Group B

Case Written on

HRM 430

Simple and efficient cellular telephony with the least possible total cost of ownership is
what we will stand for says Lars P Reichelt, the new chief executive officer of
Banglalink, the GSM operation of Orascom Telecom.

The Swiss-educated Reichelt has a string of successful involvements in some of the
major players of the European mobile market. They include European telecoms giant
Telefonicas GSM operations in Switzerland, ONE of Austria and Telesystem
International Wireless in the Czech Republic which is a subsidiary of global telecoms
player Vodafone AirTouch. Till recently Lars Reichelt headed Yahoo Wirelesss Europe
operations. Brought in by Orascom Telecom to spearhead its latest venture, Banglalink,
he believes it is not competition but expansion of the market with efficiency that matters.
Would Banglalink be able to catch up with Grameen Phone or Aktel, the countrys two
leading GSM operators?

However, Banglalink is far away behind Grameen Phone and AKTEL regarding
preference as the favorite cell phone provider. And there is a rumor going on that Hutch
Telecom will take over Banglalink. And this grapevine is really affecting their
reputation.

HISTORICAL BACKGROUND
The service sector has been growing rapidly after the World War II, as many nations shift
from a manufacturing based economy to service economy. Telecommunication industry
is playing an important role in the communication system that has become an obvious for
this modern world. Orascom Telecom Holdings which was established in 1998 is one of
those dynamic telecom companies of the world. Till date, this Egyptian Telecom
company is facilitating cellular phone service to the people of 9 countries. Banglalink
is the new member of the esteemed GSM family of Orascom Telecom Holdings. The
scenario of the telecom industry has totally changed as Banglalink
TM
entered in the
industry with the aim of serving mobile phone services to the mass population of the
country so that the entire communication system of Bangladesh develop dramatically.

If we compare the present situation of Banglalink
TM
with Sheba Telecom Company, we
find the emerging growth and cordial consumer acceptance of Banglalink
TM
which was
never been seen and even thought during the operational period of Sheba Telecom
Company. Brand preference and consumer acceptance of Banglalink
TM
has created this
immense growth rate.

Banglalink is the new member of the GSM family of Orascom Telecom Holdings.
Orascom Telecom Holdings is operating in 9 countries of the world. The subsidiaries
include Egypt, Algeria, Pakistan, Tunisia, Iraq, Bangladesh, Congo Brazzaville,
Zimbabwe, and Democratic Republic of Congo. The operational performance in 2004
was driven by a robust subscriber growth with a marked rise in commercial activities by
- 1 -
Group B
Case Written on

HRM 430

OTH operations. The number of subscribers exceeded 15 million by August 2004, with
prepaid subscribers constituting 73% of the total subscriber base. In Pakistan, Mobilink
exceeded the 5 million-subscriber base. In Algeria, Djezzy exceeded 3.4 million
subscribers
BANGLALINK TIGER RUN IN OUR CELLPHONE SECTOR
Banglalink, the most recently acquired subsidiary of Orascom Telecom Holdings. In
September, 2004, Naguib Sawiris-the Chairman and CEO of Orascom Telecom Holdings
announced the acquisition of Sheba Telecom (Pvt.) Limited. The acquisition cost was
US$60million. The company started its operation in Bangladesh on February 10, 2005
with the trade mark Banglalink. A robust growth has been seen from the very
beginning of the operation of Banglalink. Surprising Public acceptance resulted to get
nearly 100,000 subscribers within couple of weeks of its launch in February 2005. By the
end of May, Banglalink was able to get approximately 400,000 subscribers. And now it
has above 900,000 subscribers in Bangladesh which shows the most aggressive growth &
an unprecedented success in the mobile phone industry in Bangladesh.
Orascom Telecom Holding was established in the year 1998. After the establishment
Orascom Telecom Holding has acquired nine operating licenses in this region. Now it is
one of the leading mobile telecommunication companies of the world which is operating
its business in nine emerging markets in the Middle East, Africa and South Asia. Huge
capital investment and the honest effort of all the employees helped Orascom telecom
holding to grab the market share of in the telecom industry of the world within a short
period of seven years. Now Orascom Telecom Holdings is serving to 18 million mobile
phone subscriber of the world which is only 3.46% of the total market size of 520
million. The capital of Orascom Telecom is estimated at 1.1 billion Egyptian Pound
represented in 110 million shares. The majority of the share (56.9%) of Orascom
Telecom Holding is owned by the Sawiris family of Egypt. IPO (Initial Public Offerings)
of US$320 million was raised during the year 2000 which was the largest public offering
at Egyptian Stock Market at that time. To increase the capital, Orascom Telecom Holding
traded its share in London, Cairo, and Alexandria Stock Exchanges and all these offering
covers the remaining 43.1% share of the total capital investment.
MISSION STATEMENT
The mission statement of the OTH is to be the prime telecom operator in the Middle
East, Africa, and South Asia, providing the best quality services to our customers,
value to our shareholders, and a dynamic working environment for our employees.
With this mission in mind, Orascom Telecom Holdings is working effectively to reach its
goal.
- 2 -
Group B
Case Written on

