Human Resource Management

Topic:- HR practices of two organizations Airtel &

Vodafone

Profile of Airtel & Vodafone .

Role of HR.
Employer Rankings.
Compensation.
Job Description.
Comparative analysis.
India government suggestion.

Trai Recommendations on 2G spectrum.

Business Strategy.
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Company Profile of Airtel

We are one of world’s leading providers of telecommunication services with presence in all
the 22 licensed jurisdictions (also known as Telecom Circles) in India, and operations in
Srilanka, Bangladesh and Africa. We served an aggregate of 207.8 million customers as of
December 31, 2010; of whom 199.6 million subscribe to our GSM services and 3.2 million
use our Telemedia Services either for voice and/or broadband access delivered through DSL.
We are the largest wireless service provider in India, based on the number of customers as of
December 31, 2010. We offer an integrated suite of telecom solutions to our enterprise
customers, in addition to providing long distance connectivity both nationally and
internationally. We also offer Digital TV and IPTV Services. All these services are rendered
under a unified brand "airtel".

The company also deploys, owns and manages passive infrastructure pertaining to telecom
operations under its subsidiary Bharti Infratel Limited. Bharti Infratel owns 42% of Indus
Towers Limited. Bharti Infratel and Indus Towers are amongst top providers of passive
infrastructure services in India.

Inthe2000s,telecommunications(telecom)companyBhartiAirtelLimited(BAL)wasthemarket
leader in the Indian telecom market. It had established itself as the leader in the market by
differentiating itself with its focus on building a strong brand through innovation in sales,
marketing, and customer service, and an innovative cost effective business model. Analysts
also credited BAL with negotiating the regulatory hurdles in this emerging market and
competition very effectively. This enabled it to become profitable despite the Indian telecom
market having the lowest tariffs in the world.
Some analysts opined that BAL's unique business model had become the benchmark for
emerging markets. Mobile telephony in India was experiencing the fastest growth in the world
and India was already one of the leading markets in terms of mobile subscriber base. Despite
Average Revenue per User (ARPU) figures in the country being quite low compared to many
other markets, it was viewed as an attractive market as mobile penetration of the market,
particularly in the huge rural areas in India, was still low. With the developing market in the
West reaching high levels of saturation (70% in US and 100% in some European markets), many
global telecom operators were looking at emerging markets for their growth and this made India
a prime target market for these firms. The market in India was also expected to witness many
changes with the introduction of new technologies and mobile number portability.

BAL had been facing serious threats to its leadership position. On the one hand, there was the
onslaught from global players such as Vodafone and Virgin Mobile, and on the other, the threat
from established Indian companies such as Reliance Communications Ltd., Tata Teleservices
Ltd., and the state-owned Bharat Sanchar Nigam Ltd (BSNL). Moreover, the market was
expected to witness the entry of some more Indian and foreign companies. BAL had responded
to investing heavily in expanding its network, technology, and marketing. It was trying to cover
all segments of the population -from the tech-savvy youth population who coveted the latest
value-added services (VAS) to the Bottom of the Pyramid (BoP) segment who would be satisfied
with a low-cost offering.

In early 2008, BAL, which still dominated the Indian telecom market and was the world's tenth
largest telecom company, was also readying itself to replicate its success story in some other
emerging markets.

Company profile of vodafone

Vodafone was launched in Fiji on 5 July 1994. Vodafone Pacific owns a 49 per cent interest in
Vodafone Fiji and Telecom Fiji Ltd owns the remaining 51 per cent. The company is a GSM 900
network operator using the Ericsson switch. There have been continuous upgrades of the switch
to be in line with the advancement in technology, services and support. Vodafone began the
business with 13 radio base stations covering all major centres. Currently there are 70 radio base
stations around the country in all the urban centres, along highways and in several rural locations
covering 50 of the population. The current plans are to install 8 more radio stations by the end of
the year.

