UFone Assignment by Shakeel Ahmad
UFone Assignment by Shakeel Ahmad
CHAPTER -1
INTRODUCTION
In this report the focus will remained on the performance of the company
regarding the tough industry competition and growth and the company’s
marketing strategies. It will also cover to some extent different other areas, and
also the company’s strategy to remain directly in contact with its customers
through customer care centers.
1.2 ANALYSIS:
Ufone has very good prospects, as the growth potential of the cellular
industry in the country is enormous. Ufone has successfully reached over 180
cities and still a lot more has to be done.
Ufone holds a very effective sale promotion strategy and one of the major
steps it has taken in this regard is the free launch of connections on 14 august
2004 which has boosted its customer base and sale of scratch cards. Ufone is
always been consistent in lowering its prices and making mobile an affordable
thing in reach of a common men.
1.3 FINDING:
All the measures of true success, exceeding the revenue targets, crossing
the targeted subscriber base, providing excellent customer care, capturing a
substantial expanding the size of the market and surpassing all customer
expectations, have been achieved by Ufone, quite obviously. Ufone is a real
success.
1.4 RECOMMENDATIONS:
Ufone should sustain its niche of being inexpensive and reliable. It should
adapt the horizontal growth strategy. It should re-organize the current structure of
management at Ufone customer care centers to improve the quality of work over
there.
CHAPTER-2
Source J.D. Hunger, E.J. Flyon and T.L. Wheelen, “Contingency Corporate
Strategy; A Proposed Typology with Research Proposition,” Paper presented to
EVOLUTIONARY PROCESS:
The dream of PTCL to enter into the cellular phone industry is very
old. Till 1995, 96 cellular connections were being provided by three different
companies (which will be discussed briefly in coming chapter). The cellular
phone industry was enjoying high profit margins by targeting corporate customers
only. Mobile phone was considered to be symbol of status. This can be called an
early growth stage of mobile phone industry in Pakistan. From the progress of
these companies being in touch with PTCL for using its land lying network, it was
easy for PTCL to forecast the future of the cellular phone industry. So the plan
was proposed which ultimately led to the establishment of PTML in 1998 and
Ufone in 2001.
MISSION STATEMENT:
“To become the best cellular communication option available in the country for
U.”
SLOGAN:
Concentrate to generate high quality sales and help to build trust, loyalty
and sense of affection among the customers by performing and extending
extra services to them.
To do all possible efforts to out class competitor’s activities from the
market and to achieve the company’s goals by representing excellently as
a true Pakistani company.
To sustain customer base and maintain quality to avoid sale returns.
To ensure the following personal excellence;
STRATEGIES:
Provide integrity.
QUALITY POLICY:
o Voice quality.
o Connectivity.
o Customer services.
o Coverage.
In this regard the objective of the firm can be summarized as “To retain the
subscribers on board by maintaining the quality of the product.”
The Cabinet approved this decision and a major step was taken in 1962 to create
the Pakistan Telephone & Telegraph department. The World Bank felt a
reorganization necessary in 1968 and for that purpose appointed consultants for a
study. This was also followed in 1969 by a review and a report to the Chief
Marshall Law Administrator. In 1973, the Cabinet approved to setup a board to
administer and control the T&T. after prolonged discussions between the
Government and the World Bank during 1973 to 1979, a Presidential Order was
issued on 30th May 1979 which gave the DG T&T enhanced administrative and
fiscal powers and appointed a full time Financial Advisor. The new arrangements
came into force on 1st July 1979. As a result and after reviews, the Government
decided to convert the T&T into an autonomous corporation that was created as
PTC by an ordinance on 15th December 1990. Government obtained the services
of a consortium led by Bear Steams (USA) for study and recommendation which
resulted in the promulgation of the Telecommunication Ordinance of July 1995
separating the policy, regulations and operations in the sector. While policy was
reserved for the Government, the regulation of the sector was entrusted to the
Pakistan Telecommunication Authority (PTA). A frequency allocation board
(FAB) was created for the management of the radio frequency spectrum and for
government’s telecommunication services; National Telecommunication
Corporation (NTC) was created. The PTC was converted to the Pakistan
Telecommunication Company Limited (PTCL) on December 31st, 1995.
PRIVITIZATION OF PTCL:
organizations to operate efficiently. This was evident in counties like the former
Soviet Union and several of the communist states of the Eastern Europe.
