PROJECT SHIKHAR Strategy & Business transformation exercise undertaken along with The Boston Consulting Group Background and context Over the last few years, the telecom industry in India has been going through a period of intense change. Needs of the retail as well as corporate customers are changing and their expectations in terms of service and quality are getting more demanding. BSNL is facing increasingly stiff competition from private players. Over the recent past, BSNL’s performance has come under considerable pressure. It has not been able to grow in line with the market and has been steadily losing market share. The lack of top-line growth coupled with increasing costs has put pressure on BSNL’s operating performance in the past few years. BSNL has engaged the services of The Boston Consulting Group (BCG) to help develop an overall strategy and transformation plan for the organization. BCG is a leading global consulting firm and have extensive experience working with working with major telecom incumbents globally and in India on issues of strategy, sales & marketing strategy and large scale transformations. BCG has significant experience of working with large Public Sector undertakings to help them define and implement their change agenda. This transformation exercise, called Project SHIKHAR, will cover development of an overall strategic agenda across BSNL’s key businesses including customer segmentation, sales channel management as well as product management. It will also look at appropriate strategic initiatives in operations as well as in Human Resource Management in order to implement the new strategy effectively. All this is aimed at making BSNL more capable to thrive in a very competitive market place. BSNL’s aspiration BSNL has created an aspiration to guide its transformation process. This aspiration was developed in a very systematic manner and involved interactions and deliberations among employees from various cadres, designations and geographies. 1 BSNL’s aspiration is to – Be the leading telecom service provider in India with global presence Create a customer focused organization with excellence in sales, marketing and customer care Leverage technology to provide affordable and innovative products / services across customer segments Provide a conducive work environment with strong focus on performance Establish efficient business processes enabled by IT Proposed strategy to achieve aspiration Having defined this aspiration, we are working on the following key pillars of transformation Revitalise the business via – o Focusing on aggressive growth in Mobility (2G/3G), Broadband and Enterprise segment(i.e., corporate customers) o Reducing churn in the landline (including PCO) business and consolidating our position in the wholesale business (i.e., NLD) o Venturing into new areas to further drive growth such as infrastructure sharing, DTH, international expansion among others Build operations excellence in the following critical areas – o Marketing, sales and distribution o Product innovation and pricing o Customer service o Revenue assurance o Cost efficiency Create a high performance organisation to achieve the above – o Redesign the organisation structure, roles & responsibilities o Strengthen our HR policies and practices o Put in place a strong performance management system and culture 2 Transformation approach Project SHIKHAR has been designed in two distinct phases Phase 1: Diagnosis and Design – the focus of this phase is to develop a robust Strategy and Business plan for BSNL, which will enable it to achieve its aspiration. At the end of this phase, a prioritised set of initiatives will be identified, that will be implemented in a sequenced manner. Phase 1 started in late December, 2008 and will be fully completed by May 2009. Few critical areas for immediate action have already been identified and we have started work on detailing and implementing these in the form of pilots. Additional initiatives will be identified and prioritised by the end of this Phase. Another critical area of focus in Phase 1 is to redesign the organisation structure to enable effective execution of the proposed strategy. The five pilots that have been identified as high priority include: Pilot 1: Fixed access growth – referred to as “Udaan” Pilot 2: PCO retention – referred to as “Dosti” Pilot 3: Mobility sales & distribution – referred to as “Vijay” Pilot 4: Revenue assurance – referred to as “Kuber” Pilot 5: Cost efficiency – referred to as “Sanchay Phase 2: Detail and Implement – this phase will focus on implementing the set of prioritised initiatives that have been identified as part of Phase 1. The focus in this phase will be to scale up these pilot initiatives to the rest of the organisation, as well as implement additional initiatives identified in Phase 1. The new organisation structure and HR implications will also be implemented as part of this Phase. 3 Details of the Pilot Projects are given below PROJECT UDAAN – Fixed Access Pilot Objectives of project The overall objective of Project Udaan is to rapidly expand broadband subscriber base while reducing churn in wireline voice subscribers and increase realization from existing subscribers. A pilot project has been started in three areas (North-East, South and West) of Bangalore telecom district. Specific objectives of this pilot are: 1. Define new product / price plans that will address specific requirements of various customer segments 2. Create a new sales force to actively reach out to customers 3. Make customer service processes more friendly and responsive to subscriber requirements 4. Optimize service delivery process for fast provisioning of connections Key activities identified & initiated 1. Six new product / price plans have been defined for launch 2. Concept testing of these plans was conducted by BSNL Sales team 3. Sales team consisting of BSNL personnel has been created to serve two areas (Bangalore – North-East and South) 4. Sales team consisting of DSAs is being tried for Bangalore West area; it is being led by BSNL persons 5. Developing systems and processes to capture and pass on all new customer leads from various channels e.g., call centres, SMS, online interface, to sales team 6. Introducing new monitoring mechanisms using in-house developed tool to ensure all requested services by customers are delivered in a satisfactory and prompt manner Spectrum of people involved This project is being led by team consisting of Director (Plng & New Services), GM (BB) at HO, CGM (Karnataka) and PGM (Bangalore – TD). There are four teams within this project being led by DGMs – Product & Pricing, Sales & Alliances, Customer Service and Service Delivery. These teams consist of BSNL personnel across the hierarchy. Currently, there are ~70-80 SDE/JTOs and ~70-80 Group C/D personnel mostly for Sales, Customer Service and Service Delivery. 