiü
Share of EU telcom sector in world turnover was nearly 25%2. Increasing of business rela-
tionships and falling prices is broad recognized trend that leads to growing of telecommunication
services and integration of telcom providers. Therefore, Deutsche Telecom has share in 15 EU
countries, such as Austria (T-Mobile, T-Online), France (T-Online), Netherlands (T-Mobile), UK
(T-Mobile), etc.
Through analysis, the following drivers of change are recognised:
x regulation,
x impact of the crisis in 2001,
x entry of new operators into the market,
x technology and standardization,
x increase in employment of computer support specialists,
x increase in employment of computer software engineers,
x increase in employment of information systems managers,
x increase in employment of marketing and sales managers,
x increase in employment of computer services employees,
x increase in employment of Þnancial specialist,
x increase in quality managers and quality engineers,
x increase in IMS managers and engineers,
x decline in the number of telecommunication equipment installers and maintenance workers.
Telecom Austria Group offers communication solutions that seamlessly integrate into people
lives, with slogans:
x innovation: innovating with You,
x quality: importing with You,
x diversity: sharing with You,
x responsibility: caring with You3.
Enhanced competitiveness in telecommunication sector needs new approaches involvement, as
quality and business excellence. Quality, as degree of satisfaction of customers, is evolved in satisfac-
tion of all stakeholders. Therefore, Quality Management Systems (QMS) evolved through Integrat-
ed Management Systems (IMS), which consists from different Standardized Management Systems
(SMS) related to ISO 9001, ISO 14001, ISO 18001, ISO 26000, ISO 28000, TL 9000, etc. In design
of IMS, some very famous methods are included as well as techniques and tools from Total Quality
Management (TQM) approach. It is link to the new paradigm known as Business Excellence (BE).
Basis for implementation of quality and BE paradigm in telecommunication sector are proc-
esses and integration of all stakeholders needs related to those processes, especially when compa-
nies are challenged with higher competitiveness in global telecommunication market.
Telecommunication companies have to be competitive in both, landline and mobile phone
services with lower prices. Under these circumstances, telecommunication companies need to
improve productivity, quality and operating efÞciency that are essential for business success, in
accordance to BE model presented below.
In this paper, basis of quality and BE paradigm are presented, as well as actual state of Serbian
telecommunication sector with emphasis on new approach to the one Serbian Telecommunication
Company which is aimed to achieve higher level of competitiveness.
2
Trends and drivers…, op. cit.
3
Future, Telecom Austria Group, Annual Report, 2010. http: //ar2010.telecomaustria. com
Quality and Business Excellence in Telecommunication Sector: A Case Study 91
4
J. Kelada, Integrated Reengineering with total quality, ASQC Quality Press, Milwaukee, Wisconsin, 1995.
5
Transforming Telecom Management – facing the challenge of next generation networks, White paper, Ericsson,
January, 2009.
6
J. Kelada, op. cit.; N. Slack et al., Operations and Process Management: Principles and practice for strategic
impact, FT-Prentice Hall, London 2009; J. Oakland, Oakland on Quality management, Elsevier, Amsterdam
2004; R. Garvare, P. Johanson, Management for Sustainability: A stakeholder theory, “Total Quality Manage-
ment & Business Excellence” 2010, Vol. 21, No. 7-8, pp. 737-744; S. Karapetroviü, J. Jonker, Integration of
Standardized Management Systems: Searching for a Recipe and Ingredients, “Total Quality Management &
Business Excellence” 2003, Vol. 14, No. 4, pp. 451-459.
92 Zora Arsovski, Slavko Arsovski, Goran Markoviü, Igor Milanoviü, Maja Dabetiü
Previously, management theory and practice have been changed rapidly, which results in ex-
istence of many management concepts, whose acronyms are unknown to the experts of particular
areas (e.g. TPM, MBO, HRM, etc.).
During growth of quality and environment movement in 90cs, concepts listed in addition have
appeared – environment management system (ISO 14000), occupational safety and health man-
agement (OHSAS-ISO 18001), risk management system and some others management concepts
are still in preparation phase (Fig. 1).