HRM 430

VISION
Understand people's best need and create & deliver appropriate communication
services to improve people's life and make it easier.Orascom Telecom Holding
Company has established some values that inspire its employees to work effectively and
efficiently which ultimately helping the organization to reach its vision.
OBJECTIVE
The main objective of the company is to increase the market share in related
diversified products and complete mobility solutions in Bangladesh.

EXISTING DEPARTMENTS
Orascom Telecom Holdings is providing GSM mobile service in Bangladesh with the
trade mark Banglalink.

Banglalink has seven functional departments. These are:
1. Marketing,
2. Sales,
3. Human Resource,
4. Customer Care,
5. Technical Department.
6. Finance,
7. Administration,
Here we focused about the HR department and Marketing department and the functions
of these departments are described below:
Human Resources Department
The Real Tigers Behind the Stripes!

Banglalink, believe that our teamwork is our greatest asset. Useful contributions made by
each individual bring us that much closer to our goals. The Banglalink family is made up
of a group of passionate individuals, uniquely qualified from diverse disciplines but
working towards our vision.
- 3 -
Group B
Case Written on

HRM 430

Banglalink ensures for the Tigers/Tigress:
A friendly, professional and mutually supportive environment that encourages
our people to develop their potentials to an optimal level.




A true quality of professionalism that can be found in all world-class
multinational companies
Team oriented professionals, who contribute to the greater whole of the
organization through their participation in decision making situations.
A system which recognizes and rewards groups as well as individuals for their
efforts and contributions to the company
Human resource department plays a very important role in the functioning of the
organization. There are 12 employees in the HRD who are reporting to the Head of HRD-
Mr. Mohammed Allam. The main tasks of this department are employee recruitment,
selection, transfer, promotion, training, performance appraisal, manpower planning etc.
Different divisions send their personnel requirement to HR department.

Then HRD sets target, prepare recruitment planning and go for the recruitment process.
When an employee is recruited a separate employee file is opened comprising of all
information of the particular employee which is regularly upgraded by HRD. This
department is also responsible for performance appraisal of employees that is very
important for the confirmation, increment, promotion, transfer of employees.

This is done through job analysis, setting up of performance standard and appraisal
interview. Aside from recruiting and training employees, the HR department is also
responsible for disseminating internal communication to all users and in the process of
developing compensation packages for its employees, such as medical insurance under
the group plan, life insurance and running several activities such as the Vaccination
Program for all.

Training activities are continuously taking place to develop and hone the skills &
knowledge of the personnel, such as the English Language & MS Project Courses for
selected employees and conducting a GSM Orientation session for all employees,
especially the Sales, Marketing & Customer Care Departments who have to deal with
customers.

Marketing Department:
The Marketing department consists of a number of sub units which includes:
Value added service (VAS) unit,


Loyalty & Retention unit,
Public Relation & Communications unit, Finance,
- 4 -
Group B
Case Written on

HRM 430















International Roaming unit.
As these teams work under the supervision of the marketing director, so they are fully
responsible to report to the Marketing Director.
Value Added service (VAS) unit is responsible for innovating and ensuring the value
added services. The existing value added services includes all the services except calling
and text message service. The existing value added services of Banglalink are:
Call waiting/holding,
Call forwarding/diverting
Call conferencing/ T-adda.
Call barring.
Voice mailing/ i-bouble service.
Free itemized billing.
International roaming,
Data/fax sending,
Closed user group,
SMS push-pull
Premium SMS
International SMS.
Song dedication service.
The Loyalty & Retention unit is responsible for the designing of the special offers
launched from time to time in an attempt either to increase customer base or to increase
ARPU. The VAS division is responsible for the continuously adding valuable services to
provide a complete solution to existing customers, for example, for making conference
calling & ring tone/logo downloads possible. These two teams together are in charge of
making the customers experience with our network more satisfying.
Public Relation & Communication unit is responsible for designing and developing all
promotional materials for the marketing of any new product/package and any other
activities. They coordinate and work directly with the advertising agency and other
vendors. While other companies have an entire department for promotions and branding,
at Banglalink this division, consisting of only a handful of people is responsible for
this task.
International Roaming unit ensures the roaming facility for the post-paid users
banglalink. Post-paid subscribers of banglalink is getting international roaming
facility in 120 countries.
Sales Department:
- 5 -
Group B
Case Written on

