ACKNOWLEDGEMENTS

All praises and thanks are for

Almighty ALLAH Who is the source of
all knowledge and wisdom endowed
to mankind and to the humanity as a
whole. Then, we would like to thank
my parents and family without whom
we would not have reached at this
level. I would particularly like to
thank my Course Instructor Ms. Saira
Ibrahim for many insights she
provided us throughout the course of
Strategic Management.

1|Page
 Table of Contents

CASE……………………………………………………………………………………………………….4
ABSTRACT..............................................................................................................................................29
EXECUTIVE SUMMARY.......................................................................................................................31
EVALUATION OF MISSION AND VISION STATEMENTS................................................................33
Mobilink’s Vision....................................................................................................33
Mobilink’s Mission .................................................................................................33
Evaluation of Mission Statement...........................................................................34
Re-vised VISION STATEMENT.................................................................................34
Mission Statement after Evaluation.......................................................................35
SWOT........................................................................................................................................................36
STRENGTHS........................................................................................................... 36
WEAKNESSES........................................................................................................37
OPPORTUNITIES.....................................................................................................38
THREATS................................................................................................................ 38
ANALYSIS...............................................................................................................................................39
Matrices on Microsoft Excel .................................................................................40
RECOMMENDATIONS & CONCLUSION............................................................................................56
BIBLIOGRAPHY.....................................................................................................................................58

2|Page
MOBILINK GSM
CASE

STRATEGIC MANAGEMENT

PRESENTED TO MS. SAIRA IBRAHIM

11/27/2010

3|Page
4|Page
 MOBILINK GSM - 2010

ML

www.mobilinkgsm.com

MOBILINK

Mobilink, a subsidiary of the Orascom Telecom Holding, is Pakistan’s leading cellular and
Blackberry service provider. Mobilink currently has more than 31.6 million subscribers.

Mobilink maintains market leadership in Pakistan through cutting-edge, integrated technology,

the strongest brands, competent employee strength of 4,500 and the largest portfolio of value
added services in the industry, a broadband carrier division providing next generation internet
technology as well as the country’s largest voice and data network with over 8,000 cell sites.

Mobilink housing Pakistan’s largest distribution and contact centre networks and an unparalleled
6,500 kilometres fibre optic backbone, Mobilink has already invested over US $3.3 billion in
Pakistan to date and provides countrywide connectivity, customer services and international
roaming in over 140 countries.

In Pakistan, the Pakistan Mobile communications Ltd (Mobilink) started its operations in 1994
and, until early 2001, had a market share of 40%. In April 2001, OTH took over management
control of Mobilink from Saifullah Group and Motorola. As the market leader even today,
Mobilink serves more than 32.203 million subscribers, representing a market share of 32.47% (as
of June 2010; PTA Statistics).

The company is also the official cellular partner of the Pakistan Cricket Board. As a responsible
corporate citizen, Mobilink also offers a range of socially inclusive products and services
dedicated to enhance access to information. Through Mobilink Foundation founded in December

5|Page
2007, the company supports education, health and environmental initiatives and promotes
sustainable business practices.

Mobilink offers exclusively designed tariff plans that cater to the communication needs of a
diverse group of people, from individuals to businessmen to corporate and multinationals. To
achieve this objective, they offer both post-paid (Indigo) and prepaid (JAZZ) solutions to our
customers. Compared to their competitors, both the post-paid (Indigo) and prepaid (JAZZ)
brands are the largest brands of their kind in the Pakistan cellular industry.

In addition to providing advanced voice communication services that makes the lives of millions
that much easy, they also offer a host of value-added-services to their prized customers. At the
same time, Mobilink places high importance to its coverage, 10,000+ cities and towns
nationwide as well as over 140 countries on international roaming service.

ORASCOM TELECOM HOLDING S.A.E

Orascom Telecom Holding S.A.E. (OTH) is part of the Orascom group of companies began its
journey in 1976 and Orascom Telecom Holding S.A.E. (OTH) was established in 1998. Since
then it has grown to become a key player in the telecommunication market. Orascom entered the
domain of Information Technology and Telecommunications by exchanging and distributing IT
and telecom equipment in Egypt. OTH had exceeded 99.1 million subscribers as of August 2010.

OTH is considered among the largest and most diversified network operators in the Middle East,
Africa, and South Asia. Orascom Telecom is a leading mobile telecommunications company
operating in six emerging markets having a population under license of 430 million with an
average penetration of mobile telephony across all markets of approximately 40%.

Weather Investments S.p.A. (Weather), a major share holder 51.7% of ‘Orascom Telecom’ has
joined hands with VimpelCom Ltd, a Russia based company. This partnership led to 20.0%
economic interest and an 18.5% voting interest in the enlarged VimpelCom group.

6|Page
OTH through Mobilink has positioned itself as a leader in the region for its diverse GSM
operations with various GSM support and Internet operations. One of OTH's main strategies is to
create its own non- GSM subsidiaries to act as a backbone of support for its regional GSM
operations. OTH has achieved this by dedicating financial, technical and management resources
for supporting its subsidiaries. This includes network support and installation of GSM
operations, equipment procurement, handset procurement and distribution companies, Value
Added Services, and Internet Operations. OTH is dedicated to providing the best quality services
to its customers, value to shareholders and a dynamic working environment for its more than
15,000 employees.

