Iden­ti­fied chal­lenges in re­vival

Financial Chronicle - - FOCUS -

The chal­lenges fac­ing BSNL can be clas­si­fied into three ma­jor heads:

1. Tech­no­log­i­cal/ mar­ket:

These in­clude the rapid evo­lu­tion of tech­nol­ogy (5G, IOT), fast evolv­ing con­sumer needs of data con­sump­tion, chang­ing de­mo­graph­ics pat­terns and in­creas­ing role of con­tent in driv­ing busi­nesses. Such a com­bi­na­tion of tech­nol­ogy/mar­ket char­ac­ter­is­tics re­quires or­gan­i­sa­tions to have agility, build part­ner­ships, re­duce costs, and be in­no­va­tive. On all these di­men­sions BSNL has sig­nif­i­cant chal­lenges. The mech­a­nism for re­spond­ing to the chal­lenges is not elab­o­rated as it is in­cluded in the part on or­gan­i­sa­tional chal­lenges.

2. Pol­icy en­vi­ron­ment:

Since BSNL is 100 per cent gov­ern­ment owned, it is of­ten sub­ject to the de­lays and de­ci­sions made by the gov­ern­ment. For ex­am­ple, while the gov­ern­ment has trans­ferred its li­a­bil­i­ties (work­force) to BSNL, the trans­fer of land and build­ing as­sets are yet to be com­pleted. There seems to be a lot of con­fu­sion sur­round­ing the own­er­ship of the land and build­ing as­sets of BSNL.

3. Or­gan­i­sa­tional:

These are spe­cific to the sys­tems and pro­cesses adopted by BSNL. These re­late to de­lays in pro­cure­ment due to its own in­ef­fi­cien­cies and the need to fol­low guide­lines for pub­lic pro­cure­ment; cen­tral­iza­tion of de­ploy­ment of tar­iff plans, lead­ing to in­flex­i­bil­ity in ser­vice of­fer­ings; poor link­age of per­for­mance with in­cen­tives, fre­quent trans­fers etc. The larger chal­lenges re­late to de­vel­op­ing or­ga­ni­za­tional re­sponses on rapid devel­op­ments in the sec­tor, build­ing part­ner­ships, en­hanced mar­ket­ing ori­en­ta­tion. Chal­lenges be­ing faced in those cat­e­gories where BSNL/DoT could take ac­tion.

Pol­icy en­vi­ron­ment

a. De­lay in al­lo­ca­tion of 4G spec­trum as out­lined in Part B.

b. Lack of a sep­a­rate project or­gan­i­sa­tion: BSNL op­er­ates as a sin­gle en­tity un­der a UAS Li­cense: All tele­com ser­vice op­er­a­tors have to pay 8 per cent rev­enue share from all ac­tiv­i­ties that oc­cur un­der the UAS Li­cense.

BSNL’s bid for projects, in­clud­ing those that do not ex­plic­itly in­volve tele­com ser­vices is higher due to the rev­enue share. This makes its bid un­com­pet­i­tive. In com­par­i­son, other op­er­a­tors have set up sub­sidiaries that can un­der­take such projects, and thus there is no man­date of rev­enue share.

c. Flux in the de­ci­sion re­gard­ing MTNL: MTNL serves the na­tional cap­i­tal re­gion and Mum­bai. BSNL serves the rest of the coun­try. All tele­com ser­vice providers have pan-In­dia pres­ence and earn about 40-50 per cent of the rev­enues and 30-40 per cent profit from these two metropoli­tan cities. How­ever, de­spite this, MTNL has been suf­fer­ing mount­ing losses.

The op­er­a­tion of BSNL and MTNL as two sep­a­rate en­ti­ties is eco­nom­i­cally, op­er­a­tionally and fi­nan­cially sub-op­ti­mal.

d. De­lays in project al­lot­ment and project fund­ing: The project al­lot­ment may get stuck due to bu­reau­cratic pro­ce­dures and pro­cesses, and also de­lays in de­ci­sion-mak­ing. Of­ten times, lack of clar­ity of cri­te­ria on which to base de­ci­sion is miss­ing.

