The MTN group is a major player in the local, regional and global telecommunications market. Launched in 1994, the MTN Group has subscribers in 22 countries in Africa and the Middle East. The MTN Group is listed on the JSE Securities Exchange in South Africa and as of 31st December 2015, MTN recorded 232.5 million subscribers across its operations in Afghanistan, Benin, Botswana, Cameroon, Cote d’Ivoire, Cyprus, Ghana, Guinea Bissau, Guinea Republic, Iran, Liberia, Nigeria, Republic of Congo (Congo-Brazzaville), Rwanda, South Africa, Sudan, South Sudan, Swaziland, Syria, Uganda, Yemen and Zambia.
The changes that the group is making and the new hires in this region highlight some major areas that can be split into several sections. It must be clear that local disturbances in Nigeria where the company faced legal action for not turning off sim-cards was partially responsible for these shifts in thinking and restructuring after a massive loss of money. As such we have looked or created a category which we have referred to as Corporations which is really a study under governance and how difficult it is becoming for companies and international corporations to divorce themselves from the politics of local governments. For this reason we have also chosen to focus on regional issues believing for example that having business in the middle east or in trouble areas in East Africa would have an effect on the general operations of business.
MTN GROUP's DNA
It is almost impossible to speak about MTN and not talk about the rise of its mobile money platform. This is not a phenomenon restricted only to this telecom but a reflection of a trend in the region (mainly third world) that had brought about an invasion of telephony into banking. There are other shocks in the banking industry and in places like Asia this has brought about a rise in micro finance institutions that have been designed for less fortunate users which have thrived by simplifying the process of banking and by creating a saving culture. The bed rock of most of these systems has been the existence of strong social structures where the poor have really had no choice but to work together. The Rollout of infrastructure for telephony has caused a corresponding effect on the populace bringing about increased sales in cheap mobile handsets. There are several markets for these groups.
1. The affordable handset.
2. The dual sim handset.
3. The affordable smart phone that can handle simple applications.
4. The rise of the phone application (to boost agriculture, banking, health and education) and the need for young design professionals.
5. The creation of online stores for the hosting of applications.
So in this regard the decision to hire people with some extensive knowledge in the functions of banking institutions makes a lot of sense (both the Group CEO and the Vice President for Strategy have extensive banking experience).
THE BOARD
As can be expected, such massive penalties may have prompted a loss of staff.
The most natural process of larger groups such as these is to cut costs. If for example the group was charged a certain amount by the courts, it would make sense to ensure that the same amount of money that would go into payment of staff be diverted in order to cut costs. In addition to this the group would also make sure that new hires are given much broader portfolios so that less would be spent hiring more costly top level staff.
In addition to this the group would meet and observe the performance of its different regions and localities and then figure out where monies from one region or country can be sent to salvage the operations of another.
The Uganda group has seen the potential in alternative unrelated sources of revenue such as Marathons (which are held at the end of each year as possible sources of more revenue), in addition to this sponsorships of local artistes in large events have also proven quite effective as additional means of driving growth. The broad content or nature of some of these contracts has proven useful in for example making use of the popularity of local talents in the sell of handsets and device promotions.
EXPERIENCE LEVELS OF NEW HIRES
There are three key words in MTN groups thinking. Strategy, Management and Governance. On the whole, the three major hires at least in this country seem to be asking for a very broad skill level which feels a lot more like the need for evaluators (consultants). The MTN Group has also made sure that it continues to engages directly with locals in their Corporate Social Responsibility. This they have done using what they call Y'ello Care. A program for visually impaired children that assists the young learners as well as rolls out MTN Technological Strenghts is an example of a positive footstep that can ensure long term governance that is both 'visible' and noteworthy. A program that has run for over ten years covering a whole range of areas and subjects and givings it management staff more access to locals continues to provide useful insight into the future and in areas where growth is possible. This time around the partnership was with the Ministry of Education but there is plenty of room for growth given the youthful populations in the Country. We see possibilities of collaborations with other ministries such as Gender Labor and Social Development (which handles youth issues as well as disabilities). We also see an interconnection with the Ministry of Health for the creations of more platforms and MTN sponsored competitions that could drive up the level of partcipations and force the technology sector into the First World.
REGIONAL AND LOCAL CHALLENGES
We would expect to see some varying strategies for different regions. In areas affected by refugees we would hope to see more innovation to help people in need and those in transition. We also foresee the a lot of activity in the strategy department which makes sense given MTN GROUP's focus. For countries that are trying to achieve peace we see many opportunities for youth and employment and also for growth in infrastructure in places like South Sudan. Coastal areas have to be used to the maximum to ensure that fiber optic cables are fully utilized. In addition to this we hope to see a lot more engagement on a policy level. The ability to negotiate the different interests that are represented by governments in conflict will be a plus. The middle east represents a mix potential and possibility which must be balanced with politics and policy.
Middle East
Afghanistan, Cyprus, Iran, Syria,Yemen.
West Africa
Benin, Botswana, Cameroon, Cote d’Ivoire, Ghana, Guinea Bissau, Guinea Republic, Liberia, Nigeria.
Eastern Africa
Republic of Congo (Congo-Brazzaville), Rwanda, Sudan, South Sudan,Uganda.
Southern Africa
Swaziland, South Africa and Zambia.
TECHNOLOGICAL OPPORTUNITIES (4G LTE)
The release of new technology is welcome but must be tempered. The group should ensure that there are regulations that prevent unhealthy excitement over new technologies that causes older ones to become almost obsolete.
We also foresee partnerships with phone makers that are currently running newer Technologies. This means more links with the Chinese and companies like Huawei for tablets phones, dongles, routers and switches.
THE BROADER GROUP VISION
Perhaps the most notable part in the new changes in management is the choice of a former Vodafone employee. Maybe the groups sees an opportunity for a merger in the future ala Airtel and Warid. But the choice also reflects the need for fresher experience and perhaps even the need to extend and expand MTN thinking to reflect new possibilities for a continent on the move. A person with extensive experience in Europe might prove useful in the management of continental MTN. We also see this in light of regional telcos activity in East Africa where for example different countries often have very different dynamics and therefore a need for a whole new way of thinking. There are some positive ideas around Tanzania for example and fears regarding Kenya. Regional stability will tend to drive the manner in which these groups operate.
THE RISE OF CORPORATIONS
As corporations continue to rise and increase in power, there will be a need to think differently and across borders and to engage more deeply with governments in a manner not before seen. Risk areas have to be identified and decisions to invest weighed in light of concerns such as conflict and corruption.
CHANGES IN SENIOR MANAGEMENT AND WHAT THEY MEAN
We see a three major changes that reflect a thrust that is driving the activity of the management of the regional and local team. The first is focused on client loyalty and retention, the second is focused on services and products while the third is focused on sponsorships and events with an emphasis on the Geography or the region.
a) You have numbers, how do you keep them and how do you increase them? How do you create a system that can manage your existing clients so that you can meet their needs more effectively. Is the group going to outsource the customer service function to enhance it or will it boost the same and further computerize it?
Customer Experience and Loyalty Management
Customer Retention and Development
Strategic input
Budget Management
b) What are the areas that are most promising given the demographic challenges that are unique to regions and geographies? How do you harness these areas to create products that are relevant and useful and how do you boost your services?
Product Strategy
Product Design & Build
Product Solutions and Delivery Implementation
Product Management
Device Management
Budget Management
c) Can MTN group and it's regional managers make better use of events that are reflections of MTN Groups global vision? How can events and sponsorships be used to harmonize the bigger vision on a smaller scale?
Strategic planning
Regional Marketing Strategy
Operational Planning
Customer Experience & Customer Satisfaction
Regional Planning and Implementation Management
The Article is written by Nicholas Kyanda of the Hope First Group. Sources of information for this article were derived from post on the MTN social media page. Use of this article without permission is forbidden.
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