Description
BT Group plc, trading as BT, is a British multinational telecommunications services company headquartered in London, in the United Kingdom. It is one of the largest telecommunications services companies in the world and has operations in over 170 countries
1 BRITISH TELECOM-A CASE
Background-Post office Telephones was under government-format was traditional Post & Telegraph + telephones, until 1968-became a public Corp. In 1969, Postal & communication business split in 1981-Post Office Telephones became BT-UK was the 1 st country to privatize-MARGARET THATCHER privatized British Airways, British Gas, & other utilities too. -Nov. 1984 issued 1bn. Shares [51% holding to the British public & raised 3,9bn GBP from 0.22m employees & 2m citizens AIMS-competition-choice between operators will benefit the consumer- [license was issued to Mercury Communications also]-provided B T/M C with a breathing space for 7 years-no further licenses up to 1991, to fixed line operators-however Mobile licenses went to 4 players separately, including BT/MCI. GOVERNMENT CONTROL; ? O F T EL [office of telecommunications] was opened-1.to keep an eye on possible B T abuse, 2. Its business conduct, 3. Regularize 4. Its pricing policies, 5. Prohibition to marketing personnel to information on customer billing records. ? 1984-1991-2 major reorganizations a] PROJECT SOVEREIGN, the most ambitious attempt to reform its management culture & prepare for 3 challenges I.Industry`s traditional national monopoly approach, breaking of regulatory barriers to international competition. II. As companies internationalize, they prefer to deal with a single telecom co. worldwide. & Service provision to less defined segments. III. Intense international competition, high cost of technology, hence leads to Convergence [M & A]. ? 1992- 25 call centers over UK. Launch of TAM project [Telephone account management, this involves telephone contact instead of actual field visit], while Customer relationship management with large accounts. MARKET SEGMENTATION Total connections 25,013 m [domestic 19,281m, business 5,732m Total revenues 13,15 bn. G B P Type of acct no. of a/c s no. Of lines sales/line National accts. GBP 0,2-500 m 0,3 k 100+ 3000 key reg. A/c G B P 25 k-200 k 3,0 k 15+ 2000 Med. Bus. A/c G B P 0,2 m 200 k 6-15 5,4-22 k Small bus. A/c G B P 0.65 m 650 k 2-5 1,2-4,5 k V. small bus. G B P 0,8 m 800 k 1 0,4 k
Aims of TAM: 1. per customer growth-offer hi-tech upgrades 2. per customer product usage 3. competition push 4. cost of mktg. critical
2 ? account management is fundamentally different from sales force mgmt-in fact an area of conflict ? segmentation reveals different annual configurations, customer needs/ preferences are changing ? COSTS1. CUSTOMER CARE-field sales cost G B P 60,000 65% of salary, for customers> 15 lines [key regional a/cs], the a/c mgmt. is face-to-face + support by specialists & mgrs. For large national a/cs, & large lucrative customers, with international sophistication. This way field force has more time for med./large customers, higher level of consultancy and high visibility. 2. For TAM [telephone a/c mgmt] G B P 40,000 50% salary for customers < 15 lines up from 5 lines a/cs mgmt is soft sales approach, customer base is spread over a wide area. He deals with a specific B T man-there is motivation, continuity of contact. 20 Mt. Call info about needs, relationship perpetuation. RESULT-a/c coverage is 10 X, customer purchases 3 X, cheaper customer contact costs [than face-to face]. After telephone contact know who customer is and passes it on to field sales force. Drives sales force through referrals, Targets other vertical markets in HOSPITALITY, CAR RETAILS, LEISURE AND AFTER SALES INDUSTRY. Focuses on repeat purchase [on their own 1/ 3yrs. And TAM induced 1/3 months!] AMALGAMATE DATABASE + CUSTOMER INFORMATION + TELEPHONE AS DELIVERY CHANNEL. 3. ORGANIZATION:
GSM, UK REG.S M 1 R SM 2 R SM 3 R SM4 Small bus.mgr. TAM SM Med. Bus. Mgr. SM fld. Sales mgr. Sales devl. SPLS. SM mktg. exec Fld. A/C mgr
A/CS exec TAM Opns. mgr.