EXHIBIT 1

WEATHER INVESTMENTS AND VIMPELCOM LTD PARTNERSHIP

After this recent transaction on October 10, 2010, VimpelCom become the fifth largest mobile
platform in the world by subscribers, with:

• operations in a total of 20 countries in Europe, Asia, Africa and North America with
approximately 850 million people living within the coverage area

• pro forma net operating revenues of US$21.5 billion for the year ended December 31,
2009

• pro forma EBITDA of US$9.5 billion and an EBITDA margin of approx. 44% for 2009

7|Page
The combination of VimpelCom with Weather will lead to substantial value creation for
shareholders, both in the short and long term.

The Transaction will substantially increase the scale of operations and will create a new global
telecom player with over 174 million mobile subscribers.

About VimpelCom

VimpelCom Ltd. consists of telecommunications operators providing voice and data services
through a range of wireless, fixed and broadband technologies. The VimpelCom Ltd. group is
headquartered in Amsterdam and has operations in Russia, Ukraine, Kazakhstan, Uzbekistan,
Tajikistan, Georgia, Armenia, Kyrgyzstan, Vietnam and Cambodia, covering territory with a
total population of about 345 million. VimpelCom Ltd. operating companies provide services
under the "Beeline" and "Kyiv star" brands. VimpelCom Ltd. is listed on the New York Stock
Exchange under the symbol "VIP".

About Weather

Weather Investments S.p.A. is a leading international telecommunications company offering

mobile, fixed, Internet and international communication services to 123 million subscribers in
Algeria, Bangladesh, Egypt, Greece, Italy, Pakistan, Tunisia and North Korea. Weather's
subsidiary Orascom Telecom Holding has an indirect equity ownership in Globalive Wireless
which operates mobile services in Canada. Weather Investments operates through its subsidiaries
Orascom Telecom Holding S.A.E., Wind Telecomunicazioni S.p.A. and Wind Hellas
Telecommunications S.A. Weather is owned 72.65% by Weather Investments II S.a.r.l. (which is
itself owned by the Sawiris family) and the balance by certain financial investors.

MOBILINK MISSION, VISION AND VALUES

 Mobilink’s Mission Statement

“To be the unmatchable mobile system of communications in Pakistan, providing the best
value to its customers, employees, business partners and share holders”.

8|Page
 Mobilink's Vision

“To be the leading Telecommunication Services Provider in Pakistan by offering innovative

Communication solutions for our Customers while exceeding Shareholder value & Employee
Expectations”.

 Mobilink's Values

• Total Customer Satisfaction

Customers are at the heart of our success. They have placed their trust and confidence in
us. In return, we strive to anticipate their needs and deliver service, quality and value
beyond their expectations.

• Business Excellence

We strive for excellence in all that we do. We aspire to the highest standards and raise the
bar for ourselves every day. This commitment to delivering world-class quality translates
into unmatched service and value for our customers and all stakeholders.

• Trust & Integrity

At Mobilink, we take pride in practicing the highest ethical standards in an open and
honest environment, and by honouring our commitments. We take personal responsibility
for our actions, and treat everyone fairly, and with trust and respect.

• Respect for People

Our relationships drive our business. We respect and esteem our employees and all
stakeholders. We believe in teamwork, empowerment and honour.

9|Page
 • Corporate Social Responsibility

As the market leader, we recognize and fulfil our responsibility towards our country and
the environment we operate in. We contribute to worthy causes and are dedicated to the
development and progress of the society.

TELECOM INDUSTRY PAKISTAN

The economic downfall has hit almost every industry globally and telecom industry is also a prey
to it. However it is still not a total downfall in the South. Worldwide the industry is going thru
recession and the mergers and acquisitions. Revenues are down and companies globally are
focusing on market consolidation. Expansion is rare and telecom industry is into cost cutting
cycle.

Telecom sector is vital to economy as it provides the prime services that an economy needs for
rapid growth, development and modernization.

As the economy grows demand for telecom services increases to conduct the increased number
of economic transactions in the expanded economy. But as of economic crises and high inflation
in Pakistan the growth is negative. There is also an increasing concern for security in Pakistan
and inconsistent and adhoc decisions from regulatory authorities. The concern is also the sudden
change in governmental trade policies.

The telecommunication industry of Pakistan suffered broad and deep damages to infrastructure
due to the floods of 2010. The current damage assessment estimates a loss of
approximately Rs.4.148 million, just from cellular operators, according to an estimate by the
government. This figure represents the sites which are totally damaged and are non-operational
and the cost incurred to repair/recover the damaged sites have not been included. The actual
damage cost will be considerably higher than this number.

10 | P a g e
This disaster has left a mark on the already struggling telecom industry of Pakistan. Going
forward, the industry cannot afford to ignore catastrophic events like these. They need to take
natural disasters into account and plan for them.

ORGANIZATIONAL STRUCTURE

EXHIBIT 2

11 | P a g e
12 | P a g e
DIVISIONS

All the divisions especially the north and central severely suffered due to flood 2010. On the
whole, the telecommunication industry of Pakistan suffered broad and deep damages to
infrastructure due to the floods of 2010. The current damage assessment estimates a loss of
approximately Rs.4.148 Million, just from land line and cellular operators, according to an
estimate by the government. This figure represents the sites which are totally damaged and are
non-operational. However, the costs incurred to repair/recover the damaged sites have not been
included. The actual damage cost will be considerably higher than this number.