RM
Risk Management
OHSAS EMS
ISO 18001 ISO 14001
Problem in
Telcom sector
Other
QMS management
ISO 9000 systems
Resolving
Appearance of many dissimilar management systems, with different and sometimes divergent
demands, needs optimal strategies reconsideration in introduction of standards in national quality
policies and emphasize question of their integration through integrated management system.
Quality management system (ISO 9000), environment management system (ISO 14000) and occu-
pational safety and health management (ISO 18000) appeared in the last decade of 20-th century. They
give partial answers on above-mentioned questions and particular quality demands. Therefore, there is
high level of similarity and overlapping between them (e.g., between ISO 9000 and ISO 14000), but
there are also speciÞc demands for every mentioned management system. Actually, there is a possibility
of changing identiÞed relations between them afterwards, which could result in their integration.
The Þrst question is which integration elements are keys for the above-mentioned area. The
answers could be:
x same stakeholders, that is interest groups (employees, management, business associates, pop-
ulation, state, stakeholders) and interested parties,
x same organization and environment processes,
x same methods and techniques, theory and management practice,
x similar resource management,
Quality and Business Excellence in Telecommunication Sector: A Case Study 93
7
D. Sumers, Quality, Fifth Edition, Prentice Hall, Boston 2010, p. 20; J. Kelada, op. cit.; N. Slack et al., op.
cit.; J. Oakland, op. cit.; R. Garvare, P. Johanson, op. cit.; S. Karapetroviü, J. Jonker, op. cit.; M. McDonald,
T. Mors, A. Phillips, Management System Integration: Can it be done?, “Quality Progress” 2003, 36, pp. 67-74;
A. Zutshi, A. Sohal, Requirements for successful integrated management system: The experiences of Australian
organizations, Faculty of business and economics-Monach University, Australia 2003.
94 Zora Arsovski, Slavko Arsovski, Goran Markoviü, Igor Milanoviü, Maja Dabetiü
environment of telcom
Enterprise management
management
management
& readiness
Fulfilment
Assurance
Quality and Business Excellence in Telecommunication Sector: A Case Study 95
Each component process in macro process (strategy, infrastructure and product) is decoupled
from four perspectives:
x marketing and offer management,
x service development and management,
x resource development and management and
x supply chain development and management.
Redesign and introduction of all stakeholders’ needs and their transformation into processes
in Telecommunication Company is complex project. For realization of this project, it was neces-
sary to develop following project infrastructure (Fig. 3).
CEO
Central team:
- Project manager
- Team managers from side of
Project consulting and telcom
Council - Project principal
Team 2
Team 3
Team 4
Team 1
Central
team
Team 5
Team 8
Team 6
Team 7
Legend
Team manager - Subproject manager
Leading consultant
Consultant
Team manager from telcom
Team members from telcom
project principal
96 Zora Arsovski, Slavko Arsovski, Goran Markoviü, Igor Milanoviü, Maja Dabetiü
Global
world wide
telcoms
...........
Telcoms in
Serbia
Product
Leadership Organizational and service Competitiveness
benefit quality
Level of
Customer each telcom
satisfaction
Reliability
Overal satisfaction
On-time delivery
Product Customer loyalty
and service Errors or defects Customer
quality satisfaction Complaints
Rework
Factor feedback
Product recall
Costs
Cycle time
Quality system
and employee Organization Employ ee turnover
involvement benefits
Employ ee
satisfaction
Safety and health
Productivity
8
Y. Chung et al., A study of business value of Total Quality Management, “Total Quality Management & Business
Excellence” 2008, Vol. 19, No. 3-4, pp. 367-379; G. Kanji, Architecture of business excellence in the public and
service sectors, “Total Quality Management & Business Excellence” 2008, Vol. 19, No. 4, pp. 399-416.
Quality and Business Excellence in Telecommunication Sector: A Case Study 99
Enablers Results
People
Key performance
People results
Leeadership
Processes
results
Policy & Customer
Strategy results
Partnerships Society
& resources results
In telecommunication sector in EU many companies have already achieved high level of BE.
