PTCL is Pakistan's primary telecommunications company established in 1996. It has its headquarters in Islamabad. While Pakistan's telecom sector has grown significantly in recent decades, particularly in cellular mobile and internet, landline density remains stagnant with PTCL as the sole provider. The document discusses PTCL's strategy formulation and challenges in improving landline services in Pakistan.

1. ALLAMA IQBAL OPEN UNIVERSITY ISLAMABAD
(Department of Business Administration)
BUSINESS POLICY AND STRATEGY (887)
Submitted By: Husnain Khalid
Roll # AD511764
Submitted To: Mr. Ateeq ur Rehman
An Assignment is submitted in partial fulfilment of the requirement for the degree
of MBA
ASSIGNMENT No. 2
ISSUE
STRATEGY FORMULATION

2. ACKNOWLEDGEMENT
First of all, I would like to say Alhamdulillah, for giving me the strength and
health to do this project work until it done Not forgotten to my family for
providing everything, such as money, to buy anything that are related to this
project work and their advise, which is the most needed for this project. Internet,
books, computers and all that as my source to complete this project. They also
supported me and encouraged me to complete this task so that I will not
procrastinate in doing it.
Then I would like to thank my teacher for guiding me and my friends throughout
this project. We had some difficulties in doing this task, but he taught us patiently
until we knew what to do. He tried and tried to teach us until we understand what
we supposed to do with the project work.
Last but not least, my friends who were doing this project with me and sharing
our ideas. They were helpful that when we combined and discussed together, we
had this task done.
As there are four topics, you will select the topic according to the last digit mentioned as
under:
2

3. Table of Contents
3

4. It is
INTRODUCTION
It is useful to consider strategy formulation as part of a strategic management
process that comprises three phases: diagnosis, formulation, and implementation.
Strategic management is an ongoing process to develop and revise future-oriented
strategies that allow an organization to achieve its objectives, considering its
capabilities, constraints, and the environment in which it operates.
Diagnosis includes: (a) performing a situation analysis (analysis of the
internal environment of the organization), including identification and evaluation
of current mission, strategic objectives, strategies, and results, plus major
strengths and weaknesses; (b) analyzing the organization's external environment,
including major opportunities and threats; and (c) identifying the major critical
issues, which are a small set, typically two to five, of major problems, threats,
weaknesses, and/or opportunities that require particularly high priority attention
by management.
Formulation, the second phase in the strategic management process,
produces a clear set of recommendations, with supporting justification, that revise
as necessary the mission and objectives of the organization, and supply the
strategies for accomplishing them. In formulation, we are trying to modify the
current objectives and strategies in ways to make the organization more
successful. This includes trying to create "sustainable" competitive advantages --
although most competitive advantages are eroded steadily by the efforts of
competitors.
A good recommendation should be: effective in solving the stated
problem(s), practical (can be implemented in this situation, with the resources
available), feasible within a reasonable time frame, cost-effective, not overly
disruptive, and acceptable to key "stakeholders" in the organization.
important to consider "fits" between resources plus competencies with
opportunities, and also fits between risks and expectations.
4

5. There are four primary steps in this phase:
* Reviewing the current key objectives and strategies of the organization,
which usually would have been identified and evaluated as part of the
diagnosis
* Identifying a rich range of strategic alternatives to address the three
levels of strategy formulation outlined below, including but not limited
to dealing with the critical issues
* Doing a balanced evaluation of advantages and disadvantages of the
alternatives relative to their feasibility plus expected effects on the issues
and contributions to the success of the organization
* Deciding on the alternatives that should be implemented or
recommended.
In organizations, and in the practice of strategic management, strategiesmust be implemented to achieve the intended results. The most wonderful
strategy in the history of the world is useless if not implemented successfully.
This third and final stage in the strategic management process involves
developing an implementation plan and then doing whatever it takes to make the
new strategy operational and effective in achieving the organization's objectives.
THREE ASPECTS OF STRATEGY FORMULATION
The following three aspects or levels of strategy formulation, each with a different
focus, need to be dealt with in the formulation phase of strategic management.
The three sets of recommendations must be internally consistent and fit together
in a mutually supportive manner that forms an integrated hierarchy of strategy, in
the order given.
5

6. Corporate Level Strategy: In this aspect of strategy, we are concerned with broad
decisions about the total organization's scope and direction. Basically, we
consider what changes should be made in our growth objective and strategy for
achieving it, the lines of business we are in, and how these lines of business fit
together. It is useful to think of three components of corporate level strategy: (a)
growth or directional strategy (what should be our growth objective, ranging from
retrenchment through stability to varying degrees of growth - and how do we
accomplish this), (b) portfolio strategy (what should be our portfolio of lines of
business, which implicitly requires reconsidering how much concentration or
diversification we should have), and (c) parenting strategy (how we allocate
resources and manage capabilities and activities across the portfolio -- where do
we put special emphasis, and how much do we integrate our various lines of
business).
Competitive Strategy (often called Business Level Strategy): This involves
deciding how the company will compete within each line of business (LOB) or
strategic business unit (SBU).
Functional Strategy: These more localized and shorter-horizon strategies deal
with how each functional area and unit will carry out its functional activities to be
effective and maximize resource productivity.
CORPORATE LEVEL STRATEGY
This comprises the overall strategy elements for the corporation as a whole, the
grand strategy, if you please. Corporate strategy involves four kinds of initiatives:
6