HRM 430


Sales department consist of a number of sub-division which are linked with each other.
All the sales activities of the organization are done by the sales department. Sales
department is controlled and led by the Sales Director. Four divisions of the sales
department are:
Direct Sales,



Corporate Sales,
Distribution Sales, and
Sales Support.
Distribution Sales:
This is the largest team in the department. Distribution Sales Department is responsible
for managing the product distriactivities and ensuring the sales targets are met by the
companys six distributors (Lipro, Asimpex, Butterfly, Propel, Deens & Deshlink). They
are also responsible to ensure that these distributors and all the dealers who are iperating
under the distribution team are following the policies of the company with regard to
promotions, package offerings, branding, pricing etc. This team works mostly outdoors
and report to the manger of the department in the evening for the completion of all types
of paper work.
Direct Sales:
This sales division helps the company to stay in close touch with its customers and get
faster and more reliable feedback from the sales force. This sales division consists of 23
employees. The purpose of these booths is to sell directly to its customers, beside its
distributors/dealers. The booths were originally established with the idea that people
prefer to purchase their cell phones from reliable sources and no one can be more reliable
than the company itself. Thus, they provide another mechanism by which the company
can meet and satisfy its consumers communication needs, swiftly and completely.


The direct sales division operates two sales booths, run by its own employees. The first
booth is located in Gulshan 2, on the 4
th
Floor of its head office, and the second booth in
Chittagong.

Corporate Sales

Distribution Sales
Sales
Department
Sales Support
- 6 -
Direct Sales
Group B
Case Written on

HRM 430




Corporate Sales:
In comparison with direct and distribution sales, Corporate Sales is very small and this
sales division consists of only 12 employees including the manager. They are 3 sub units
of the corporate sales department:
Large Corporate





SME (Small & Medium Enterprises)
PCO (Public call offices)
Large Corporate Sales deals with the sales activities to the large companies where they
sell bulk amount which is more than 30 corporate connections. SME deals with the sales
activities to relatively small companies where they sell less than 30 corporate
connections. PCO sells high value packages to the telephonic business centers which is
known as public call centers.

Sales Support:

This team is the smallest of all the four teams. There are only 7 employees in the
department. But, they form an integral part of the department by providing logistical
support to the other three teams. Thus, they have to maintain liaison with the
Procurement Department which maintains the out sourcing activities from
Kallol Group of Companies
Ring Bangladesh Limited
OrasInvest (BD) Limited

Kallol Group is banglalink
TM
s scratch card distributors; Ring Bangladesh and OrasInvest
are wholly own subsidiaries of OTH who provide the company with SIM cards, SAF,
handsets, POSM and other logistical support.
Functions of Customer Care Department
After sales service is the heart of the service oriented business and for the
telecommunication industry Customer Relations Division works as the bridge between
the customers and the company. People here are always serving the clients. A total of 142
people in this division providing customer service are strengthening the relationship of banglalink
- 7 -
Group B
Case Written on

HRM 430

with its valued customers. Rumana Reza, the only female director in the organization, is the
head of the Customer Care Department. This department is divided into three major divisions:

Call Center Unit, (CCU)



Billing Division (BD)and
Support Service Unit. (SSU)
Customer Care Line (CCL)

Call Center:
This division responds to customers' query 43 people are working in shifting basis in call
center to provide 24 hours service to the customers. They receive queries and
complaints related to banglalink service and network, and provide different types of
information and solution to the clients. Mr. Shibu Kanti Ghosh is supervising the actives
of call center.
Billing & Credit Management Division:
This part of customer care division is mainly responsible for billing customers and
collecting revenue. This department works with the help of its six units. The units are
bank reconciliation unit, bank communication unit, collection unit, credit recovery unit,
fraud management unit and revenue assurance unit. Mr. Shawkat Rehman is supervising
the billing and credit management unit which consist of 18 employees.
Support Service Unit:
Support Service Unit is responsible for maintaining the data base profile of the
subscribers. There are 14 employees who are working and maintaining link with sales
department to do their respective job.
Customer Care Line (CCL):
Customer care line is the core unit of Customer Care Department which has the direct
interaction with the customers of banglalink. Their job responsibility is to make one-stop
solution regarding any problem, quarry, or services to the banglalink customers.
PRODUCT OFFERING
Banglalink currently has five packages in the market. When the company started out,
government regulations had prevented it and other telecom companies from selling SIM
- 8 -
Group B
Case Written on