The categories of damage to Mobilink includes (mainly in Central and Northern Division):

• Erosion of boundary walls and tower bases.

• Equipment damage due to water accumulation inside the site.(BSS, Trx, Power etc)
• Feeder cables damage due to settlement of cable bridge foundation support.
• Fibre cable Cuts on backbone and local fibre cables.
• Microwave Backhaul disruption
• Short circuits and power system damage including Generator damage
• In rare cases tower foundation settlement issues have occurred.

Mobilink has further divided all it departments on geographic bases northern, southern and
central.

13 | P a g e
EXHIBIT 3

Geographic Sales $ Sales Profits $ %

Region (M) % (M) Profit
Northern 3.353 (7.10) 0.753 (9.74)
Division
Southern 4.229 (5.34) 1.129 (3.37)
Division
Central 2.476 (5.16) 0.377 (13.12)
Division

Total 10.06 -17.60 2 (26.23)

Regional Sales and Profits

 Northern

The northern region includes Islamabad, Khaibar Paktunistan and Azaad Kashmir area.
Islamabad is a very profitable region of Mobilink. After Karachi and Lahore, Islamabad is the
next maximum profit generating city for Mobilink. Khaibar Paktunistan is the region with lots of
scope and resources for Mobilink yet not generating a lot of profit, mainly because of culture
backwardness of Khaibar Paktunistan.

 Southern

The south region includes the whole of Sindh and Balochistan. Karachi is the highest profit
generating city of Mobilink. Balochistan’s low revenue generation is mainly due to security
reason. Security is also a concern for Karachi and other cities yet citizens of Karachi have
buffered themselves to this issue.

 Central

14 | P a g e
The central region includes parts of Punjab and Lahore city is the most profitable region of
Central. The battle between Lahore and Karachi is lifelong for Mobilink. The security is also a
concern for central region like southern people here are also buffered to it.

EXHIBIT 4

TELECOM COMPANIES MARKET SHARE %

Mobilink 32.47%
Ufone 19.50%
Telenor 23.00%
Warid 16.03%
Zong 9.00%

Market Share Comparison

PRODUCTS & SERVICES

JAZZ

Jazz is Mobilink’s prepaid service which provides a bouquet of benefits in the form of fun
services, attractive services call rates and network reliability. The packages that Jazz offers are:

• Jazz Budget: Offering remarkable rates and package features, it is the best way to stay in
touch with millions of Mobilink family members in Pakistan. The major target market are
the teens and younger age group people who wants to stay connected. Happy Hour only
charging 0.4/30seconds.

• Jazz One: One network, one nation, one rate … one brand, Jazz! Introducing Jazz One,
this proves that it pays to be part of the biggest network in Pakistan.
Based on the premise of simplicity, Jazz One truly brings our promise of freedom to life.
The freedom to call anyone, anytime, anywhere at the lowest rates ever.

• Jazz Ladies - First: It is a package designed especially for ladies. From sizzling recipes
to tips on looking best are all an SMS away. Remarkably low calls rates.

15 | P a g e
 Women around the globe love to talk for hours on end, and Jazz understands this need to
the fullest, thus introducing its brand new revolutionary offer, where all women can talk
for as low as Rs. 5 / hour! This enticing new offer is surely every woman's dream come
true, bringing forth a product that will now satiate their desire to talk more and more for
hours. There also offering recipes, tips for forever young, shopping discounts and etc.

• Jazz Easy: It is the most affordable package that provides access to the best rates to call
across Pakistan. Jazz Easy customers can not only enjoy calling at amazingly low call
rates for Mobilink numbers, they also benefit tremendously from the fabulous rates to call
on any other network.

• Jazz Octane: It offers call and message rates to all networks at a very lowest rate. They
also have an option of late night calls on all Mobilink numbers. In this tariff plan
subscribers can also avail the international facilities as well but all services for only 3
favorite numbers.

• Jazz International Roaming: Jazz subscribers now have the convenience to carry their
Jazz connections while traveling to some of the most popular countries worldwide. Jazz
connects their customers across the globe giving a one stop solution to international
communication needs. Offering via promotions of Jazz Share, Advance and Load.

MOBILINK INDIGO:

Mobilink Indigo is the ultimate post-paid service which helps you explore the next level of
personalised and value driven services that come together as the indigo experience.

It offers a range of highly competitive post-paid packages offering great value for their
customers’ money. These include packages for more SMS-savvy individuals, while also offering
more high-end packages which provide a combination of bulk free minutes, free data offering
and the best call rates in the industry. The offer voice and SMS bundles italk and isms for
weekend and late night communication and SMS bundles to any network any time.
Indigo is now offering Bill payment viz cell phone and Business on the Go and Citi Mobile
Credit Card.

16 | P a g e
MOBILINK BLACKBERRY

Mobilink introduced BlackBerry Services in Pakistan in 2005. BlackBerry from Mobilink

provides users with a secure, wireless access to a full suite of business and social networking
applications including Push Email, Phone, SMS, Internet Access Organizer Features, Social
Networking – Face book, G Talk, MSN Messenger Etc. Today Blackberry usage soars in
Pakistan especially Karachi, Lahore and Islamabad.