7. * Making the necessary moves to establish positions in different
businesses and achieve an appropriate amount and kind of diversification.
A key part of corporate strategy is making decisions on how many, what
types, and which specific lines of business the company should be in.
This may involve deciding to increase or decrease the amount and
breadth of diversification. It may involve closing out some LOB's (lines
of business), adding others, and/or changing emphasis among LOB's.
* Initiating actions to boost the combined performance of the businesses
the company has diversified into: This may involve vigorously pursuing
rapid-growth strategies in the most promising LOB's, keeping the other
core businesses healthy, initiating turnaround efforts in weak-performing
LOB's with promise, and dropping LOB's that are no longer attractive or
don't fit into the corporation's overall plans. It also may involve
supplying financial, managerial, and other resources, or acquiring and/or
merging other companies with an existing LOB.
* Pursuing ways to capture valuable cross-business strategic fits and turn
them into competitive advantages -- especially transferring and sharing
related technology, procurement leverage, operating facilities,
distribution channels, and/or customers.
* Establishing investment priorities and moving more corporate resources
into the most attractive LOB's.
It is useful to organize the corporate level strategy considerations and
initiatives into a framework with the following three main strategy components:
growth, portfolio, and parenting. These are discussed in the next three sections.
What Should be Our Growth Objective and Strategies?
7

8. Growth objectives can range from drastic retrenchment through aggressive
growth.
Organizational leaders need to revisit and make decisions about the growth
objectives and the fundamental strategies the organization will use to achieve
them. There are forces that tend to push top decision-makers toward a growth
stance even when a company is in trouble and should not be trying to grow, for
example bonuses, stock options, fame, ego. Leaders need to resist such
temptations and select a growth strategy stance that is appropriate for the
organization and its situation. Stability and retrenchment strategies are
underutilized.
Some of the major strategic alternatives for each of the primary growth
stances (retrenchment, stability, and growth) are summarized in the following
three sub-sections.
Growth Strategies
All growth strategies can be classified into one of two fundamental categories:
concentration within existing industries or diversification into other lines of
business or industries. When a company's current industries are attractive, have
good growth potential, and do not face serious threats, concentrating resources in
the existing industries makes good sense. Diversification tends to have greater
risks, but is an appropriate option when a company's current industries have little
growth potential or are unattractive in other ways. When an industry consolidates
and becomes mature, unless there are other markets to seek (for example other
international markets), a company may have no choice for growth but
diversification.
There are two basic concentration strategies, vertical integration and
horizontal growth. Diversification strategies can be divided into related (or
8

9. This
concentric) and unrelated (conglomerate) diversification. Each of the resulting
four core categories of strategy alternatives can be achieved internally through
investment and development, or externally through mergers, acquisitions, and/or
strategic alliances -- thus producing eight major growth strategy categories.
Comments about each of the four core categories are outlined below,
followed by some key points about mergers, acquisitions, and strategic alliances.
1. Vertical Integration: This type of strategy can be a good one if the company
has a strong competitive position in a growing, attractive industry. A company
can grow by taking over functions earlier in the value chain that were previously
provided by suppliers or other organizations ("backward integration").
strategy can have advantages, e.g., in cost, stability and quality of components,
and making operations more difficult for competitors. However, it also reduces
flexibility, raises exit barriers for the company to leave that industry, and prevents
the company from seeking the best and latest components from suppliers
competing for their business.
A company also can grow by taking over functions forward in the value
chain previously provided by final manufacturers, distributors, or retailers
("forward integration"). This strategy provides more control over such things as
final products/services and distribution, but may involve new critical success
factors that the parent company may not be able to master and deliver. For
example, being a world-class manufacturer does not make a company an effective
retailer.
Some writers claim that backward integration is usually more profitable
than forward integration, although this does not have general support. In any case,
many companies have moved toward less vertical integration (especially
backward, but also forward) during the last decade or so, replacing significant
9

10. amounts of previous vertical integration with outsourcing and various forms of
strategic alliances.
2. Horizontal Growth: This strategy alternative category involves expanding the
company's existing products into other locations and/or market segments, or
increasing the range of products/services offered to current markets, or a
combination of both. It amounts to expanding sideways at the point(s) in thevalue chain that the company is currently engaged in. One of the primary
advantages of this alternative is being able to choose from a fairly continuous
range of choices, from modest extensions of present products/markets to major
expansions -- each with corresponding amounts of cost and risk.
3. Related Diversification (aka Concentric Diversification): In this alternative,
a company expands into a related industry, one having synergy with the
company's existing lines of business, creating a situation in which the existing and
new lines of business share and gain special advantages from commonalities such
as technology, customers, distribution, location, product or manufacturingsimilarities, and government access. This is often an appropriate corporate
strategy when a company has a strong competitive position and distinctive
competencies, but its existing industry is not very attractive.
4. Unrelated Diversification (aka Conglomerate Diversification): This fourth
major category of corporate strategy alternatives for growth involves diversifying
into a line of business unrelated to the current ones. The reasons to consider this
alternative are primarily seeking more attractive opportunities for growth in which
to invest available funds (in contrast to rather unattractive opportunities in
existing industries), risk reduction, and/or preparing to exit an existing line of
business (for example, one in the decline stage of the product life cycle). Further,
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11. For
this may be an appropriate strategy when, not only the present industry is
unattractive, but the company lacks outstanding competencies that it could
transfer to related products or industries. However, because it is difficult to
manage and excel in unrelated business units, it can be difficult to realize the
hoped-for value added.
Mergers, Acquisitions, and Strategic Alliances: Each of the four growth
strategy categories just discussed can be carried out internally or externally,
through mergers, acquisitions, and/or strategic alliances. Of course, there also can
be a mixture of internal and external actions.
Various forms of strategic alliances, mergers, and acquisitions have
emerged and are used extensively in many industries today. They are used
particularly to bridge resource and technology gaps, and to obtain expertise and
market positions more quickly than could be done through internal development.
They are particularly necessary and potentially useful when a company wishes to
enter a new industry, new markets, and/or new parts of the world.
Despite their extensive use, a large share of alliances, mergers, and
acquisitions fall far short of expected benefits or are outright failures.
example, one study published in Business Week in 1999 found that 61 percent of
alliances were either outright failures or "limping along." Research on mergers
and acquisitions includes a Mercer Management Consulting study of all mergers
from 1990 to 1996 which found that nearly half "destroyed" shareholder value; an
A. T. Kearney study of 115 multibillion-dollar, global mergers between 1993 and
1996 where 58 percent failed to create "substantial returns for shareholders" in the
form of dividends and stock price appreciation; and a Price-Waterhouse-Coopers
study of 97 acquisitions over $500 million from 1994 to 1997 in which two-thirds
of the buyer's stocks dropped on announcement of the transaction and a third of
these were still lagging a year later.
11