HRM 430

cards alone, but rather had to bundle them with a handsets. However, this policy has been
withdrawn ever since BTRCs Teletalk itself started selling SIM cards alone to the
public.
In fact, according to customer feedbacks, Banglalink packages are all attractive, since
the connections and monthly line rents are the lowest in the industry, and would have
attracted a lot more customers, if only the network could be improved.
Pre-paid M2M










Pre-paid Standard
Post-paid M2M
Post-paid M2M+
Post-paid Standard
Upper Class
Corporate Products Offering:
M2M & M2M + (T&T INCOMING) CONNECTION
STANDARD CONNECTION
STANDARD (ISD)
DISCOUNT OFFER ON CONNECTION PRICE & MONTHLY FEES
FREE CONNECTION ON MIGRATION
CREDIT DEAL WITH MULTINATIONAL BANKS

Banglalink has signed a credit facility agreement with Standard Chartered Bank in Dhaka
recently. It will help them to expand their market rapidly. Under the agreement, the bank
will provide Banglalink with working capital facility including import and post-import
finance of telecommunication equipments and fund collection.
Banglalink is investing in telecommunication equipments for rapid expansion of its
network. Currently, Banglalink network expands to 13 districts and the cell phone
operator will cover 61 districts by end of the year.
INTIMIDATION AND PRESSURES IN THE TELECOM SECTOR
Bargaining power of buyers is growing for Banglalink because: Cellular phone
customers have significantly high bargaining power because of the low cost of
procurement of a hand set and SIM card. The industry is at the growing stage and many
more players fighting for market share with competitive price and packages. In the
telecom industry prices are coming down significantly everyday and switching cost
- 9 -
Group B
Case Written on

HRM 430

coming down which is increasing the bargaining power of the buyers. Users of low cost
packages may switch from Banglalink to other packages.

High degree of rivalry in the telecom industry: The scenario of telecom industry of
Bangladesh has drastically changed when OTH invested in the country by purchasing
100% equity of Sheba Telecom Ltd. Suddenly all other competitors reduced the price as
Orascom Telecom Holdings initiated the lowest pricing policy for banglalink
TM
. GP,
CityCell, AKTEL never reduced their charges for their consumers since banglalink
entered into the market. To sustain in the market, all the players of the market reduced
their price as competitive low price is offered by banglalink.

As price and quality of service two important factor for the growth market, so all the
players of telecom industry is giving more concentration on these two issues. Low price
and innovative product and service strategy is the core strategy of the telecom industry of
Bangladesh.
Pressure for the New Entrants Is High: Bangladesh has a potential market for telecom
industry as mobile telephony penetration in the country being somewhere around 8.54%
of the total population of 148 million in the country. So, Telecom industry of Bangladesh
is now at growth stage, which is attracting the foreign investors of world telecom market.
If we look back to the history of telecom industry of Bangladesh we see that, Norwegian
telecom company-Telenor made a joint venture with Grameen Phone, SingTel went into
a joint venture with CityCell, Telecom Malaysia buys a huge share of AKTEL. OTH
the leading telecom company of Middle-east owned 100% equity of Sheba Telecom
(Pvt.) Ltd. Recently Warid Telecom the 3
rd
largest telecom company of the world has
got license to invest solely in Bangladesh. Foreign Investors like OTH, WTH, SingTel,
Telenor are coming to invest in the country as the market is very attractive.

MOBILE PHONE PRICE WAR INTENSIFIES

Cell-phone tariff, after years of having a one-way-street in a captive market, is likely to
head down shortly as the four private sector mobile operators are raring for what
promises to be a bloody price battle. However, industry people and analysts said the entry
of Banglalink in February this year actually initiated the price war among the operators.
The mobile market had first seen the beginning of a price war and a rapid competitive
pricing when Banglalink offered a connection and a brand new handset at the lowest start
up cost at Tk 3,400 at the time, said a regulatory commission official. Following
Banglalink, the three early operators also came up with various offers including
increasing the validity of prepaid cards, conditional reduction of call tariff to woo more
customers.
- 10 -
Group B
Case Written on

HRM 430

The chief executive officer of Banglalink, Lars P Reichelt, claimed on different occasions
that Banglalink has brought competition in the market and the prices of connection and
handsets have fallen by almost 40 per cent in the last seven months since Banglalinks
debut.

POTENTIAL COMPETITORS SCENARIO FROM BARRIERS TO ENTRY
PERSPECTIVE

Brand loyalty: Due to increasing performance and fastest progress in expansion of
network, banglalink
TM
packages inspire brand loyalty in comparison with the time of
Sheba Telecoms operational period. However potential new entrants to the industry will
be deterred by the high brand loyalty to Grameen packages.

