Table of Contents

INTRODUCTION....................................................................................................... ....2
STRATEGY FORMULATION...........................................................................................4
VISION................................................................................................ .....................4
MISSION................................................................................................................. ..4
VALUES.................................................................................................... ................5
EXTERNAL ENVIRONMENT.......................................................................................5
INTERNAL ENVIRONMENT........................................................................................7
LONG TERM OBJECTIVES......................................................................................... .7
STRATEGIES.................................................................................................. ...........9
STRATEGY IMPLEMENTATION.................................................................................... .10
OBJECTIVES.................................................................................. .........................10
POLICIES...................................................................................................... ..........10
A STRATEGY SUPPORTIVE CULTURE.......................................................................11
HUMAN RESOURCE STRATEGIES............................................................................13
DIVERSITY.............................................................................................................. 15
STRATEGY EVALUATION............................................................................................ .16

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 INTRODUCTION
Telenor Pakistan, a wholly owned subsidiary of Telenor ASA, launched its
operations in March 2005. One of the leading telecom operators providing
prepaid, postpaid and value-added services to seven million customers, it is
spread across the country with a network of 15 company-owned sales and
service centers, more than 200 franchisees and some 100,000 retail outlets
selling subscriptions and refills. Differentiated packages include TalkShawk,
Telenor Persona and Djuice.

Telenor took a big step seven years ago when it decided to expand in
international markets. The key take points include: right time, targeting of
emerging markets, policy of full management control (avoided joint
ventures) and deployment of a repeatable methodology (for example the
djuice brand). The success of the strategic focus can be understood from the
following1:

1
http://telecompk.net/2008/12/30/telenor-emerging-market-strategy-success-swot/

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Telenor believes:

“What matters most is the right strategy, at the right time and
precision in execution.”

STRATEGY FORMULATION

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VISION2

MISSION3
Telenor's primary goal is to create greater value for our shareholders,
We exist to help our customers get the full benefit of
customers, employees and partners, and for society in general. We strive to
communications services in their daily lives.
be a driving force in creating, simplifying and introducing communication and
content solutions to the marketplace.

VALUES4

EXTERNAL ENVIRONMENT

SEGMENTATION

Market Toda Feature Year Existing Product Profitabi

Segment y Estimate lity
Youth/ 25% 27% Djuice, TalkShawk 29%
Students

2
http://www.telenor.com.pk/about/visionValues.php

3
http://creativez.blogster.com/mission-statements-different

4
http://www.telenor.com.pk/about/visionValues.php

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Women 10% 20% TalkShawk 21%

Financially 40% 23% TalkShawk, Telenor 20%

Constraint Azadi
Corporate/ SME 25% 30% Postpaid Packages 30%

CPM

CPM Mobilink Warid Ufone Zong

Critical Weight Rating Score Rating Score Rating Score Rating Score
Success
Factor
Advertisin 0.1 2 0.2 2 0.2 3 0.3 3 0.3
g
Product 0.15 2 0.3 2 0.3 3 0.45 3 0.45
Quality
Price 0.1 3 0.3 2 0.2 3 0.3 3 0.3
Competiti
on
Managem 0.1 3 0.3 2 0.2 4 0.4 3 0.3
ent
Financial 0.1 4 0.4 2 0.2 3 0.3 2 0.2
Position
Customer 0.15 2 0.3 2 0.3 3 0.45 2 0.3
Loyalty
Global 0.1 3 0.3 2 0.2 1 0.1 3 0.3
Expansion
Market 0.2 4 0.8 2 0.4 3 0.6 2 0.4
Share
Total 1.0 2.90 2.00 2.90 2.55

The intense competition in the telecom industry has made it really difficult to
survive the financial crunch has added to the difficulties of the telecom
service providers. The most important factors in that need to be considered
while making a strategic plan are customer loyalty which generally is based
on the quality of the service provided and this determines the market share
of the firm. Advertising is a double edge sword; good promotion attracts the
customer while bad one distracts them. In telecom industry a common

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practice is to eat competitor’s market share by indulging into price wars but
one must set a limit otherwise it could backfire and sunk the company.
Company needs to plan all its operations depending on its financial health
never ever pick up industry giants for one on one fight and avoid taking
leverage position instead go for the cost cutting strategy.