Indian Telecom Industry & role of HR in it, With emphasis

on Airtel & vodaphone
1. The Indian telecommunications has been zooming up the growth curve at a feverish pace,
emerging as one of the key sectors responsible for India's resurgent economic growth. India
is has surpassed US to become the second largest wireless network in the world with a
subscriber base of over 300 million in April, according to the the Telecom Regulatory
Authority of India (Trai). The year 2007 saw India achieving significant distinctions: 1
having the world's lowest call rates 2-3 US cents 2 the fastest growth in the number of
subscribers 15.31 million in 4 months 3 the fastest sale of million mobile phones in a week 4
the world's cheapest mobile handset US$ 17.2 5 the world's most affordable color phone US$
27.42 1
2. 6 largest sale of mobile handsets in the third quarter Segment-wise growth Wireless segment
has emerged as the preferred mode of telephone service by the consumers, reflected in the
rising share of mobile phone connections to total connections. 1. The share of mobile phones
has increased from 71.69 per cent at the end of March 2006 to 87.68 per cent at the end of
May 2008.
3. With such growth projection, this industry is likely to see increased investments. In fact, total
investment is projected at US$ 76.6 billion during the eleventh plan period (2007-12). Private
sector is estimated to continue its dominant share, accounting for 67 per cent of the total
projected investment while public sector accounts for the rest. Top players The top players
based on cellular subscriber (in millions) base were Cellular services can be divided into two
categories: Global System for Mobile Communications (GSM) and Code Division Multiple
Access (CDMA). The GSM sector is dominated by Airtel, Vodafone-Hutch, and Idea
Cellular, while the CDMA sector is dominated by Reliance and Tata Indicom. Surprisingly,
CDMA market has increased its market share up to 30% thanks to Reliance Communication.
However, across the globe, CDMA has been losing out numbers to popular GSM technology,
contrary to the scenario in India reasons for growTh 5
4. The two major reasons that have fuelled this growth are 1. low tariffs 2. falling handset
 prices. problems faced The bottlenecks for ' Indian Telecom Industry ' are:  Slow reform
process.  Low penetration.  Service providers bears huge initial cost to make inroads and
achieving break-even is difficult.  Lack of infrastructure in semi-rural and rural areas,
which makes it difficult to make inroads into this market segment as service providers have
to incur a huge initial fixed cost.  Huge initial investments.  Limited spectrum
availability and interconnection charges between the private and state operators. rural
Telecom markeT – an emergIng markeT According to numbers compiled by the Telecom
Regulatory Authority of India, nearly 21 per cent of the mobile user base now reside in the
villages of India, where a few years ago none of the operators wanted to venture. As on
September 2007, out of the 209 million mobile users in the entire country, 43 million were in
rural areas. 6
5. Rural India will wrest 40 percent of new telecom market India’s rural telecom connectivity is
poised for explosive growth in the next five to 10 years, grabbing a 40 percent share of the
new market, a study released Wednesday said. “Of the estimated new 250 million Indian
wireless users, in next 5-10 years approximately 100 million will be from rural areas,” said
the study by the Federation of Indian Chambers of Commerce and Industry (Ficci) and Ernst
and Young. Operators have demonstrated they can achieve profitability by reducing fixed
costs, controlling variable costs and carefully tailoring services to the requirements of their
customers. A similar model with minor customization could be emulated in the rural areas.
The government will roll out new incentives for mobile networks in rural India. It’s also
planned that the ultra-low cost handset of approximately Rs.840 ($20) to the market with
built-in subsidies, lifetime validity and minimal maintenance costs have promoted mobile
usage in remote areas. Moreover, operators could learn from business models that have been
experimented across the developing world for expanding rural connectivity. Reasons for rural
inclination Far from being considered as a social obligation, offering telecom services in
rural areas has now become the hot spot for private telecom operators. Nearly 75 per cent of
the mobile users in the villages are now owned by private operators as cellular phones catch
the imagination of rural consumers. Until now, state-owned Bharat Sanchar Nigam Ltd was
known to be the only significant rural telecom operator in the country. Analysts said that the
share of rural telecom consumers will continue to increase as operators have initiated an
aggressive roll-out plan to cover remote areas of the country. This is primarily driven by a
slump in the growth rate of mobile user base in the metro and urban areas. According to the
data released by the Cellular Operators Association of India Circle C and Circle B States
such as Bihar, Kerala, Madhya Pradesh and Punjab are showing better growth rates
compared to the metros. Therefore, most of the mobile operators are investing heavily in
setting up infrastructure in these circles. 7
6. The telecom regulator has suggested a number of initiatives to make mobile connection
attractive, including lower entry cost to make it more affordable. In a hi-tech market like
telecom, Schumpeter's view that competition through innovation is more important than price
holds significance. Technology advancements, lower costs and competition translate this into
benefits for the consumer. Moreover, competition drives innovation.quot; - Poonam Madan
Sarmah, Head of Research, Genesis PR. quot;We are looking at making the phone a more
useful product than just an instrument to exchange voices. We want to be identified as a great
value-added service provider.quot; - Harit Nagpal, Vice President (Corporate Marketing),
Vodafone “Talented persons are like frogs in a wheelbarrow, which can jump at any point of
 time when they sense opportunities” human resource managemenT The goal of human
resource management is to help an organization to meet strategic goals by attracting, and
maintaining employees and also to manage them effectively. 8
7. The process involves carrying out a skills analysis of the existing workforce, carrying out
manpower forecasting, and taking action to ensure that supply meets demand. This may
include the development of training and retraining strategies. Through HRP an organization
strives to have the right number & the right kind of people at the right place at the right time.
recruITmenT According to Edwin B. Flippo, “Recruitment is the process of searching the
candidates for employment and stimulating them to apply for jobs in the organization”.
Recruitment is the activity that links the employers and the job seekers. Usually, the
recruitment process starts when a manger initiates an employee requisition for a specific
vacancy or an anticipated vacancy. However, Recruitment is a continuous process whereby
the firm attempts to develop a pool of qualified applicants for the future human resources
needs even though specific vacancies do not exist
8. laTesT Trends In recruITmenT 1. OUTSOURCING The outsourcing firms help the
organization by the initial screening of the candidates according to the needs of the
