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STRATEGIC MANAGEMENT
08-09-2019 2
TELECOM EQUIPMENT VENDORS
ADVANTAGES DISADVANTAGES
• Lower investments • Transferring Core Competency
Need to purchase 30%-40% excess capacity to meet Network management and operations are the core
customer demands and compensate for errors. This competency of Bharti Airtel
could account for $300M-$400M by 2007
• Quality Control
• Hassle free capacity extension A number of quality controls specified in Service Level
The process of planning, tendering, financing, agreements (SLA’s), but the quality could not be assured.
purchasing, and installing for new capacity requirements Degrading quality could lead to customers switching to
takes from six months to one year. Customer base other competitors like Tata, Reliance etc.
growing by 1.5 million every year
• Lower Capex
Upgrading to new technology like 3G requires large
capital investments
08-09-2019 3
IT EQUIPMENT VENDORS
ADVANTAGES DISADVANTAGES
• No outsourcing from different vendors • Unavailability of applications
Apart from IBM, Oracle, Bharti had to outsource for Hardware and software application not supported by
applications which were not offered, like Fraud IBM will not be available. IBM to work with other
Management. These were often incompetent. The new vendors
contract included all services and applications.
• Loss of Control
• Human Resource Tied to the financial well being of another company
Difficult finding competent IT personnel as they
preferred working with bigger MNC’s
Our proposal to Bharti Airtel is outsourcing the IT Equipment Vendors as their core competency lies in Network
Management and giving it away would pose the risk of the company losing its core competency.
08-09-2019 4