12. Many reasons for the problematic record have been cited, including paying
too much, unrealistic expectations, inadequate due diligence, and conflicting
corporate cultures; however, the most powerful contributor to success or failure is
inadequate attention to the merger integration process. Although the lawyers and
investment bankers may consider a deal done when the papers are signed and they
receive their fees, this should be merely an incident in a multi-year process of
integration that began before the signing and continues far beyond.
Stability Strategies
There are a number of circumstances in which the most appropriate growth stance
for a company is stability, rather than growth. Often, this may be used for a
relatively short period, after which further growth is planned. Such circumstances
usually involve a reasonable successful company, combined with circumstances
that either permit a period of comfortable coasting or suggest a pause or caution.
Three alternatives are outlined below, in which the actual strategy actions are
similar, but differing primarily in the circumstances motivating the choice of a
stability strategy and in the intentions for future strategic actions.
1. Pause and Then Proceed: This stability strategy alternative (essentially a
timeout) may be appropriate in either of two situations: (a) the need for an
opportunity to rest, digest, and consolidate after growth or some turbulent events -
before continuing a growth strategy, or (b) an uncertain or hostile environment in
which it is prudent to stay in a "holding pattern" until there is change in or more
clarity about the future in the environment.
2. No Change: This alternative could be a cop-out, representing indecision or
timidity in making a choice for change. Alternatively, it may be a comfortable,
12

13. even long-term strategy in a mature, rather stable environment, e.g., a small
business in a small town with few competitors.
3. Grab Profits While You Can: This is a non-recommended strategy to try to
mask a deteriorating situation by artificially supporting profits or their appearance,
or otherwise trying to act as though the problems will go away. It is an unstable,
temporary strategy in a worsening situation, usually chosen either to try to delay
letting stakeholders know how bad things are or to extract personal gain before
things collapse. Recent terrible examples in the USA are Enron and WorldCom.
Retrenchment Strategies
Turnaround: This strategy, dealing with a company in serious trouble, attempts
to resuscitate or revive the company through a combination of contraction
(general, major cutbacks in size and costs) and consolidation (creating and
stabilizing a smaller, leaner company). Although difficult, when done very
effectively it can succeed in both retaining enough key employees and revitalizing
the company.

14. PRACTICAL STUDY
PAKISTAN TELECOMMUNICATION COMPANY LIMITED
(PTCL)
Established on January 1, 1996
Head Office: - Pakistan Telecommunication Company Limited ,G-8/4,
Islamabad
INTRODUCTION
Ten years into a new century, the telecom sector of world finds itself at crossroads
after changing itself almost beyond recognition over the last 25 years.
Privatization and competition are the order of the day, with a majority of countries
having adopted these policies to advance their telecom sector. The results have
been impressive; the industry has grown at unprecedented pace. Although there
has been a phenomenal growth in Pakistan, especially in the cellular mobile
communication and in the internet, yet the late density remains almost stagnant.
So far PTCL is the sole land line service provider of Pakistan. PTCL is the giant
of Pakistan telecommunication industry and enjoying the monopoly. This part of
the report contains a brief introduction of PTCL. This introduction is divided into
two parts,
HISTORY AND CURRENT SITUATION
BRIEF HISTORY
Over the years, technology has changed the concept of communication and what
was thought to be a fictional only a decade ago, has actually made its way through
14

15. to our hands today. This is the future we dreamt of so fondly. Welcome to the
modern age, of telecommunication, which have become complementary to our
lives. But there must also be an anchor to introduce, allow, improve and
channelize all these services and innovations sweeping through the globe. In
Pakistan same anchor is Pakistan Telecommunication Company Limited from the
humble beginnings of posts & Telegraph Department in 1947 and establishment
of Pakistan Telephone & Telegraph Department in 1962, to this very day, PTCL
is a story of commitment and vision. Pakistan Telecommunication Corporation
(PTC) set sails for its voyage of glory In December 1990, taking over operations
and functions from Pakistan Telephone and Telegraph Department under Pakistan
Telecommunication Corporation Act 1991. This coincided with the Government’s
competitive Policy, encouraging Private Sector participation and resulting in
award of licenses for Cellular, card-operated Payphones, paging and, lately, data
communication Services.
Pursuing a progressive policy, the Government in 1991, announced its Plans to
privatize PTC, and in 1994 issued six million vouchers exchangeable into 600
million shares of the would-be PTCL in two separate placements. Each had a par
value of Rs.10 per share. These vouchers were converted into PTCL Shares in
mid 1996.In 1995, Pakistan Telecommunication (Reorganization) Ordinance
Formed the basis for PTCL monopoly over basic telephony in the country. It also
paved the way for the establishment of an independent regulatory regime. The
Provisions of the Ordinance were lent permanence in October 1996 through
Pakistan Telecommunication (Reorganization) Act. The same year, Pakistan
Telecommunication Company Limited was formed and listed on all stock
Exchanges in Pakistan. Since then, PTCL has been working vigorously to meet
the dual Challenge of telecom development and socio-economic uplift of the
country. This is characterized by a clearer appreciation of ongoing telecom
scenario where in convergence of technologies continuously changes the shape of
15