organization and creating a suitable pool of talent for the final selection by the organization.
Outsourcing firms develop their human resource pool by employing people for them and
make available personnel to various companies as per their needs. In turn, the outsourcing
firms or the intermediaries charge the organizations for their services. 2.
POACHING/RAIDING “Buying talent” (rather than developing it) is the latest mantra being
followed by the organizations today. Poaching means employing a competent and
experienced person already working with another reputed company in the same or different
industry; the organization might be a competitor in the industry. A company can attract talent
from another firm by offering attractive pay packages and other terms and conditions, better
than the current employer of the candidate. But it is seen as an unethical practice and not
openly talked about. It has become a challenge for human resource managers to face and
tackle poaching, as it weakens the competitive strength of the firm. 3. E- Recruitment Many
big organizations use Internet as a source of recruitment. E- recruitment is the use of 11
9. technology to assist the recruitment process. They advertise job vacancies through worldwide
web. The job seekers send their applications or curriculum vitae i.e. CV through e mail using
the Internet. Alternatively job seekers place their CV’s in worldwide web, which can be
drawn by prospective employees depending upon their requirements. Top 5 Job Sites 1
www.naukri.com 2
10. Flexible work arrangements are on the rise. Sixty percent of employers offer flexible work
plans now — usually alternative schedules (shifted start and quit times), condensed work
weeks or telecommuting, while 39 percent expect to offer some form of flex-time in ‘08. 3)
Online candidate screening will grow, and not only the use of qualifying pre-application
questions, but full-blown searching of social networking sites and search engine checks. 4)
Video & audio Resume will be preferred as is a way for job seekers to showcase their
abilities beyond the capabilities of a traditional paper resume. The video resume allows
prospective employers to see, hear and get a feel for how the applicant presents themselves.
5) Retiree rehiring will increase as companies remain pressured from the loss of more
experienced workers. Twenty-one percent say they are likely to rehire retirees from other
 companies in 2008; another 14 percent plan to provide incentives for workers at or
approaching retirement age to stay on with the company longer. The numbers here aren’t
large, but this trend won’t go away. 6) Recruiting diversity workers, especially workers
bilingual, will continue to be an important focus of recruiters. Survey respondents
particularly noted “mature” workers. 7) Freelance or contract hiring will continue to be a key
part of the workforce mix, with 31 percent of employers anticipating a working relationship
with freelancers or contractors this year. 8) Perks and benefits will receive more attention
from companies wanting to remain competitive in attracting and keeping workers. In light of
rising healthcare costs, nearly one- in-five employers (19 percent) report their companies
plan to offer more comprehensive or better health benefits to employees in 2008. Ten percent
plan to enhance or add perks such as bonuses, discounts, company cars, stock options, free
childcare, educational reimbursement, transit passes and wellness programs. 9) One in four
(26 percent) of the surveyed companies are likely to provide more promotions and career
advancement opportunities in 2008. More than half of workers stated that a company’s
ability to offer career advancement is more important than salary, so employers are taking
action to carve out career paths for employees. Twenty-seven percent of workers say they are
dissatisfied with pay, but 67 percent of workers reported they received a raise in 2007. A
quarter of the surveyed workers plan to change jobs within the next two years: 41 percent are
leaving their jobs to find a position with better pay and/or career advancement opportunities;
8 percent are changing careers; 7 percent say they want to find a company where they would
feel appreciated; 7 percent are retiring; and 5 percent plan to start their own business. This
survey was released by CareerBuilder.com conducted by Harris Interactive, tracking
projected hiring trends for 2008. The 2008 Job Forecast survey is based on the responses of
3,016 hiring managers and human resource professionals in private-sector companies. 13
11. Around 1 lakh people in its workforce. The telecom sector has a huge demand for the trained
and qualified engineers and other professionals specializing in telecommunications.
Compensation: According to various studies in recent times, the telecom sector offers the
best salary packages at the entry level i.e. an average of 20k. The average hike in salaries
across the various levels in the telecom sector ranges from 15 to 20 percent. Incentives also
form a part of the compensation till the middle levels. Attrition and retention: Although the
sector faces the moderate attrition rates of 20 to 25 percent, the HR’s prime strategic function
in the sector is retaining the talent and employee engagement. The only functional area which
faces the high attrition rate is the sales people in the telecom industry.
12. Here rankings of the ten companies in the Indian Telecom sector are given on the basis of
their workforce relationship factors. Ten companies were selected on random basis from the
sector. The companies were given a consolidated rank on a scale of 1-10 on the basis of sum
of their individual ranks on various HR practices, procedures, policies and parameters like
recruitment practices, compensation policies, work culture, recognition for good work,
retention, training and development, performance appraisals et al. The scores are
consolidated on the basis of data collected through recent surveys and studies by renowned
names like Business Today, Hewitt, IDC Data Quest, NASSCOM and naukrihub.com hr
challenges In recruITmenT In the last few years, the job market has undergone some
fundamental changes in terms of technologies, sources of recruitment, competition in the
market etc. In an already saturated job market, where the practices like poaching and raiding
are gaining momentum, HR professionals are constantly facing new challenges in one of
 their most important function- recruitment. They have to face and conquer various challenges
to find the best candidates for their organizations. The major challenges faced by the HR in
recruitment are: 1. Adaptability to globalization – The HR professionals are expected and
required to keep in tune with the changing times, i.e. the changes taking place across the
globe. HR should maintain the timeliness of the process 2. Lack of motivation – Recruitment
is considered to be a thankless job. Even if the organization is achieving results, HR
department or professionals are not thanked for recruiting the right employees and
performers. 3. Process analysis – The immediacy and speed of the recruitment process are the
main concerns of the HR in recruitment. The process should be flexible, adaptive and
responsive to the immediate requirements. The recruitment process should also be cost
effective. 4. Strategic prioritization – The emerging new systems are both an opportunity as