The 1970’s saw a major shift in Pakistan towards nationalization due to the
policies of the government at that time, which was inclined towards a socialist
welfare model. However, subsequent turn of events was to prove these policies to
be seriously flawed a failure worldwide. Only a decade later, the government was
advocating the privatization of everything under the sun. Superficially, it seems to
be an open and shut case of a poor strategy corrected after it was proven wrong.
o Percentage digitalization:
o Universal Access Network:
o Mobile Telephone Base:
o Toll Free (0800 operational) Customers:
o Internet Customers:
o Universal Internet Number(UIN):
o Nation Wide Direct Dialing Stations:
o Country Teledensity:
P.T.A
Pakistan is the very attractive market for the mobile phones. There are over 3
million active mobile phone users. Most of these customers belong to the key
cities like Karachi, Lahore, Islamabad, Peshawar, Faisalabad etc. but now with the
P.T.A
ISP
PTCL Sat Phone
Companies
Co.
increase in the networks of the mobile companies in the different other big and
small cities and the rapid decrease in mobile service charges, the ratio has also
increased in the small cities too. A large market is still lying untouched and
waiting anxiously to get the cell phone because of the fact that with a mobile
phone in hand one can expand its business operations and remain in touched with
his business all time. According to P.T.A the number of cell phone subscribers is
expected to reach 15 million during next two years. A potential demand of around
25 million subscribers till 2018 is required to be satisfied in the country. P.T.A
has so far issued 178 licenses for various telecom services, 90 licenses for
Wireless Local Loop (WLL) to 15 companies for all 14 telecom regions of the
country. Besides this, 76 Fixed Local Loop (FLL) licenses have been awarded to
34 companies and 12 Long Distance & International (LDI) licenses awarded to
different companies. Some of the companies which have won the WLL licenses
include M/s.Telecard, M/s.Burraq Telecom, M/s.DV Com, M/s.World Call,
M/s.Warid WLL, M/s.Microtech Link and others. PTA will issue as much as 108
WLL licenses to 20 companies which have won the spectrum through open
bidding in August this year. The Authority received Rps. 14.121 billion against
the spectrum price. After successful completion of phase-one of the deregulation
process, PTA has also invited applications from Pakistani and foreign companies
for the grant of Local Loop (LL) and Long Distance & International (LDI)
licenses for all PTCL regions excluding Azad Jammu & Kashmir and Northern
Areas on open and unrestricted basis.*
At present there are four mobile companies operating in Pakistan and the
upcoming new foreign companies will commence there activities soon, as they are
in process to establish their setup. The present companies are Paktel, Instaphone,
Mobilink, & Ufone.
PAKTEL
Paktel is the first company that introduced the mobile phones in Pakistan. Started
its operation in 1989, Paktel entered the Pakistani market with a huge investment
Cable and Wireless, an American based company. Being pioneer in the mobile
phone industry, Paktel at one time became a generic name for mobile phones like
Coke. It has recently upgrade its network to GSM and brought a big investment in
its brand and marketing setup. Some facts and figures about the company are as
under;
A great change in the history of Paktel is its merger with Instaphone whereby
Instaphone parent company Millicom purchased 97% shares of the Cable &
Wireless and owned Paktel.
INSTAPHONE:
Officially the merger of Instaphone and Paktel took place in sep.2000. As a new
setup, Pakcom has appointed franchises for Instaphone and Paktel for sales,
customer care and billing. These franchises are run by private investors. Majority
of the franchise holders are the ex-dealers of either
Paktel or Instaphone. So far Paktel franchise is known as Paktel Point and for
Instaphone is the Insta Sales, supervised by the territory managers of Pakcom.
MOBILINK:
Before the introduction of the Paktel GSM, Mobilink was the only direct
competitor of Ufone, interms of technology. Mobilink is the first company that
introduced GSM technology in Pakistan. Mobilink is the joint venture of
Motorola and Saif telecom, operating under the supervision of Motorola, a well
known manufacturer of the computer related parts e.g. hard disk and pagers and
mobile phone hand sets etc. Motorola is also the service provider company for
communication in many countries.
In 1999, Motorola and Saif Telecom sold off their shares to an Egyptian company
Orascom and now Mobilink is 100% owned by Orascom. As a new setup,
Mobilink has also appointed its franchises countrywide. These centers provide the
facilities of sales, service and billing.
