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FOS PRODUCTIVITY AND INCENTIVISATION OF TELECOM COMPANIES WITH SPECIAL EMPHASIS ON
VODAFONE
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EXECUTIVE SUMMARY
Title of the project :- FOS productivity and incentivization of telecom
companies with special emphasis on Vodafone.
Place of study:- Vodafone Essar Ltd., Silchar.
Duration of study:- Two months(1st May, 2010- 30th June, 2010).
Project guide:- Mr. Bikramjit Ghosh.
Objective of the study:-
1. Cost optimization.2. Revenue maximization.3. Customer delight.
Scope of the study:-
1.
Life cycle of FOS
2. FOS productivity3. Impact on channels partner profitability
Types of data used:-
Primary data: It was collected with the help of questionnaire and
interview method.
Secondary data: It was collected through company MIS reports and
internet.
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Distributor should take a brief update on the days achievements and
retailers query and concerns daily.
Distributor should set the sales targets for the DSEs based on scientific
methods.
Distributors should daily update the DSEs on their target for the day.
Monetary benefits should be given to the DSEs on achievement of targets
Sales target should be set being unbiased, based on bit strength anddemographics of market. The DSEs should not be given more than 30-35
outlets in a bit to cover otherwise it would reduce their productivity.
Regular training should be given to improve selling skills and for their
personal development and growth.
Higher incentive scheme should be considered and a proper tracking system
should be designed to keep
Company should promote sense of belongingness to the DSEs towards it.
Company can provide uniform and id- cards to the DSEs.
They can conduct talent pool programs and promote career growth program
for the DSEs.
Improvisation of Bulls eye target is required and the DSEs, Distributors
should me made aware of the key areas of the scheme.
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INTRODUCTION
India stands as one of the largest and fastest growing telecom markets of the
world. Having more than 264.77 million telephone connections and the
subscribers base growing steadily at a rate of around 82.2 percent, Indian
telecom market currently stands at the third position in the global market. The
year 2007 was stated as the Year of Broadband in India.
India is fast emerging as the Telecom hub of the world both in terms of the
growing demand, size of the market, setting up of the manufacturing facilities
in India by leading players across the world and, the inflow of FDI, which is
currently the highest in all the sectors of Indian industry. The Indian telecom
market can be divided into three segments: the mobile (wireless) market,
manufacturing segment and value-added services segment. Every day, new
drivers and advancements are revolutionizing and fuelling the growth of the
sector. Right from the telegraphic and telephonic systems in the 19th century,
the scope of telephonic communication has now expanded to make use of
advanced technologies (in mobile phones) like GSM, CDMA, and WLL to
the great 3G Technology launched in 2007, and is increasing at a tremendous
rate.
The government of India has also come forward and has taken various
initiatives to boost the growth of the sector. Opening the sector to FDI has
encouraged and attracted heavy investment from major players across the
world to enter the Indian markets. The manufacturing segment of the telecom
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sector has also started flourishing with Nokia, LG, Motorola, Samsung and
many other players setting up its manufacturing facilities in India.
The Indian telecom sector is witnessing great competition. MTNL, BSNL,
VSNL are the major Public Players, whereas Airtel, Idea, Vodafone, Tata,
Reliance, BPL are the leading Private Players in the country. The consumer is
emerging as the clear winner in this competition where the players in the
mobile segment are coming up with new tariffs and discount schemes to gain
the competitive advantage.
Although the sector faces the moderate attrition rates of 20 to 25 percent, the
HRs prime strategic function in the sector is retaining the talent and
employee engagement. The only functional area which faces the high attrition
rate is the sales people in the telecom industry.
1.1 INDUSTRY PROFILEThe Indian telecommunications industry is one of the fastest growing in the world.
According to the Telecom Regulatory Authority of India (TRAI), the number of
telecom subscribers in the country reached 621.28 million as on March 31, 2010,
an increase of 3.38 per cent from 600.98 million in February 2010. With this the
overall teledensity (telephones per 100 people) has touched 52.74.
The wireless subscriber base has increased to 584.32 million at the end of March
2010 from 564.02 million in February 2010, registering a growth of 3.6 per cent.
Mobile value added services include text or SMS, menu-based services,
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downloading of music or ring tones, mobile TV, videos and sophisticated m-
commerce applications. According to the Economic Survey 2009-10, prior to 2008
a majority of VAS revenue was attributed to SMS. But with greater penetration of
new services, availability of relatively inexpensive, feature-rich handsets and
consumer education, value-added services other than SMS are gaining importance.
It is expected that over the next few years non-SMS services will become a
dominant contributor to VAS revenue.