well as a challenge for the HR professionals. Therefore, reviewing staffing needs and
prioritizing the tasks to meet the changes in the market has become a challenge for the
recruitment professionals. 5. Attracting highly talented ones - The number of highly talented
professionals is less. All the big MNC's are trying to attract these people with high salaries,
perks, incentives etc. There is a tough competition among these companies to get these
candidates on their roles.
13. Our Vision & promise By 2010 Airtel will be the most admired brand in India:  Loved by
more customers  Targeted by top talent  Benchmarked by more businesses “We at Airtel
always think in fresh and innovative ways about the needs of our customers and how we
want them to feel. We deliver what we promise and go out of our way to delight the customer
with a little bit more” Bharti Airtel Telecom giant Bharti Airtel is the flagship company of
Bharti Enterprises. The Bharti Group, has a diverse business portfolio and has created global
brands in the telecommunication sector. Airtel comes to you from Bharti Airtel Limited,
India’s largest integrated and the first private telecom services provider with a footprint in all
the 23 telecom circles. Bharti Airtel since its inception has been at the forefront of
technology and has steered the course of the telecom sector in the country with its world
class products and services. The businesses at Bharti Airtel have been structured into three
individual strategic business units (SBU’s) - Mobile Services, Airtel Telemedia Services &
Enterprise Services. The mobile business provides mobile & fixed wireless services using
GSM technology across 23 telecom circles while the Airtel Telemedia Services business
offers broadband & telephone services in 94 cities. The 18
14. fuTure developmenT In the mobile business, Bharti Airtel plans to make considerable
investments in Network expansion to establish presence in all census towns and over 500,000
villages across India by 2010, thereby covering 95% of the country’s total population. The
company’s strategic focus will be on further strengthening the Airtel brand through best-in-
class customer service, which is backed by wide national distribution. The Airtel subscriber
base according to COAI - Cellular Operator Association of India
15. Enters into the league of the world’s top telecom companies, moves towards top 5 global 
mobile companies Adding 25000 towers every month expanding their network all over
India. Wide range of Value Added Services – like ringtones, caller tunes, news etc One
of the 1st company to introduce mobile banking, mobile bill payments etc For Employees
It has 25000 employees & with increase in network, it has wide prospects. Provide
attractive salary to employees, performance turnover, ESOPS( Employee Stock Options
 Programme) Provides an opportunity for career growth – from Management trainee to
CEO. Gives an opportunity to employee to grow vertically as well as horizontally.
Gives an opportunity to move any part of the country considering they have network
everywhere.. TargeTs  Aggressive efforts are on to provide a superior network service that
is congestion-free and to help customers get connected the first time.  Also, the SMS
capacity is sought to be raised from the current 5,500 messages per second to 6,500 messages
per second by March 2009.  After establishing itself in the domestic market, Airtel is now
spreading its wings in US by providing its mobile service under the name 'CALLHOME' to
the NRIs. adverTIsemenTs Airtel’s advertising campaigns are always admired. Their idea of
creating a signature ringtone with A R Rehman was brilliant; and they still continue to use
that tone. In a masterstroke they elevated the brand without having to talk of talk time , rates
etc. Then came the almost magical ‘Express Yourself ‘ campaign stunningly executed with
excellent imagery and creativity. It showcased the ubiquitous utility of the mobile phone
through the situations ( a fighting couple, a bride entering church, an irate mob) but
converted a rational purchase decision to an extension of one’s voice. And from that Bharti’s
market share has kept increasing to being the biggest mobile service provider. 22
16. People in the rural markets are ready to go mobile and the growth depends on the strength
and the quality of the network. Distribution has been growing at a rapid pace and Airtel will
be in easy reach for all customers in the State. “We want to increase the brand presence and
become far more local
17. 98% of organizational success depends upon efficient employee selection The TalenT
acquIsITIon / recruITmenT process The recruitment process is the basic procedure, however
there are few changes in different departments, for e.g. IT dept & Customer Care dept cannot
have same type of recruitment process as the abilities & skills required are different in
different department. However the basic process is as following : 1. Prepare the
organizational chart with the support of respective departments based on industry norms &
projection of growth. 2. Co-ordinate with all departments for their manpower requirements.
3. Create the job profile and person specification as per department requisition. 4. Create the
company profile for advertising the company to attract prospective candidates & also for the
consultants etc. 26
18. Follow internal or external methods of Recruitment Commonly used External Methods i. Co-
ordinate with recruitment agencies & HR consultants e.g.. HEED Consultancy, ABC
Consultancy etc ii. Advertisements in print e.g.. Times Ascent, Hindustan Times etc iii. Web
- in own website or portals like naukri.com, monster.com etc. iv. Campus Recruitments
Commonly used Internal Methods (IJR – Internal Job Requirement) i. Employees Referral ii.
Transfer & Promotions 6. Application Scrutiny & Preliminary Screening . 7. Shortlist for
preliminary interview – telephonic, video conferencing, personal interview. 8. Organizing
further rounds of interview with department heads etc depending upon the position. 9.
Briefing company profile to potential candidates, convincing them about the organisational
strength & about their career path & Compensation. 10. Providing offer letter to selected
candidates & help them in joining formalities within the organization. 11. Induction,
followed by training as required. 12. Taking monthly/quarterly feedback from the department
about the candidates who have joined. 13. Organizing market survey of salaries, job
opportunities etc.
19. When we progress your application, you will be contacted by phone and informed of the next
steps, which may include an initial telephone interview or face-to-face interview. Step Four –
Assessments and Reference Checks When you progress to the next stages, for some roles you
may be required to participate in psychometric assessments and for all roles there will be
reference checks, so please be prepared to provide at least two professional referees for us to
contact. These referees must ideally be people you have reported to in prior positions - or at
least people who have working knowledge of your abilities and experience. Step Five - Being
Made an Offer If you are successful in becoming the preferred candidate, you will be advised
of the offer by telephone and promptly provided with a written employment agreement. The
offer of employment is valid for a finite period of time and requires your acceptance by
signature and its return to our HR Department.