UFONE VS COMPETITORS:
Broadly categorizing and keeping technology in view as a major factor, Ufone has
direct and as well as indirect competitors. The term direct and indirect refers in
terms of the technology used. Formally, Mobilink was the only direct competitor
but now Paktel with GSM technology also became the direct competitor.
Whereas, the Instaphone comes under the indirect competitor. The number of
direct competitors are yet to get increased by the arrival of new companies like
AL-WARID &
TELENOR:
The table and diagram reveals the market share of each company:
50
45
40
35 Mobilink
30 Ufone
25 Paktel
20 Instaphone
15 Others
10
5
0
The mobile phones are basically the result of the combination of two of the
greatest inventions of the history i.e. Radio & Telephone. The afterwards
developments gave birth to different types of wireless devices. Police started
using two way radios as early as 1921, which were named Wireless or Walkie-
Talkies and are still used for variety of applications. Some of the disadvantages or
limitations of these devices include half duplex sound, one person can talk at one
time, push to talk, limited range and limited frequency.
In 1977, first license for AMPS (Advance Mobile Phone Syatem) network was
granted to IIImots Bell Telephone in Europe. Mobile phones rapidly started
making their place in various countries with every country using its own type of
network technology. (AMPS, TACS, CNET, NMT etc.)9
First cellular networks were introduced in late 70s, these were basically analogue
systems having lots of limitations and deficiencies including voice quality,
security of the communication etc. however, different standards in different areas
of the world were being used e.g.
Group special mobile or GSM was the standard in mobile phones adopted by
Europeans. The objective, as mentioned earlier, was to provide a wider market for
mobile phone operators.
The first GSM network was introduced in Europe in 1981. later on this standard
expanded quickly to become the premier world standard and thus GSM got the
meaning as Global System for Mobile Communications.
The GSM proved to be the robust technology soon after its introduction due to its
major features like:
So all these factors made possible for GSM to become the only leading standard
for mobile phones. Therefore now;
o 55% of the global cellular market (380m) uses the GSM standard.
o 500 organizations in 158 countries offer GSM.
o 4 new customers are added every second.
o 1 out of 16 people in the world has a GSM connection.
o 1 billion subscribers were expected by 2005.
o In 1999, PC growth rate was 22% while GSM growth rate was 77%.
3G or third generation, the third step from analogue to the latest one is based upon
the GSM platform.
1st Generation
Analogue.
2nd Generation
Digital. 0110000010100111
3rd Generation
Mobile Multimedia.
REGIONAL SET UP
Ufone
CHAPTER -3
ANALYSIS
Ufone is a service oriented firm and it target different promotion activities in short
or long run e.g. sales promotion, business promotion etc. it is difficult to cover up
all the activities done by Ufone at once but the major promotion activities which
had come up with outstanding and satisfactory results are;
Ufone being a service oriented firm mainly focus on the sales promotion
activities. The major sales promotion activities undertaken by Ufone are;
FREE CONNECTIONS:
Ufone come with a very bold decision in promoting its brand by offering free
connections to the people in different big cities like Peshawar, Islamabad,
Karachi, Lahore, Rawalpindi, Faisalabad, Haiderabad, etc. at the occasion of
independence day of Pakistan from 14 august till 17 august for three days. This
was a very big surprise for the people of these cities as no mobile company had
come up with such a major decision ever. People greatly appreciated this step and
rushed to the Ufone customer centers and dealers outlets. This activity resulted in
500,000 new customers for Ufone and the biggest ever recorded sale of its scratch
cards which has increased by 60%. This activity not only resulted in its product
promotion but also the promotion of Ufone’s business. But the big flaw in this
activity, which the management never realized before was the management of the
crowd. The panic created by the people in order to get a connection resulted in the
destruction of the Ufone office in Peshawar and also the injuries of the most of
the employees. This also resulted in frustration of many people who didn’t have
the connections. Ufone management should have done different precautionary
arrangements before announcing this campaign.
After offering free connections, the second major decision taken by the Ufone
management was the decrease in prices for the new connection as it has always
been consistent in gradually decrease in its connection charges with the decrease
in Govt. Tax. Now Ufone is charging only 199 Rps for a connection. This has also
brought a revolutionary increase in its customer base.
DECREASE IN TARIFFS:
Ufone has also decrease its tariff for outgoing calls. This is also a good step in
giving its customers a relief from the big charges for the different calls made. In
the first step it has decreased these charges from 5.70rps/ minute to
4.70rps/minuteOn 5th February 2005, Ufone came up with another major step
decreasing the call charges from Ufone to Ufone up to 3 Rps/minute & with a late
night option of 1.30 Rps/minute after 10pm. This is another great step by Ufone
management in promoting its product.