4 Pilot Udaan – Customer Service Team Pilot Udaan – Sales Team 5 PROJECT VIJAY – Mobility Pilot Objectives of project Project Vijay - Mobility sales and distribution project – is being piloted in UP (East) Telecom circle. The key objectives of the pilot are to - A. Design channel structure B. Create channel management team C. Develop improved channel norms to improve retailer reach, create appropriate incentives and improve performance monitoring of channel D. Implement proposed channel structure for franchisee network E. Test other recommendations on tariff and handset bundling, if appropriate Key activities identified & initiated 1. Conduct comprehensive retailer survey to: Map existing telecom retail universe in pilot SSAs Measure BSNL's reach and extraction in different types of outlets to identify improvement opportunities 2. Assess evolution of mobile market in pilot geographies over the next 5 years Calculate overall and addressable market potential for BSNL Help BSNL set the right targets for the franchisees and sub-franchisees 3. Design the overall distribution channel set up for mobiles including franchisees, sub-franchisees and retailers 4. Create a new channel management team comprising BSNL employees to Manage franchisees and sub-franchisees (FMT) Interact with retailers (RMT) 5. Revise existing channel management norms and processes (e.g., retailer service frequency, ordering and delivery process, audit norms, etc.) 6. Define key metrics for success and set up a rigorous monitoring mechanism Spectrum of people involved This project is being led by team consisting of Director (Commercial & Marketing), GM (Sales), GM (Restructuring), DGM (Sales) and AGM (Sales) at HO, CGM (UP-E), PGM (Lucknow), GM (Operations – Lucknow SSA) & TDM (Unnao) . In addition, following personnel are involved: ~10 GMs and DGMs at Circle, e.g., GM (Sales), GM (Finance), DGM (Sales) ~10 DGM/AGM/DE in pilot SSAs, e.g., DGM (South - Lucknow), AGM (Planning – Lucknow), DE (Sales - Unnao) 6 ~35 SDE/ JTOs in pilot SSAs (franchisee managers, retailer team coordinators, survey coordinators and survey team members) ~140 TTA/ TOA/ TM (field retailer managers, survey team members) Project Vijay – Soft Launch Meeting 7 PROJECT DOSTI – PCO Pilot Objectives of project The overall objective of project Dosti is to reduce decline in BSNL’s PCO business by reducing churn of existing PCO operators and innovating on PCO business model to generate new revenue sources (both for BSNL and PCO owner). It is being executed in Bangalore telecom district. Specific objectives include: 1. Increase PCO connections through reduction in churn & sale of new connections 2. Facilitate sale of ‘Broad-Band Enabled’ services model to existing and new PCO’s 3. Convert PCOs to sell full spectrum of BSNL products & services Key activities identified & initiated 1. In-depth analysis done to identify key issues faced by PCO subscribers MR and group discussions with PCO owners Interviews conducted with dealers/DSA's of various telecom providers Interviews conducted with in-house sales force of competitors and BSNL staff 2. Action plan developed to increase sales and reduce churn Improve management of DSA channel Improve customer service and pricing 3. Plan developed to facilitate sale of ‘Broad-Band Enabled’ services model Central team to create tie ups with banks, vendors Marketing support team to help create awareness Spectrum of people involved This project is being led by team consisting of Director (Plng & New Services), GM (BB) at HO, CGM (Karnataka) and PGM (Bangalore – TD). There are four teams within this project being led by DGMs – Customer offering, Sales & Relationship Management, Billing & Collections and Service Delivery. Currently, there are ~15 SDE/JTOs involved in market research. It will be expanded to include more personnel from across the hierarchy. 8 PROJECT KUBER – Revenue Assurance Pilot Objectives of project The overall objective of project Kuber is to ensure that the revenue earned by BSNL is properly billed to customers and collected from them. It is being executed in Pune telecom district. Specifically focus is on two areas: 1. Collection of bad debt, with focus on amount less that 2 years old 2. Identification & billing of leased circuits that are currently not getting billed Key activities identified & initiated 1. Collection of bad debt: Segmentation of bad debt by age and account size. The following segments are used: o Age: 90-180 days, 180-360 days, 360+days o Account size: Low, Middle, Large, Very Large Appointment of collection agencies for bad debt that are in the ‘Middle’ bucket Follow up by BSNL team on accounts that are in the ‘Large’ and ‘Very Large’ buckets 2. Leased circuits billing: Process defined for identifying unbilled circuits Data collection underway from all the exchanges in Pune Spectrum of people involved This project is being led by team consisting of Executive Director (Finance), CGM (Maharashtra) and PGM (Pune – TD). From the Pune telecom district, IFA is leading the initiative on collection of bad debts. His team includes 3 CAO/AO and 5 Sr TOA/TOA. GM (development) is leading the initiative on leased circuits billing. His team includes 2 SDE/DE and 2 CO/AO. Whole-hearted involvement of all members of BSNL fraternity is solicited in making Project SHIKHAR a resounding success. GM(Restructuring) email@example.com Telephone : 23734343 FAX : 23734353 9 10
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