Following the liberalization of India's telecommunications service industry in the early 1990s, Bharti Tele-Ventures grew from a small entrepreneurial telephone equipment importer and manufacturer to become India's largest private-sector telecommunications service group in terms of numbers of customers. Attracting over $1.2 billion in foreign equity investments, more than any other Indian telecom firm, by 2001 Bharti had achieved the country's leading market position in mobile telecom service. By 2003, however, the nature of the game had changed. A spate of mergers and acquisitions had reduced the field to the most successful and best-financed contenders. At the same time, telecommunications regulatory changes let in new, lower priced competitors, significantly altering the rules of the game. Suddenly, in addition to government-owned BSNL and the stately Tata Group, India's oldest business house, Bharti was up against Reliance, the largest and most profitable of a new generation of business groups. Bharti's management and equity partners at Mittal and his partners at SingTel and Warburg Pincus had to determine what to do next.
Authors :: Tarun Khanna, Krishna G. Palepu, Ingrid Vargas
Swot Analysis of "Bharti Tele-Ventures" written by Tarun Khanna, Krishna G. Palepu, Ingrid Vargas includes – strengths weakness that are internal strategic factors of the organization, and opportunities and threats that Bharti Tele facing as an external strategic factors. Some of the topics covered in Bharti Tele-Ventures case study are - Strategic Management Strategies, Competitive strategy, Entrepreneurship, Global strategy, Regulation and Strategy & Execution.
Some of the macro environment factors that can be used to understand the Bharti Tele-Ventures casestudy better are - – geopolitical disruptions, competitive advantages are harder to sustain because of technology dispersion, digital marketing is dominated by two big players Facebook and Google, banking and financial system is disrupted by Bitcoin and other crypto currencies, central banks are concerned over increasing inflation, increasing transportation and logistics costs, technology disruption,
increasing inequality as vast percentage of new income is going to the top 1%, increasing energy prices, etc
Introduction to SWOT Analysis of Bharti Tele-Ventures
SWOT stands for an organization’s Strengths, Weaknesses, Opportunities and Threats . At Oak Spring University , we believe that protagonist in Bharti Tele-Ventures case study can use SWOT analysis as a strategic management tool to assess the current internal strengths and weaknesses of the Bharti Tele, and to figure out the opportunities and threats in the macro environment – technological, environmental, political, economic, social, demographic, etc in which Bharti Tele operates in.
According to Harvard Business Review, 75% of the managers use SWOT analysis for various purposes such as – evaluating current scenario, strategic planning, new venture feasibility, personal growth goals, new market entry, Go To market strategies, portfolio management and strategic trade-off assessment, organizational restructuring, etc.
SWOT Objectives / Importance of SWOT Analysis and SWOT Matrix
SWOT analysis of Bharti Tele-Ventures can be done for the following purposes –
1. Strategic planning using facts provided in Bharti Tele-Ventures case study
2. Improving business portfolio management of Bharti Tele
3. Assessing feasibility of the new initiative in Strategy & Execution field.
4. Making a Strategy & Execution topic specific business decision
5. Set goals for the organization
6. Organizational restructuring of Bharti Tele
Strengths Bharti Tele-Ventures | Internal Strategic Factors
What are Strengths in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The strengths of Bharti Tele in Bharti Tele-Ventures Harvard Business Review case study are -
Superior customer experience
– The customer experience strategy of Bharti Tele in the segment is based on four key concepts – personalization, simplification of complex needs, prompt response, and continuous engagement.
Cross disciplinary teams
– Horizontal connected teams at the Bharti Tele are driving operational speed, building greater agility, and keeping the organization nimble to compete with new competitors. It helps are organization to ideate new ideas, and execute them swiftly in the marketplace.
Organizational Resilience of Bharti Tele
– The covid-19 pandemic has put organizational resilience at the centre of everthing that Bharti Tele does. Organizational resilience comprises - Financial Resilience, Operational Resilience, Technological Resilience, Organizational Resilience, Business Model Resilience, and Reputation Resilience.
Training and development
– Bharti Tele has one of the best training and development program in the industry. The effectiveness of the training programs can be measured in Bharti Tele-Ventures Harvard Business Review case study by analyzing – employees retention, in-house promotion, loyalty, new venture initiation, lack of conflict, and high level of both employees and customer engagement.
Low bargaining power of suppliers
– Suppliers of Bharti Tele in the sector have low bargaining power. Bharti Tele-Ventures has further diversified its suppliers portfolio by building a robust supply chain across various countries. This helps Bharti Tele to manage not only supply disruptions but also source products at highly competitive prices.
