XL Axiata Axis Capital Group Review: Dramatic Change in Indo
Corporate business strategy of xl axiata
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Transcript of Corporate business strategy of xl axiata
Corporate and Business Strategy Personal Assignment
Corporate Strategy Of XL Axiata Pramita Wardani | 1140003121
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About XL Axiata
External Analysis • Macro Economy • Industry Perspective • Competitive Environment
Internal Analysis • Resources • Capabilities & Core Competences • Value Chain Analysis
• VRIN Analysis
Conclusion & Recommendation • Conclusions • Recommendation
Analysis on XL Axiata Business Strategy • SWOT Analysis & Strategy Diamond Model • Generic Strategy & Value Discipline • Business Model
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1 T h e J o u r n e y o f
X L A x i a t a
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PT XL Axiata Tbk is one of Indonesia’s leading cellular service provider, offering various types of telecommunications products and services such as :
Voice | SMS | Data | Other value-added mobile products & services 4 Corporate Strategy of XL Axiata
Feel 3.0 Fierce | Focus, Ambition, Persistent
Excellent | Accurate and quality services, deliver experience
Leading | Think ahead
New XL transformation mindset is
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XL Axiata Structure Organization
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Revenue Growth XL Axiata 2011 Q3
XL Axiata Revenue Composition
Source : XL Axiata, 2011
53%
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No Provider 2009 2010 2011 2012f 2013f 2014f 2015f
1 Telkomsel 48,000 40,000 32,065 28,440 25,672 23,571 22,249
2 Indosat 37,330 34,700 26,692 23,327 20,850 19,144 18,070
3 XL Axiata 38,000 32,000 28,761 26,260 23,704 21,549 20,341
4 Bakrie Telecom 29,000 24,000 17,879 14,925 13,076 11,768 10,888
Market Average 38,083 32,675 26,349 23,238 20,825 19,008 17,887
ARPU
• The revenue trend is increasing while the ARPU trend is declining.
• Telecommunication industry is a very competitive industry
Corporate Strategy of XL Axiata |
Average Revenue Per Usage
2 External Analysis • Macro Economy • Industry Perspective • Competitive Environment
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• There is no political events related to telecommunications
Good economic growth, and Indonesia is having a raise in GDP.
The social networkers are also expanding as well
The technology changes is rapidly
Go green society
The telecommunication law prohibits monopolistic practices and unfair competition
Corporate Strategy of XL Axiata |
M a c r o E c o n o m i c P E S T E L A n a l y s i s
I n d u s t r y P e r s p e c t i v e
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• The buyers in the mobile phone market grew by 23,55 and the trend is increasing.
• In the 3G usage are also increasing 25% in year 2011.
Source : BMI, 2011
Mobile Phone Trend in 2009-2016
• This is the impact of the increasing usage of Blackberry, Iphones, Ipad, and others smartphones or tablets.
C o m p e t i t i v e E n v i r o n m e n t
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Telecommunication Market Share (Indonesia, 2011)
The competitive landscape of Telecommunication industry in Indonesia year 2010
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Porter 5 Forces
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Potential New Entrants |
MODERATE
Buyers Bargaining
Power | HIGH
Substitute Products |
HIGH
Industry Rivalry | HIGH
Alcatel-Lucent is targeting Asia. Now they already have a strong relationship with Indosat and Telkom to expand their business in Indonesia.
Most people are not only price sensitive but also wants a good services and networks
The substitute of mobile phone is fixed line and also internet
connection through laptops using lan cable
Suppliers Bargaining
Power | HIGH
Ranging from the packaging, card production, BTS rental, headphones, IT provides, music label.
Telecommunication Industry in Indonesia Year 2012
Substitute Products | MODERATE
3 Internal Analysis • Resources • Capabilities & Core Competences • Value Chain & VRIN Analysis
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R e s o u r c e s
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Tangible XL Centre, Traditional Dealer, Non-traditional Dealer, Dealer Modern
Mobile Data Service, BTS
Infrastructure
GSM 900/DCS 1800; IMT-2000/3G, Licenses of closed regular network (leased line), internet service provider (ISP), Voice over internet protocol (VoIP), and internet interconnection services (NAP).
Technological
By the end of 2011, XL Axiata recorded 1,75 Trillion IDR free cash flow (FCF)
Financial
XL Axiata Knowledge Management System, Intelligent Canvasser System (ICS), Intelligent Merchandiser System (IMS).
Organizational
In-Tangible In 2011, XL Axiata has 2,390 employees. Every year the employees increased 3%.
Human Resources
as the 3rd biggest market share in the telecommunication Industry in year 2011, XL Axiata has proven to have a good brand name.
Brand, image and
reputational
XL Axiata has a relationship with 52,000 non-traditional retail outlets and 9,000 modern channel outlets. Besides of that, XL Axiata also partner with 1,133 stores.
Relationship
C a p a b i l i t i e s
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XL Axiata main capability is in technology. XL Axiata has the most modern core network NGN capabilities, better capacity and operation management and is expandable to match future technology requirements.