MOBILINK WORLD

Mobilink World is the latest offering of Mobilink with International SMS chat service, Ring tune
club, CricVideo, Mind Reader, EDGE Technology, Corporate SMS, Holy Sayings, SMS Game
Time, SMS Scheduler, Mobi Greetings, Mobi Safe and Bolo SMS. This offer is basically to
target corporate sector International Chat Service, Scheduler, Mobi Safe – retrieving cell
numbers from a different cell or lost cell. Web Portal is also offered with Mobilink world for
corporate sector.

MOBILINK INFINITY

Mobilink Infinity WiMAX is the broadband service which helps you connect with the outer
world wherever the subscriber is. Through this service the customers can easily enjoy being
online and stay connected at all times. It provides total internet and communication solutions.

INTERNAL FACTORS

MANAGEMENT

In this highly competitive era, more of bureaucratic style of management is followed in

Mobilink. Through as shown by upper management is the decentralized style of decision making
much of the decisions are made at the top level and managers plus line managers are just told to
implement. The hiring firing is highly based on upper management decisions as well as

17 | P a g e
appraisals and promotions. Much of performance measurement is done only for procedure
purpose.

The CEO and President of Mobilink GSM was Mr. Zohair Khalique who is replaced by Mr.
Rashid Khan. Change of leadership brought change of strategy. He started cost-cutting in many
of the Mobilink’s departments. Budget allocation to department are now strictly monitored and
no resource wastage at all. Employees were previously served quite lavishly but a change in
strategy has been seen by reducing their non-financial benefits. Cut on bonuses and increments
until 2009 and tight aboard training budget for employees. Many of training programs are now
conducted within Pakistan instead of sending valuable employees aboard.

STRATEGIC BUSINESS DEPARTMENT

This is where all Mobilink's business plans are set to meet the goals and objectives of the
company. This department sets the planned activities and aims of Mobilink so that all efforts are
converted into results. It deals directly with Mobilink's alliances in the most professional way to
ensure excellent long term business relations.

PROJECT MANAGEMENT DEPARTMENT

All Mobilink's projects are managed here by a highly knowledgeable business - oriented team.
The Project Management Department is responsible for allocating the projects' tasks to the
respective department and then delivering the project to the third parties once done. The merger
of Mobilink and LinkDot.net was recent major project for PM department. The issue of identical
IDs for employee is current faced in the company many of Mobilink employees and LinkDot.net
employees have similar name hence same IDs, this is creating a confusion for the ID recognition
software. Hence, employee attendance, time of arrivals and other within company
communication is difficult.

18 | P a g e
OPERATIONS & CUSTOMER CARE DEPARTMENT

The departments where all day to day issues are dealt with high professionalism in order to
ensure all the services are operating smoothly. The operations department deals with all the
region's operators to make sure that all our third parties are being served with high efficiency.
The customer care department recently faced the issue that the customer care service at night
time from Karachi was shifted to Lahore and Islamabad. Due to Sindhi callers, the call centre
based in Islamabad and Lahore couldn’t handle the calls due to the communication barriers.
Thus, call centre was again shifted to Karachi which handled all the Sindhi callers. Rests of the
callers were handled by the call centre in Lahore and Islamabad.

ENGINEERING & INFORMATION TECHNOLOGY DEPARTMENT

The company cannot provide cutting edge technology without the best IT personnel. Therefore,
Mobilink recruits only the best IT experts from all over the world. The IT infrastructure is 100%
reliable for the fact that we use high tech solutions with clustering and load balancing facilities to
maintain applications and data solutions.
The IT department faces the issue of mismanagement due to extensive network within the
country which is resulting in poorer coverage in the country. Budgeting is another concern,
previous major portion of budget was for engineering and IT department but now more budgets
are being allocated to sales and marketing department.

FINANCE & ACCOUNTING DEPARTMENT:

This department ensures that Mobilink meets its fiscal and fiduciary responsibilities. The
Accounting Division handles payrolls, accounts receivable and payable, and responds to any
related issue from the mobile operators and third party companies. The Finance Division works
with the Business Department to manage Mobilink's budget, implement sound financial policies
and handle all treasury functions.

19 | P a g e
The Finance and Accounting Department faced issue of capital acquisition, being private limited
company Mobilink has to go for debt financing and current high interest rates due to economic
downturn. They have to do serious pondering when they decide about costing.

FINANCIAL DATA

EXHIBIT 5

20 | P a g e
21 | P a g e
22 | P a g e
ADMINISTRATION & HR DEPARTMENT:
Mobilink's HR department ensures that only and only the highly skilled are recruited. It also
establishes and maintains healthy internal communications and provides sufficient training to
everyone with respect to Mobilink's ethical and professional standards. Mobilink believes in
educating people to use technology and sense the responsibility to keep their departments
informed and competent to the latest trends. That is why they heavily invest in training their
employees. Though with the recent cost cutting strategy there is severe cut on the employee
training budget.