Also, at time the pay­ments for the ap­proved and com­pleted projects is de­layed by DoT. The de­lays in al­lot­ment of projects and the pay­ments from DoT leads to avoid­able de­mo­ti­va­tion and fi­nan­cial loss for BSNL.

e. Re­mov­ing mar­ket/fi­nan­cial in­ef­fi­ciency: At present, BSNL is 100 per cent gov­ern­ment en­tity. In or­der to in­fuse cap­i­tal and also to bring in mar­ket/fi­nan­cial ef­fi­ciency, it may be im­por­tant to think about list­ing of BSNL (like other PSUs such as ONGC, GAIL, NTPC, etc.).

Or­gan­i­sa­tional chal­lenges

a. Large legacy work­force: BSNL has a huge legacy work­force. Work­force of BSNL is 1,71,523. Ma­jor­ity (about 70 per cent) of this work­force was trans­ferred to BSNL from DoT at the time of for­ma­tion of BSNL.

The work­force of BSNL has an av­er­age age of more than 55 years (es­pe­cially in the group C and D field staff). This work­force lacks in­ter­est in im­prove­ment of ser­vices, pro­vid­ing good qual­ity cus­tomer ser­vice and even lacks tech­ni­cal knowl­edge.

b. The board: There have been con­cerns about the Board com­po­si­tion and rep­re­sen­ta­tion from the busi­ness fra­ter­nity. Also top and Board po­si­tions of­ten go va­cant for long pe­ri­ods of time. The mid­dle level man­age­ment is dom­i­nated by ex­ec­u­tives pro­moted from JEs/JTOs who were ab­sorbed/trans­ferred to BSNL at the time of its for­ma­tion. These pro­fes­sion­als are mostly above 55 years of age and have very lit­tle mo­ti­va­tion to im­prove the con­di­tion of BSNL.

c. Cen­tralised struc­ture – Im­por­tant ac­tiv­i­ties like pro­cure­ment of equip­ment, han­dling of fi­nances, prepa­ra­tion of tar­iff plans, re­cruit­ment, etc. are done cen­trally through the BSNL head­quar­ters. The cir­cle heads (CGM and PGM) are not em­pow­ered to make de­ci­sions re­gard­ing the above­men­tioned is­sues by them­selves.

d. Lack of well-thought out poli­cies and sys­tems: Even after about 19 years of ex­is­tence, BSNL does not have well thought out peo­ple-re­lated poli­cies. Some of the im­por­tant poli­cies such as the ones men­tioned below are miss­ing:

i. Per­for­mance man­age­ment and pro­mo­tion pol­icy – The per­for­mance man­age­ment sys­tem in BSNL is quite su­per­fi­cial. The pro­mo­tion hap­pens in a time-bound man­ner and there is no recog­ni­tion of merit in the sys­tem. To­day, me­diocre peo­ple are hold­ing im­por­tant po­si­tions. There is lack of pro­fes­sional lead­er­ship in the or­gan­i­sa­tion.

ii. Man­power plan­ning and re­cruit­ment – There is no se­ri­ous man­power plan­ning that has hap­pened in the or­ga­ni­za­tion since the time it was found. The re­cruit­ment has hap­pened over the years in a very ad hoc man­ner at both the head­quar­ter as well as the cir­cle level.

iii. Dif­fer­ent cadres in the or­gan­i­sa­tion – Peo­ple hired at the same level job ti­tles have been given dif­fer­ent job des­ig­na­tions.

iv. Shut­ting down of small ex­changes – There are a lot of ex­changes that are un­vi­able due to low num­ber of con­nec­tion but are still be­ing main­tained/op­er­ated by BSNL. There is no clear pol­icy/de­ci­sion be­ing taken by the head­quar­ters about shut­ting down of these un­vi­able ex­changes.

e. Lack of Cus­tomer Ori­en­ta­tion – There is tremen­dous de­mo­ti­va­tion in the BSNL work­force due to the poor per­for­mance of the PSU, illthought poli­cies, lack of com­mit­ment of the lead­er­ship, ag­ing work­force, non-im­ple­men­ta­tion of 3rd PRC and sus­pen­sion of staff ameni­ties and other dues like the re­im­burse­ment of med­i­cal bills, LTC, etc.

This lack of en­thu­si­asm has trans­ferred into poor cus­tomer ser­vice lead­ing to a re­duc­tion in cus­tomer con­nec­tions over time.

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