Effective Research and Development (R&D)
– Bharti Tele has innovation driven culture where significant part of the revenues are spent on the research and development activities. This has resulted in, as mentioned in case study Bharti Tele-Ventures - staying ahead in the industry in terms of – new product launches, superior customer experience, highly competitive pricing strategies, and great returns to the shareholders.
Ability to recruit top talent
– Bharti Tele is one of the leading recruiters in the industry. Managers in the Bharti Tele-Ventures are in a position to attract the best talent available. The firm has a robust talent identification program that helps in identifying the brightest.
High brand equity
– Bharti Tele has strong brand awareness and brand recognition among both - the exiting customers and potential new customers. Strong brand equity has enabled Bharti Tele to keep acquiring new customers and building profitable relationship with both the new and loyal customers.
Highly skilled collaborators
– Bharti Tele has highly efficient outsourcing and offshoring strategy. It has resulted in greater operational flexibility and bringing down the costs in highly price sensitive segment. Secondly the value chain collaborators of the firm in Bharti Tele-Ventures HBR case study have helped the firm to develop new products and bring them quickly to the marketplace.
Operational resilience
– The operational resilience strategy in the Bharti Tele-Ventures Harvard Business Review case study comprises – understanding the underlying the factors in the industry, building diversified operations across different geographies so that disruption in one part of the world doesn’t impact the overall performance of the firm, and integrating the various business operations and processes through its digital transformation drive.
Learning organization
- Bharti Tele is a learning organization. It has inculcated three key characters of learning organization in its processes and operations – exploration, creativity, and expansiveness. The work place at Bharti Tele is open place that encourages instructiveness, ideation, open minded discussions, and creativity. Employees and leaders in Bharti Tele-Ventures Harvard Business Review case study emphasize – knowledge, initiative, and innovation.
Strong track record of project management
– Bharti Tele is known for sticking to its project targets. This enables the firm to manage – time, project costs, and have sustainable margins on the projects.
Weaknesses Bharti Tele-Ventures | Internal Strategic Factors
What are Weaknesses in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The weaknesses of Bharti Tele-Ventures are -
Skills based hiring
– The stress on hiring functional specialists at Bharti Tele has created an environment where the organization is dominated by functional specialists rather than management generalist. This has resulted into product oriented approach rather than marketing oriented approach or consumers oriented approach.
Ability to respond to the competition
– As the decision making is very deliberative, highlighted in the case study Bharti Tele-Ventures, in the dynamic environment Bharti Tele has struggled to respond to the nimble upstart competition. Bharti Tele has reasonably good record with similar level competitors but it has struggled with new entrants taking away niches of its business.
Workers concerns about automation
– As automation is fast increasing in the segment, Bharti Tele needs to come up with a strategy to reduce the workers concern regarding automation. Without a clear strategy, it could lead to disruption and uncertainty within the organization.
Slow decision making process
– As mentioned earlier in the report, Bharti Tele has a very deliberative decision making approach. This approach has resulted in prudent decisions, but it has also resulted in missing opportunities in the industry over the last five years. Bharti Tele even though has strong showing on digital transformation primary two stages, it has struggled to capitalize the power of digital transformation in marketing efforts and new venture efforts.
Increasing silos among functional specialists
– The organizational structure of Bharti Tele is dominated by functional specialists. It is not different from other players in the Strategy & Execution segment. Bharti Tele needs to de-silo the office environment to harness the true potential of its workforce. Secondly the de-silo will also help Bharti Tele to focus more on services rather than just following the product oriented approach.
High dependence on star products
– The top 2 products and services of the firm as mentioned in the Bharti Tele-Ventures HBR case study still accounts for major business revenue. This dependence on star products in has resulted into insufficient focus on developing new products, even though Bharti Tele has relatively successful track record of launching new products.
Need for greater diversity
– Bharti Tele has taken concrete steps on diversity, equity, and inclusion. But the efforts so far has resulted in limited success. It needs to expand the recruitment and selection process to hire more people from the minorities and underprivileged background.
Employees’ incomplete understanding of strategy
– From the instances in the HBR case study Bharti Tele-Ventures, it seems that the employees of Bharti Tele don’t have comprehensive understanding of the firm’s strategy. This is reflected in number of promotional campaigns over the last few years that had mixed messaging and competing priorities. Some of the strategic activities and services promoted in the promotional campaigns were not consistent with the organization’s strategy.
High operating costs
– Compare to the competitors, firm in the HBR case study Bharti Tele-Ventures has high operating costs in the. This can be harder to sustain given the new emerging competition from nimble players who are using technology to attract Bharti Tele 's lucrative customers.
Aligning sales with marketing
– It come across in the case study Bharti Tele-Ventures that the firm needs to have more collaboration between its sales team and marketing team. Sales professionals in the industry have deep experience in developing customer relationships. Marketing department in the case Bharti Tele-Ventures can leverage the sales team experience to cultivate customer relationships as Bharti Tele is planning to shift buying processes online.