As example, Deutsche Telecom achieved responsible corporate governance in 200910 with incor-
porating all stakeholders:
x staff,
x supranational organizations,
x media,
x science, research and education,
x NGOs and residents,
9
N. Slack et al., op. cit.; Evans J., Quality Management Organisation and Strategy, South Western, Cengage
Learning, 2008; H. Khanna, S. Laroyia, D. Sharma, A Survey on Indian experience on Integrated Management
Systems (IMS), “International Journal for Quality Research” 2009, Vol. 3, No. 3; S. Arsovski, Z. Punoševac,
D. Rajkoviü, Integration of Management System QMS/EMS/OHSAS/FMS/LMS in Water Supply Organization,
“International Journal for Quality Research” 2009, Vol. 1, No. 4, pp. 313-322.
10
M. McDonald, T. Mors, A. Phillips, op. cit.
100 Zora Arsovski, Slavko Arsovski, Goran Markoviü, Igor Milanoviü, Maja Dabetiü
x customers,
x analysts and investors,
x suppliers and
x business.
Besides corporate responsibility, other aspects of telecommunication business have high im-
pact as input from different management system. Fig. 7 shows inßuence of respected manage-
ment systems.
MANAGEMENT
KPIs PROCESSES STANDARDS
1 QMS 9001
Leadership
2
Purchasing TL 9000
3
Resource mgt EMS 14001
& operations
4
SC development 18001
CR
OHSAS
& management
5
Resource
development SM 20000
8
and retirement
Quality and Business Excellence in Telecommunication Sector: A Case Study 101
For other business areas, analogy could be created. Consequently, in each telecommunication
company business is managed through more than four different management systems. Some of
them are standardized and realized through certiÞcation process, and the others are non-stand-
ardized, but well structured, developed and managed, as it is in the case of CRM in Deutsche
Telecom Group.
4. Case study
According to previously done analysis, one of Serbian telcom starts with design and introduc-
tion of quality and business intelligence, based on complementary projects of strategy develop-
ment, project management, reengineering of existing ICT, Balance Score Card and Reengineer-
ing of Business infrastructure (Fig. 8).
ess excellence
quality and busin rds
balanced score ca
nt and deploym ent
strategy deve lopme nt
project manage me
In 2011 project named “Establishment of ISO Quality Management Standards” started with
dynamics presented in Fig. 9. This project in Þrst phase covers eight key processes and training
teams with following topics – leadership, process modelling and process mapping.
102 Zora Arsovski, Slavko Arsovski, Goran Markoviü, Igor Milanoviü, Maja Dabetiü
MANAGEMENT MANAGEMENT
STANDARDS PROCESSES STANDARDS
RM 1. Selling QMS
(ISO 31000) (ISO 9001)
2. Design and improvement
CM services EMS
(BS 25999) (ISO 14001)
3. Management of conflicts in CRM
SR Hrouble ticketing, etc. OHSAS
(ISO 22000) (ISO 18001)
4. Management of compliants
SCM
TL 9000
(ISO 28000) 5. Assets management
PM
(ISO 10006) 6. Human resource management CRM
Other mgt SM
standards 7. Purchasing management (ISO 22000)
Other telecom ISMS
standards 8. Strategy design and deployment (ISO 27001)
After completition of this phase, next four are planned for complete project realization (Fig. 10).
5.
Establishment of new
strategy supported
with IMS
4.
Preparing for
EFQM award
3.
Improvement
of nextt 8 key
processes
2.
Serbian quality
and BE award
(FQCE)
1.
Improvement
of first 8 key
processes year.
2011 2012 2013
Quality and Business Excellence in Telecommunication Sector: A Case Study 103
End of the project is establishment and certiÞcation of IMS with 12 component management
standards. After this, Serbian telcom will be competitive on global market.
Accordingly, this project has high inßuence on business performance. Fig. 11 shows strategic
map11 with target values.
After realization of this project, telcom could expect respectable competitiveness improve-
ment in amount of cca 25%.
Financial Perspective
Long - Term
Shareholder
Value
Productivity Revenue
Growth
Customer Perspective
11
R. Rohrbeck, H. Arnold, J. Heuer, Strategic Foresight in multinational enterprises: A case study on the Deut-
sche telecom laboratories, ISPIM-Asia conference, New Delhi 2007, p. 4; D. Sumers, op. cit.; J. Kelada,
op. cit.
