EDGE
4.9. Grameen Phone Today's Telecom Markel Leader in Bangladesh &
6.1.1. Identifying Strength
Strength is something a company is doing well or " characteristic that gives it enhanced competitiveness: Grameen Phone is running wilh the following fonn.' of strenglh [2J
(i) Valuable physical assct~
Grameen Phone has on its own around 1200 Km optical fiber, 3600 base station and 6 million capacity exchange (:;witching Ccn!cr) country wide which arc quite hcallhy infrastructure to make a leading service provIder.
(Ii) A skill or important expert!;c
Due to he"lthy technological infraslructure new servIce cost is very low, always providing good euSlomer ,ervice, with consistent experti,e and providing promotional services with unique advertising,
(iii) Valuable human assets
From the beginning, Grameen I'hone trained and prepared :;kill manpower to operate their technological services smoothly. Though this '" not an ending process the
,o1Je,tivc leammg emocdded in the organization and built up over time a dynami"
energetic and motivated manpower.
(iv)Valllable organizational assets
Good Corp{ltat~ Governance (CG) practice:; arc a hall mark of a successful and efficient company. Grameen Phon~ has implcmented intemationally accepted cOlJX'rategovemane~ standard in it~ day to day operation. The board of dir~ctors ha:;
a pivotal role to play in achieving all stockholder>;interest and the management team of Grameen Phone are ,ommittcd to mainl.1ining effective CO through a culture of accountability,
Board ofDil'edors Investment Committee Management Team (1)&(2) Control Environment
L Business Plan and Budget 2. Financml Reporting
3, Ass~t Management (SOA FA)
4. Complianc~ of external mles and regulations Revenue A:;surance, Inl~rnal Audit ,Code, of Conduct Management and Lcad~rship Development
1. Telcnm leadership Developmenl Process 2. Internal Value Creation
(v) Valuable intangible as,ct
Grameen phone has already become the most reno••••.'lled brand name in the corporate world of Bangladesh. GP's branding through out country is mOre prominent now a days. Grameen phone's GP-GP product creales entil'e class of product name including those produced by nvak The mass peopl~ are using the Grameen Phone's logo to mark up the cell phone number. Gmmeen Phone alway> lry to ton,h the emotion of people of Bangladcsh that paid a reliability, transparency and social responsibility coupled with charisma that a true market kuderposse:;ses,
(vi) Competitive capabilities
Grameen l'hone already established a healthy, tran3parent dealership network throngh outthe country. A ~ompetitive customer service is going to establish by set np servicc desk through out the country with collaborate over the dealer network.
(vii) Loyalty
Grameen Phone olTered a strong loyalty program to their existing valued customer that is going to generate emotions to become a heritage family member.
(viii) An achievement Or attribute that pnts the company in a position of market ad,.antage
Grameen Phone first time in Bangladesh offered low cost long distance call which was tremendously popular due to very poor communication inftastrueturc. A superior wide range of product line with exccptional and innovative cU3tomer services for different market segment arc bcing offered by Grameen Phone continuously. In 2003 Gram""n Phone was rcward~d as the "Best Joint vcnhlre cnterprise of the year".
Grameen Phone is official sponsor of the Bangladesh National Cricket team for the year 2003-2005 periods. Village Phone is the unique contribution for women empowerment in Bangladesh.
6.1.2. Identifying Weakness
A weakness is something a company Jacks or does poorly (in comparison to oth=) or condition that puts it at a disadvantage. A company's internal weakness can relale to deficiencie3 in competitively important ,kills or expertise, a lack of competitively important tangible or intangib1c assetg Or weak competitive capabilities in key areas.
A weakness mayor may not make a company competitively vulnerable, depending on how much the weakncss mallers in the market placc and whether it can be overcome by the resourccs and ,trengths in the company's PO%ess;ons.
After analygis and review of 3trengths of Grameen Phone it is comprehensible that Gmmeen Phone;s in continuous process 10 overcome all deficiencies in the buSlocss.