By looking at the matrix it is evident that Mobilink and Ufone are at the front
while Warid is lagging behind in competition. On the other hand Zong’s
performance is average in industry.

INTERNAL ENVIRONMENT

LONG TERM OBJECTIVES

1. To deliver increased profitable growth

Telenor seeks to increase core mobile revenues. Telenor is also investing in

adjacent markets such as basic financial services and machine-to-machine
(M2M) communication.

2. To strengthen our performance culture

Telenor will continue the successful practice of combining a local approach

with global expertise. This means that the local management teams will
build a unique performance culture based on their own initiatives and in line
with the Telenor governance model, Codes of Conduct, vision and values and
people policy. In terms of Health, Safety and Environment (HSE), their
objective is to improve working conditions and environmental management
by having clearly defined standards across the operating company and
supply chain.

3. To make responsible business a competitive advantage

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Corporate responsibility at Telenor will be part of managing risk and linked to
the core business. Telenor has a strong track record when it comes to
sustainable business: it was ranked top performer by the Dow Jones
Sustainability Indexes (DJSI) in 2007 and 2008.

4. To provide a superior customer experience

Faced with an increasingly competitive environment, Telenor needs to

differentiate itself by providing a superior customer experience. In the vision
and core values, they put customer experience at the top of the agenda. One
of their ambitions is to reach a situation where end-users’ brand preference
is higher than the Telenor market share.

5. To ensure best practice benchmarking

A global objective is to achieve a higher reduction in the average operational

cost per minute than the expected decline in average price per minute.
Telenor aims to achieve considerable continued growth in operating cash
flow from its operations.

6. To drive change and constant renewal

To secure a strong industry position, innovation is paramount. Major areas

identified are:

• Their long-term ambition is to achieve the same position in broadband

(mobile and fixed) as they have in mobile voice today.
• Telenor aims to establish itself as a significant player in parts of the
financial services industry in select under-serviced markets,
establishing a platform for long-term growth.

• Telenor controls many valuable assets that can be further developed

together with partners. Partner-driven innovation is a cost-effective
way to create many new revenue-generating services.

Objectives 2006-07 2015

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ARPU(Average Revenue Per $4 $6- $8
User)
Market Share in terms of 10% 40%
Subscribers
Market Penetration 9% 30%
Market Share in terms of 7% 30%
Revenue
EBITA(Earning before 5% – 6% 10%
Interest, Tax and
amortization)
Unprompted Brand 20% 90%
Awareness

STRATEGIES
• Market Penetration
• Diversification in new directions and regions
• Focus on mobile internet
• Acquiring a microfinance bank
• Global expansion (Telenor has also entered the Indian market by taking
a stake in Unitech Wireless)
• Mix of differentiation and low cost
• Lower capital expense investment due to recession/ slow market
growth
• Utilize 3G technology opportunity

STRATEGY IMPLEMENTATION
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OBJECTIVES
Prepaid- djuice, talkshawk
Postpaid- persona
Achieve a SIM penetration over 70%
Attain a market share above 25%
Maintain EBITDA in mid thirties
Obtain a ratio of Capex/sales below 25% Capital expenditure was
related to network roll-out to accommodate subscription growth and
increased traffic
Increase Subscription growth

POLICIES

A STRATEGY SUPPORTIVE CULTURE

SOURCES OF CULTURE AT TELENOR PAKISTAN

PEOPLE

Telenor Pakistan consists of energetic, youthful and dedicated employees

aged 27 to 28 on average. An appropriate match is required between the
culture and employees at recruitment and hiring. If People Excellence
(Human Resource Department) feels that a person will not be unable to
adjust into the organization’s environment, even if he/she is performing
functionally well, the person is rejected.