104 Zora Arsovski, Slavko Arsovski, Goran Markoviü, Igor Milanoviü, Maja Dabetiü
5. Conclusion
The following conclusions can be drawn:
x processes in telecommunication companies are unique and they represent support to the de-
velopment of corporate strategy,
x developed strategy have to be reviewed and improved,
x IMS is high inßuential factor on business performance of each telcom,
x there are relation among each telcom and telecommunication sector related to competitive-
ness and business excellence,
x business excellence is long-term goal for each telcom.
After applying the proposed concept, achieving of following short-term indicators and long-
term goals for analysed telcom in Serbia is expected:
x improving the business performance: 1-5%/year,
x increasing the company value: 1%/year,
x increasing the level of customer satisfaction: 5% year,
x increasing the loyalty: 8%/year,
x increasing the value for customers: 5%/year,
x improving the level of business processes standardization: 25%/year,
x the design of business processes from the aspect of applying BSC – increasing the scope of
application of the BSC (5%/year),
x increasing the effectiveness of applying the appropriate KPI process: 10%/year,
x increasing the effectiveness of strategic decision-making: 15%/year,
x promoting the corporate culture: 15%/year,
x improving the know-how: 8%/year,
x improving the organization: 5%/year.
With achieving those goals, the company will be much more competitive in the market of
telecommunication services.
Bibliography
1. Arsovski S., Punoševac Z., Rajkoviü D., Integration of Management System QMS/EMS/OH-
SAS/FMS/LMS in Water Supply Organization, “International Journal for Quality Research”
2009, Vol. 1, No. 4.
2. Chung Y. et al., A study of business value of Total Quality Management, “Total Quality Man-
agement & Business Excellence” 2008, Vol. 19, No. 3-4.
3. Evans J., Quality Management Organisation and Strategy, South Western, Cengage Learning,
2008.
4. Future, Telecom Austria Group, Annual Report, 2010. http: //ar2010.telecomaustria. com
5. Garvare R., Johanson P., Management for Sustainability: A stakeholder theory, “Total Quality
Management & Business Excellence” 2010, Vol. 21, No 7-8.
6. Kanji G., Architecture of business excellence in the public and service sectors, “Total Quality
Management & Business Excellence” 2008, Vol. 19, No. 4.
Quality and Business Excellence in Telecommunication Sector: A Case Study 105
7. Karapetroviü S., Jonker J., Integration of Standardized Management Systems: Searching for
a Recipe and Ingredients, “Total Quality Management & Business Excellence” 2003, Vol. 14,
No. 4.
8. Kelada J., Integrated Reengineering with total quality, ASQC Quality Press, Milwaukee, Wis-
consin, 1995.
9. Khanna H., Laroyia S., Sharma D., A Survey on Indian experience on Integrated Management
Systems (IMS), “International Journal for Quality Research” 2009, Vol. 3, No. 3.
10. McDonald M., Mors T., Phillips A., Management System Integration: Can it be done?, “Qual-
ity Prepress” 2003, 36.
11. Oakland J., Oakland on Quality management, Elsevier, Amsterdam 2004.
12. Rohrbeck R., Arnold H., Heuer J., Strategic Foresight in multinational enterprises: A case
study on the Deutsche telecom laboratories, ISPIM-Asia conference, New Delhi 2007.
13. Slack N. et al., Operations and Process Management: Principles and practice for strategic
impact, FT-Prentice Hall, London 2009.
14. Sumers D., Quality, Fifth Edition, Prentice Hall, Boston 2010.
15. The 2009 Corporate Responsibility Report, Deutsche Telecom Group, 2009. www.telecom.
com/cr-report
16. Transforming Telecom Management – facing the challenge of next generation networks,
White paper, Ericsson, January, 2009.
17. Trends and drivers of change in the EU telecoms sector: Mapping report, Foundation for
the improvement of living and European Working Condition, Dublin 2005. www.eurofound.
eu.int
18. Zutshi A., Sohal A., Requirements for successful integrated management system: The experi-
ences of Australian organizations, Faculty of business and economics-Monach University,
Australia 2003.