A rejig that delivered!
Triggered by falling KPIs, a leadership change at the helm virtually led to a management exodus, but the bet paid off
India’s largest telco by subscribers as well as revenues was more focused on improving its business and operational key performance indicators (KPIs) and less on growing subscriber numbers, which anyways kept adding up. A declining net profit for more than 10 quarters in a row had made the telco sit up and take note seriously.
The leading integrated services major underwent a major organizational transformation, with some of the old horses, including CEO Sanjay Kapoor, exiting the ranks to make way for fresh blood in the likes of the new CEO Gopal Vittal.
A battery of senior management exits took place, spread over the year. These included Amrita Gangotra, Director of IT for India and South Asia; Drew Kelton, President – Enterprise Services Business; S Ashokan, Head of Supply Chain, and Vineet Taneja, Director – Operations for South India and Sri Lanka. Krish Shankar, Executive Director of human resources; K Srinivas, President – B2C, India and South Asia and Bharat Bambawale, Global Brand Director also left. However, the most high-profile exit of all was that of Jai Menon, who had orchestrated a trendsetting model of outsourcing in telecom when driving a $750 million deal with IBM way back in 2004.
Almost a year after Vittal had taken up the reins did the company managed to end an era of 15 successive quarters of declining profits. (It also went on to cut down the size of its deal with IBM by more than a half when it came for a renewal in 2014, while also letting other vendors in as partners.)
Some of the key decisions that helped bring about a much needed upturn in net profits included, what obviously was a massification approach to monetizing the 3G investments, which drove the launch of plans like Rs 1 video download, followed by Re 1 entertainment store. As part of its move to raise customer stickiness by way of creating more transparency in its offerings, Airtel launched its MyPlan in October 2013.
Airtel also partnered with Google to come out with Free Zone, a Googlepowered service that allowed Airtel users to access Google mobile services, including Search and Gmail on the go at no data costs. In early 2013, Airtel also launched its mEducation suite of offerings, which included services such as English Guru, Campus Search, Scholarship Alert, Career Counselling and Ask an Expert, among others.
Airtel also took further small but important steps in the area of 4G, as it launched its services in the cities of Chandigarh, Mohali and Panchkula in March 2013.
It also entered a landmark infrastructure sharing deal with emerging arch rival Reliance JioInfocomm, which also signaled a greater intent to share passive infrastructure in mutual interests. The two companies signed an Indefeasible Right to Use ( IRU) Agreement, under which Bharti would provide Reliance Jio data capacity on its i2i submarine cable.
Bharti Airtel is expected to focus on further strengthening its business KPIs through 2014 and further deleverage its balance sheet, as it is faced with the need to be better prepared for the upcoming competition from RJio in 2015.