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Primarily the culture comes from the top management. CEO of Telenor
Pakistan is humble and cooperative. The employees get the message that if
the top management is so accommodating then the employees should
behave similarly. What is important to the CEO becomes important for
employees to identify completely with the organization. There are four
foreigners in the top management but this does not create communication
barriers. They are extra humble to others while individuals of a local origin
are extra sensitive to them so no one feels alienated. The values of
humbleness and free interaction in putting forth ideas lead to a harmonious
culture and efficient communication. The management is easily accessible to
discuss various issues. It is difficult to distinguish between them as the
culture is so homogeneous that it keeps every one at par with others (no
formal protocol is given).

ORGANIZATIONAL ETHICS

While making any decision, Telenor Pakistan has been ethically conscious.
Since Telenor (the parent company) has is origins in Norway, a society with a
soft-oriented and feminine culture, Telenor Pakistan acknowledges its moral
and ethical duty towards its stakeholders and society. Telenor Pakistan will
not resort to bribery or illegal offers to accept any decision; values will not be
compromised to get licensed. If the organization believes it is not ethically
right, it will never take that decision.

In most of advertisements they project themselves as the care taker of the

values of Pakistani people, so they claim to cherish the core cultural norms
and values of the Pakistani people. When the cartoon controversy arose,
Telenor condemned such actions mocking religious beliefs and portrayed this
on their building.

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ORGANIZATIONAL STRUCTURE

The organic structure of Telenor Pakistan promotes cultural values that result
in integration and coordination.

CEREMONIAL RITES AT TELENOR PAKISTAN

Type of Rite Instances of Rite Purpose of Rite

Rite of passage Orientation Sessions Learn and internalize
values
Rite of integration Eid Milan Programs, Halloween Build and reinforce
Parties and announcements of common values
Telenor’s success
Rite of Legends, Press Releases, Integrate and
enhancement Employee of the Year Rewards, enhance cultural
Employee Promotion and values
Rotation

At Telenor, People Excellence reinforces the culture through the concept of a

‘LEGEND’ for individuals who have performed outstandingly. These become
role models for other people and their examples are quoted on various
occasions (forum or ceremonies), so every employee is internally motivated
to work harder.

The new recruits are given orientation sessions where they are made to
familiarize with the values and norms of the organization and how they can
contribute to the organization even better. They are also provided with a
Joining Book that comprises of the code of conduct and complete structure of
policies and values.

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HUMAN RESOURCE STRATEGIES
The Human Resource at Telenor Pakistan is their core competency. The
reason is that the employees create a culture and all the achievements of
Telenor are attributed to its flexible culture. It is necessary to motivate and
retain this asset of the organization. For this purpose, training and
compensation is provided to employees along with other motivational
techniques.

TRAINING

The methods of training differ from function to function. On-the-job

training is required in the Customer Relationship Department (CRD)
and similar system training in the IT Department. Management Training
Programs combine experiential learning with theory. Leaders are
chosen according to the following role expectations:

LEADERSHIP EXPECTATIONS FOR TELENOR PAKISTAN

COMPENSATION

The core compensation includes:

Base salary
LEADERSHIP
EXPECTATIONS
Bonus/commission

Long-term incentive plans

In addition, Telenor offers a total package that may include insurance,

recreational activities and other benefits adapted to the local market
and individual employee’s need.
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 Managers are rewarded according to the achievement of assigned
goals. Apart from monetary rewards, such as variable pays/increments,
other motivational tools such as recognition (Employee of the Year
rewards) are used.