MARKETING & SALES

Mobilink along with its competitors are having a price war. They are competing with one another
on lowest call and message rates. Fighting a price war is the current competitive advantage with
decline in disposal income in Pakistan that all the telecom companies are trying to win on this
competitive advantage.

Since the entry of Zong, Mobilink has started concentrating on marketing their brand and
services. Previously they concentrated on employee benefits. More concentration is now being
paid to do the effective marketing of Mobilink and more budget is allotted to the sales and
marketing department.

FRANCHISE OPERATIONS

Mobilink launched software called SIEBAL couple of months back in all its franchises and at
customer care centres. Initially the software worked well yet the software had issues when
connecting with dial-up connection so forth the franchises in small towns and villages could not
connect to the software. The software was to facilitate the franchises in the issues related to SIM
and Mobilink service connections. The company reverted back to the old software.

CSR AT MOBILINK

23 | P a g e
Mobilink plays an active role in supporting the community and social development of Pakistan.
Their Corporate Social Responsibility goes with charity and donations whereby they take into
full account the impact on the society as whole and the natural environment.

They recognize that an educated, healthy society is Pakistan’s key to ensuring sustainable
development and they do their best to give back to the community they operate in and for this
purpose they have created Mobilink Foundation. The Mobilink Foundation is a grant-giving
organization, which provides support for the local community not only financially but also
through dedicated volunteer hours.

The establishment of the Mobilink Foundation in December 2007 is a reflection of the

commitment of Mobilink and its employees to benefit the community in which they operate.

INDUSTRY FACTORS

Fuelled by recent rapid adoption in developing countries, mobile communications have propped
up the industry’s top line. But now with these markets saturating, communications revenue
growth as a whole is beginning to stall, and content connectivity revenues have not risen quickly
enough to compensate. Although increase in mobile internet usage offers a glimmer of hope, the
telecom industry faces some serious questions: where will future growth come from? How will
the industry evolve?

With Call blockage service offered by all telecom companies except Mobilink. According to
PTA 3 Million people in Pakistan are still using Illegal SIM’s. This is a serious issue within the
industry as prevailing competitors have found solution to it yet Mobilink has done nothing to it.

COMPETITORS

24 | P a g e
Considering developments and increased competition in the telecommunications market of
Pakistan, a more liberalized economy, the Mobilink management has to think of how to direct a
company into more customer oriented operation, how to operate the company on sound
economic principles and how to streamline the company’s image by issuing a communication
strategy to support the business strategy of One Company – One Profile. Mobilink is looking for
ways to organize and manage the company to comply with the high quality of services demanded
by the customer. Mobilink is working on how to compete with an increasingly competitive
telecommunications environment.

EXHIBIT 6

TELECOM COMPANIES NUMBER OF CELLULAR

SUBSCRIBERS SUBSCRIBERS %
Mobilink 32,203,000 32.56%
Ufone 18,368,074 19.47%
Telenor 18,329,428 23.72%
Warid 15,774,299 16.97%
Zong 4,446,024 7.27%

Subscribers Comparison

• TELENOR

Telenor Pakistan is 100% owned by the Telenor Group, an international provider of high quality
voice, data, content and communication services in 14 markets across Europe and Asia. Telenor
Group is among the largest mobile operators in the world with over 179 million mobile
subscriptions and a workforce of approximately 40,000.

At the end of October 2010 it had a reported subscriber base of 23.84 million, and a market share
of 23% making it the country's second largest mobile operator within 5yrs of launching its
services in 2005.

25 | P a g e
.Telenor Pakistan acquired 51% of Tameer Micro finance Bank in November 2008. In 2009 it
launched ‘Easy paisa’ to become Pakistan’s first telecom operator to partner with a bank to offer
mobile financial services across Pakistan.

A nationwide network encompassing 8,000 plus cities and 2,500 employees and the subscriber
growth is 9.9%.

• UFONE

Ufone subsidiary of PTCL was established to provide cellular services across Pakistan. Ufone is
currently providing quality services across Pakistan. Ufone currently lowered their calling rates
across other networks as low as 2.50/min which is currently the cheapest prepaid rates available
in the market. Ufone with the backend support of PTCL always provides quality services to its
subscribers.

Ufone claims to have 3 million subscribers and still growing. Ufone is one of the best cellular
companies in Pakistan with reliable network and coverage to over 100 key cities and prominent
highways.

• WARID

Abu Dhabi Group led by Sheikh Nahayan Mabarak Al Nahayan operates Warid. Warid started it
services in Pakistan May 2005. Since then Warid Telecom successfully launched the services
covering 28 cities with a total population of around 32 million people. Ufone with the backend
support of PTCL always provides quality services to its subscribers.

• ZONG

China Mobile is the world's largest telecom operator having a customer base of over 300 million
customers, its network routes 700 million text messages every day and handles 250 million calls
every hour. China Mobile's first overseas subsidiary, China Mobile Pakistan (CMPak) is a 100%

26 | P a g e
subsidiary which has the license to offer and operate voice, data and all value added services in
the entire country. The pioneering overseas set up of China Mobile came through acquisition of a
license from Millicom to operate a GSM network in Pakistan. The first international brand of
China Mobile is Zong being launched in Pakistan

So far CMPak has invested more than US$ 700 million in the telecom sector in Pakistan and an
additional US$ 800 million will be invested till the end of year 2008.