4. I.
B T PRODUCTS VOICE SERVICES
CITY DIRECT-abbrv. Dialing Lon-NY SPEECHLINES-intra-firm speech services. LINKLINE-offers cust. freefone by firms [order/enq.]
3
CALLSTREAM-service providers sell stored voice/data on normal phone. NETWORK SERVICES-call diversion, call barring, waiting, last no. recall, redial, conferencing VOICECOM INTERNATIONAL-24 hour mailbox [receive /forward] from any phone in the world.
II. DATA SERVICES
DATEL-data transmission in 100 countries KEYLINE-modems-analog services for data transmission LEASELINE-analog circuit to customer [voice, fax, mail], intl./nat. KILOSTREAM/digital pvt. Circuits at high speeds. MEGASTREAM PSS-packet switching public data network MULTISTREAM-enhanced accesses to public data at local call rates. DATADIRECT-hi-speed to USA/Japan. PRESTEL-public videotext system SATSTREAM-business communication to EC/US- a satellite service TELECOM GOLD-electronic mail, 250k boxes to 17 countries ISDN-integrated services digital networks allow customer to transmit voice, data, text, image, information at high speeds, assured quality, without dedicated private circuits. PUBLIC SECTOR-managerialism Prof. Pherwani/2001 Features: 1. Increasing privatization-govt. wants orgns. To become more mkt.-focused, specifically on cust. requirements 2. Open to competitive pressures-face its dynamics-formulate clear strategies-explain internally. 3. Accountability to internal regulators. 4. As surrogate for real competitive mkt.-or creates one. 5. Progressive deregulation. 6. Formalized planning systems are for internal also ensures visible public acceptability. 7. Competition for resource inputs-careful analysis & its allocation. 8. Need to demonstrate value for money in output-performance indicators-competitive tendering. 9. Criteria of acceptability to stakeholders in strategic choice more significant here. 10. Difference in nature of ownership and controls-from outside by govt. 11. Planning horizons limited by political rather than commercial-mkt. considerations 12. Constraints on investing, finance, capital base, and latitude mgrs. have to change strategies. 13. Mgrs. forced to control orgn. More centrally for reporting purposes-to the ministry 14. Mgrs. have to understand power of different stakeholders 15. GOVT. AGENCY HAS A LABOR MKT.-MONEY MKT.-SUPPLIERS-USERS-at its heart lies a political mkt., which approves budgets, provides subsidies-mgrs. Have to cope up with these political dimension-it changes the horizon of decision making-heavily influenced by political considerations understanding of political dogma necessary. 16. Govt. orgns. -Health services run by govt. face difficulty from strategic viewpoint-may not be allowed to specialize, generate surpluses form their services to invest in developmentleads to mediocrity in service quality-retention of improved services & efficiency on a limited budgets.
4 17. Managers face enforced choice of strategies-government dictates a particular strategic course of direction in public sector or in sectors where it exercises extensive regulationgovt. lays down the overall industry structure, cater to which markets at what prices, by which process-it was not a choice of the managers, but the intent of the government-an enforced direction. 18. Mangers have to manage strategy in this constrained environment-resources dominated by government not given to meet the needs of orgn. Only what is allocated-& according to VISION of the government. 19. Intrusive external environment, dominant individuals, political processes, power groups, pronounced political influences, traditional way of doing things, external forces determine strategy-managers not in control of org, destiny & no deliberate managerial discretion. 20. Standardized planning procedures, data/reporting/ controls as prescribed, so also reward/ punishment styles set, bargaining negotiation and conflict resolution accommodates rival views, power groups have control over critical resources, strategy has to work within thisroutines embedded deeply, strong resistance to change. Freedom of choice severely restricted. 21. Labor/ exit policy fixed, sourcing procedures-lowest or recommended bidder instead of the best value for money. 22. Political activity within the org, Has external links & drives the strategy-cultural web drawn by influence holders-org are captured by their own cultures, which are product of history or institutional forces.
5
Fishbone analysis for BT’s strategic outcome
where we want to be
regular climate surveys inter-divisional problem solving forums Skills development Team building objective setting
employee involvement program communication program
Where are we?