CAREER GROWTH

Initially, qualifications are the defining criterion for fresh graduates. For
career growth, the right mix of performance on the job and
performance potential for the other level is imperative. Apart from the
right attitude, knowledge also matters. If an individual from Finance
gets a higher degree, for instance, becomes a chartered accountant
then the chances of growth increase. There are no specific career
paths: Vice President (VP) of Human Capital Division (HCD) became the
next Chief Marketing Officer (CMO).

EMPLOYEE MOTIVATION

Underperforming managers are encouraged through coaching and

counseling by their respective directors or the director of People
Excellence. The turnover is not high as compared to that of the
industry. There is no defined employee exchange program. Employees
performing exceptionally well are taken up to work in the Telenor
Group.

Relocations are common in the organization: employees are

transferred from People Excellence to Finance or from Procurement to
Customer Relations. Investment per employee is placed at the higher
end of the industry.

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DIVERSITY
Telenor Pakistan is keen to promote diversity and has achieved good results
in this area. Telenor has developed requirements for diversity in both
recruitment and our management development programs. There is an
appropriate blend of less seasoned and experienced employees. No quota
has been assigned; the best-fit candidate (according to the job requirements)
is employed. At the office level or call centers, even fresh graduates are apt
but the director level requires a masters degree and preferably some work
experience.

Telenor Pakistan has a large proportion of females who are recruited for
internal leadership development programs and executive positions on the
basis of past performance. The organization is working on Day Care Centers
to help female employees manage their responsibilities after settling down.
Relocation issues are dealt cooperatively when female individuals move out
of the city after marriage and wish to continue working. They are relocated
and facilitated in the new city.

STRATEGY EVALUATION
REENGINEERING: AFTERMATH OF FINANCIAL CRUNCH

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Telenor has attained a competitive advantage in the market by aligning
competences and strategies. Highly motivated employees and flexible
culture enables them to achieve an edge over competitors.
COMPETITIVE ADVANTAGES OF TELENOR PAKISTAN

Improving our performance management

The Telenor Group aims to create a stronger link between the strategy
process and performance monitoring. All operating companies will
implement a new and improved management model where strategic
objectives and ambitions are monitored closely at both the company level
and the lower department level.

Since its launch of services in March 2005, Telenor Pakistan has exceeded all
expectations: It has created the second largest mobile network and the
largest and most advanced data network in the local market, turned into the
second highest revenue-generating mobile player with the highest Average
Revenue Per User (ARPU) in the market, and become the second largest
mobile player in the market with 18 million active subscriptions in little more
than 3 years of operations. During the first half of 2008, Telenor Pakistan
added 3.24 million subscriptions against the industry average of 1.63 million,
taking 33% of the market share of net additions over the period – the highest
in the mobile sector in Pakistan.

The company has created 2500 direct and more than 25000 indirect
employment opportunities with 100,000+ retail outlets and 200+ franchises
in addition. 99.9% of these employment opportunities belong to Pakistanis.

Initiated with a relief effort worth 95 million rupees in the wake of the
devastating earthquake of October 2005, Telenor Pakistan’s community
contributions have extended over the years to include education,
empowerment, enterprise, and environment - with special focus on bringing
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the telecom promise within the grasp of the most disadvantaged sections of
the society.

Telenor Pakistan has received several awards for its solid performance in key
areas of activities:

Federation of Pakistan Chambers of Commerce & Industry’s Telecom

Excellence Award in Foreign Direct Investment in June 2006
Central Board of Revenue’s High Tax Payer Award 2004-5 in January
2006
The Pakistan Society of Human Resource Management’s Preferred
Graduate Employer Award for Most Preferred Telecommunications
Company 2007 among MBA students
SAARC Communication Industry Conference 2007’s Most Innovative
Mobile Operator Award and Mobile Operator with the Most Consumer
Pull Award
Telenor Global Brand Award for the year 2007
All Pakistan Dawn Aurora Advertising Awards in three of five nominated
categories in March 2007
The National Forum for Environment & Health’s Annual Environment
Excellence Awards 2008
Lahore Chamber of Commerce & Industries’ Appreciation Award for the
Largest FDI and Rawalpindi Chamber of Commerce & Industries’
Achievement Award 2008
The Helpline Trust’s 2nd Corporate Social Responsibility Award 2008

