I guess it won’t survive if the current situation continues for couple of more years. A visit to BSNL office recently drove me to pen my thoughts about it.
BSNL has reported a loss of around 6000 crores for this financial year 2010-2011. Though one of the reason is 3G and BWA fees paid this year, it does not show the correct picture. Though BSNL had the first mover advantage like getting allotted the 3G/4G spectrum much before private operators, it turned out to be something like giving a sapling to someone who does not know/(want) to grow it.
A company which wishes to survive in the competitive market while making profit will have a right mix of Opex and Capex in its sheet and for BSNL it looks like there are many roadblocks in new investments to strengthen its network in the same time it is continuing to feeding its aging horses (just a comparison) which compete with others in the race.
Major problem I see (like others) is BSNLs ever continuing Opex. Salaries for around 281K employees. Does BSNL really need 281K employees when competing private players can do that with around 1/10th of BSNL’s count. Am not denying that BSNL has the biggest infrastructure but it has more number of people sitting in office than maintaining the infrastructure. Take for example the office I visited today, which had 11 counters for handling different services apart from 4 for bill payment. Once I had to talk to a PRO for activating my 3G plan. Does that kind of service really need a executive level officer to solve it. It would be done on a call to customer care with the private player.
I hardly see some young blood in BSNL offices, whichever branch it may be. Avg age I guess would be over 45+ and 80% of the strength would be above average whereas I guess with the private player 20% would be 45+.
How BSNL can be revived?
BSNL can reduce/merge services like Wireless/Wireline/Enterprise. You don’t need different people at n number of counters like one for B-fone/Broadband/Landline, when all can be brought under one umbrella served by one. If the office infrastructure is improved, job done by 10 now can be done by 3 at least.
Sam Pitroda recommended for bringing in VRS to cut down the workforce by 1/3 if not by half and from 2009 discussions are onnnngoing. Though it is easy to say it is really hard to digest for people who would have seen at least a dozen of different seats (i mean chairs) under them in their time in BSNL until now. If am nearing my 50 I will more than happy to give up my seat and I believe my words won’t change when I cross 45. VRS and reducing workforce is the only way to bringdown the opex and also it will push the employees to work harder if not lethargic like what we see now in each of the BSNL offices. Have the 20%-80% share in employee strength in favor of young blood.
3.Bring in some new partners.
4.Restructure the Pay – link a part of it with performance.
5.Replace the existing front-end employees with back-end systems.
Get rid of the paper work, where it can be done. Why the hell customer has to come to the service office for a change of an existing plan or apply for a new service. Why do you to have a person just sitting in front office to read a bit of paper and enter details in a machine. It can all be automated with an effective on-call customer support system.
6.Remove the executives working closely with lobbyists.
One player might grow at the expense of other in a competitive market. It can be a pure in-efficiency of one who is losing business and the winner has someone working for him on the other side.
I guess my blog title will suit BSNL much in the current scenario..