• PTCL

Pakistan Telecommunication Company Limited (PTCL) is the largest telecommunication

company in Pakistan. This company provides telephony services to the nation and still holds the
status of backbone for country's telecommunication infrastructure despite arrival of a dozen other
telecoms including telecom giants like Telenor and China Mobile and Mobilink locally. The
company consists of around 2000 telephone exchanges across country providing largest fixed
line network. GSM, CDMA and Internet are other resources of PTCL, making it a gigantic
organization. The Government of Pakistan sold 26% shares and control of the company
to Etisalat in 2006. The Government of Pakistan retained 62% of the shares while the remaining
12% are held by the general public.

PTCL also provides fixed line service through its countrywide CDMA based WLL (Wireless
Local Loop) network, under the Vfone brand name. In the cellular segment, the second largest
cellular provider in Pakistan, Ufone, is also a wholly owned subsidiary of PTCL.

FUTURE OUTLOOK

Mobilink is attempting effectively managing its labour costs, as well as continue to introduce
new and contemporary product lines to complement its existing product lines. The economic
downfall and high inflation has been of major concern.

27 | P a g e
The company is continuing to introduce new product lines to follow trend of market while
maintaining quality and tradition.

The possibility of dilution of the brand is always present, with the in the current scenario of the
deal between VimpelCom and Orascom. The company is trying to maintain an iconic status of its
brands but it is either going to be Mobilink-Telenor merger or something better for the telecom
industry. The merger leads to better relationship with neighbouring country Russia and narrower
domination by Arabs in the telecom sector. Mobilink is also planning to takeover Warid in
December 2010. So Mobilink is going through several changes, let’s see how it shapes the future
of telecom industry. It is early to predict but a better and brighter future of Pakistan can be
forecasted.

REFERENCES

1. www.mobilinkgsm.com.pk
2. www.orascomtelecom.com
3. www.ufone.com
4. www.telenor.com.pk
5. www.zong.com.pk
6. www.pta.gov.pk
7. www.telecompk.com
8. www.ntcpk.com

28 | P a g e
MOBILINK GSM
ANALYSIS

STRATEGIC MANAGEMENT ABSTRACT

PRESENTED TO MS. SAIRA IBRAHIM
11/27/2010

29 | P a g e
Mobilink GSM is a premier cellular company which has 10 million subscribers nationwide.
Mobilink has the advantage of being the pioneers of introducing cellular networks in Pakistan.
Orascom took the hold of Mobilink in 2001, it managed to make Mobilink grow five-fold in just
18 months in terms of subscribers.

Mobilink’s greatest competition came in the form of two new operators; Telenor & Warid that
launched their services in 2005. Nevertheless, Mobilink maintained its leadership in market with
a share of approximately 56.2% of the total mobile subscribers in Pakistan. As of December
2005, Mobilink served approx 11 million subscribers. The major milestone for 2005 is
considered to be the launch of BlackBerry services in Pakistan.

Following the launch of Zong in 2008, the telecom industry became even more competitive. In
market with huge operators like Telenor, Warid, Ufone & now Zong, Mobilink’s recognition
remained the same having the highest top of the mind brand awareness.

Besides generating revenues & services, Mobilink has also played a role as a socially responsible
corporate entity. Mobilink has made number of contributions in charities like Shaukat Khanam
Memorial Trust, Umeed-e-Noor ,blind cricket for special people, donated cash to the President’s
Flood Relief Fund, worked for the welfare and education of special children, sponsored events
like Quaid-e-Azam National Gold Polo Championship. Mobilink has also promoted Pakistan’s
art & culture in an international forum.

30 | P a g e
 EXECUTIVE SUMMARY

Mobilink, a subsidiary of the Orascom Telecom Holding, is Pakistan’s leading cellular and
Blackberry service provider. Mobilink currently has more than 31.6 million subscribers.
Mobilink maintains market leadership in Pakistan through cutting-edge, integrated technology,
the strongest brands, competent employee strength of 4,500 and the largest portfolio of value
added services in the industry, a broadband carrier division providing next generation internet
technology as well as the country’s largest voice and data network with over 8,000 cell sites.

Orascom Telecom Holding S.A.E. (OTH) is part of the Orascom group of companies began its
journey in 1976 and Orascom Telecom Holding S.A.E. (OTH) was established in 1998. OTH
through Mobilink has positioned itself as a leader in the region for its diverse GSM operations
with various GSM support and Internet operations.

In order to do the analysis of Mobilink GSM, we have gone through three stages which are the
Input Stage, the Matching Stage and the Decision Stage.

The first tool of Input Stage is EFE Matrix which tells us that Mobilink GSM is a flourishing
company with having a total weighted score of 3.25. It indicates that Mobilink is responding in a
very positive way to the existing threats and opportunities in the telecom industry. In our CPM
we can see that most weights are assigned to Technology and Innovation and Price
Competitiveness which are 0.150 respectively. The competitors we used to do the CPM analysis
are Telenor and Ufone. Overall Mobilink GSM is strongest, indicated by the total weighted score
of 3.440, closely followed by Telenor with the total weighted score of 3.360 and Ufone at 2.810.
Overall, Mobilink GSM has received a 3.13 total weighted score, which on 1 - to - 4 scale is
quite good but still has room for improvement in factors such as low motivation and low
employee morale due to cost – cutting programs and employee termination and call blockage
service is still not being offered though all the competitors have taken this step.

