Cracking Down Business Models :BSNL
Bharat
Sanchar Nigam Limited is an Indian state owned telecom business. It has a
nationwide telecom network that provides mobile voice and internet services all
over India. It has stayed in the market for a long long time now in spite of
several ups and downs. It becomes imperative to get an understanding of the
business model of a company that has seen everything through thick and thin.
The Beginning
BSNL
is one of India's oldest communication company and it has been in existence
since the times of British India. The
creation of the Telecom Department eventually led to the making of the State
owned telegraph and telephone company which in turn led to the foundation of
BSNL. The company continued the telegraph services in India until it shut down
those services completely after providing it for 160 years, on 15 July 2013.
The company has been regarded for its name as it is credited as the oldest
telecom service provider in the country hence gaining the confidence of the
public.
Services
Mobile
BSNL
Mobile has been a major provider of GSM network under brand name CellOne all
over India. It has a wide range of
network coverage in both urban and rural areas.
It
offers prepaid services, postpaid services and other value-added services such
as Free Phone Service (FPH), India Telephone Card, Account Card Calling (ACC),
Premium Rate Service (PRM). It offers the IPTV service as well however it was
never well established in that division.
Landline
BSNL
Landline was launched in the early 1990's. It was the only fixed-line telephone
company in the entire country before the New Telecom Policy. Only
Government-owned BSNL and MTNL were allowed to provide land-line phone services
through copper wire in India for a long time.
Broadband
BSNL
also forayed into the internet broadband line for expansion purpose. It has an
extensive optical fiber network. BSNL provides Internet access services under
different schemes like the dial-up
connections as prepaid, NetOne as Postpaid and DataOne as BSNL Broadband.
Ownership
BSNL
was incorporated by the Government of India. The company is primarily state
owned and is one of the oldest players in the market. Since its inception was
by the government, the major control of the company has remained in their hands
ever since. In 2019, the Government of
India brought forward a way to
revive BSNL including monetising assets, fund raising, TD-LTE spectrum, voluntary retirement scheme for its employees. Other than this, the Ministry of Communications decided to orchestrate a merger of MTNL
with Bharat Sanchar Nigam Limited. Post this, MTNL will be made to function as
a subsidiary of BSNL.
Problems faced
The ERP
project of BSNL required 65,000 SAP licenses and 315,000 employee self service
licenses for all their employees. The gravest challenge that BSNL faced was the
heterogeneity in its systems. Also, they had a huge employee base -- totalling
300,000.
In terms of operations, each of BSNL’s circles are further
divided into secondary switching areas (SSA). For financial reporting, BSNL had
manual process at the levels of SSA and circle. This meant that the finance
department in order to benefit the ERP roll-out would need to consolidate 750
trial-balance accounts. Since each system was independent, the company did not
have an integrated financial system. The heterogeneity, for instance, also
affected taxation pay-out. Most importantly, BSNL always invested in IT systems
primarily.
Since the
company did not have consolidated IT systems, it resulted in a slew of
customised applications, different databases and internal processes that led to
problematic situations for the company. Finally, the company was facing a lot
of pressure in the market with the
private players growing massively and constantly.