Capital Spending Reduction
– Even during the low interest decade, Bharti Tele has not been able to do capital spending to the tune of the competition. This has resulted into fewer innovations and company facing stiff competition from both existing competitors and new entrants who are disrupting the industry using digital technology.
Opportunities Bharti Tele-Ventures | External Strategic Factors
What are Opportunities in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The opportunities highlighted in the Harvard Business Review case study Bharti Tele-Ventures are -
Creating value in data economy
– The success of analytics program of Bharti Tele has opened avenues for new revenue streams for the organization in the industry. This can help Bharti Tele to build a more holistic ecosystem as suggested in the Bharti Tele-Ventures case study. Bharti Tele can build new products and services such as - data insight services, data privacy related products, data based consulting services, etc.
Better consumer reach
– The expansion of the 5G network will help Bharti Tele to increase its market reach. Bharti Tele will be able to reach out to new customers. Secondly 5G will also provide technology framework to build new tools and products that can help more immersive consumer experience and faster consumer journey.
Building a culture of innovation
– managers at Bharti Tele can make experimentation a productive activity and build a culture of innovation using approaches such as – mining transaction data, A/B testing of websites and selling platforms, engaging potential customers over various needs, and building on small ideas in the Strategy & Execution segment.
Leveraging digital technologies
– Bharti Tele can leverage digital technologies such as artificial intelligence and machine learning to automate the production process, customer analytics to get better insights into consumer behavior, realtime digital dashboards to get better sales tracking, logistics and transportation, product tracking, etc.
Reconfiguring business model
– The expansion of digital payment system, the bringing down of international transactions costs using Bitcoin and other blockchain based currencies, etc can help Bharti Tele to reconfigure its entire business model. For example it can used blockchain based technologies to reduce piracy of its products in the big markets such as China. Secondly it can use the popularity of e-commerce in various developing markets to build a Direct to Customer business model rather than the current Channel Heavy distribution network.
Learning at scale
– Online learning technologies has now opened space for Bharti Tele to conduct training and development for its employees across the world. This will result in not only reducing the cost of training but also help employees in different part of the world to integrate with the headquarter work culture, ethos, and standards.
Increase in government spending
– As the United States and other governments are increasing social spending and infrastructure spending to build economies post Covid-19, Bharti Tele can use these opportunities to build new business models that can help the communities that Bharti Tele operates in. Secondly it can use opportunities from government spending in Strategy & Execution sector.
Manufacturing automation
– Bharti Tele can use the latest technology developments to improve its manufacturing and designing process in Strategy & Execution segment. It can use CAD and 3D printing to build a quick prototype and pilot testing products. It can leverage automation using machine learning and artificial intelligence to do faster production at lowers costs, and it can leverage the growth in satellite and tracking technologies to improve inventory management, transportation, and shipping.
Redefining models of collaboration and team work
– As explained in the weaknesses section, Bharti Tele is facing challenges because of the dominance of functional experts in the organization. Bharti Tele-Ventures case study suggests that firm can utilize new technology to build more coordinated teams and streamline operations and communications using tools such as CAD, Zoom, etc.
Using analytics as competitive advantage
– Bharti Tele has spent a significant amount of money and effort to integrate analytics and machine learning into its operations in the sector. This continuous investment in analytics has enabled, as illustrated in the Harvard case study Bharti Tele-Ventures - to build a competitive advantage using analytics. The analytics driven competitive advantage can help Bharti Tele to build faster Go To Market strategies, better consumer insights, developing relevant product features, and building a highly efficient supply chain.
Developing new processes and practices
– Bharti Tele can develop new processes and procedures in Strategy & Execution industry using technology such as automation using artificial intelligence, real time transportation and products tracking, 3D modeling for concept development and new products pilot testing etc.
Low interest rates
– Even though inflation is raising its head in most developed economies, Bharti Tele can still utilize the low interest rates to borrow money for capital investment. Secondly it can also use the increase of government spending in infrastructure projects to get new business.
Remote work and new talent hiring opportunities
– The widespread usage of remote working technologies during Covid-19 has opened opportunities for Bharti Tele to expand its talent hiring zone. According to McKinsey Global Institute, 20% of the high end workforce in fields such as finance, information technology, can continously work from remote local post Covid-19. This presents a really great opportunity for Bharti Tele to hire the very best people irrespective of their geographical location.