Telecom Sector Employer Rankings

India stands as one of the largest and fastest growing telecom markets of the world. Having more than
264.77 million telephone connections and the subscribers base growing steadily at a rate of around
82.2 percent, Indian telecom market currently stands at the third position in the global market. The
year 2007 was stated as the “Year of Broadband” in India.

India is fast emerging as the Telecom hub of the world both in terms of the growing demand, size of
the market, setting up of the manufacturing facilities in India by leading players across the world and,
the inflow of FDI, which is currently the highest in all the sectors of Indian industry. The Indian
telecom market can be divided into three segments: the mobile (wireless) market,

Compensation:
According to various studies in recent times, the telecom sector offers the best salary packages at
the entry level i.e. an average of 20k. The average hike in salaries across the various levels in the
telecom sector ranges from 15 to 20 percent. Incentives also form a part of the compensation till
the middle levels.

Job Description :
Monitor and coordinate Payroll Operation processes to deliver consistent error-free payroll
output across the organization. Provide support for integrating the Payroll Management System
with Oracle HRMS & other systems for better service delivery. Looking after Retirals like PF,
Gratuity, Superannuation coordination with the Third party vendors, employees , Finance & HR.
Timely & Accurate Payroll service delivery for business entities/circles.1.Interface with payroll
coordinators at business entities/circles for timely inputs to the vendor.
Checking completeness and accuracy of inputs as per policies/guidelines.
Interface with the Vendor for processing of inputs and timely output delivery to the payroll
coordinators
Check and confirm effectiveness of payroll processing with payroll coordinators and outsource
partner and devise & implement processes for improvement.
Provide necessary support in Implementation of payroll automation and integration with Oracle
HRMS1.Analysis of current policies/process and provide basic rules for automation of payroll
process
Check and confirm local practices/systems followed in the business units and policy/process
gaps across organisation, prepare overall guidelines and provide required information for
automation.
Payroll Query resolution1.Resolution of escalated one-to-one queries from Payroll Coordinators
and Outsource Processor/Vendor
Understand, gather the data and provide resolution to escalated queries from employees related
to payroll process.
Implementation of various types of Dashboard / Metric Report .1. Dashboards/reports for
decision making
Identify gaps in existing processes and undertake projects for improvement in the service
delivery & policy/statutes compliance.