6
Fishbone analysis or ISHIKAWA Diagram
doc_929272552.doc
BT Group plc, trading as BT, is a British multinational telecommunications services company headquartered in London, in the United Kingdom. It is one of the largest telecommunications services companies in the world and has operations in over 170 countries
1 BRITISH TELECOM-A CASE
Background-Post office Telephones was under government-format was traditional Post & Telegraph + telephones, until 1968-became a public Corp. In 1969, Postal & communication business split in 1981-Post Office Telephones became BT-UK was the 1 st country to privatize-MARGARET THATCHER privatized British Airways, British Gas, & other utilities too. -Nov. 1984 issued 1bn. Shares [51% holding to the British public & raised 3,9bn GBP from 0.22m employees & 2m citizens AIMS-competition-choice between operators will benefit the consumer- [license was issued to Mercury Communications also]-provided B T/M C with a breathing space for 7 years-no further licenses up to 1991, to fixed line operators-however Mobile licenses went to 4 players separately, including BT/MCI. GOVERNMENT CONTROL; ? O F T EL [office of telecommunications] was opened-1.to keep an eye on possible B T abuse, 2. Its business conduct, 3. Regularize 4. Its pricing policies, 5. Prohibition to marketing personnel to information on customer billing records. ? 1984-1991-2 major reorganizations a] PROJECT SOVEREIGN, the most ambitious attempt to reform its management culture & prepare for 3 challenges I.Industry`s traditional national monopoly approach, breaking of regulatory barriers to international competition. II. As companies internationalize, they prefer to deal with a single telecom co. worldwide. & Service provision to less defined segments. III. Intense international competition, high cost of technology, hence leads to Convergence [M & A]. ? 1992- 25 call centers over UK. Launch of TAM project [Telephone account management, this involves telephone contact instead of actual field visit], while Customer relationship management with large accounts. MARKET SEGMENTATION Total connections 25,013 m [domestic 19,281m, business 5,732m Total revenues 13,15 bn. G B P Type of acct no. of a/c s no. Of lines sales/line National accts. GBP 0,2-500 m 0,3 k 100+ 3000 key reg. A/c G B P 25 k-200 k 3,0 k 15+ 2000 Med. Bus. A/c G B P 0,2 m 200 k 6-15 5,4-22 k Small bus. A/c G B P 0.65 m 650 k 2-5 1,2-4,5 k V. small bus. G B P 0,8 m 800 k 1 0,4 k
Aims of TAM: 1. per customer growth-offer hi-tech upgrades 2. per customer product usage 3. competition push 4. cost of mktg. critical
2 ? account management is fundamentally different from sales force mgmt-in fact an area of conflict ? segmentation reveals different annual configurations, customer needs/ preferences are changing ? COSTS1. CUSTOMER CARE-field sales cost G B P 60,000 65% of salary, for customers> 15 lines [key regional a/cs], the a/c mgmt. is face-to-face + support by specialists & mgrs. For large national a/cs, & large lucrative customers, with international sophistication. This way field force has more time for med./large customers, higher level of consultancy and high visibility. 2. For TAM [telephone a/c mgmt] G B P 40,000 50% salary for customers < 15 lines up from 5 lines a/cs mgmt is soft sales approach, customer base is spread over a wide area. He deals with a specific B T man-there is motivation, continuity of contact. 20 Mt. Call info about needs, relationship perpetuation. RESULT-a/c coverage is 10 X, customer purchases 3 X, cheaper customer contact costs [than face-to face]. After telephone contact know who customer is and passes it on to field sales force. Drives sales force through referrals, Targets other vertical markets in HOSPITALITY, CAR RETAILS, LEISURE AND AFTER SALES INDUSTRY. Focuses on repeat purchase [on their own 1/ 3yrs. And TAM induced 1/3 months!] AMALGAMATE DATABASE + CUSTOMER INFORMATION + TELEPHONE AS DELIVERY CHANNEL. 3. ORGANIZATION:
GSM, UK REG.S M 1 R SM 2 R SM 3 R SM4 Small bus.mgr. TAM SM Med. Bus. Mgr. SM fld. Sales mgr. Sales devl. SPLS. SM mktg. exec Fld. A/C mgr
A/CS exec TAM Opns. mgr.