16. the Sector. A measure of this understanding is progressive measures such as
Establishment of the company’s mobile and Internet subsidiaries (U-fone &
Paknet) in 1998. As telecommunication monopolies head towards and imminent
end, services and infrastructure providers are set to face even bigger challenges.
Pakistan also entered post-monopoly era with deregulation of the sector in
January 2003. On the Government level, a comprehensive liberalization policy for
Telecom sector has already been announced now. Now PTA have issued License
to two new telecom companies in Pakistan TELENOR international and WARID
TEL this act will put some challenges for PTCL to cope with. PTCL is in process
of enhancing organizational and business Proficiency through vertical integration
and horizontal diversification. At the same time, cross-national ownerships,
operations and partnerships are being evaluated with a view to developing and
diversifying the business.
CURRENT SITUATION OF ORGANIZATION
After having brief introduction from past end of PTCL now we move towards the
current situation of the company .In this part focus will be on the:
 Structure of organization
 Technical & operational Net work
 Services provided by PTCL
 Financial front of PTCL
 Competitors and subsidies
Structure of organization
An Organizational Structure clarify the roles of personnel of an Organization and
to determine who has to do what task, which is responsible for what, objectives to
be achieved, who is to report to whom and to remove the obstacles for
performance caused by confusion and uncertainty of job assignment as well as to
16

17. make easy decision- making and communication networks reflecting and
supporting organization objectives.
The head of Pakistan Telecommunication Company Limited is called “President”.
Then come the SEVPs (Senior Executive Vice Presidents), i.e. SEVP (Finance),
SEVP (Operations), SEVP (Technical), and SEVP (Human Resource
Management), SEVP (Marketing & Business Development). Then there is a chain
of Executive Vice-Presidents (EVPs) like EVP (Finance Central), EVP
(Marketing), EVP (HR Central), EVP (Accounts), EVP (Operation), EVP
(Information Technology, Training & Research), and EVP (Revenue). All these
are appointed at Pakistan Telecommunication Company, Headquarters at G-8/4,
Islamabad. Apart from these EVP, there are also EVP (Operation), EVP (HR) etc
who are heading the other regions of PTCL in major cities country wide. Then
there are Chief Engineers and General Managers at H/Qs who report to their
relevant EVP. Then there are Senior Managers, Deputy Directors, Assistant
Directors, Account Officers, Assistant Account Officers, Financial Analysts,
Marketing Managers, Computer Programmers, and IT Specialists etc.There are
also Regional Heads (General Managers) to head PTCL Regions then come the
Senior Managers (Operations), Senior Engineers (Operations), Engineers to look
after the telecom system of Regions. There are also Senior Managers Finance,
Account Officers and Accountants to Handle Regional account and billing matters.
Manager HR & his staff are responsible to take care of Personnel affairs at
Regional Level. In non-gazetted staff there are Engineering Supervisors
Operations /Switching /Power plant /Optical Fiber system/M.W Media, Account
Assistants, Stenographers, Assistants, Key Punch Operators, Telecom
Technicians, Upper Division Clerks, Lower Division Clerks, Line Men, Wire
Men, Drivers, Exchange Cleaners, Naib Qasids and Peons etc. All the staff is
17

18. a
recruited by the HR Department headed by SEVP HR. The HR experts are
responsible for hiring & to further streamline its recruitment process.
MAIN OFFICES
The Head Office of Pakistan Telecommunication Company Limited is situated in
Sector G-8/4, Islamabad, which is headed by the “President”. Besides, it has
Regional Headquarters like:
 Islamabad Telecom Region,
 Rawalpindi Telecom Region,
 Hazara Telecom Region Abottabad,
 Northern Telecom Region-I Peshawar,
 Lahore Telecom Region (South),
 Lahore Telecom Region (North),
 Multan Telecom Region,
 Faisalabad Telecom Region
 Southern Telecom Region-I Hyderabad
 Southern Telecom Region-II Karachi
 Southern Telecom Region-V Sukkur
 Western Telecom Region Quetta.
 Switching network Central region Lahore.
These Regions provide Telecommunications services to the customers in their
respective areas. Apart from these, PTCL has an Optical Fibre Construction
Region Lahore and Optic Fiber System Islamabad, each headed by a General
Manager to install, operate and look after optic fibre systems/cables.
Technical & Operational Net Work
Pakistan telecommunication Corporation under the Act 1996, PakistanTelecommunication Authority (PTA) issued license to Pakistan
Telecommunication Company Limited for the provision of telecom services
within Pakistan to private sector and the general public as the Federal
18