Comparative analysis of sales and distribution between

airtel & vodaphone
1. This project aims to study the distribution channels, sales network and service patterns of
the telecom sector through an analytical and comparative study of two leading companies-
Bharti Airtel Limited. & Vodafone Ltd. The project also tries to bring out the shortcomings,
if any, in the present system and thus recommends suggestions to improve the same. The
project also gives insights into the various financial terms, norms of the sales and service
departments as per the guidelines of the telecom industry. The project was designed after
detailed discussion with the company officials on three parameters i.e. distribution network,
service network and sales functioning. The project also includes the insights given by the
dealers and officials of the company. Firstly, the project discusses the distribution network
of the two companies and the functions carried out by the channel members. Bharti Airtel
Limited being the largest services provider in India definitely has a wider reach and more
number of dealers than vodafone. The project also covers the financial terms of the
company with the dealers and that of the dealers with the customers. Secondly, the project
discusses the sales functioning of the two companies, which includes aspects such as the
hierarchy of the sales department prevalent in the company; the responsibilities and
functions of the sales force, their performance appraisal structure etc.
2. Finally the project covers the service network of the two companies which deals with the
after sale services and their effectiveness provided by both the companies and various
complaints and queries are handled by them. Acknowledgements
3. The objective of this project on sales and distribution is to do an analytical and comparative
study of the sales, service and distribution function of two players from the chosen business
sector. The business sector chosen for this purpose is the fast growing telecom sector, and
the players chosen for study from this sector are: Bharti Airtel Limited Vodafone Limited
4. Interviews & Discussions with the company officials, dealers and Sales people.
Questionnaires were used to record data. LIMITATIONS: It was difficult to ask for time
required for a detailed discussion on the questionnaire & therefore several aspects of the
 questionnaire were answered briefly. The company officials did not divulge details about
competitive sales policies, strategies & certain financial terms with dealers as they find it to
be a confidential piece of information of the company. Indian Telecom Market SIZE • India
is the fifth largest telecom services market in the world; $17.8 billion revenues in FY 2005 •
Industry grew by about 36% in FY 2005 over FY 2004 • The Indian telecom market size of
over $8.3 billion is expected to treble itself by year 2011-2012, according to Ernst &
Young. "The Indian telecom market size of over $8.3 billion is expected to treble itself by
financial year 2012. Thus there is a significant opportunity for telecom players. • Telecom
market has grown at about 25% p.a. over the last 5 years • Wireless segment subscriber
base grew at 85% p.a.: fixed line segment at about 10% p.a.
5. STRUCTURE • The Indian telecom market has both public and private sector companies
participating: • Public sector has over 60% market share, down from 90% in 2000 • Private
companies have added subscribers at a CAGR of 192% since 2000 • Mobile operators have
deployed both CDMA ( 16 million users) and GSM (55 million users) wireless networks •
Value added service features constitute 10% of revenue today (2 % in 2001) POLICY •
74% to 100% FDI permitted for various telecom services • FIPB approval required for
foreign investment exceeding 49% in all telecom services • 100% FDI permitted in telecom
equipment manufacturing • India has a telecom policy aims to encourage private and
foreign investment , Highlights are • An independent regulator – the Telecom Regulatory
Authority of India (TRAI) • Revenue-share model for license issued by the Government for
telecom services in India. Unified access licenses are available for providing telecom
services on a pan-India basis • Planned opening up of National Long Distance (NLD),
International Long Distance (ILD) and other value added services. COMPANY SERVICES
INVESTOR Cellula Basi NLD ILD r c 1.Bharti Televentures Yes Yes Yes Yes Vodafone,
Singapore Telecom, Warburg Pincus 2.Reliance Infocomm Yes Yes Yes Yes Reliance
Group
6. Increasing affordability-low tariffs, easy payments plans and handset financing • Increased
coverage and availability of mobile services 2. Investment opportunity of $22 billion across
many years: • Telecom Devices and Software for Internet, Broadband and Direct To Home
Services. Set Top boxes, Gateway exchange, Modem, Mobile handsets and consumer
premise equipments, Gaming Devices, EPABX, Telecom Software • Telecom Services for
voice and data via a range of technologies • Applications and Content development ranging
from gaming to education •
7. Selection of channel members/dealers Airtel follows a strict policy in selection of the
dealers, and therefore it is necessary to fulfill the following pre- requisites to be eligible to
become a dealer: 1) The dealers should have a sound financial background. The financial
capability of a dealer is solely depended on the discretion of the company officials. 2) The
dealers should have a good market reputation, since the dealers help the customers in
forming the first impression a customer has about the company. 3) The dealer should have a
good previous track record,i.e of timely payments, no criminal background etc. 4)The
dealers should have good market penetration. The companies ability to gain maximum
customers in this era of competition solely depends on the penetration the dealers have in
the market. 5)The last criterion of dealers selection for Airtel is the area the dealers cover.
This would include different geographical areas which are covered by a dealer.
 8. RESPONSIBILITIES AND FUNCTIONS OF THE DEALERS Airtel believes in
“Customer Loyalty” and thus Airtel expects that their dealers apart from selling paint
products should perform the following functions for better customer relations’
management: 1) Sales promotion through regular promotional schemes, road shows,
campaigns etc. the expenses incurred by the dealers is shared by the company only if these
activities are for promotion of the company and not of the dealer. 2) Recruitment- done
under the guidance of certain Airtel officials 3) Training and development of manpower
with company assistance 4) Servicing according to the size of orders 5) Customer relation
management 6) Promote other products of the company The dealer should be in regular
touch with the customer, keep taking his feedback and ensure maximum customer
satisfaction. The dealer should also try and convince the customer to try newer product’s of
the company. The dealer has to thus cater to 3 major areas: Pre sale Selling Post sale
services
9. Company Background Vodafone limited Vodafone, the world’s leading international
mobile communications company, has fully arrived in India. Vodafone Essar announced
today that the Vodafone brand will be launched in India from 21st September onwards. The
popular and endearing brand, Hutch, will be transitioned to Vodafone across India. This
marks a significant chapter in the evolution of Vodafone as a dynamic and ever-growing
brand. The brand change over the next few weeks will be unveiled nationally through a
high profile campaign covering all important media. Vodafone, the world’s leading mobile
telecommunication company, completed the acquisition of Hutchison Essar in May 2007
and the company was formally renamed Vodafone Essar in July 2007. Asim Ghosh,
Managing Director, Vodafone Essar, said "We’ve had a great innings as Hutch in India and
today marks a new beginning for us. Not as a departure from the fundamentals that created
Hutch, but an acceleration into the future with Vodafone's global expertise."
Distribution network A supply chain is described that consists of all the parties and their supplied
activities that help us to create and deliver services to the final customer. The front channels are
specially kept in mind. ACTIVITIES: 1. Order 2. Handling 3. Storage 4. Display 5. Promotion 6.
Selling 7. Information and feedback. The channel structure Co. or direct sales Indirect sales
Misc. sales Business head DSA/DST Dealers G.M. Sales Manager Shop Owners Assist. Sales
Manager TLS Metro Shops Sales Consultants Telemarketing Executives Hutch Shops
Executives Field Executives Tele Marketing Executives