Absolute cost advantages & economies of scale: Current players have a more or less
absolute cost advantage because they have already invested in telecom infrastructure and
have got back a significant portion of their investments. New companies like warid
Telecom and OTH will have to invest in equipment and will take considerably greater
time to cover initial equipment-purchase expenses.

Distribution channel: Access to distribution channels is another major barrier to entry.
Distributors of mobile phones are becoming very limited for the new entrants as there is
already 5 companies who are fighting for the market share. In all, we see that the barriers
to entry being very high, there is significantly less likelihood of new entrants into the
industry though high market attractiveness is influencing the strong foreign investors to
invest in Bangladesh Telecom Market.

BANGLALINK GET INTERLINKED WITH OTHER SUBSCRIBERS

Mobile company cannot run themselves, so they have to interlink with other subscribers,
which gives them an opportunity to operate their service in the industry. Banglalink also
interlinked with other subscribers.
The state-run cell phone company, Teletalk, Tuesday signed interconnectivity agreement
with the Banglalink ending the sufferings of its nearly 80,000 clients. The Teletalk
managing director, M Obaidullah, and the chief executive officer of the Banglalink, Lars
P Reichelt, signed the agreement on behalf of their respective companies. The Teletalk
earlier this week signed similar accords with the three other mobile phone companies
AKTEL, CITYCELL and GrameenPhone.
- 11 -
Group B
Case Written on

HRM 430

The Teletalk subscribers were constrained to reach mobile phones of other operators due
to delays in signing interconnectivity agreements caused by conditions put forwarded by
the private mobile phone operators. However, sources said, it may take around a week for
the Teletalk users to get access to mobile phones of the private operators.

BANGLALINK CROSSES 1 MILLION MARK

Mobile operator Banglalink has crossed one million subscriber marks with a network
covering 425 upazilas of 61 districts in 10 months inside the launch of its services. This
is a tremendous achievement. We have operations in some other countries. But we have
not had one million subscribers in only 10 months ealsewhere, said Naguib Sawiris,
chairman of the Egyptian Orascom Telecom Holding, which fully owns Banglalink, at a
news briefing in Dhaka on Tuesday. One of our main objectives from the beginning of
the operation was to focus on enhancing the network and coverage, and offering
subscribers reliable communications. And crossing the one million mark in such a short
time is proof of the success of our strategy, Sawiris said.
He said by the year-end, 88 per cent of Bangladeshs 140 million people would come
under the Banglalink coverage. Banglalink is the third largest mobile operators with
around 8 per cent market share. With a plan to target three million more subscribers by
2006, Sawiris said Banglalink was one of the priority markets of the Orascom group. The
group will make more investments in the future in expanding the network and
introducing new products to ensure the best quality. He said Bangladesh is a good
investment destination for telecommunications as the sector is growing very rapidly with
the steady growth of economy.
I am sure the economy will grow further, and of course, the telecoms market is going to
grow, he said. He said tariff cuts and a subsidised sale campaign had helped the
company to grow in the market. Launched in February, Orascom bought Sheba telecom
with only 60,000 subscribers and planned to invest $300 million in network expansion
over two years. Bangladesh now has about nine million subscribers, connected to five
operators with a penetration rate of around 6 per cent. Telecommunications equipment
manufacturer Ericsson estimated that the total mobile subscribers will reach at least 21
million by 2007, with a penetration rate of around 14 per cent.
Banglalink launched special promotions valid till January to celebrate the
achievement.The promotion package include 88 per cent discount on prepaid mobile-only
connections to celebrate the 88 per cent population coverage. The connection price will
be only Tk 132 against its regular price of Tk 1,100. Prepaid mobile-to-mobile plus with
BTTB incoming connection will cost Tk 425 against its regular price of Tk 1,400. The
- 12 -
Group B
Case Written on

HRM 430

companys chief executive officer, Lars P Reichelt, and the chief commercial officer,
Mehboob Chowdhury, were also present at the briefing at the Hotel Lakeshore.



ENVIRONMENTAL FACTORS AFFECTING BANGLALINK

Warning of Substitute Products: Technological developments have opened up a new
dimension in the deployment of creative and efficient telecom services and customer
satisfaction. Mobile telephony is a technological product where researchers are constantly
innovating ways to improve and make modern lifestyle convenient. New innovation and
introduction of new value added services by one Telecom Company creates strong threat
for other existing companies. Introduction of GPRS and internet browsing facility by
Grameen Phone & AKTEL has made threat and affected the business of banglalink and
CityCell.

Political environment: Political environment is quite unstable that might affect
banglalink
TM
s operation. Frequent change in government policy regarding tax, VAT,
import and the like. There are complexities related to law and regulations. Government
decision to enter mobile telecommunication industry. Effects of events in international
politics.

Economic Environment: Bangladesh has a very insignificant GDP and GNP. Per capita
income for the people of Bangladesh is also low. The current inflation rate (more than
5%) is higher than what it was in the past years. Sudden rapid increase in energy price
may have significant impact too. High tax imposition by the government will reduce the
buying power of the consumers. Worldwide negative economic impact after September
11, 2001affecting Bangladesh too.

Social Environment: Huge variation in socio-demographic and socioeconomic
characteristics. In Bangladesh, society is clearly clustered in to different categories along
different dimensions, for example, higher and lower class population in the society.
Cultural values are very strong but at the same time, always open to changes and new
things. Concern for quality is less important than concern for price. Most of the people
are homesick too. Need for affection is valued everywhere. There is moderate diversity of
lifestyle. People think more in group rather than individually. Hi-tech products and
services are mostly accepted as luxury rather than necessity.

- 13 -
Group B
Case Written on

HRM 430

Technological Environment: Technologically, Bangladesh is still far behind than the
standard. Lack of technical skill is a regular phenomenon for every industry in
Bangladesh. Low quality of after sales service in technological products and services.
Moderate focus on the development of technical skills. Lack of skilled labor in the
industry is a commonplace.




NEW BUDGET AND SIM TAX

The news - cell phone operators warn of investment rethink if SIM tax of Tk. 1,200 not
lifted - that published in front page of New Age in June 14 is very painful. Where the
cell-phone call charge is as high as Tk. 6.00 per minute, I think they had already got
return manifolds of their investment. Why are they threatening not to further invest in this
area? Is Bangladesh not a profit heaven for cell phone operators? Is there any other
country around the world where cell phone call charge is so high?

Then again the finance and planning minister M Saifur Rahman now shouting against the
private cell phone operators for charging high call tariff but over the half decade more
than thousands crore taka has been robbed in a sophisticated way. Why the government
declares it today as high call tariff for the people? Is it for what they are going to be
imposed Tk 1,200 SIM tax? This tax also has to be paid by the people.

The government and cell phone operators both are blaming each other and targeting only
for high tax and tariff none is bothering for the service to the people for a reasonable
price.

However, I like to call all cell phone operators to reduce their call charge and the
government to withdraw or reduce the SIM tax if they want this communication
technology to flourish further in this country as an association for economic
advancement.

ISSUES FACING BANGLALINK

The poor image of Sheba Telecom: Banglalink was as good as dead, and thus, a
dog (even in a high growth market) while it operated under the brand name Sheba.
However, with the change in ownership, it is giving the star and the second operator of
the country a run for its money. While it may seem too ambitious saying that it would
- 14 -
Group B
Case Written on

HRM 430

overtake the leader anytime soon, it is certainly a possibility. Banglalink is thus setting
up BTS towers at a rate faster than its competitors in order to repair its image as the worst
network provider.
Operational issues: Banglalink management has placed one of the highest priorities
on improving its network. In 2005 alone, Orascom plans to invest $120 million,
earmarking close to another $300 million for future investments. The company plans to
provide mobile communication coverage to all the 61 districts of the country and its
major highways by the end of the year.
Strategic issues: In a country where the mobile telephony penetration is below 2%, the
best strategic move for any operator would be to concentrate on expanding the subscriber
base. For this, packages such as Banglalink s launch offer and its most recent tariff
plans are ideal, since like most emerging markets, Bangladesh is also a pre-paid driven
market.

However, in a population where majority of the people live below the poverty line it is
doubtful as to how far the companies can succeed in increasing percentage penetration.
Hence, value added services like new and innovative SMS and IVR based products can
help to raise the level of ARPU from its current position.

CURRENT OPERATIONS OF BANGLALINK

Banglalink

is grabbing market share: The growth rate of subscriber base is astonishing
which already caught the eyes of many business analysts. In the 1
st
year of its operation,
banglalink
TM
was able to hold the position of highest growth rate of world telecom
industry and this growth rate was 1363%. This surprising growth rate reflects
banglalinks aggressive carriage in grabbing market share. It took banglalink nearly
4 months to build a subscriber base of 400,000 and by the end on 9 months operation it
became a cell phone operator with 1 million subscriber base, while it took nearly five
years for its largest competitor to build a subscriber base of 500,000. Currently it has
subscriber base of 1.64 million.
Spontaneous brand awareness: The marketing department is following diversified
strategy to crate prompt brand image among the people of Bangladesh. Huge investment
in advertising, sponsoring different types of events, organizing creative e business events
like Corporate Bazar are helping banglalink to build more awareness among Bangladeshi
people. By the end of one year of its operation, banglalink has a spontaneous brand
awareness of more than 78% which is astonishing.

