Presentation Topic SWOT Analysis of Pakistan Tele-communication Co. Ltd: a case study

1947 Posts & Telegraph Dept. established

1962 Pakistan Telegraph & Telephone Deptt.

1995 About 5 % of PTC assets transferred to PTA,FAB & NTC.

1996 PTCL Formed & listed on all Stock Exchanges of Pakistan

1998 Mobile & Internet subsidiaries established

2000 Telecom Policy Finalized

2003 Telecom Deregulation Policy Announced

2006 Etisalat Takes Over PTCL's management

BRIEF HISTORY OF PTCL

INTRODUCTIONPakistan Telecommunication Company Limited (the backbone for country's telecommunication infrastructure) was founded in 1947 while incorporated on December 31, 1995 and commenced business on January 1, 1996.The Company is now listed in Karachi, Lahore and Islamabad stock exchanges.Originally fully owned by the Government of Pakistan, this holding has; since 2006; been reduced to 62%, when 26% of shares and control was sold to Etisalat - and the remaining 12% to the general public.

INTRODUCTIONEtisalat is the Middle East's leading telecommunications operator and one of the largest corporations in the six Arab countries of the Gulf Cooperation Council, with a market value of approximately Dh 81 billion (US$22 billion) and annual revenues of over Dh32.9 billion (US$9 billion).

A multinational, blue-chip organization, Etisalat has operations in 15 countries in the Middle East, Africa and Asia. Nearly 42,000 people are directly employed by the company.

INTRODUCTIONEtisalat acquired shares in PTCL, Pakistan's most reliable and largest converged services carrier providing all telecommunications services from basic voice telephony to data, Internet, video-conferencing and carrier services to consumers and businesses all over the country. The company has over 20 million mobile subscribers under the name "Ufone" and more than 5 million fixed-line customers.

•Etisalat International Operations include Etisalat UAE Thuraya , Zantel, Mobily , Etisalat Lanka , Canar Atlantique Telecom (AT) , Pakistan Telecommunications Company Limited (PTCL) Etisalat Misr , Etisalat Afghanistan, Excelcomindo (XL), Etisalat Nigeria

INTRODUCTIONPTCL is a leader in providing infrastructure to other telecom operators and corporate customers in Pakistan. PTCL is committed to improvement, growth and quality service as is evidenced by the modernisation of local loop services from copper to an optical network, the acquisition of supplementary capacity on the two SEA-ME-WE and IMEWE intercontinental cabling route to expand its international capacity in an effort to meet the increasing demand of international traffic. With the laying of Fibre Access Network technologies in major metropolitan centres of Pakistan, PTCL has proved to a potential instrument of change in Pakistan's economic growth

PRODUCTS

RevenueU.S. $310 million(2011)

Net incomeU.S. $16 million

Websitewww.ptcl.com.pk

To be the leading Information and Communication Technology Service Provider in the region by achieving customer satisfaction and maximizing shareholders' value'.The future is unfolding around us. In times to come, we will be the link that allows global communication. We are striving towards mobilizing the world for the future. By becoming partners in innovation, we are ready to shape a future that offers telecom services that bring us closer.

Vision OF PTCL

Mission OF PTCLTo achieve our vision by having:•An organizational environment that fosters professionalism, motivation and quality•An environment that is cost effective and quality conscious•Services that are based on the most optimum technology• "Quality" and "Time" conscious customer service•Sustained growth in earnings and profitability

Core ValuesOF

PTCL•Professional Integrity•Customer Satisfaction•Teamwork•Company Loyalty

SWOT AnalysisOf

A scan of the internal and external environment is an important part of the strategic planning process which is performed by strategic planning tool called as SWOT analysis.Environmental factors internal to the firm usually can be classified as strengths (S) or weaknesses (W), and those external to the firm can be classified as opportunities (O) or threats (T).

SWOT Analysis?

Environmental Scan         / \           

Internal Analysis       External Analysis

/ \                  / \Strengths  Weaknesses    Opportunities    Threats

SWOT Matrix

The SWOT Analysis Framework

Strengths:Attributes of the organizationthat are helpful in achievingthe objectives.

PTCL Strengths Oldest Telecommunication Company of Pakistan founded in 1947.The largest landline network of Pakistan. Strong international brand names.

Strong financial position Competent and Skillful Human Resources in few specialized fields. PTCL is offering multiple services which includes Telephone, Internet and T.V. PTCL can be used as a backup network if the mobile networks are down due to any reason. PTCL maintain the records of customers in an organize way with the principle of privacy.

All the telecommunication companies operating in Pakistan directly or indirectly dependent upon PTCL network. It has been offering Internet DSL connection to the customers with students’ package offer. It offers low rates for the national calls etc, as compared to mobile networks.