However, as a market leader WIth more than GO % market share a few number of strategy are not comparable with other riV"!.
De,pite of being a dominant market leader the foIlowing weakne"" can prove fatal if not remedied properly
(il Higher tarin than c(>mpctitor
TariITis higher than other operator in the marht. Stnvmg to be the indusuy's overall high cost provider is a less powerful competitive approach in market with any price ,en,itive buyers.
(Ii) Underestimate thc rival, or competitors
Every competitor of Grameen Phone has own potentiaL All the competitors are looking for the opportunity to grow their busincss against the giant competitor.
Previously several timc:; Gramecn Phone showed indifference care to the valued subscriber which caused loss ofthe;r market sl'Hrefl'om 70% to 60%.
(iii) Complacent with Own services
A!; a dominant market leader, aflel sales service is yc! to reach salisfac!ory level III tenns of customer :;ervice and network service, (GoS).
(Iv) Neglectiug the particlllar market segment that rivals can find Ollt.
Thi, stl'ategy involves concentrating on customer or end use application that market leaders have by passed or ncglccted. For an example Bangia link alld AKTEL already hit the SME market whcre as Grameen l'holle i., more concentrated on corporatc sales and services,
6.1.3. Identifying Opportunity
Market opportunity is a big factor in shaping a compallY's ,trategy. A high demand in the telephony penetration is most important factor in market opportunity. To grow the
market and increase the subscribcr pcnclrati"n the f,,!lowing aspects are strongly considerable for this market.
• Low cost handset will crcate a big opportunity in the market to lower niche market.
• Accelerated capital injection into the Bangladesh economy.
• Poor traruport infra,tructure within the country
• Propcr utilization of mineral rcsourccs
• Tcchnological influence to the new generation
• 54% of the i.e.81m below 25 years of age. In the next 4 to 8 years they would be wage-earners and influencing spending decision&life style,.
• Rising income level -Per capita as well as purchasing power parity (!'l'P) is growmg
• Increased urbani"ation -wilh increa,ed development of inii:aslrueturc, Dlml Bangladesh will b~com~ mcreasingly mail1,treamed.
• lncreased affordability - over 90% drop in tariffs ,ince commencement of servIces
• Socio-eeonomic aspects ,,",oulddrive WileJeSSmarket growth.
All the above factors will make Bangladesh one of the large mobile market in South Asia and Asia pacific reglOn other than India.
6.1.4. Identifying Threat
Certain factors in a company's eXlernal environment pose t1ueats to its pmtltability and competitive well-being.
(i) Cheaper and bcttcr technQlogies
All the nvals of Grameen phone are using a market known Chinese technology, so rivals can DIrera new and chc"pcrprodlLct easily \~ith" ve,y low cost.
(ii) Apotential entTYuf new cOlllpetitGT
Orascom Telecom (Hold on share of Sheba telccom in the name of Bangia link) launched their serviee~ in March 2005 ,nth stwng base, BTRe awarded another license to ncw eompetilor - Walid Telecom (a giant financial group) which is a pOlential candidate for Ihis bu,iness,
Political upheaval: Few nvals are gelting favors limn govemment wherc is Gmmeen Phone stragghng with impOl1ant issue like intelconncetion, Voll' permission, consultant appointment and so on.
(iii) Lower switching cost to competing brands
The lower cosl of s"ilching makes the ri,a!> ofGrameen phone are stronger Buyers who have the flexibility 10 fill their needs by switehmg brand, or sourcing from wv~ral sellers often havc negotiating room with sellers, Wh~n the products of rivals arc virtually identical, it is rclati,dy ea,y for buyers to swilch from ,eller to seller at little or no cost.
(iv) Growing bargaining power of customer
Buyers arc a strong competitive force whcu they are able to exercise bargaining leverage Overprice, ,ervice quality Orother terms of ,ale.
(v) Sudden price cutdown by the riyals
It creates a volatile markct in terms of profilability and lingering the return on investment.