4. I.
B T PRODUCTS VOICE SERVICES
CITY DIRECT-abbrv. Dialing Lon-NY SPEECHLINES-intra-firm speech services. LINKLINE-offers cust. freefone by firms [order/enq.]
3
CALLSTREAM-service providers sell stored voice/data on normal phone. NETWORK SERVICES-call diversion, call barring, waiting, last no. recall, redial, conferencing VOICECOM INTERNATIONAL-24 hour mailbox [receive /forward] from any phone in the world.
II. DATA SERVICES
DATEL-data transmission in 100 countries KEYLINE-modems-analog services for data transmission LEASELINE-analog circuit to customer [voice, fax, mail], intl./nat. KILOSTREAM/digital pvt. Circuits at high speeds. MEGASTREAM PSS-packet switching public data network MULTISTREAM-enhanced accesses to public data at local call rates. DATADIRECT-hi-speed to USA/Japan. PRESTEL-public videotext system SATSTREAM-business communication to EC/US- a satellite service TELECOM GOLD-electronic mail, 250k boxes to 17 countries ISDN-integrated services digital networks allow customer to transmit voice, data, text, image, information at high speeds, assured quality, without dedicated private circuits. PUBLIC SECTOR-managerialism Prof. Pherwani/2001 Features: 1. Increasing privatization-govt. wants orgns. To become more mkt.-focused, specifically on cust. requirements 2. Open to competitive pressures-face its dynamics-formulate clear strategies-explain internally. 3. Accountability to internal regulators. 4. As surrogate for real competitive mkt.-or creates one. 5. Progressive deregulation. 6. Formalized planning systems are for internal also ensures visible public acceptability. 7. Competition for resource inputs-careful analysis & its allocation. 8. Need to demonstrate value for money in output-performance indicators-competitive tendering. 9. Criteria of acceptability to stakeholders in strategic choice more significant here. 10. Difference in nature of ownership and controls-from outside by govt. 11. Planning horizons limited by political rather than commercial-mkt. considerations 12. Constraints on investing, finance, capital base, and latitude mgrs. have to change strategies. 13. Mgrs. forced to control orgn. More centrally for reporting purposes-to the ministry 14. Mgrs. have to understand power of different stakeholders 15. GOVT. AGENCY HAS A LABOR MKT.-MONEY MKT.-SUPPLIERS-USERS-at its heart lies a political mkt., which approves budgets, provides subsidies-mgrs. Have to cope up with these political dimension-it changes the horizon of decision making-heavily influenced by political considerations understanding of political dogma necessary. 16. Govt. orgns. -Health services run by govt. face difficulty from strategic viewpoint-may not be allowed to specialize, generate surpluses form their services to invest in developmentleads to mediocrity in service quality-retention of improved services & efficiency on a limited budgets.
4 17. Managers face enforced choice of strategies-government dictates a particular strategic course of direction in public sector or in sectors where it exercises extensive regulationgovt. lays down the overall industry structure, cater to which markets at what prices, by which process-it was not a choice of the managers, but the intent of the government-an enforced direction. 18. Mangers have to manage strategy in this constrained environment-resources dominated by government not given to meet the needs of orgn. Only what is allocated-& according to VISION of the government. 19. Intrusive external environment, dominant individuals, political processes, power groups, pronounced political influences, traditional way of doing things, external forces determine strategy-managers not in control of org, destiny & no deliberate managerial discretion. 20. Standardized planning procedures, data/reporting/ controls as prescribed, so also reward/ punishment styles set, bargaining negotiation and conflict resolution accommodates rival views, power groups have control over critical resources, strategy has to work within thisroutines embedded deeply, strong resistance to change. Freedom of choice severely restricted. 21. Labor/ exit policy fixed, sourcing procedures-lowest or recommended bidder instead of the best value for money. 22. Political activity within the org, Has external links & drives the strategy-cultural web drawn by influence holders-org are captured by their own cultures, which are product of history or institutional forces.
5
Fishbone analysis for BT’s strategic outcome
where we want to be
regular climate surveys inter-divisional problem solving forums Skills development Team building objective setting
employee involvement program communication program
Where are we?
6
Fishbone analysis or ISHIKAWA Diagram
doc_929272552.doc