Ufone in response to its competitors has also come up with the removal of all the
roaming charges throughout the country. Now with zero balance one can attend a
call from any city of Pakistan. This is also a major step in promoting its sales and
people visiting the customer care greatly appreciated this decision which has
resulted in the greater brand loyalty of the Ufone customers.
Ufone is now mainly focusing in attracting new customers by promoting its Value
Added Services like Multi Media Messaging (MMS) and GPRS as it’s the only
mobile company offering these services. Ufone in collaboration with United
Mobile (a mobile set selling company) has offered free 50 multi media messages,
free activation of the MMS service and a free Ufone connection on the purchase
of a MMS enabled set from the any outlet of the company or temporary stalls
arranged for this purpose in different areas. This is also a good step in attracting
youngsters as they are more interested in these sorts of things.
Ufone till now was offering the free activation of its GPRS and MMS services
with the free settings in the customers’ mobile set’s configuration at any customer
acre center or through call center. But now these services are offered on the
payment of only 70rps at the customer service centers.
PRIZES:
Ufone also announce different cash prizes contest for its customer on different
occasions like Eid, Cricket matches etc. These prizes are usually given to those
customers who have the MMS service. Like on Eid ul Adha , the Bakra contest,
where customers could win a cash prize of 100000 Rps. The cricket contests on
different big matches of Pakistani team.
PUBLIC RELATIONS:
Public Relations (PR) is another important marketing tool. Not only must the
company relate constructively to its customers, suppliers, and dealers, but also
relate to large set of interested public. A public is any group that has an actual or
potential interest or impact on a company’s ability to achieve its objectives.2
Ufone also gives an important emphasize on establishing and promoting its PR. It
is always in touch with its customers through its customer service centers and
dealers. The different tools Ufone uses in promoting its PR are;
EVENTS:
NEWS:
understands the press’s needs for stories that are interesting and timely and for
press releases that are well written and attention getting. Ufone always gives
special attention towards these and have come up with many interesting ideas.
Like on the removal of roaming charges, Introduction of MMS and GPRS first
time in the market, Ufone has tried its level best to take advantage of this
opportunity and make people aware of these in best possible way.
IDENTITY MEDIA:
William Newman suggests that a corporation should seek a propitious niche in its
strategy formulation process. Wheelen and Thomas elaborate this in detail by
explaining this niche. They say, “This niche is a corporation’s specific
competitive role. It should be so well suited to the firm’s internal and external
environment that the other corporations are not likely to challenge or dislodge it.
The corporation thus has a distinctive competence that enables it to take
advantage of specific environmental opportunities”.4
Finding such a niche is not always easy. As firm’s management must be always
looking for strategies windows that is market opportunities. According to a study
of high performing, mid-sized growth companies, It was found that these
successful corporations have four characteristics in common.
EXAMPLE:
The machine tool industry in 1990 was not a very attractive enterprise for most of
the U.S. companies. Led by Japanese corporations, importers were responsible for
43% of the $4 billion industry. U.S. companies such as Cincinnati Milicron and
Gidding & Lewis had been successful by catering to multi billion-dollar
customers like Caterpillar and Boeing, but were also threatened by foreign
competition. All in all, this did not appear to be a good industry for a small family
run business.
The company soon expanded into another machine tools that were designed to
appeal to smaller manufacturers that could not afford the more sophisticated,
complex machines made by larger outfits. The machines made by Fadal were
functional and durable, but far cheaper than the typical lowest priced competing
machine. Since Fadal generally used U.S. made standard parts, repairs were
usually a simple matter. By 1990, Fadal’s sales reached the $80 million range, ten
times what they were in 1985. The company controlled nearly 20% of the $400
million metal working machine market tailored to the needs of small
manufacturers.
As discussed before Ufone mostly targeted the prospects with the lower income.
In its advertisements on TV, students, taxi drivers, mechanics, businessmen,
housewife, people working abroad away from their homes, people in rural areas
etc were targeted. Another emphasize in these advertisements was the
connectivity of Ufone service which was a major issue and lots of problems in
this regard were faced by other companies. Here can be found a major
relationship between Ufone and above mentioned example. Ufone claims of being
inexpensive and reliable and this is basically the propitious niche of Ufone.