Weaknesses:Attributes of the organizationthat are harmful in achievingthe objectives.PTCL Weaknesses Quality of Service; offered to the Customer is very poor and in-efficient, specially the Internet service. Lack of technical staff in DSL technical support. Poor organizational structure. No clear strategic direction. No research and development programs. Functional units are not well organized.

Extra employee overhead due to over-hiring. Very low employee morale. V-wireless coverage and service is feeble. Form processing for new connection takes more time in larger cities.

Low rate of customer retention.

Weak marketing of new services.Bad debts due to non payments of bills. Low revenue per user. Political intervention in decision making.

Opportunities:External conditions that may be helpful,In achieving the objectives.

PTCL Opportunities Huge market size to Increase market share. Development of new, innovative and customized products (Increase in company product lines) Re-structuring of organizational hierarchy (Proper planning and implementation is required, to Improve overall services).

Adopt latest technologies. Making technology accessible to all (e.g. broadband).Hire competent marketers and adopt aggressive marketing that is required to promote offered services and give tough time to competitors.Improvement in customer services. Joint ventures with other telecommunication companies for introducing new services. Hire technical staff in specific areas e.g for DSL issues in order to increase customer satisfaction.

Threats:External conditions thatmay be harmful in achieving the objectives.

PTCL Threats Strong competition from telecommunication companies. New players in the industry.Inconsistent and Adhoc decisions by Company management.

Political instability. Inflation in the country, may increase the cost of services which will finally transferred to customers. Rapid raise in Government taxes.Recession in economy.

Security and fraud issues. Cyber crimes percentage is increasing.

SWOT Interactions

TOWS Analysis

Strengths Weaknesses

Opportunities S-O Strategies

W-O Strategies

Threats S-T Strategies

W-T Strategies

SWOT / TOWS Matrix

4 types of Suggested

Strategies for

1)S-O Strategies: An oldest telecommunication company of Pakistan, containing good reputation, customers trust & high brand loyalty as strengths can grab the opportunity to increase its market share and position globally.

•Having a high reputation and brand name, it has an opportunity of Joint ventures with other telecommunication companies for introducing new services so can increase its market share.

The largest land-line network having a strong financial position can increase further its product lines, invest its capital, hiring competent marketers to adopt aggressive marketing strategies particularly advertising. hiring 0f expertise and skillful human resources to adopt latest technologies and to make technology accessible to all.Good financial position of PTCL can help availing the opportunity of developing new and innovative products.

Producing customized products as per demand of the customers can able PTCL to compete with other companies in the industry. For instant students’ package for DSL. PTCL offering multiple services, enjoying competitive advantage in the industry, can cope with its national and international competitors through its valuable resources.

PTCL can be used as a more sophisticated and secure backup network.

Continuous improvement in customer services: PTCL can increase its market share by improving its customer services including privacy of customers, secrecy and organization of profiles, before /during & after sale services etc.

low call (national & international) rates or uniform fixed service charges may help PTCL to enjoy long term sustainability and growth

2)W-O strategies: PTCL has weak marketing of new services and contain an opportunity to adopt latest on-line technologies to overcome this weakness.The company can also overcome this weakness by availing opportunities of hiring competent marketers and to adopt aggressive

marketing strategies particularly advertising.

• Enhancing employees morale with organizational polices and leadership trust .

Poor and in-efficient customer service can be overcome through re-structuring of organizational hierarchy and delegate authority in a limit with responsibility to low level staff, that may increase level of motivation with accountability.

Impact of poor overall management structure and policies can be reduced through re-structuring of organizational hierarchy and benchmarking. Bad debts (non payments of bills from customers) requires improved , enthusiastic and efficient management in decision making process.

Low Revenue per user, generated by company, can be overcome by increasing its market size to make it acceptable and sufficient for company. Technical staff in DSL technical support can be helpful to the level of DSL issues and to increase customer satisfaction.

To adopt latest on-line technologies the company may overcome the weakness of form processing and can make it easier.

3)S-T strategies: PTCL good reputation, customers trust & high brand loyalty can eliminate the threat of new comers in industry. PTCL financial position can overcome the threat of existing competition with other telecommunication companies in the industry through differentiation.

PTCL also maintains privacy of its customers by keeping customer profiles secret and in well organized manner to enhance customer satisfaction and resolve the security issues like fraud and cyber crimes

4)W-T strategies:Following weaknesses /problems have to be addressed to avoid or minimize the threats of competitive environment. Poor organizational/management structure inconsistent and adhoc decisions by company’s management.

in-efficient customer service (especially internet services.

weak V-wireless coverage and serviceExtra employee overhead due to extra hiringLow employee moraleForm processing duration for new connectionpolitical intervention in decision making process

ConclusionPTCL is at maturity stage now. They are following the cost leadership & differentiation strategies. They are providing advanced technologies and services to their customers by lowering the prices and they are the only ones, who are providing the services to such a big extent. The suggested strategies are under consideration. If serious attention been on required actions , the company can enjoy long term sustainability and competitive edge.