Major Investments
The booming domestic telecom market has been attracting huge amounts of
investment which is likely to accelerate with the entry of new players and launch
of new services. According to the Department of Industrial Policy and Promotion
(DIPP), the telecommunications sector which includes radio paging, mobile
services and basic telephone services attracted foreign direct investment (FDI)
worth US$ 2,495 million during April to February 2010. The cumulative flow of
FDI in the sector during April 2000 and February 2010 is US$ 8,872 million.
Norway-based telecom operator Telenor has bought a further 7 per cent in
Unitech Wireless for a little over US$ 431.3 million. Telenor now has 67.25
per cent hold of the company. Telenor has now completed its four-stage
stake buy and has invested a total of US$ 1.32 billion in Unitech Wireless as
agreed on with the latter last year
The government has approved the foreign direct investment (FDI) proposal
of the Federal Agency for State Property Management of the Russian
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Federation to buy 20 per cent stake in telecom service provider Sistema-
Shyam for US$ 660.1 million .
Going global
In March 2010, Bharti Airtel bought the African operations of Kuwait-based Zain
Telecom for US$ 10.7 billion, driving the Indian player into the league of top ten
telecom players globally.The Reserve Bank has liberalised the investment norms
for Indian telecom companies by allowing them to invest in international
submarine cable consortia through the automatic route. In April 2010, RBI issued a
notification stating "As a measure of further liberalisation, it has now been
decided... to allow Indian companies to participate in a consortium with other
international operators to construct and maintain submarine cable systems on co-
ownership basis under the automatic route." The notification further added,
"Accordingly, banks may allow remittances by Indian companies for overseas
direct investment."
3G services
The Department of Telecom has taken the pioneering decision of launching of 3G
services by BSNL and MTNL and initiation of process for auction of spectrum for
3G services to private operators. Allocation of spectrum for third-generation (3G),and broadband wireless access (BWA) services was done through a controlled
simultaneous, ascending e-auction process.All the 71 blocks that were put up for
auction across the 22 service areas in the country were sold, leaving no unsold lots.
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Auction for 3G spectrum ended on May 19, 2010 after 183 rounds of intense
bidding over a span of 34 days. The Government is expected to morph revenue
worth US$ 14.6 billion. All the available slots across 22 circles have been sold to
seven different operators. A pan-India bid for third generation spectrum stood at
US$ 3.6 billion. The Anil Ambani-led Reliance Communication bagged the
highest number of 13 circles at a cost of US$ 1.9 billion, followed by Bharti Airtel
in 12, Idea in 11 and Vodafone and the Tatas in nine circles each, according to the
Department of Telecommunications. MTNL and BSNL will have to pay US$ 1.42
billion and US$ 2.2 billion respectively.
The Indian telecom industry manufactures a vast range of telecom equipment using
state-of-the-art technology.According to the Economic Survey 2009-10, the
production of telecom equipment in value terms has increased from US$ 9 billion
in 2007-08 to US$ 10.53 billion in 2008-09 and is expected to be US$ 12.4 billion
in 2009-10.Exports have increased from US$ 86.74 million in 2002-03 to US$ 23.7
billion in 2008-09, accounting for 21 per cent of the equipment produced in the
country. Telecommunication equipment major Nokia Siemens is planning to
source components worth US$ 28.5 billion from India in 2010-11. In 2009, the
company sourced components worth US$ 20 billion from India.
According to a report by technology researcher Gartner Inc., India ranks fourth inmanufacturing telecom equipment in the Asia-Pacific (Apac) region. The country
has a 5.7per cent share of the regions total telecom equipment production revenue
of US$ 180 billion in 2009.
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"We expect India to move up to the third spot (after China and South Korea) with a
share of 8.5 per cent of the total (estimated) Apac telecom equipment production
revenue of US$ 277 billion by 2014," Gartner said. The firm estimates Indias
telecom equipment production revenue to grow at a CAGR of 17.1 per cent to
reach US$ 22.6 billion in fiscal 2014. India will be the fastest growing telecom
equipment production market in the Apac region over the next five years, it
predicts.
Rural Telephony
According to the Economic Survey 2009-10, rural tele-density has increased from
1.2 per cent in March 2002 to 15.1 per cent in March 2009 and further to 21.2 per
cent at the end of December 2009.Rural telephone connections have gone up from
12.3 million in March 2004 to 123.5 million in March 2009 and further to 174.6
million in December 2009. The share of private sector players in the total
telephone connections has steadily increased from around 14 per cent in 2005 to 31
per cent as on December 31, 2009. During 2008-09, the growth rate of rural
telephones was 61.5 per cent as against 36.7 per cent for urban telephones. The
private sector has contributed significantly to the growth of rural telephony by
providing 81.5 per cent of the rural phones as on December 31, 2009.It is proposed
to achieve rural tele-density of 25 per cent by means of 200 million ruralconnections by the end of the Eleventh Five Year Plan.