C o r e C o m p e t e n c i e s
XL Axiata’s core competencies : mobile and corporate solutions by providing various types of telecommunication products and services : Voice, SMS, Data and other value–added mobile telecommunication services.
Va l u e C h a i n
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Service Design
Knowledge Management
Marketing and Sales
Distribution Channel
Human Resources
Procurement
Research & Development
Infrastructure
X L A x i a t a Va l u e C h a i n
Information Technology
Dealers Marketing
&SMD High
Technology KMS, ICS, IMS XL Center
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No Components Valuable Rare Imperfectly
Imitable
Non
Substitutable
1 Resource v v x x
2 Buildings v x x v
3 Workflow System v v x x
4 Database v v x x
5 Reputation v v x x
6 Staffs v v x x
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V R I N A n a l y s i s
Valuable Rare Inimitable Non Substitutable
owns an extensive fiber optic backbone network
XL Axiata has a Service
Management Department
XL Axiata use Knowledge
Management System to
integrate all the
knowledge
It can be substitute with fixed lines and internet
through lan cable
V R I N F r a m e w o r k
4 Analysis on XL Axiata Business Strategy • SWOT Analysis & Strategy Diamond
Model • Generic Strategy & Value Discipline • Value Propositions & Business Model
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S W O T A n a l y s i s
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Strengths • The 3rd largest
telecommunication provider in Indonesia
• Mobile-centric operator
Weakness • Low product quality
(network)
Opportunity • Market penetration in internet
users are increasing • Changing of people lifestyle
and habits
SO Strategies • Global expansion to South
East Asia • Create new application which
gives value added to the customers
WO Strategies • Diversify into new product
markets
Threats • Market competition : price
war, competitors heavy advertising
ST Strategies • Keep low price but still
maintain the services
WT Strategies • Strategic alliance with
third party
S t r a t e g i c D i a m o n d M o d e l
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Arena
Vehicle
Economic Logic
Differentiators
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XL Axiata have their expertise in the telecommunication industry.
To achieve their goals, XL Axiata do an internal development by training their employees
Based on the usage revenue contribution of XL Axiata in year 2011, the trend in the
telecommunication industry is Data.
The 4 key initiative transformation of XL Axiata : 1. Focusing to MDS 2. Enhancing service
quality 3. Increasing Customer
Retention 4. Strengthening brand
positioning
Staging
Brand Name, Number Subscribers, Data, SMS, Voice
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G e n e r i c S t r a t e g y
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Va l u e D i s c i p l i n e
Operational Excellence : • Providing low price with
reasonable quality • High quantity • Focus on efficiency
No Strategy Before After
1 Grand Strategy Hi Price-Low Volume Low Price- High Volume
2 Functional Strategy
A Price High Low
B Product Many brands Single
C Place Direct Dealerships
D Promotion Complicated Simple
B l a c k b e r r y S e r v i c e P r i c e C o m p a r i s o n y e a r 2 0 1 2
Va l u e P r o p o s i t i o n s & B u s i n e s s M o d e l
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• Personal • Corporate
• Customer Care 24 hours/day
• Website • Branches • Mobile
Applications • Dealerships
• Internet Services
• Customer Services
• Simple and attractive promotions
• Packaging Vendors
• BTS Rentals • IT Providers • Music Labels • Collaboration
with 3rd parties : Blackberry, Iphone, Ipad, Samsung
• Marketing • Sales • IT Services • Call Center
Services • Outsourcing
• Low Price-High Volume
• Single product • Voice-Centric • Data-Centric • Domestic
Backbone
Voice | SMS | Data | Other value-added mobile products & services | Ringtones | collaboration with 3rd parties
BTS Rental | Network and infrastructure expand | Maintenance equipment's | promotions
5 Conclusion & Recommendation • Conclusions • Recommendation • Implementation Issues
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C o n c l u s i o n
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• Telecommunication industry is a very competitive industry. To maintain their customers, XL Axiata not only competes in price but also innovation of its products.
• Xl Axiata is very concern to their customers. In this year they established Service Management Directorate which coordinates strategy to give XL Axiata’s experience to their customers and also employee.
• XL Axiata’s transformation to become a leader in data-centric is a good step. By changing their business model, it could give a good impact to XL Axiata in the future.
R e c o m m e n d a t i o n s
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Stars
Cash Cow
Question Marks
Dog
Mar
ket
Gro
wth
Low
High Low
Low
H
igh
Voice – centric
Cloud Computing and e-Money as a solution to provide a go green environment and reduce cost.
• 4G Technology • HSPA+ , • WIMAX • LTE
Maintain and Building a BTS by
the outsource company
Telecommunication industry is becoming a prospect industry in the future, even though the ARPU (average revenue per user) is declining because of the competition among providers. Providers try to decrease their expenses to keep maintain their profits. To keep their competitiveness in the telecommunication industry, XL Axiata could implement new strategies by using BCG Matrix.
High
Market Share
Corporate and Business Strategy Personal Assignment
Corporate Strategy Of XL Axiata Pramita Wardani | 1140003121
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