Threats Bharti Tele-Ventures External Strategic Factors
What are Threats in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The threats mentioned in the HBR case study Bharti Tele-Ventures are -
Capital market disruption
– During the Covid-19, Dow Jones has touched record high. The valuations of a number of companies are way beyond their existing business model potential. This can lead to capital market correction which can put a number of suppliers, collaborators, value chain partners in great financial difficulty. It will directly impact the business of Bharti Tele.
Barriers of entry lowering
– As technology is more democratized, the barriers to entry in the industry are lowering. It can presents Bharti Tele with greater competitive threats in the near to medium future. Secondly it will also put downward pressure on pricing throughout the sector.
New competition
– After the dotcom bust of 2001, financial crisis of 2008-09, the business formation in US economy had declined. But in 2020 alone, there are more than 1.5 million new business applications in United States. This can lead to greater competition for Bharti Tele in the Strategy & Execution sector and impact the bottomline of the organization.
High dependence on third party suppliers
– Bharti Tele high dependence on third party suppliers can disrupt its processes and delivery mechanism. For example -the current troubles of car makers because of chip shortage is because the chip companies started producing chips for electronic companies rather than car manufacturers.
Backlash against dominant players
– US Congress and other legislative arms of the government are getting tough on big business especially technology companies. The digital arm of Bharti Tele business can come under increasing regulations regarding data privacy, data security, etc.
Stagnating economy with rate increase
– Bharti Tele can face lack of demand in the market place because of Fed actions to reduce inflation. This can lead to sluggish growth in the economy, lower demands, lower investments, higher borrowing costs, and consolidation in the field.
Learning curve for new practices
– As the technology based on artificial intelligence and machine learning platform is getting complex, as highlighted in case study Bharti Tele-Ventures, Bharti Tele may face longer learning curve for training and development of existing employees. This can open space for more nimble competitors in the field of Strategy & Execution .
Increasing international competition and downward pressure on margins
– Apart from technology driven competitive advantage dilution, Bharti Tele can face downward pressure on margins from increasing competition from international players. The international players have stable revenue in their home market and can use those resources to penetrate prominent markets illustrated in HBR case study Bharti Tele-Ventures .
High level of anxiety and lack of motivation
– the Great Resignation in United States is the sign of broader dissatisfaction among the workforce in United States. Bharti Tele needs to understand the core reasons impacting the Strategy & Execution industry. This will help it in building a better workplace.
Trade war between China and United States
– The trade war between two of the biggest economies can hugely impact the opportunities for Bharti Tele in the Strategy & Execution industry. The Strategy & Execution industry is already at various protected from local competition in China, with the rise of trade war the protection levels may go up. This presents a clear threat of current business model in Chinese market.
Aging population
– As the populations of most advanced economies are aging, it will lead to high social security costs, higher savings among population, and lower demand for goods and services in the economy. The household savings in US, France, UK, Germany, and Japan are growing faster than predicted because of uncertainty caused by pandemic.
Increasing wage structure of Bharti Tele
– Post Covid-19 there is a sharp increase in the wages especially in the jobs that require interaction with people. The increasing wages can put downward pressure on the margins of Bharti Tele.
Regulatory challenges
– Bharti Tele needs to prepare for regulatory challenges as consumer protection groups and other pressure groups are vigorously advocating for more regulations on big business - to reduce inequality, to create a level playing field, to product data privacy and consumer privacy, to reduce the influence of big money on democratic institutions, etc. This can lead to significant changes in the Strategy & Execution industry regulations.
Weighted SWOT Analysis of Bharti Tele-Ventures Template, Example
Not all factors mentioned under the Strengths, Weakness, Opportunities, and Threats quadrants in the SWOT Analysis are equal. Managers in the HBR case study Bharti Tele-Ventures needs to zero down on the relative importance of each factor mentioned in the Strengths, Weakness, Opportunities, and Threats quadrants.
We can provide the relative importance to each factor by assigning relative weights. Weighted SWOT analysis process is a three stage process –
First stage for doing weighted SWOT analysis of the case study Bharti Tele-Ventures is to rank the strengths and weaknesses of the organization. This will help you to assess the most important strengths and weaknesses of the firm and which one of the strengths and weaknesses mentioned in the initial lists are marginal and can be left out.
Second stage for conducting weighted SWOT analysis of the Harvard case study Bharti Tele-Ventures is to give probabilities to the external strategic factors thus better understanding the opportunities and threats arising out of macro environment changes and developments.
Third stage of constructing weighted SWOT analysis of Bharti Tele-Ventures is to provide strategic recommendations includes – joining likelihood of external strategic factors such as opportunities and threats to the internal strategic factors – strengths and weaknesses. You should start with external factors as they will provide the direction of the overall industry. Secondly by joining probabilities with internal strategic factors can help the company not only strategic fit but also the most probably strategic trade-off that Bharti Tele needs to make to build a sustainable competitive advantage.