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Policy Initiatives
The government has taken many proactive initiatives to facilitate the rapid growth
of the Indian telecom industry.
In the area of telecom equipment manufacturing and provision of IT-enabled
services, 100 per cent FDI is permitted.
No cap on the number of access providers in any service area. In 2008, 122
new Unified Access Service (UAS) licences were granted to 17 companies
in 22 services areas of the country.
Revised subscriber based criteria for allocation of Global System of Mobile
Communication (GSM) and Code Division Multiple Access (CDMA)
spectra were issued in January 2008.
To provide infrastructure support for mobile services a scheme has been
launched to provide support for setting up and managing 7,436 infrastructure
sites spread over 500 districts in 27 states. As on December 31, 2009, about
6,956 towers had been set up under the scheme.
According to the Consolidated Foreign Direct Investment (FDI) Policy document,
the FDI limit in telecom services is 74 per cent subject to the following conditions:
This is applicable in case of Basic, Cellular, Unified Access Services,
National/ International Long Distance, V-Sat, Public Mobile Radio Trunked
Services (PMRTS), Global Mobile Personal Communications Services
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(GMPCS) and other value added Services.
Both direct and indirect foreign investment in the licensee company shall be
counted for the purpose of FDI ceiling. Foreign Investment shall include
investment by Foreign Institutional Investors (FIIs), Non-resident Indians
(NRIs), Foreign Currency Convertible Bonds (FCCBs), American
Depository Receipts (ADRs), Global Depository Receipts (GDRs) and
convertible preference shares held by foreign entity. In any case, the 'Indian'
shareholding will not be less than 26 per cent
FDI up to 49 per cent is on the automatic route and beyond that on the
government route. FDI in the licensee company/Indian
promoters/investment companies including their holding companies shall
require approval of the Foreign Investment Promotion Board (FIPB) if it has
a bearing on the overall ceiling of 74 per cent. While approving the
investment proposals, FIPB shall take note that investment is not comingfrom countries of concern and/or unfriendly entities.
The investment approval by FIPB shall envisage the conditionality that the
Company would adhere to licence Agreement
FDI shall be subject to laws of India and not the laws of the foreign
country/countries
The Road Ahead
According to a report published by Gartner Inc in June 2009, the total mobile
services revenue in India is projected to grow at a compound annual growth rate
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(CAGR) of 12.5 per cent from 2009-2013 to exceed US$ 30 billion. The India
mobile subscriber base is set to exceed 771 million connections by 2013, growing
at a CAGR of 14.3 per cent in the same period from 452 million in 2009. This
growth is poised to continue through the forecast period, and India is expected to
remain the worlds second largest wireless market after China in terms of mobile
connections."The Indian mobile industry has now moved out of its hyper growth
mode, but it will continue to grow at double-digit rates for next three years as
operators focus on rural parts of the country," said Madhusudan Gupta, senior
research analyst at Gartner. "Growth will also be triggered by increased adoption
of value-added services, which are relevant to both rural and urban markets."
Mobile market penetration is projected to increase from 38.7 per cent in 2009 to
63.5 per cent in 2013, according to Gartner.
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1.2 COMPANY PROFILEVodafone Group Plc is the world's leading mobile telecommunications company,
with a significant presence in Europe, the Middle East, Africa, Asia Pacific and the
United States through the Company's subsidiary undertakings, joint ventures,
associated undertakings and investments. The Group's mobile subsidiaries operate
under the brand name 'Vodafone'. In the United States the Group's associated
undertaking operates as Verizon Wireless. During the last few years, VodafoneGroup has entered into arrangements with network operators in countries where the
Group does not hold an equity stake.
Under the terms of these Partner Market Agreements, the Group and its partner
operators co-operate in the development and marketing of global products and
services, with varying levels of brand association. On 31 March 2010, based on the
registered customers of mobile telecommunications ventures in which it had
ownership interests at that date, the Group had 341 million customers, excluding
paging customers, calculated on a proportionate basis in accordance with the
Company's percentage interest in these ventures.
The Company's ordinary shares are listed on the London Stock Exchange and the
Company's American Depositary Shares ('ADSs') are listed on the NASDAQ Stock
Market. The Company had a total market capitalisation of approximately 71.2
billion at 12 November 2009.Vodafone Group has entered into arrangements with
network operators in countries where the Group does not hold an equity stake.
Under the terms of these Partner Market Agreements, Vodafone and its partner
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operators co-operate in the marketing of global products and services with varying
levels of brand association. This strategy enables Vodafone to implement services
in new territories and to create additional value to their partners' customers and to
Vodafone's travelling customers without the need for equity investment in these
countries. Similar agreements also exist with a number of the Groups joint
ventures, associated undertakings and investments (the affiliates).