India government to take firms' views on telecom

regulator's suggestions
Bharti Airtel, Vodafone Essar, Idea oppose TRAI's proposal
to charge excess spectrum fee.
The Indian government and the telecom regulator said Friday they will meet with mobile phone
companies who have opposed calls for a one-time fee on operators holding excess 2G
bandwidth, as the regulator tried to soothe concerns by saying the fee wouldn't be high.
"We will discuss it in the ministry. Thereafter, due process will be taken up. If necessary, before
taking any decision through the Telecom Commission, patient hearing will be given to all
stakeholders," Communications Minister
Top operators such as Bharti Airtel Ltd., unlisted Vodafone Essar Ltd. and Idea Cellular Ltd.
have opposed the proposal of a one-off charge, which the Telecom Regulatory Authority of
India, or TRAI, said should be linked to third-generation spectrum. Auctions for 3G bandwidth
are ongoing.
The operators fear a charge would heap on yet more costs at a time when revenue and profit are
already being hurt by an intense tariff war in India, the world's fastest-growing telecom market.
Bharti condemned the TRAI's proposals after they were made public Tuesday, labeling them
"shocking, arbitrary and impractical," while Vodafone Essar described them as "illogical,
retrograde and perverse".
From Tuesday to Thursday, Bharti and Idea saw their share prices plunge 12.1% and 12.5%,
respectively. However, the stocks staged a recovery Friday after the government said it would
hear the companies' views, while they were also helped as the regulator said the one-time fee
wouldn't be high.
Bharti closed up 2.2% at INR264.45 on the Bombay Stock Exchange Friday, and Idea gained
3.2% to INR56.95. Both outperformed the benchmark Sensex, which ended 1.6% lower.
TRAI's recommendations have been sent to the Telecom Commission in the Department of
Telecommunications for approval. The commission could accept or reject the suggestions or
revert to TRAI for clarification.
TRAI Chairman J.S. Sarma told reporters that the regulator would be meeting the companies.
"Let me hear them first, what it is they have to say. We have already indicated to the
government, that we will be sending them the findings (after speaking to the companies)...so I'm
sure the government will wait before taking a final decision

Ficci proposed the meeting to thrash out the issue of

Trai recommendations on 2G spectrum

The Federation of Indian Chambers of Commerce and Industry (Ficci) will take up the cause of telecom
companies with the telecom regulator. The telecom companies are worried about the recommendations on
2G spectrum made recently by the Telecom Regulatory Authority of India (Trai).

Come Thursday, Trai would hold a meeting with the operators that is being described as a “grievances
session” by the telecom companies. A team led by Ficci along with members from the Cellular Operators
Association of India (COAI) and the Association of Unified Telecom Service Providers of India (AUSPI)
will hold a closed door meeting with senior Trai officials.
Sources in Trai said Ficci President Rajan Bharti Mittal, who is also the Vice-Chairman and Managing
Director of Bharti Enterprises and a Director and member on Bharti Airtel board, is leading the team.
Ficci's official spokespersons, when contacted, did not confirm or deny his participation in the meeting.

The meeting has been proposed by Ficci, to thrash out the issue of Trai's recommendations on 2G
spectrum. Some of the companies would have to shell out huge amounts of money for the additional
spectrum they hold. These include companies like Bharti Airtel and those who are yet to get spectrum
despite being ahead in the queue, like Tata Teleservice Ltd, if the recommendations are accepted by the
government.

Over the last few days, letters have been shot off by operators to the government seeking partial
acceptance of the recommendations. Trai too shot off letters to the government seeking to clarify its
position and on Tuesday has again written that the operators are unduly worried. It has pointed out that
the regulator was still examining the issues like payment of 3G prices for the additional 2G spectrum
beyond mandated by the government, fixed by the regulator.

In his letter, Trai Chairman J S Sarma has requested the government to hold back a final decision on two
of its recommendation till it gives a final suggestion. Trai had suggested that 3G price be adopted as
‘current price’ of spectrum in the 1800 megahertz band and that refarming of 800/900 MHz spectrum
should be examined. But in the same breath, Sarma has also said that Trai was initiating a separate
discussion on both the issues and these findings would be submitted to the government. Till then, it has
urged the government not to take any decision on these two.

On the other issues, the regulator reiterated that all other recommendations are integral recommendations.
If DoT has any difference of opinion on any of these recommendations, that can be referred back to the
regulator, before the Department of Telecom takes any decision.

Business Strategy
increasing competition from established mobile companies, fixed-line companies moving to
mobile and internet companies moving into the mobile domain is one of the main challenges
Vodafone has to face. In addition, changing technology and therefore tastes, a regulatory
environment that is forcing down call costs, and the fact that Vodafone’s growth has traditionally
been in mow mature markets have worked together to push the company towards five strategic
objectives. Business units have been aligned to strategy: Europe; Eastern Europe, Middle East,
Africa, Asia Pacific, affiliates; and new businesses.
In Europe, the company plans to leverage regional scale to reduce costs and stimulate revenues.
In order to reduce costs Vodafone plans to increase outsourcing, particularly of the customer
management systems and IT development of billing and scale efficiencies will be enhanced
through greater standardization in all areas across the Group, at the global level. The company
sees scope to increase revenues in the fact that its customers only use their mobiles on average
for four minutes a day. New bundles and tariffs, for example Vodafone Passport, which is a
family plan focusing on groups and roaming, will help in this respect as will targeting fixed to
mobile substitution at the business level.
The potential for growth in emerging markets has to some extent been exploited by Vodafone
already, for example in South Africa and Egypt. The company plans to expand on success in
these markets by obtaining stakes in other emerging markets, and where possible, obtaining
control.
Vodafone’s third strategic objective is to deliver a total communications package to its
customers. This will obviously require some innovation as well as a move into homes and offices
through the integration of fixed and mobile services, although the latter will remain the focus.
High speed internet services through HSDPA, DSL and Wi-Fi will be developed, as will
integrated mobile and PC services such as VoIP and instant messaging.
The company’s fourth strategic objective is to actively manage its portfolio by focusing on
acquisitions in specific geographic locations that are likely to offer strong growth and a return on
the cost of capital within three to five years. Vodafone’s policy to exit markets that are no longer
attractive and where there is an opportunity to create value for shareholders has already been
seen in the sale of its stake in Japan in April 2006. GBP6 billion of the settlement will be
returned to shareholders. In answer to speculation over the position Vodafone holds in the US
through Verizon Wireless, Chief Executive Arun Sarin, has stated that the expected continued
growth in the US market warrants Vodafone’s existing stake.
Vodafone’s final strategic objective is to align its capital structure and shareholder returns in
such a way as to support strategy. In order to do this, the company has announced that it will
now pay out 60% of adjusted earnings per share as opposed to 50%. Dividend per share is set to
increase with underlying earningsI