Telenor Pakistan is committed to bringing true mobile innovation to the

under-served masses of Pakistan. The company has picked up two Universal
Service Fund projects in order to provide connectivity to the yet unconnected
in the remotest areas of Pakistan. It aims to invest strongly for further
network expansion into the rural areas and for the rollout of third generation
of mobile technology (3G) in Pakistan.
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SWOT Analysis

An overall evaluation of Telenor’s Strengths (S) Weakness (W) Opportunities

(O) and Threats (T) are as follow:

Strengths

Network quality & design

Superior customer care

Financial Strength

Excellent Coverage & Distribution.

Commercial Launch of LDI & mobile services

Contract with Siemens & Nokia

Brand image of Quality

PTA initiatives

E-commerce usage.

Weaknesses

Relatively low market share

Low profit margins

Negative cash flows in the initial years

Opportunities

Favorable Macroeconomic indicators

low cellular market penetration

Inefficiency & poor performance of other mobile networks

Co branding e.g. Ufone with ABN AMRO

Strategic Alliances & Infrastructure Sharing Facilities

International Mobile Equipment Identity System

Threats
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 Rolling Customers

Privatizations & deregulations- increased competitions.

Grey Traffic

MNP mobile number portability

Wireless technology at boom

Public pay phones & calling cards usage where network is not available

Propagandas attacking brand image

Strengths Weaknesses

Opportunities SO Strategies WO Strategies

• Introducing 3G • Diversifying into
service similar industries
• Make the post e.g. DSL services
paid package • More attractive
more attractive pre-paid packages
Threats ST Strategies WT Strategies
• Co branding with • Protect image
companies in through constant
other industries CSR efforts
e.g. Banks • Capitalize and
• Use other promote EDGE
mediums of technology
promotion other
than conventional
advertising
BCG

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Boston Consulting Group is used to help corporations with analyzing
their business units or product lines. This helps the company allocate
resources and is used as an analytical tool in brand marketing, product
management, strategic management, and portfolio analysis.

This BCG matrix is with respect to the competition that exists for Telenor in
the telecom industry. This includes the following mobile operators:

• Mobilink
• Ufone
• Warid
• Zong

The reason
why all the companies are place in either question mark or star is that it is a

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growing industry and overall the market share is increasing however
individual players may not be doing well.

The reason why telenor and Ufone are placed in stars is that their relative
market share is increasing which is visible by their sales and ARPU. Mobilink
although very old in the market is now losing its relative market share to
both Ufone and Telenor. Mobilink is now investing in its brands and have
engaged in price wars to stay competitive and regain its market share.

Same is true for Warid and Zong, the only reason why they are placed in
question mark is that the overall industry is growing however their individual
performance has been poor over the years. Ufone has changed its strategic
policies. It has gone through rebranding and emerged as a more successful
company.

Now if we talk about Telenor ,it has gained a favourable position in the
industry through effective advertising and packages. It can also be attributed
to effective utilization of its Human Resource to gain a competitive
advantage in the in the industry.

FUTURE OUTLOOK
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 Following can be the future plans of action that Telenor can pursue in order
to ensure sustainable growth:

Improve network quality to make it a sustainable competitive

advantage

Develop an employee exchange program for enhanced employee

motivation

Establish a coordination department/integrated IT system for effective

communication

Introduction of employee stock options

Quota for the disabled people for greater CSR and diversity

Building an organization with competency, capabilities and resource

strengths

Developing Technical Know How in Employees

Developing budgets to steer ample resources into critical value chain

activities

Creating strategy supportive policies and procedures

Instituting best practices and a commitment to continuous

improvement

Installing support systems and Value added Services

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 Maintain low cost

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