- 15 -
Group B
Case Written on

HRM 430

Rapid improvement in network quality and coverage: During the time of its
inauguration, Banglalink top management has declared that the company will cover most
of the major districts and highways with its network coverage. Banglalink has kept their
promise regarding the network coverage; banglalink network has covered 61 districts and
highways within a time span of 10 months. Siemens Bangladesh limited and Huawi is
working jointly with banglalink to install state-of-the-art equipment for network
coverage.

Rate of new product and service innovation: If we consider the innovation rate for new
offerings it is clear that, banglalik is innovating and introducing new packages and new
value added services for its valued customers. The rate of innovation is also apprciable,
currently banglalink has 3 exclusive pre-paid packages, 13 catagories post-paid upper
class packages and 4 special corporate packages and 1 VIP post paid package for elite
people are available in the market. New innovated value added services are Call
Conferencing, SMS Adda & SMSemail. Voice mailing (i-bubble), song dedication, i-
topup (balance transfer) etc. are noticeable. Currently banglalink it department is working
on a project to introduce GPRS and MMS for its valued subscriber,
Lowest call rate for upper class (post-paid) subscribers: Most of the Banglalink
packages are attractive for affordable initial purchasing price and lowest tariff rate in the
industry. Besides monthly rent for the upper class (post-paid) schemes are also lowest. So
it can be said that banglalink is trying to keep its promise to make cellular phone
affordable for the country people. In other way around, banglalink
TM
s lower call rate
offering strategy pressurized the other operators to reduce the tariff rate. Hence, the
people of Bangladesh are now talking through cellular phone at a cost of only 4.00 TK on
an average where only one tear before the average price for 1 minute call was 7 TK. The
call rate for upper class (post-paid) subscriber is only TK 3.48 / minute which is also the
lowest in the in the industry. So, we can say that banglalink
TM
is playing an important
role to make the cell phone more affordable.

FUTURE DIRECTIONS OF BANGLALINK
The ability to expand into new services that require an approach that is compatible with
banglalinks strengths and that compensates for its weaknesses, e.g. provision of wireless
data transfer services by corporate clients (corporate clients generally require less
technical or otherwise support). Integration of new commercially viable packages into
current offerings e.g. call & control package (pre-paid facility in post-paid connection)
which have been recently introduced.

The growing need for cross-border telecom services at lesser cost (e.g. with neighboring
India, Burma, then onto Thailand, etc). Expansion into landline services from dedicated
- 16 -
Group B
Case Written on

HRM 430

stations across country that will provide compatibility with other Bangladeshi telecom
networks.

Higher degrees of public acceptance of new cell phone operator in the country. Economic
growth of Bangladesh is another opportunity for banglalink.





The mobile industry is growing at a phenomenal pace these days. While it took the
industry leader more than five years to reach its first million subscribers, its last million it
had acquired in a bit more than 2 month period. With an annual growth rate of 132% in
the industry itself, it can be said to be the fastest growing industry in the country. So
Bangladesh is a huge potential market for the cell phone operators. Investors like
Orascom Telecom Holdings, Warid Telecom, Sinktel are investing in the Bangladesh
Cell-phone market. Attraction and investment of the strong foreign investors has created
an immense competition in the industry which is resulting price war and present market is
no longer monopolistic, now cellular phone industry is an oligopoly market. So, to
survive in the competitive industry and to ruin the first place in the industry, banglalink
TM

has to follow mass marketing strategy. At the same time it must innovate value added
services and lucrative products for the existing and potential subscribers.

A recent trend in the market is that people have more than one SIM card which is of
different operators. They use SIM card of one operator when they see that the package
is more cost effective meaning the operator is charging less compared to other operators
tariff rate. Competitive price-offerings by the operators became a natural phenomenon for
present competitive industry. To attract potential subscribers, banglalink
TM
has to
introduce technologically updated features and packages and ensure complete mobility
solution with improved coverage.
BAKLOG of BANGLALINK
Underprivileged network quality: Network quality is a very important tool to evaluate
the service quality of cell phone. As the existing subscribers of banglalink are not
satisfied with the current network condition, so, the top level management of the
company should concentrate on this issue so that they can improve the quality of the
network. Banglalink technical department has to be more conscious to ensure best quality
network in the country. High quality BTS (Base Transverse Station) and powerful
equipments set up can increase the quality of network.

Dont have any separate corporate care line: Since the existing corporate subscribers
of banglalink are not satisfied with the customer care service, so the company should
introduce a separate unit in the customer care department to serve the corporate
- 17 -
Group B
Case Written on

HRM 430

customers so that the corporate subscribers get prompt one stop solution of any sort of
problem.