19. Government may determine and during the exclusivity period of the Pakistan
Telecommunication Company Limited (PTCL) specified in above-mentioned Act.
PTCL has 25 years license to provide telecom services in Pakistan with Stake in
the Company with about 62% equity. PTCL has largest network and huge
infrastructure for it’s more than 4,405,161users as on (Mar,2008).
Switching Technology
There are 7 different kinds of switching technologies currently operational in
PTCL network.
Alcatel
Siemens
NEC
Erricsson
Huawi
J.S telecom
ZTE
With these different switching technologies PTCL is running its huge network
and providing different communication facilities to its customers.
TECHNICAL AND OPERATIONAL MILE STONES
PTCL is continuously improving its network. During the year 2007 PTCL
installed capacity was 4940154 but now in current year the installed capacity is
improved. PTCL achieved 100% digitalization in this year.
Computerized Fault Management System
This feature of PTCL improved network & is being used to register & rectify
Land Line Faults in a computerized way. This system was working in few cities
but now it is available all over the Pakistan. (18)
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20. Launch Of IN Platform
To augment the capacity and introduce additional value added services a new
Intelligent Network (IN) Platform was launched in October 2003.This platform
has higher capacity for prepaid calling cards and provision for introduction of new
services.
Optical Fiber Junction Access Network
To further support the launch of new services the optical fiber junction access
network has been in implementation phase. This system further supports the
upcoming project of PTCL WLL (wire less local loop), Broad Band Services &
IPTV. This was the brief introduction of PTCL network now we move further and
develop our understanding about PTCL services and offerings.
SERVICES OF PTCL
Pakistan Telecommunication Company Limited not only Provides Conventional
telephone facilities, it also offers optical fiber services to the private sector. We
will briefly discuss below the product lines being offered by the PTCL. Basically
PTCL divide their services into two parts.
services for consumers
services for corporate customers
Services for Consumers
These services are basically for the common users (Individual/home users) those
use telephone in their home/work place and they are basically non business users.
a) New Telephone Connections:
As mentioned earlier, PTCL is presently the only telecom company, who
provided fixed-line telephony in the country. So whenever, any Private business
concern or any individual needs a new telephone connection for provision of
telephone service.
b) Value Added Services:
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21. t
CLI (Caller’s Line Identification)
Caller Line Identification (CLI): Calling line Identification (CLI) allow customers
to identify the caller before picking up the phone receiver. To subscribe to CLI
services, a customer needs a telephone set with display capability or a CLI device
attached to the phone.
Advantages:
A Check on obnoxious calls.
C Complete record of incoming / outgoing calls with time & date.
C User Friendly
PREPAID CALLING CARDS:
PTCL calling card is the most popular choice of millions of customers all over the
country. It is now available with balance transfer facility and follow on call
facility.
 Comes in easily affordable denominations of Rs. 100, 250, 500, 1000
and 2000.
 Easily available throughout the country
 Easy to use from any PTCL digital phone (Dial 1010)
 Fast and easy, nationwide and international access
 No line rent and no Phone bills
 24 hours customer services through toll free number (0800-80800)
How to use it:
 Scratch off the security coating on the indicated strip to get your card
Pin Number.
 Dial PTCL’s toll free number 1010 from any digi al phone.
 Dial 1 for Urdu & 2 for English Instructions, Enter your card Number &
Press #. For International Call Dial
00+CountryCode+CityCode+PhoneNumber+#.
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22. E-BILL PAYMENT
Billing system is a part of customer services so providing connivance to its
valuable customers PTCL launched a new billing service which is available
through “ PTCL Calling Card” This is another service from PTCL. This service is
basically providing billing solutions for the users.
FINANCIAL ANALYSIS
Financial analysis of any organization is very necessary for the evaluation and
assessment of a firm. The information derived from these types of analysis should
be blended to determine the overall financial position. This analysis includes ratio
analysis, common size analysis and the study of differences in components of
financial statement. One of the primary objectives is identification of major
changes in trends, amounts and relationship and investigation of the reasons
underlying those changes. In the financial analysis of P.T.C.L we will analyze
some important information about the company. As I did my internship in human
resource management, but it has not an independent organization so I have to
analyze the P.T.C.L for the analysis purpose.
Current ratio
Current Ratio is an indicator to determine the short term debt paying ability or the
liquidity of a company. It tells us that how many current assets are available to
pay for the current liabilities of the company. Current ratio of the company in 31
Mar 2008 is 1.67& is favorable for a company. The ideal condition is 1.1 but ratio
is quite reasonable. Quick ratio:
Quick ratio or the acid test ratio also performs the same task as is performed by
current ratio but with more sophistication. Quick ratio of the company is 1.5 up to
Mar 31, 2008 its quick ratio is decreasing. As P.T.C.L is a service organization
there fore the quick ratio is very good because there is not need of inventory as
any manufacturing organization needs. As already mentioned, presently PTCL
has to face war with major competitors in mobile phone & WLL telephony
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23. operators, however, there are also competitors of its following
subsidiaries/products: -
SUBSIDIRAY/PRODUCT COMPETITOR
Multimedia & Broad Band (ISP Product) There is about 100 competitors of
product throughout the country to provide Internet service to the customers.
However, some of the major competitor ISP’s of product are Cyber net, World
online, Apollo, World Call, and Comsats WOL etc. U-fone (Cellular service
provider). There are five competitors of Ufone in cellular phone industry i.e.
Mobilink, Instaphone and C.M Pak, Telenor, Waridtel. PTCL Calling Cards
(Product) Hello Cards, Call Point Cards, Call Mate Cards, Global Telecom Cards.
Wireless Local Loop (V-Fone) Go CDMA, Wateen Telecom & World Call are
the Fixed Wireless Telephone competitors of V-PTCL. Marketing Department is
called a revenue-generating department of an organization. Marketing Department
undertakes market research and gives feedback to management about customers
needs and wants on the basis of which, products and services are developed and
positioned to give value to the customers. Thus Marketing department of an
organization plays a pivotal role in its business development, growth & expansion.
During my internship I worked with PTCL marketing department. Through
working there I gain so much practical knowledge that will help me during my
practical life. For understanding the work flow and the operation of the
department we have to move in certain manner. We have to look the key
operation the structure of the department and in the end the focus will be on the
critical analysis.So we will move in the pattern describe below:-
 Marketing strategy of PTCL
 Market segmentation of PTCL
 Marketing mix of PTCL
 Promotional strategy of PTCL
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24. 1. Marketing Strategy of PTCL
For understanding the marketing department work flow and its function we must
have clear picture of the PTCL’s marketing strategy. For developing clear
understanding of marketing strategy of PTCL there is no one line statement or
clear vision of marketing department so we have to move traditionally .Classically,
Marketing has been all about the “four P’s”: Product, Place, Price and Promotion.
The marketer identifies a target market, defines the product and Pricing to appeal
to this market and a strategy to deliver the product to the market. Thus the
marketer is the steward of the value proposition, ensuring that the firm is
delivering maximum value to its customers. We will briefly discuss below the
marketing strategy, product planning, development & management, Pricing
strategy, distribution strategy and promotional strategy: -
Marketing Strategy
Normally, a marketing strategy identifies the target markets, the desired position
in each market and the marketing mix that will persuade those target markets to
part with their money. Market is targeted through market segmentation.
Segmentation can be done on four types i.e. Demographic Segmentation (age,
gender, race/ethnicity, household type, home ownership, education, employment,
income etc.), Geographic segmentation. Positioning oneself by product can do
positioning differentiation, positioning by product usage, positioning against a
particular competitor, positioning against an entire product category, positioning
by association and positioning by problem, Marketing Mix includes P’s i.e.
Product, Price, Promotion and place.
TARGET MARKET
PTCL’s 80% revenue comes from just 20% customers, who are corporate
customers and other big and small business organizations. The main focus of
PTCL marketing efforts is on retaining and satisfying that 20% chunk of key
customers at any cost. For this purpose, PTCL is now established Corporate
24

25. Customer Services Centers in major cities to take care of these vital customers.
Apart from these important customers, PTCL targets general public and other
small business companies for sale of its landline telecom services like telephone,
fax, Internet, as well as other services like CLI, VMS, and Digital Facilities etc.
Market Segmentation
Basically PTCL segmented its market on two bases
To better implement customer services features, segment the market on a
customer basis:
– Corporate
– Resident ional
on the basis of services as:
– Telephony
– Data
– Video
PTCL has segmented its market for its services and products to effectively deal
with its customers. Some of its services like Universal Access Number, Co-
Location centers and virtual private network are specially targeted at corporate
customers and business concerns. The other services like new telephone
connections, digital services etc. are meant for mass market. The services like
Internet, fax facility etc. are targeted at both the corporate and general customers.
POSITIONING STRATEGY
As PTCL is the sole provider of the landline telecom services in the country; it is
the market leader in providing these services because there are no competitors to
challenge its market leader status. Thus presently PTCL is facing no problems in
positioning its services in the market as a market leader because it enjoys
monopoly in the industry. However, with the deregulation of telecom sector
PTCL is gearing up itself to maintain this market leader position, on the other
hand competitors are doing to challenge it.
25

26. MARKETING MIX
Product Planning:
In PTCL, so far products had been planned and developed by the engineering
department and marketing professionals had no role in product planning as there
was no marketing department in the Company. But now marketing professionals
have been inducted in the Company and they will definitely have a close
coordination with engineering department in planning and development of
products to satisfy customers’ desires. It should also be kept in mind that PTCL is
a technical organization enjoying state-of-the-art telecom technology. The
services offered by PTCL are built in the technology and with the passage of time;
PTCL rolls out these products in the market. even many products, which have
become obsolete in developed countries, are launched as new products by PTCL.
But we cannot deny the fact that being monopolist, PTCL is depriving customers
of many digital services that are available free in many other countries. However,
as the Marketing department has been established now, it is expected that in
future there will be close coordination and liaison between marketing
professionals and engineers for planning and developing customers oriented
products.PTCL is also in the process of hiring brand Managers to manage its
different products in a thorough professional way.
Pricing Strategy:
Being a government organization, PTCL is not authorized to determine the prices
of its products itself, the Telecom Regulator Authority viz. Pakistan
Telecommunication Authority (PTA) fixes the prices of telecom services. The
process is such that whenever PTCL intends to increase or reduce the rates of its
services, it submits its Proposal to PTA for approval. PTA then calls consumers’
representatives, journalists and other interested groups for discussion on the
proposal. After listening to the viewpoints of all the interested parties, PTA gives
26

27. its decision. If PTA approves PTCL’s proposal, the new rates are enforced. It may
be mentioned here that telecom technology is only technology whose rates are on
the decline with the passage of time. PTCL also rationalizes its tariff with the
passage of time. Tariff rationalization process started in 1997 as part of GoP
Telecom Sector policy for privatization of this sector. It was mainly focused on
rebalancing the domestic process like NWD, international, local call, line rent etc.
Rebalancing is completed by the end of 2003 (as per Tariff rates) with the
objective to position PTCL for competition.
PROMOTIONAL STRATEGY
PTCL is using following components of promotional mix for the promotion and
Publicity of its product/services.
P Advertising:
In promotional mix, PTCL’s main stress is on advertising in print and electronic
media. PTCL periodically places its advertisements in print media on services like
“H/Qs hotline 0800-44544”, “Caller line identification (CLI)”, “Voice Messaging
Service”, “Digital Facilities”, “PTCL Prepaid Calling Cards”, “Inquiry 17”,
“Complaint 18”, phone bill cards prepaid telephone etc. to remind the customers
of these services. Sometimes, corporate ads are also released to print media to
mark special occasions. PTCL’s Commercials on “Prepaid Calling Card”, “CLI”,
“Voice Messaging”, “Digital Facilities” etc. are also broadcast immediately on
electronic media as reminders to Customers.
Sales Promotion:
PTCL charges 1/3rd rates on national calls from 06:00 pm – 07:00 am and local
calls are free from 11:00 pm to 06:00 am to promote the usage of its telecom
network. Moreover, PTCL offers special rate packages on special occasions like
Ramadan Package and EID package, which offer customer reduced rates for
specific timings. For Example, In EID Package PTCL charges half rates from
6:00am - 6:00pm and quarter from 6:00pm – 6:00 am to attract customers to use
27

28. its telephone service. These rates result in increased revenue for PTCL and also
facilitate the customers to talk to their near and dear ones on these special
occasions on affordable rates.
o Personal Selling:
As PTCL is enjoying monopoly in fixed-line telephony, the Company has no
Professional sales force because the company has not felt any strong need to use
the Services of a sales force for increasing the sale of its products. At the moment,
PTCL’s Customer Services Centers are playing the role of sales outlets.
Customers can make telephone calls; send fax messages from these Customer
Services Centers. They can also get connected their telephone bills and get
duplicate bills from these outlets. However, with the establishment of Marketing
Department in PTCL, The marketing professionals are now in the process of
inducting professional sales force for the company.
SWOT ANALYSIS OF PTCL
S STRENGTH
S PTCL enjoy monopoly
P State of the Art International Gateway Exchanges & Satellite Earth Stations
S large earnings
l good quality international connectivity
g Customer Base of over 4 million
C Government support
These are the few basic strengths of the PTCL now we look each one in isolation.
PTCL Enjoy Monopoly
PTCL is sole provider of land line services in Pakistan .so there is no competition
regarding their basic service. it means that there is a monopoly of PTCL.
• International Submarine Cables
28