Factors
Factors
(EFAS)
Opportunities (O) SO Strategies WO (Strategies)
Source: Adapter from H.Weihrich, “The TOWS Matrix-A Tool for Situational
Analysis,” Long Range Planning (April 1982), p.60 Copyright © 1982 by
Pergamon Press.
STRENGHTS WEAKNESSES
OPPORTUNITIES THREATS
* Rapid growth in mobile Industry * Privatization policy
* Many potential cities still waiting * Upcoming foreign
for mobile service companies
* Reduction in tax on mobile phone * Satalite Phones
connections
* Car tracking system *Political Unrest and
Terrorist activities in
Pakistan
* Potential market of Afghanistan
WO STRATEGIES:
• Get hold of present Ufone cities and make sure that the sales of
connection remains continued as in present.
• Restructure the customer service center and appoint new skilled staff to
improve customer satisfaction.
• Introduce more and attractive packages for new and existing customers
with reduction in tariffs.
• Reduce the charges for GPRS and MMS.
ST STRATEGIES:
• Engage the dealers of others companies and free lancers to sale Ufone
connection and reward them with attractive packages.
• Invest more in social welfare activities.
WT STRATEGIES:
• Give more authority to the authorized dealers and engage them in others
activities e.g. SIM change, Sale of scratch cards and activation of GPRS
and MMS.
• Improve the quality of service at service centers or just close down the
customer service centers and appoint the staff at dealer’s offices. It will
reduce the fixed cost.
• Merge with the upcoming foreign companies to expand its network and
utilize their experience to become the market leader.
REFERENCES
CHAPTER -4
By interviewing different people, users as well as non users of the mobile phone
in order to find out the general opinion of the people in terms of advantages and
disadvantages of the mobile phone, revealed following interesting facts;
ADVANTAGES:
• An easy way to remain in touch with the business, family and friends.
• A symbol of modernism.
• Entertainment device.(Games, messages)
• Cheap way to give any message through SMS
• A show off device.
• A sense of security and satisfaction.
• A solution to talk to a friend/girl friend at any time.
• Schedule developer device.
• A device to access internet through GPRS.
• A device to exchange multi media messages through MMS.
DISADVANTAGES:
• Wastage of money.
• Lack of privacy.
• One of the causes of stress.
• Injurious to health (harmful electromagnetic waves)
FINDINGS:
RECOMMENDATIONS:
Ufone must sustain its niche of being inexpensive, reliable and economical
and it must maintain its prices as low as possible in future.
In future the company must upgrade its quality of service with time and
must make it sure that the service quality remains good.
It should make its dealers confidence in the company stronger and reward
them on showing good performance.
Restructuring of the customer centers is required because of many
problems faced by the customers while visiting any. A plan is proposed
for resolving this problem.
As it is discussed earlier in chapter.02 that the customer care center has a very key
role in polishing and strengthening the company’s image and goodwill in
customers mind. Company is in direct contact with the customer through these
outlets. No matter Ufone has a wide network of customer care centers in cities
with the mobile phone service with efficient and well trained staff. But many
deficiencies were observed at these centers. A few important one’s are;
base of Ufone, customer care centers requires few changes in the style of work
they are up to.
COUNTER 1:
This counter should deal the sale of connections only. As it is not a difficult task,
so only one person is enough to handle it.
COUNTER 2:
This counter will deal in different queries about the MMS and GPRS only like the
activation, deactivation, customer information etc. the number of representatives
here may vary from 1-2 according to the requirement.
COUNTER 3:
The representatives at this counter will deal only in the SIM related issues e.g.
issuing new SIM, customer verification, blocking and unblocking of service etc.
COUNTER 4:
This counter will deal only in the balance adjustment and other related issues like
restoration of balance in case of balance drops, approving security waivers,
adjusting customer security deposits etc.
The distribution of work will reduce the burden of work and customer’s wastage
of time. By this way the customer centers will also become more efficient and
quick. This will also increase the company’s goodwill and customer trust in the
firm and its service and thus make the brand loyalty stronger. This re-organization
can also be presented in the form of chart given;
Manager
Incharge
Incharge Incharge Incharge
Customer
Care Finance Sales Eng& IT
Sales Sales
CCR CCR CCR CCR
Officer Officer
REFERENCES
CHAPTER -5
CONCLUSION
5.1 CONCLUSION: