Case Analysis: Strategic Outsourcing at Bharti Airtel Limited
Submitted by:
Bhuvnesh Prakash (PGP/18/188)
Group No: 6
Section- D
Introduction:
Mittal founded Bharti In 1995 with $900 in start-up capital. In 1999, Bharti sold a 20% equity interest to the private equity from Warburg Pincus. In 2000 it went public on the Indian National Stock Exchange, the Mumbai exchange and the Delhi stock exchange, raising $172 million in its IPO. In 2001-2002, it obtained licence for 15 out of India’s 23 circles and also obtained fixed-line licences for six of them. By 2003, Bharti was present in all of the major economic and industrial centres- representing 91% of all mobile users in India.
1. What must Bharti do to succeed well in the Indian mobile …show more content…
Their Purchasing power is relatively low compared to the U.S. and the Europe. The challenge for Bharti Airtel is to have the reliable, predictable usage-linked cost structure to become lowest cost producer of minutes. The issue with them is to overcome the capital expenditure problem. Indian telecom market was growing at 17% per annum. To succeed well in the Indian mobile phone market it must have expertise in customer services, reduce its cost and able to penetrate in every customer base. Technology leadership is must. Opportunities abound in the hinterland which must be exploited. The major competencies lies in Network operators, Innovation and sales and marketing, good service to customers, help in reducing …show more content…
If you were Bharti, What major concerns would you have about entering an outsourcing agreement with IBM? With Ericsson, Nokia, or Siemens?
The outsourcing to vendors and IBM were successful, but issues were there always. In the beginning of the implementation of the deal, Bharti had to contend with the high internal expectations from the deal as suddenly IT requests were coming from every office. It required a great deal of internal communication to clarify the limits of the agreement with IBM and the process that would be used to handle requests. Second issue was due to the different objectives of the partners from the deal which came from the diverse cultures at the two organizations. While Bharti had its start-up culture, IBM was quite the opposite and thus while Bharti looked at the deal to enable it to respond better in a high-intensity environment. Another important issue was the transfer of personnel from the IT and infrastructure teams to the partner organizations. The employees were conscious about the culture difference and career path. Due to outsourcing, Bharti may lose out better opportunities available with other vendors. Coordinating with vendors on daily basis, also adding the risk of outsourcing company ie company going
Submitted by:
Bhuvnesh Prakash (PGP/18/188)
Group No: 6
Section- D
Introduction:
Mittal founded Bharti In 1995 with $900 in start-up capital. In 1999, Bharti sold a 20% equity interest to the private equity from Warburg Pincus. In 2000 it went public on the Indian National Stock Exchange, the Mumbai exchange and the Delhi stock exchange, raising $172 million in its IPO. In 2001-2002, it obtained licence for 15 out of India’s 23 circles and also obtained fixed-line licences for six of them. By 2003, Bharti was present in all of the major economic and industrial centres- representing 91% of all mobile users in India.
1. What must Bharti do to succeed well in the Indian mobile …show more content…
Their Purchasing power is relatively low compared to the U.S. and the Europe. The challenge for Bharti Airtel is to have the reliable, predictable usage-linked cost structure to become lowest cost producer of minutes. The issue with them is to overcome the capital expenditure problem. Indian telecom market was growing at 17% per annum. To succeed well in the Indian mobile phone market it must have expertise in customer services, reduce its cost and able to penetrate in every customer base. Technology leadership is must. Opportunities abound in the hinterland which must be exploited. The major competencies lies in Network operators, Innovation and sales and marketing, good service to customers, help in reducing …show more content…
If you were Bharti, What major concerns would you have about entering an outsourcing agreement with IBM? With Ericsson, Nokia, or Siemens?
The outsourcing to vendors and IBM were successful, but issues were there always. In the beginning of the implementation of the deal, Bharti had to contend with the high internal expectations from the deal as suddenly IT requests were coming from every office. It required a great deal of internal communication to clarify the limits of the agreement with IBM and the process that would be used to handle requests. Second issue was due to the different objectives of the partners from the deal which came from the diverse cultures at the two organizations. While Bharti had its start-up culture, IBM was quite the opposite and thus while Bharti looked at the deal to enable it to respond better in a high-intensity environment. Another important issue was the transfer of personnel from the IT and infrastructure teams to the partner organizations. The employees were conscious about the culture difference and career path. Due to outsourcing, Bharti may lose out better opportunities available with other vendors. Coordinating with vendors on daily basis, also adding the risk of outsourcing company ie company going