29. • High Capacity National Fiber Optic Backbone Ring
• 36 Transit Exchanges with easy Facility of Expansion
• About 99% Digitization of Country Network
• Strong Platforms & Exchanges for Value added Services
• Access Network & Customer Base of over 04 millions
State Of The Art International Gateway Exchanges & Satellite Earth
Stations
PTCL have largest net work with its state of art technology and new digital
exchanges. These are the few important characteristics of PTCL network.
• International Submarine Cables
• High Capacity National Fiber Optic Backbone Ring
• 36 Transit Exchanges with easy Facility of Expansion
• About 99% Digitization of Country Network
• Strong Platforms & Exchanges for Value added Services
Large Earnings
As described earlier that PTCL with more then 4 million users having greet
revenues this is another strength of the company
Government support
As you know PTCL is government organization so it has great support and it is
strength for PTCL.
29

30. Seven Key Internal Forces
Management
Marketing
Research &
Development
Purchasing
Manufacturing
Finance/Accounting
Information
Systems
Why do firms in the same industry pursuing the same strategies vary
by performance?
Ebay versus Ubid
Walmart versus Kmart
Best Buy versus Radio Shack
Often the top performing firm(s) possesses a Competitive Advantage
over its rivals

31. r
SWOT ANAYLASIS
WEAKNESS
Image– Government organization
Image– Lack of customer focus
Image– Outdated people and technology (perception)
Lack of aggressive marketing
Lack of customer services
Ambiguous management style
Lack of corporate culture
Social responsibility
OPPORTUNITY
Growth in telecommunication industry
More aware and technology understanding consumer – a base that is
growing at a fast rate
Market open for more number of products – less dependence on single
category or product
Opportunity to introduce High Value Added Products / High margin
products for the new, more aware consumer
Time to establish brand loyalty, Pre-empt competitors, co-opt partners,
invest in technology and networks
THREATS
Internet Telephony & othe rapidly evolving technologies
Expected competition due to the deregulation in December 2003
New technologies
Efficient operators
International players, reduction in settlement rates,
31

32. Migration to satellite and cellular telephony
REVIEW OF LITERATURE
Organizations have to formulate strategies at three major levels: Corporate,
Business and functional.
1. Corporate strategy: Determines the business or businesses in which the
firm will or should compete and how it will fundamentally conduct the
business or businesses. Corporate strategy answers these questions:
Does the organization have a strategic advantage?
Does the company want to compete or find a niche?
Does the company seek to concentrate on one product or product line, or
on multiple products or products line?
Will the corporation be innovative?
Does the company want or need to grow, stabilize, reduce its investment,
turn company fortunes around, or defend itself against a takeover?
2. Business (SBU) strategy: Answers the question, how do we compete in
this business? (This is the focus of many grand strategies)
3. Functional level strategies: Supports other strategies and answers the
question, how do we obtain the most effective and efficient use of our
resources?
Economic Functional strategies
1. Marketing
2. Operations-production or service generation
3. Finance
4. Human Resource management
32

33. 5. Information Systems/Research and Development/Other
significant areas
1. Management Functional Strategies
1. Planning, organizing, Leading, Controlling, Problem Solving
2. Communicating, integrating
3. Management Systems
4. Organizational culture
CORPORATE OR GRAND LEVEL STRATEGY:
Growth Strategy
Integrative
Market penetration
Forward
Market Development
Backward
Product Development
Horizontal
Diversification
Stability
Holding
Harvesting
Divestment
Retrenchment
Turnaround
Liquidation
Selling out
Investment ReductionFUNCTIONAL STRATEGIES
Functional strategies are relatively short-term activities that each functional area
within a company will carry out to implement the broader, longer-term corporate
level and business level strategies. Each functional area has a number of strategy
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34. The
choices, that interact with and must be consistent with the overall company
strategies.
Three basic characteristics distinguish functional strategies from corporate
level and business level strategies: shorter time horizon, greater specificity, and
primary involvement of operating managers.
A few examples follow of functional strategy topics for the major functional
areas of marketing, finance, production/operations, research and development,
and human resources management. Each area needs to deal with sourcing
strategy, i.e., what should be done in-house and what should be outsourced?
Marketing strategy deals with product/service choices and features, pricing
strategy, markets to be targeted, distribution, and promotion considerations.
Financial strategies include decisions about capital acquisition, capital allocation,
dividend policy, and investment and working capital management.
production or operations functional strategies address choices about how and
where the products or services will be manufactured or delivered, technology to
be used, management of resources, plus purchasing and relationships with
suppliers. For firms in high-tech industries, R&D strategy may be so central that
many of the decisions will be made at the business or even corporate level, for
example the role of technology in the company's competitive strategy, including
choices between being a technology leader or follower. However, there will
remain more specific decisions that are part of R&D functional strategy, such as
the relative emphasis between product and process R&D, how new technology
will be obtained (internal development vs. external through purchasing,
acquisition, licensing, alliances, etc.), and degree of centralization for R&D
activities. Human resources functional strategy includes many topics, typically
recommended by the human resources department, but many requiring top
management approval. Examples are job categories and descriptions; pay and
benefits; recruiting, selection, and orientation; career development and training;
34