31 | P a g e
In the Matching Stage, SWOT is an important tool which helped us develop four types of
strategies: SO, ST, WO, and WT strategies. We matched the key external and internal factors
and produced feasible alternative strategies that would take Mobilink GSM a higher step.
Mobilink GSM’s vector is drawn in the Competitive quadrant of the SPACE Matrix.

With the help of BCG, the differences among divisions in terms of relative market share position
and industry growth rate have become clear. The South Division, North Division and Central
Division lie in the second quadrant Stars which represents the organization’s best long – run
opportunities for growth and profitability. The IE Matrix tells us that South Division is in the
quadrant I which is described as grow and build which means it is in strong position. Central and
North Division fall between quadrant I and II which indicates that these divisions are above
average. The last tool of Matching Stage, GSM indicates that Mobilink is in the quadrant I which
means that it is in an excellent strategic position.

The final tool we have used in Decision Stage is QSPM in which we considered two main
strategies which are ‘Improve service and gain market share via adopting MVNO, MVNE &
UTMS technology’ having a total attractiveness score of 7.75 and ‘Backward integration over
their infrastructure ventures and suppliers to reduce cost and expenses’ (TAS = 6.39). By total
attractiveness scores of 7.75 VERSUS 6.39 that the analysis indicates the first strategy is the best
option to opt for.

Based on the results, the economic down turn in Pakistan and Intense competition in the industry
has really taken its toll on Mobilink. Though Mobilink is at a strong financial position, it has not
been performing up to the mark since last three to four years. Thus Mobilink must adopt
innovative information technology. It is important to deliver good quality and reliable service
and it is highly essential to retain its customers in the competitive environment.

32 | P a g e
 EVALUATION OF MISSION AND VISION
STATEMENTS

MOBILINK’S VISION

“To be the leading Telecommunication Services Provider in Pakistan by offering

innovative Communication solutions for our Customers while exceeding
Shareholder value & Employee Expectations”.

MOBILINK’S MISSION

“To be the unmatchable mobile system of communications in Pakistan,

providing the best value to its customers, employees, business partners and share
holders”.

33 | P a g e
EVALUATION OF MISSION STATEMENT

Customers Yes ‘providing best value to

its customer’
Products or Services Yes ‘mobile system of
communications’
Markets Yes ‘in Pakistan’
Technology No -
Concern for Survival, No -
Growth and Profitability
Philosophy Yes ‘providing best value’
Self – Concept Yes ‘unmatchable’
Concern for Public No -
Image
Concern for Employees Yes ‘providing bets value to
its employees’

RE-VISED VISION STATEMENT

34 | P a g e
The Mobilink’s original vision statement is quite good. It clearly states that what are the aims of
Mobilink and what is their target to achieve. Therefore, we have left the Mobilink’s vision
statement untouched. It doesn’t need any changes.

MISSION STATEMENT AFTER EVALUATION

 We anticipate consumer need and deliver outstanding products and services that improve
people's lives.

 Delighting customers with a wide range of products and services in the communication
industry with the best people and improved quality via virtual and innovative technology
through providing growth opportunity.

 We are dedicated to provide the highest possible level of value to our customers,
employees, community and investors.

 Mobilink being friend of nature is working toward creating a prosperous society and tidy
world.

 Contribute to meet global standards at competitive price and committed to act in highest
ethical manner with the rights and dignity of others.

35 | P a g e
 SWOT

STRENGTHS
 Largest Market Share & Highest number of Subscriber in Pakistan
 Blackberry usage soars
 Strong Brand Image, Indigo leading Postpaid brand and Mobilink Jazz
singular pioneer pre-paid brand; & sweep two super brands award 2009 &
Pioneers with GSM Technology
 Wide Network Coverage of 10,000 cities in Pakistan and over 100 countries
with International Roaming
 Engineering and Technological stability at Mobilink along with competent
employees
 Current ratio of company to meet its obligations improved in 2009 to 1.18
from 0.93
 Concern for society and adapt to work environment needs; active CSR and
only cellular operator to be awarded 6th Environmental Excellence Award
by NFEH
 ISO 9002 Quality Management System Certification for Billing, Engineering
Departments and CS Contact Center
 First mobile operator in Pakistan to offer extensive GPRS Roaming and
BlackBerry Roaming services & Best extensive Network Infrastructure;
optical network and Satellite links
 Declining Sales and EBIT by 13.5% but exponential growth in Revenue in
first 3 quarter of 2010
 Only cellular service in Pakistan to provide coverage on the M2 motorway
and implementation of full intelligence network (IN) platform from Siemens

36 | P a g e
 for the prepaid platform
 Mobilink's Short Message Service Center allows Vehicle Tracking and Fleet
Management services
 Largest Call Center in Pakistan, which is there to assist the customers 24
hours
 Total Assets Turnover and Fixed Assets Turnover had been low for 3yrs, in
2009 TAT & FAT is 0.09 and 0.22 respectively
 In 2009, Mobilink ranked in top 100 telecom companies worldwide - 3rd
among the 'Brands punching above their weights' ahead of Airtel, Tata
Indicom and Reliance
 Continuous and latest employee training approaches
 Effective and Rapid Communication within Management
 Partnership with MCB to offer all banking services to Mobilink customers
via their handsets

WEAKNESSES
 Service issues with customers - average to below average service
 Mismanagement due to large network
 Huge Expenses incurred, high cost of material and other expenses
 High Tariffs as compared to competitors & expensive service quality both
call rates and SMS
 Call Blockage service still not offered
 Sort of bureaucratic style of Management; biasness by intermediate bosses
 ARPU for pre-paid declined from 1.8 to 1.6 but for post-paid inclined to 1.3
from 1.2
 Customer Retention
 No clear strategic direction of Orascom
 Low employee Morale; due to recent cost cutting program and employee job
termination
 Extensive Organizational Structure

37 | P a g e
 OPPORTUNITIES
 Promotional Packages
 Sponsorships for local and International events
 Changing Marketing Mix
 Investment and Development Opportunities
 Improved Customer Service and Value Added Services
 Economic Influx both globally and locally
 Global Telecom Industry on Growth, both supply push and demand pull,
pursuit of expansion
 Adoption New Technology; Mobile Wallet and Gift Cards
 Merger with VimpelCom; Opportunity to be Global 5th Largest Telecom
Company
 Local handset manufacturing
 Adaptation to UTMS- 3G technology up coming in Pak
 Adopting to MVNO and MVNE services
 Exchange Rate Fluctuation

THREATS
 Intense Competition – Telenor, Ufone, Warid & Zong
 Inconsistent and Adhoc Regulatory Environment and Adverse Trade Policies
of Pakistan
 Market Saturation of Subscribers
 Increasing maintenance cost
 Skilled labor attracted to competitors via better benefits
 High Tax Rates
 Price war between brands in telecom industry
 Natural Disaster; like the recent flood caused huge losses and the previous

38 | P a g e
 earthquake
 Political Instability and Security Concern

ANALYSIS

39 | P a g e
Matrices on Microsoft Excel

40 | P a g e
41 | P a g e
42 | P a g e
43 | P a g e
44 | P a g e
45 | P a g e
46 | P a g e
47 | P a g e
48 | P a g e
49 | P a g e
50 | P a g e
51 | P a g e
52 | P a g e
53 | P a g e
54 | P a g e
55 | P a g e
 RECOMMENDATIONS & CONCLUSION

Based on the results, the economic down turn in Pakistan and Intense competition in the industry
has really taken its toll on Mobilink. The continuous decline in market share and subscriber base

56 | P a g e
suggests that the company has not been performing well in last 3-4years. In actual fact, the
company's financial conditions are good even in economic down turn yet have been incurring
huge expenses, which they are considering via cost cutting on their major nonessential costs.
However it shows a slight improvement which can also be a result of the recent re-structuring,
re-engineering and cost cutting approaches by the company.

We would recommend the company the following recommendations:

• Maintaining leadership in the market requires innovative organizations willing to

reengineer to succeed.

• IT fusion with the business means restructuring and remodeling to understand the role IT
would play to meet the business objectives and a clear strategic direction including
revision of firm’s vision and mission statements.

• Constructing websites is not about content; it is about understanding what adds value and
how humans interact with information. Their website Mobilink Infinity has nothing
useful for customers or for any other stakeholder.

• Knowledge management is a plan that companies need to develop as part of their initial
business process modeling

• It is not wrong for large firms to try to adapt to successful processes implemented by
other firms and merger of Orascom-VimpelCom is go for future of Mobilink Telenor
both as well for Pakistan.

From analysis, the merger of Orascom – VimpelCom is good for the two giants of telecom in
Pakistan as well as for Pakistan Economy. Let’s see how the deal proceeds as for now the dispute
is over the merger of Orascom Algeria Venture where the Algerian Government wants to
nationalize it.

Previous in April 2010, Orascom had talks with merger to MTN – South African Telecom yet
deal did not proceed.

57 | P a g e
Mobilink is also planning for acquisition of Warid Telecom by 2011, which means gaining
market share and subscribers as well have to compete at a larger extent with other competitors.

The Strategies Mobilink should focus on are:

• Adopting Innovative Technology; mobile wallet and gift cards– Product Development
• Global Expansion in Emerging Markets – Market Development
• Concentrate on providing better and reliable service – Market Penetration
• Concentrate on consumer retention and gaining market share – Market and Product
Development & Penetration
• Backward Integration over venders for reduction in infrastructure maintenance cost and
other expenses.

BIBLIOGRAPHY

• www.mobilinkgsm.com
• http://www.zumbeel.net/beta/news/details.php?rev_param=6874

58 | P a g e
• http://www.zumbeel.net/beta/news/details.php?rev_param=6993
• http://www.zumbeel.net/beta/news/details.php?rev_param=7039

• http://www.zumbeel.net/beta/news/details.php?rev_param=7136

• http://www.zumbeel.net/beta/news/details.php?rev_param=7160

• www.orascomtelecom.com

• www.ufone.com

• www.telenor.com.pk

• www.zong.com.pk

• www.pta.gov.pk

• www.telecompk.com

• www.ntcpk.com

59 | P a g e