research report sample - strategy formulation exercise

Project Target2020A research report submitted to TTT Telecom Ltd.

Date: Jan 16th 2017

THE CONTENT PRESENTED IN THIS SLIDE DECK IS A WORK OF FICTION AND MAINLY BASED ON MY LEARNINGS FROM PARTICIPATING IN DIFFERENT FORUMS, WEBINARS, INTERACTIONS AND EXPERT DISCUSSIONS. THE IDEASPRESENTED HERE ARE MY PERSONAL VIEWPOINTS AND DO NOT REPRESENT VIEWS OF ANY ORGANIZATION OR ENTIT Y.

Content

• Introduction

Background and Context

Our Approach

• Research Report

PEST Analysis

Telecom Industry Analysis

Competitive Positioning

Key outcomes

• Strategic Roadmap

Strategic Choices

SWOT/SCOT Analysis

Roadmap

Target2020 © Conceptualized and developed by Aditya Dashora

Background and Context

TTT Telecom leadership had recently launched a strategic initiative namedTarget2020. Focus of this initiative is to introduce new VAS product offeringsand identify growth opportunities in emerging markets

Target2020 project will be delivered in 3 phases

Phase 1 - Market Research and Strategic Analysis

Phase 2 – Developing Market Platform Plan

Phase 3 – Go To Market

As part of Target2020 Phase-1, XXX Consulting LLP was invited to conduct adetailed research and provide a strategic analysis report. The report mustprovide:

Telecom Industry Analysis and Growth Perspective

TTT Telecom’s Competitive Analysis

Strategic Roadmap for TTT Telecom

TTT Telecom is one of

largest telecom

providers based out of

India. With current

market capitalization of

USD 20bn and last 5

years’ CAGR of 10%, TTT

Telecom has shown

tremendous potential to

regain its market

leading position.

TTT Telecom and XXX

Consulting share a long

standing relationship.

XXX has been privileged

to provide strategy

consulting and

transformation services

to TTT Telecom for more

then 10 years.

4


Our approach

We would like to thank TTT Telecom for providing this opportunity.

With its distinct telecom domain expertise, XXX Consulting is in unique positionto support TTT in the journey of Target2020 initiative.

Our approach consisted of two parallel tracks: Industry analysis and growth market strategy

Company analysis and SWOT analysis of VAS offerings

The outcomes of both the tracks were intermingled to validate the analysis.

This report presents a summary of our findings, strategic choices and a highlevel strategic roadmap

5

RESEARCH REPORT

PEST ANALYSIS

INDUSTRY ANALYSIS

TTT’S COMPETITIVE POSITION

OUTCOMES


PEST Analysis for Telecom Industry

Positives (+)

Government’s inclination towards technology

Large subscriber base with high average ARPU in urban centers

Increasing ‘demand’ due to internet and social media adoption

Affordable smartphones

Negatives (-)

No negatives from PEST analysis

Political

• Governmental inclination for technology and digitization

• Desire for end to end internet connectivity

• E-Governance initiatives

• Digital economy and cashless society

Economical

• Sustain GDP and per-capita growth

• High disposable income in urban centers

• New taxation laws

• Growth of ‘e-commerce’ sector

Social

• Large internet user base

• Quick adoption of social media and e-commerce

• Improved literacy rate in the country

• Narrowing information gap between Gen Z and Millennials

Technological

• Affordable smartphone devices

• Rapid adoption of POS, card based payment, digital wallet etc.

Key Observations

7


- Not easy to enter into the traditional telecom

sector due to strict regulatory requirements

- Strong industry rivalry

- Around 14+ providers of telecom services across India but

most of them operate in very few circuit

- With a limited growth in last few years, consolidation is

bound to happen

- New growth opportunities will emerge from rural/sub-

urban markets mainly due to rapidly increasing data

consumption

- Common telco suppliers are tower providers, network infra providers,

chip manufacturers, software vendors, IT/BPO service providers etc.

- There is very limited possibility of supplier’s forward integration in

telco domain

- Supplier switching cost from telco’s perspective is not significant

- Telcos are large customers of their supplier therefore the bargaining

power is limited

- Holistically, telecom industry has negligible threat of

substitute

- However, increase of VOIP providers may cannibalize

the traditional voice products

- Buyer’s command a significant bargaining power in Telco

industry. Having a large number of players certainly raises

buyer’s power

- There is very low switching cost as far as buyer’s are concerned

- Telco’s must focus on there service offerings and VAS products

to remain attractive in competitive market

Telecom Industry Analysis using Porter’s Five Forces

Telecom Industry

1. Threat of Entrant

2. Threat of

Substitute

3. Buyer's bargaining

power

4. Supplier's bargaining

power

5. Industry Rivalry

Telecom industry is still one of the most attractive industries. With the current mobile subscriber base of more then 900 mn and

rapid growth in smartphone market, Telecom industry has a great opportunity ahead. However, recent slowdown in growth is an

indication of saturation due to large number of players focusing on a smaller segment of urban user base.