35. evaluation and incentive systems; policies and discipline; and
management/executive selection processes.
THE DATA COLLECTION METHODS
Remembering that data form the basis for the effective, unemotional
communication without which no process improvement effort can succeed,
you need to avoid two significant problems associated with Data
Collection. You need to define, not simply identify, the following: ! When
and how often you will collect the data
! How you will collect the data
! Units of measurement you will use in collecting the data
! The criteria for defects
! How you will handle multiple defects on single products
If you haven't thought about these issues, your Data Collection process
may be doomed from the start. This is especially true when more than one
person is collecting data. What is meaningful to one worker might not be
to another. You have to take the time to develop adequate, clear-cut
definitions, and train each collector to use those definitions. You can never
eliminate bias, but it is important to minimize it. Here are some ways your
data can be biased (Viewgraph 9):
On the one hand, the workers may speed up the way they work in
the process, thus skewing the data in their favor. This may occur if
they have a perception that the variables data they are collecting
will show that they could be more efficient, productive, or effective.
Once the Data Collection effort ceases, they may return to their old
pace of operations.
On the other hand, the burden of Data Collection may cause a
slowdown in the natural flow of the process.
35

36. DATA ANALYSIS
Analysis of data is a process of inspecting, cleaning, transforming, and modeling
data with the goal of highlighting useful information, suggesting conclusions, and
supporting decision making. Data analysis has multiple facets and approaches,
encompassing diverse techniques under a variety of names, in different business,
science, and social science domains.
Data mining is a particular data analysis technique that focuses on modeling and
knowledge discovery for predictive rather than purely descriptive purposes.
Business intelligence covers data analysis that relies heavily on aggregation,
focusing on business information. In statistical applications, some people divide
data analysis into descriptive statistics, exploratory data analysis, and
confirmatory data analysis. EDA focuses on discovering new features in the data
and CDA on confirming or falsifying existing hypotheses. Predictive analytics
focuses on application of statistical or structural models for predictive forecasting
or classification, while text analytics applies statistical, linguistic, and structural
techniques to extract and classify information from textual sources, a species of
unstructured data. All are varieties of data analysis.
36

37. CONCLUSIONS
Decision making is a complex subject, worthy of a chapter or book of its own.
This section can only offer a few suggestions. Among the many sources for
additional information, I recommend Harrison (1999), McCall & Kaplan (1990),
and Williams (2002). Here are some factors to consider when choosing among
alternative strategies:
* It is important to get as clear as possible about objectives and decision
criteria (what makes a decision a "good" one?)
* The primary answer to the previous question, and therefore a vital
criterion, is that the chosen strategies must be effective in addressing the
"critical issues" the company faces at this time
* They must be consistent with the mission and other strategies of the
organization
* They need to be consistent with external environment factors, including
realistic assessments of the competitive environment and trends
* They fit the company's product life cycle position and market
attractiveness/competitive strength situation
* They must be capable of being implemented effectively and efficiently,
including being realistic with respect to the company's resources
* The risks must be acceptable and in line with the potential rewards
* It is important to match strategy to the other aspects of the situation,
including: (a) size, stage, and growth rate of industry; (b) industry
characteristics, including fragmentation, importance of technology,
commodity product orientation, international features; and (c) company
37

38. position (dominant leader, leader, aggressive challenger, follower, weak,
"stuck in the middle")
* Consider stakeholder analysis and other people-related factors (e.g.,
internal and external pressures, risk propensity, and needs and desires of
important decision-makers)
* Sometimes it is helpful to do scenario construction, e.g., cases with
optimistic, most likely, and pessimistic assumptions.
38

39. RECOMMENDATIONS
Follow the Leader: when the market has no more room for copycat products and
look-alike competitors. Sometimes such a strategy can work fine, but not without
careful consideration of the company's particular strengths and weaknesses. (e.g.,
Fujitsu Ltd. was driven since the 1960s to catch up to IBM in mainframes and
continued this quest even into the 1990s after mainframes were in steep decline;
or the decision by Standard Oil of Ohio to follow Exxon and Mobil Oil into
conglomerate diversification)
Count On Hitting Another Home Run: e.g., Polaroid tried to follow its early
success with instant photography by developing "Polavision" during the mid-
1970s. Unfortunately, this very expensive, instant developing, 8mm, black and
white, silent motion picture camera and film was displayed at a stockholders'
meeting about the time that the first beta-format video recorder was released by
Sony. Polaroid reportedly wrote off at least $500 million on this venture without
selling a single camera.
Try to Do Everything: establishing many weak market positions instead of a
few strong ones
Arms Race: Attacking the market leaders head-on without having either a good
competitive advantage or adequate financial strength; making such aggressive
attempts to take market share that rivals are provoked into strong retaliation and a
costly "arms race." Such battles seldom produce a substantial change in market
shares; usual outcome is higher costs and profitless sales growth
39

40. Put More Money On a Losing Hand: one version of this is allocating R&D
efforts to weak products instead of strong products (e.g., Polavision again, Pan
Am's attempt to continue global routes in 1987)
Over-optimistic Expansion: Using high debt to finance investments in new
facilities and equipment, then getting trapped with high fixed costs when demand
turns down, excess capacity appears, and cash flows are tight
Unrealistic Status-Climbing: Going after the high end of the market without
having the reputation to attract buyers looking for name-brand, prestige goods
(e.g., Sears' attempts to introduce designer women's clothing)
Selling the Sizzle Without the Steak: Spending more money on marketing and
sales promotions to try to get around problems with product quality and
performance. Depending on cosmetic product improvements to serve as a
substitute for real innovation and extra customer value.
40

41. REFERENCES
1. Harrison, E. Frank (1999). The Managerial Decision-Making Process (5th
ed.). Boston: Houghton Mifflin.
2. McCall, Morgan W., Jr., & Kaplan, Robert K. (1990). Whatever it takes:
The realities of managerial decision making (2nd ed.). Englewood Cliffs,
NJ: Prentice-Hall.
3. Porter, Michael E. (1980). Competitive Strategy: Techniques for analyzing
industries and competitors. New York: Free Press.
4. Porter, Michael E. (1985). Competitive advantage: Creating and sustaining
superior performance. New York: Free Press.
5. Williams, Steve W. (2002). Making better business decisions:
Understanding and improving critical thinking and problem solving skills.
Thousand Oaks, CA: Sage Publications.
41