Less value added services: Banglalink must add more value added services to its line-
up, such as WAP, Data & Fax, etc. recently GP and AKTEL introduced GPRS facility for
its subscribers and this service is still not available with banglalink. To compete in the
market, and to satisfy the customers, banglalink has to be up to date regarding the
innovation and introduction of more value added services.

Poor billing delivery: If the customers do not receive the monthly bill on time, or
receive wrong itemized bill, then it directly affect the image of the company. As
banglalink is way behind the competition regarding on time bill delivery and sometimes
it sends wrong itemized bill, so to survive in the competition, banglalink must solve this
issue quickly, otherwise the company will lose its existing clients.

Technological developments have opened up a new dimension in the deployment of
creative and efficient services and customer satisfaction. Telecommunication industry is
playing an important role in the communication system that has become an obvious for
this modern world and the scenario is indifferent for Bangladesh telecom industry. If we
look at the scenario of telecom industry of country we see that people has paid
approximately 7.00 TK/minute charge for the use of their cellular phone. The scenario of
the telecom industry has totally changed as Banglalink

entered in the industry with the
aim of serving mobile phone services to the mass population of the country so that the
entire communication system of Bangladesh develop dramatically.

The intense competition in telecom industry is facilitating the people with reduced tariff
rate. Cell phone is no more a fashion in the country rather it became a necessity. People
now have more than one scheme card of different subscribers. So, considering the
competitive scenario, banglalink must come up with new product and service idea that
will satisfy not only the existing subscribers but also attract the potential subscribers and
this is the only way how the company can sustain in the intense competitive market in the
long run.










- 18 -
Group B
Case Written on

HRM 430

- 19 -



















Group B
Case Written on

HRM 430




ORGANIZATIONAL STRUCTURE: BANGLALINK

















- 20 -
Rumana Reza
Customer Care Director
Mohammed Allam
Head of HR
Ezzel M. Heikal
Chief Financing Officer
Parvez Sajjad Mahtab
Manager
Distribution Sales
Program
Management
Hassan Samy
Sales Director
Altaf H. Faquih
Admin Director
Mehbub Chowdhury
Chief Commercial Officer
Mohammad Mustafa
Chief Technology Officer
Nasar Yousuf
Supervisor
Corporate Sales
Waled El Sonbaty
Acting Chief Information Officer
Omar Rashid
Marketing Director
Tanvir Ibrahim
Manager
Corporate Sales
Kazi Munirul Kabir
Manger
Direct Sales
Raed El-Shafei
Sr. Manger
Sales Support
Lars P. Reichelt
Chief Executive Officer
Group B
Case Written on

HRM 430




ORASCOM TELECOM HOLDINGS IN VARIOUS COUNTRIES


Country Brand name Market Share
Algeria Djezzy 73.0%
Pakistan Mobilink 63.8%
Egypt MobiNil 53.5%
Tunisia Tunisiana 29.4%
Iraq Iraqna 100.0%
Bangladesh Banglalink 1.0%
Congo Brazzaville Libertis 36.8%
Zimbabwe Tel Zim 31.0%
Democratic Republic of
Congo
Oasis
Telecom
5.1%






BANGLALINK PRODUCT LIFE CYCLE
- 21 -
Group B
Case Written on

HRM 430


V
L
O
U
M
E

G
R
O
W
T
H

R
A
T
E

Maturity
Growth
Decline
Introduction
TIME
banglalink
TM
PLC
In growth stage of PLC, banglalink
TM
and its market characteristics are:

1. Sales increasing rapidly.
2. Costs per customer average.
3. Profits increasing.
4. Customer type early adopters.
5. Competitors increasing; some emulators.
6. Competitors strategies attempting to achieve trial; undifferentiated packages,
services; emphasis on fighting for share.
7. Marketing objectives rapid share increases/ maximize share.

FIGURES
- 22 -
Group B
Case Written on

HRM 430

The service provider
1.6%
23.0%
14.8%
43.4%
17.2%
Missing
Banglalink
Aktel
GP
City Cell

Figure 1: The service provider users




- 23 -

Group B
Case Written on

HRM 430

- 24 -
The preference
1.6%
25.4%
13.1%
55.7%
4.1%
Missing
Banglalink
Aktel
GP
City Cell


Figure 2: Private subscription beside the corporate connection

network coverage
5.00 4.50 4.00 3.50 3.00
network coverage
F
r
e
q
u
e
n
c
y
120
100
80
60
40
20
0
Std. Dev = .40
Mean = 4.83
N = 120.00
101
18

Figure 3: Service quality in terms of network coverage