With prudent control of capital expenditure and reductions to operatingexpenditure, the Company is positioning itself to benefit from the re-invigoration
of the economy when it comes, driven by strong cash generation, a sound liquidity
position, and the diversity and geographic distribution of our customer base.
Vodafone will continue to promote innovation in products and services across the
range of their markets. For example, over 6 million people are now using the
Vodafone Money Transfer system (branded M-PESA in Kenya) in Kenya,
Tanzania and Afghanistan. In total, they are sending approximately US$200
million a month, mostly as small transactions of less than US$20. With over 4
billion people owning mobile handsets, they believe that for the majority of the
worlds population, mobile is likely to be the primary means of access to the
internet. Higher speed networks in markets such as South Africa and Egypt
increase the speed and range of internet access. Using economies of scale to workwith handset manufacturers has allowed approximately eight million customers to
gain access to communications through our ultra low cost handsets during the year,
at the same time helping to make Vodafone the second largest handset brand in
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India.
In their developed markets, they will continue to enhance their customers
communication capability, with innovative products such as netbooks and laptops
with embedded SIM cards to connect directly to higher speed mobile data
networks. They continue to see very strong growth in mobile data usage, over
100% in our European markets. Industry is undergoing an important change away
from the predominance of voice traffic; within a few years most of the traffic onour European network will be data. They will promote services, particularly for
small and medium enterprises, which increase workforce flexibility and enable
greater efficiency and cost control.
FINANCIAL GROWTH
Vodafone reports its results in accordance with International Financial
Reporting Standards (IFRS).
Vodafone has some large minority stakes, which are not included in its
consolidated turnover. In order to provide additional information on the
overall scale and growth trends of its business, it publishes "proportionate
turnover" figures, and these are included in the tables below. For example, if a
business in which it owns a 45% stake has turnover of 10 billion that equals
4.5 billion of proportionate turnover for Vodafone. Proportionate turnover is
not an official accounting measure, and Vodafone's proportionate turnover
should be compared with other companies' statutory turnover.
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Vodafone also produces proportionate customer number figures on a similar
basis, e.g. if an operator in which it has a 30% stake has 10 million customers
that equals 3 million proportionate Vodafone customers. This is a common
practice in the mobile telecommunications industry.
The group's recent first quarter trading updates (24 July, 2009) saw
management reiterating its profit guidance for the full year. Whilst revenues
across Europe had been relatively weak, mirroring general economic
conditions, there had been a positive showing from South Africa, with the
company's Indian purchase of Hutchison Essar continuing to generate returns.
Meanwhile, its joint venture with Verizon in the US had strengthened further,
with Vodafone's overall customer base now standing at 315 million - 8
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million having been added during the first quarter. In addition, management
noted that its cost reduction programme, targeted to save 1bn in operating
costs by the end of the 2011 financial year, would reach 65pc of its target by
the end of the current financial year.
History
Vodafone Group Plc is a public limited company incorporated in England
under registered number 1833679. Its registered office is Vodafone House,
The Connection, Newbury, Berkshire, RG14 2FN, England.
Vodafone was formed in 1984 as a subsidiary of Racal Electronics Plc. Then
known as Racal Telecom Limited, approximately 20% of the company's capital
was offered to the public in October 1988. It was fully demerged from Racal
Electronics Plc and became an independent company in September 1991, at whichtime it changed its name to Vodafone Group Plc. Following its merger with
AirTouch Communications, Inc. (AirTouch), the company changed its name to
Vodafone AirTouch Plc on 29 June 1999 and, following approval by the
shareholders in General Meeting, reverted to its former name, Vodafone Group
Plc, on 28 July 2000.
Vodafone and Essar agree partnership term
Vodafone and Essar have reached an agreement under which they will work to
continue the growth of Hutchison Essar Limited ("Hutchison Essar"), one of
Indias leading mobile operators. This follows Vodafones announcement on 11
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February 2007 that it had agreed to acquire Hutchison Telecommunications
International Limited's ("HTIL") controlling interest in Hutchison Essar, in which
Essar is and will continue to be a 33% shareholder.
The partners have agreed that Hutchison Essar will be renamed Vodafone Essar
and, in due course, that the business will market its products and services under the
Vodafone brand.
With penetration levels of around 13%, both partners believe that there aresubstantial growth opportunities in the Indian mobile telecommunications market.
Vodafone is the leading international mobile operator with an extensive range of
products and services, many of which are not currently available in India. Essar is
a major industrial group with a deep understanding of India and the Indian mobile
telecommunications industry. With these complementary strengths Vodafone and
Essar plan to broaden Vodafone Essars service offering and enable it to become
the leader in the Indian mobile telephony market.
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VISION AND ACTION PLAN OF VODAFONE
for
Barak Valley200809
VISION STATEMENT:
To be the most admired telecom service provider by being the most easily
AVAILABLE, most VISIBLE and most CUSTOMER CARING
ORGANISATION in Barak Valley.
OBJECTIVES:
To be most available product in the region with penetration ofabove 50 %
To be most visible in terms of both in shop POS and on shopdisplays
To develop 20 exclusive Vodafone MBO with focus on customerCare and product / service information
ACTION PLAN:
Availability Plotting of outlet base by ward visa vis competition andmarket segments to finalise target outlet gaps
ByTgt date - 15-06-08
Visibility - Finalise area wise list of sites for on shop displays
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based on measure norms and complete placements
Corporate Responsibility
At Vodafone, they believe they can help to build a sustainable future by delivering
products and services that enable positive economic, social and environmental
outcomes for their stakeholders worldwide.
As the global population grows and sustainability challenges intensify, they arealso accelerating the development of products and services that can make a
positive contribution to sustainable development. They aim to identify and focus
on the areas where their interventions can address sustainability challenges most
effectively at the same time as offering an attractive commercial return for their
shareholders .
By creating sustainable products and services we began to address their ambition
to be sustainable at every point in our business building on a foundation of
responsible operations and responding to the needs of their stakeholders.
.
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2. RESEARCH METHODOLOGY
2.1OBJECTIVES
Cost optimization
Revenue maximization
Customer delight
2.2RESEARCHDESIGN
The research design followed is exploratory design.
Method of Data Collection
The data was collected through primary source by questioning the concerned
authority with the help of questionnaire prepared.
Secondary data was collected by companys website and MIS reports.
Instruments Used
A Questionnaire was prepared to collect data from the sampling unit.
Questionnaire was designed with both close ended and open ended questions.
Also personal interaction and interviews have facilitated to understand the life
cycle of FOS and the sales process.
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2.3 Sampling
Universe :- consists of distributors of Barak valley region their DSEs and the
retailers who form the sampling unit.
Sample size :- includes 5 distributors of Vodafone, 25 DSEs under them and
80 retailers.
Sampling design: - chosen was Convenience sampling
2.4Scope of the study:-
Life cycle of FOS
FOS productivity
Impact on channels partner profitability
2.5 Limitations
The demanding nature of human being is unpredictable, the responses
may not yield 100 percent.
Time was one of major constraints; the research had to be limited
within the given parameter.
The study was restricted to the geographic boundary of Barak Valley
region
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3 DATA ANALYSIS, INTERPRETATION AND PRESENTATION
Table 3.1
Representing the number of outlets covered by each DSE.
Serial no. No. of outlets Respondents Percentage
1 40- 60 6 24%
2 60-80 11 44%
3 80-100 5 20%
4 100-120 3 12%Total 25 100%
Chart 5.1
Representing the number of outlets covered by each DSE
Interpretation:
44% of the DSEs cover 60-80 retail outlets. 24% of the DSEs cover 40-60 retail
outlets. 20% of the DSEs cover 80-100 retail outlets.12% of the DSEs cover 100-
120 retail outlets.
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Table 3.2
Representing revenue generated per month by each DSE.
Serial No. Revenue generated Respondents Percentage
1 Below 1 lakh 3 12%
2 1-3 lakh 8 32%
3 3-5 lakh 5 20%
4 5-7 lakh 9 36%
Total 25 100%
Chart 3.2
Representing revenue generated per month by each DSE.
Interpretation
12% of the DSEs generate revenue below Rs. 1 lakh. 32% of the DSEs generate
revenue of Rs. 1 lakhRs. 3 lakh. 20% of the DSEs generate revenue of Rs. 3
lakh- Rs.5 lakh. 36% of the DSEs generate revenue of Rs. 5 lakh Rs.7 lakh.
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Table 3.4
Representing the factors that drive towards more sales by the DSEs.
Serial no. Driving factors Respondents Percentage
1 High incentive 17 68%
2 Reward 4 16%
3 Recognition 2 8%
4 Proper treatment from reportingboss
2 8%
5 Fixed salary 0 0Total 25 100%
Chart 3.4
Representing the factors that drive towards more sales by the DSEs.
Interpretation
68% of the DSEs feel High Incentive can motivate them towards more sales. 16%
of the DSEs feel Reward would motivate them towards more sales. 8% of
the DSEs feel Recognition and Proper Treatment from reporting boss can
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motivate them towards better performance. None of the DSEs feel that Fixed
Salary would drive them towards more sales.
Table 3.5
Representing the number of retailers visited per day by each DSE.
Serial No. No. of retailers visited per day Respondents Percentage
1 25-35 12 48%
2 35-45 10 40%
3 45-55 3 12%Total 25 100%
Chart 3.5
Representing the number of retailers visited per day by each DSE.
Interpretation
25-35 retail outlets are visited by 48% of the DSEs per day. 35-45 retail outlets are
visited by 40% of the DSEs per day. 45-55 retail outlets are visited by 12%
of the DSEs per day.
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Table 3.6
Representing time spent per day in each outlet by the DSEs.
Serial No. Time spent (min) Respondents Percentage
1 5-10 8 32%
2 10-15 7 28%
3 15-20 4 16%
4 20-25 6 24%
Total 25 100%
Chart 3.6
Representing time spent per day in each outlet by the DSEs
Interpretation
32% of the DSEs spend 5-10 minutes per day in each retail outlet. 28% of
the DSEs spend 10-15 minutes per day in each retail outlet. 16% of the
DSEs spend 15-20 minutes per day in each retail outlet. 24% of the DSEs
spend 20-25 minutes per day in each retail outlet.
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Table 3.7
Representing whether the DSEs handle complaints from the retailers.
Serial No. Complaints
handled
Respondents Percentage
1 Yes 25 100%
2 No 0 0
Total 25 100%
Chart 3.7
Representing whether the DSEs handle complaints from the retailers.
Interpretation
100% of the DSEs handle complaints from the retailers.
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Table 3.8
Representing whether the DSEs are satisfied with their salary.
Serial No. Satisfied with
salary
Respondents Percentage
1 Yes 16 64%
2 No 9 36%
Total 25 100%
Chart 3.8
Representing whether the DSEs are satisfied with their salary
Interpretation
64% of the DSEs are satisfied with their salary whereas 36% of the DSEs are not
satisfied with their salary.
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Table 3.9
Representing whether the DSEs are satisfied with their incentive.
Serial No. Satisfied with
incentive
Respondents Percentage
1 Yes 11 44%
2 No 14 56%
Total 25 100%
Chart 3.9
Representing whether the DSEs are satisfied with their incentive.
Interpretation
44% of the DSEs are satisfied with the incentives received where as 56% are not
satisfied.
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Table 3.10
Representing whether the DSEs feel regular training is necessary.
Serial No. Necessity of
training
Respondents Percentage
1 Yes 25 100%
2 No 0 0%
Total 25 100%
Chart 3.10
Representing whether the DSEs feel regular training is necessary.
Interpretation
100% of the DSEs feel regular training is necessary.
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Table 3.11
Representing whether the DSEs receive regular training.
Serial No. Receive training Respondents Percentage
1 Yes 25 100%
2 No 0 0%
Total 25 100%
Chart 3.11
Representing whether the DSEs receive regular training.
Interpretation
100% of the DSEs receive regular training.
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Table 3.12
Representing whether the DSEs fill up daily sales report.
Serial No. Fill up sales
report
Respondents Percentage
1 Yes 25 100%
2 No 0 0%
Total 25 100%
Chart 3.12
Representing whether the DSEs fill up daily sales report.
Interpretation
100% of the DSEs fill up the daily sales report.
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Table 3.13
Representing factors kept in mind by DSEs while getting connections from
retailers.
Serial no. Factors Respondents Percentage
1 Age of network 15 60%
2 Quality 3 12%
3 ARPU 7 28%
Total 25 100%
Chart 3.13
Representing factors kept in mind by DSEs while getting connections from
retailers.
Interpretation
60% of the DSEs consider Age of Network while getting connections from
retailers. 12% of them consider Quality in getting connections from retailers and
24% of them consider ARPU to be the prime factor in getting connections from
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retailers.
Table 3.14
Representing whether the DSEs face any issues while dealing with retailers.
Serial No. Any issues Respondents Percentage
1 Yes 25 100%
2 No 0 0%
Total 25 100%
Chart 3.14
Representing whether the DSEs face any issues while dealing with retailers.
Interpretation
100% of the DSEs responded that there are issues while dealing with retailers.
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Table 3.15
Representing sales generated by each DSEs under their distributors.
Serial no. Distributors Sales
1 Hindustan Auto Traders 290000
2 Manoj Kumar Baid & Brothers 400000
3 Eureka Telecom 105000
4 Chowdhury Traders 300000
5 Brahman Bariar library 160000
Chart 3.15
Representing sales generated by each DSEs under their distributors.
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of them are not satisfied.
Table 3.17
Representing whether the Distributors feel that the DSEs require more training.
Serial No. Training required Respondents Percentage
1 Yes 5 100%
2 No 0 0
Total 5 100%
Chart 3.17
Representing whether the Distributors feel that the DSEs require more training.
Interpretation
100% of the Distributors feel that the DSEs require more training.
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Table 3.18
Representing the motivating factor to the DSEs according to the Distributors.
Serial no. Driving factors Respondents Percentage
1 High incentive 5 100%
2 Reward 0 0
3 Recognition 0 0
4 Proper treatment fromreporting boss
0 0
5 Fixed salary 0 0Total 5 100%
Chart 3.18
Representing the motivating factor to the DSEs according to the Distributors.
Interpretation
100% of the Distributors feel that High Incentive can enhance the preformance of
the DSEs.
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Table 3.19
Representing productivity per DSE under each Distributor.
Serial No. Name of Distributor Productivity
1 Hindustan Auto Traders 72%
2 Manoj Kumar Baid & Brothers 100%
3 Eureka Telecom 26%
4 Chowdhury Traders 75%
5 Brahman Bariar Library 40%
Chart 3.19
Representing productivity per DSE under each Distributor.
Interpretation
DSEs of HAT are 72% productive, MKBB said that their DSEs are 100%
productive. Productivity of the DSEs of Eureka Telecom is 26%. Productivity of
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the DSEs in Chowdhury Traders is 75% whereas that of BBL is 40%.
Table 3.20
Representing whether the DSEs arrive and fill the stock in time in the retail outlets.
Serial No. Response Respondents Percentage
1 Yes 55 69%
2 No 25 31%
Total 80 100%
Chart 3.20
Representing whether the DSEs arrive and fill the stock in time in the retail outlets.
Interpretation
69% of the retailers said that the DSEs do come on time and fill the stocks
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regularly, whereas 31% of them have converse response.
Table 3.21
Representing whether the DSEs deal with the complaints of the retailers.
Serial No. Response Respondents Percentage
1 Yes 63 79%
2 No 17 21%
Total 80 100%
Chart 3.21
Representing whether the DSEs deal with the complaints of the retailers.
Interpretations
79% of the retailers responded in the affirmative whereas 21% of them
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contradicted to the above opinion.
Table 5.22
Representing the views of retailers regarding the performance of DSEs of various
service providers.
Performance/
Service
provider
Vodafone Aircel Airtel BSNL Reliance Total
Very good 15 35 5 25 0
Good 30 30 10 10 0
Neutral 25 5 35 15 0
Bad 10 10 20 20 20
Very bad 0 0 10 10 60
Total 80
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Chart 5.22
Representing the views of retailers regarding the performance of DSEs of various
service providers.
Interpretation
Very good: 19% of the retailers voted for DSEs of Vodafone, 44% forAircel , 6% for Airtel and 31% for BSNL.
Good:38% each for Vodafone and Aircels DSE, 12% each for both Airtel
and BSNL.
Neutral: 31% for Vodafone, 6% for Aircel, 44% for Airtel and 19% for
BSNL.
Bad: 12.5% for Vodafone , 12.5% for Aircel, 25% each for Airtel, BSNL
and Reliance.
Very bad: 12.5% each opined for Airtel and BSNL and the rest 75% for
Reliance.
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They often report late not followed in all distribution points on daily basis
start.( 9.00-9.15) am
DSEs do not push sales DSEs do not physically check stock and
hardly greet the retailers
No scientific method
to arrive @ average
stock sale retail wise
from distributors
side, beat-wise
Not all the DSEs updatethe retailers
They do not do this & do
not choose the best
location
Not on daily basis
Not a daily activity with the DSE @ all
O/Ls
DSE does not do the
activity at all activation
O/Ls on a daily basis.
DSE reports @distributor point
@ 9.00 am
Daily updating on targets and
targets for the day by the
distributor a.k.a. Gate Meeting
DSE collects the
stocks based on his
own assumptions
for the day.
He hits the market
and starts his beat
work.
He greets the retailer and
checks the availability of stocks
@ retail point either verbally or
physically (ETOP, SIM &physical)
Retailer asks for
stocks (e tops
and physical and
SIM)
DSE
cuts the
bill
DSE
collects
cash
DSE gives the stock to the
retailer electronically for
etop and physically for PRC
and SIM
DSE updated the
retailer on new
schemes
DSE pastes a one
pager of new
scheme inside the
shop
DSE checks MTD activations
of the retailer in retailer
activation book and pending
PAFs
DSE updates retailer on this MTD
achievement on tertiary and
activations and pushes for meeting
his target
DSE addresses queries and
concerns of the retailer and
escalates them to distributor
and RM
DSE follows the same
structure for the rest of
his beat plan
Post market visit DSE gets
back to the distributionpoint
DSE counts total cash collected, balance
Etop, PAFs, SIM and hands over to the
distributor
Distributor takes a brief update on the days achievements
and misses and retailers query and concerns
DSE leaves for the
day.
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FINDINGS
Most of the DSEs cover around 60-80 retail outlets and their monthlyacquisitions vary from 500-700.
Monthly revenue generated by the DSEs varies widely from Rs.1-3 lakh toRs.5-7 lakh.
Most of the DSEs feel that HIGH INCENTIVE can boost their performanceand the Distributors too agree to this fact.
About half of the DSEs visit 25-35 retail outlets per day and the time taken bythem in each retail outlet varies from 5-15 minutes.
Majority of the DSEs are satisfied with the salary provided but not with theincentive received.
All of them feel regular training on sales processess is necessary.
Most of the DSEs keep Age of Network in mind while getting connectionsfrom the retailers.
The issues that the DSEs face while dealing with retailers are regarding delayin SIM delivery , Network problem and delay in the activation of Recharge
cards.
All the DSEs do not visit the retail outlets regularly. The sales figure portrays that the DSEs of MKBB are performing better than
the rest.
Productivity of the DSEs of MKBB is higher than the rest of their peers.On anaverage, productivity per DSE is 63%.
Some of the retailers face stock out and a number of customer complaints due
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RECCOMENDATION
ForFOS:-
They should arrive on time at the distributor point so that they can start on
early to hit the market.
DSE should always physically check stocks at the retail point. DSE should
greet the retailer with warmth rather than paying a lip service.
DSEs should push sales and visit all the retailers who are under their bits
every alternative day.
DSEs should update the retailer on new schemes and on his MTD
achievement on tertiary sales, activations and push him to meet his targets
on daily basis.
They should also check daily the MTD activations of the retailer in retailer
activation book and pending PAFs
DSEs should paste a one pager of new scheme inside the shop at the bestlocation that comes under customer line of sight.
DSEs should not spend more than 10 minutes in each outlet by this they can
save time and go for opening up new outlets.
FOR DISTRIBUTORS :-
Distributor should take a brief update on the days achievements and
retailers query and concerns daily.
Distributor should set the sales targets for the DSEs based on scientific
methods.
Distributors should daily update the DSEs on their target for the day.
Monetary benefits should be given to the DSEs on achievement of targets
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this would in turn motivate them towards higher performance.
Sales target should be set being unbiased, based on bit strength and
demographics of market. The DSEs should not be given more than 30-35
outlets in a bit to cover otherwise it would reduce their productivity.
Regular training should be given to improve selling skills and for their
personal development and growth.
Higher incentive scheme should be considered and a proper tracking system
should be designed to keep a check on the DSEs activities.
Monthly contest to be conducted. While planning an incentive scheme the
basic need and security needs of DSEs should be taken into account.
Reward and recognition program should be extensively conducted to boost
up their spirit.
FOR COMPANY:-
Company should promote sense of belongingness to the DSEs towards it.
Company can provide uniform and id- cards to the DSEs.
They can conduct talent pool programs and promote career growth program
for the DSEs.
They should ensure that training programs are being facilitated to the DSEs.
Improvisation of Bulls eye target is required and the DSEs, Distributors
should me made aware of the key areas of the scheme.They should inject this scheme well into the DSEs mind so that they can be
encouraged to perform better.
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CONCLUSION
The topic of the study was FOS productivity and incentivization of Telecom
companies with special emphasis on Vodafone.
The study has helped in understanding the theoretical and practical aspects of
productivity in reality. It has given a way to in depth understanding of the
productivity and incentivization schemes followed by the distributors of Vodafone.
It has also helped in knowing the working norms of all the DSEs under theTelecom companies and the way they are motivated. The survey conducted has
opened up the loopholes in the sales process.
Productivity depends upon two factors; at first is the product that contributes
90% to it and the remaining 10% by the performance of the DSEs. The DSEs
productivity can be raised only by 10% (based on scientific method) and all the
DSEs cannot be given equal targets as the efficiency varies. To get the best out of
them they can only be motivated by high monetary benefits and meeting up their
basic and security needs. The study has shown lack of association of the DSEs with
the company. So the sense of belongingness towards the company should be
enhanced by the company.The DSEs should not be over burdened with more of
retail outlets in each bit, it would reduce their productivity.
At last I would conclude that revenue can be maximized by opening up UAOs and
selling of more innovative VAS and Bonus cards. Sales can be maximized by
motivating the DSEs and they in turn would encourage and strengthen the retailers
by making them well aware of the products. The customers would be ultimately
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benefitted with the sales process being carried out effectively. Customer delight is
possible with customer complaints solved well in time, easy availability of SIM
cards, and well availability of preferred products at arms length.