S

W

W

S

W

WS Strong Weak

Legend

8


TTT Telecom’s Competitive Positioning

RESOURCE BASED VIEW OF TTT TELECOM KEY OBSERVATIONS

TTT Telecom has been able to grow its operations in PAN India network with a strong partner ecosystem and sufficient spectrum licenses

Considering the next growth wave of telecom industry, TTT must consider transforming its technology platform using a mix of software-hardware infra

TTT must focus on creating verity/choices in its core and VAS service offerings to remain attractive in emerging markets

We used ”Resource Based View” analysis for determining competitive positioning of TTT Telecom. We determined all the resources

and capabilities that TTT currently has and plotted them on a 2x2 matrix of ‘relative strength’ and ‘strategic importance’. Clearly,

TTT needs to attack towards its ’key weaknesses’ to regain its lost market position

9


Key Outcomes of the research

•Next growth wave of telecom industry is expected in the emerging markets which predominantly tier-3 cities and small towns

Telecom industry attractiveness is ‘high’

•Having a strong PAN India partner network is certainly advantageous for TTT to support in future market growth

So far, TTT's focus has been on topline growth through network expansion and partner ecosystem

•TTT should consider designing new VAS services to attract customer base in the growth markets

TTT must venture into the growth markets to regain its lost market share,

•TTT should also focus on platform modernization which may include software/hardware upgrade and automation

Platform modernization and automation is critical for future growth

Below is the list of key outcomes of ‘industry analysis’ and ‘competitive positioning analysis’ for TTT Telecom.

These outcomes will be further considered for determining strategic choices for TTT Telecom.

10

STRATEGIC ROADMAP

STRATEGIC CHOICES

SCOT ANALYSIS OF SELECTED OPTION

ROADMAP


Strategic choices for TTT TelecomBased on the analysis outcomes, we are able to put together three strategic choices to help TTT embark on the

journey of gaining its lost market share. TTT’s leadership team has decided to go with Option 2 - New VAS

Offerings & Focus on growth market

•Pros

•No additional investment

•Low opportunity cost

•Cons

•Risk of further loosing market share

•High

Option 1- Do Nothing

•Pros

•Access to new markets

•Projected revenue growth of 2-3%

•Expected ARPU growth by increasing user base

•Cons

•Sizable upfront investment

Option 2 - New VAS Offerings & Focus on growth market

•Pros

•Moderate investment and high value

•Future ready platform for growth

•Cost avoidance potential by automation

•Cons

•No immediate topline growth opportunity

Option 3 - Platform Modernization

12

✔


SCOT Analysis of selected option

StrengthsExisting distributor and partner network

Low subscriber churn

Available spectrum

Skilled human capital

ChallengesCreating innovative VAS offerings

Deep market research to access new market

Competitive environment

Recent decline in revenue growth

Weak current VAS offering

OpportunitiesEasy access to new subscriber base

Projected revenue growth of 2-3%

Expected ARPU growth by increasing user base

Early access to new markets

ThreatRisk of further revenue decline

New players with competitive pricing

Weaker technology platform

TTT leadership has chooses to go with option 2 – ‘New VAS Offerings & Focus on growth market’ . We have

conducted a SWOT/SCOT analysis of the selection option. The outcomes of this analysis are used further for

preparing a strategic roadmap for TTT Telecom

13


Strategic Roadmap for TTT Telecom1st Quarter 2nd Quarter 3rd Quarter 4th Quarter

Go

als New VAS Offerings Creation

Access to new market

Pla

nn

ing

Ma

rke

tin

gR

& D

Growth in the new market

Prepare a detailed

plan for creating

new offering

Marketing campaign

for new VAS

offerings

Market research for

growth market

New Offering

Development

15% Market Share

in the new market

Large new

subscriber bsae

Ongoing refinement of new VAS

offerings to align with the

market needs

Prepare market

attack plan for new

offerings

Prepare market

entry strategy for

new markets

Marketing campaign

for growth market

Marketing strategy

for new VAS

offerings

14

Thank You

Aditya Dashora

M: +91-88615-33211

E: [email protected]

L: https://in.linkedin.com/in/adityadashora

mailto:[email protected]

https://in.linkedin.com/in/adityadashora

research report sample - strategy formulation exercise

Business