Group 3 Section D Report
Group 3 Section D Report
Group 3 Section D Report
on
By Group 3, Section D:
Vrajesh Kumar Singh (1811438)
Chayan Baul (1911234)
Avinash Deka (1911242)
Rituparna Ghosh (1911246)
Yemineni Meghana (1911266)
Prasun Shekhar (1911289)
Sumit Shubham (1911291)
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Contents
1. Introduction
3. Product Portfolio
4. Core Competencies
6. Structural Dimension
9. Growth Opportunity
16. References
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Vodafone Idea Limited
Vodafone developed as a joint venture in early 1980s, founded by Racal electronics limited. In
the early stages, Vodafone developed cellular network in United Kingdom and enjoyed
duopoly with one major competitor Cellnet. The company was a dominant player in the 1990s.
Vodafone entered India in 2000 by acquiring Delhi operations of Essar. In 2007, Vodafone
acquired controlling stake of 67% in Hutchison Essar. It gained full control of Essar in 2014
when government allowed 100% foreign direct investment in the telecom sector. Vodafone
invested heavily in the Indian market after its advent with a growing customer base. After a
Reliance Jio which changed the telecom market drastically providing tough competition to
Idea cellular is an Aditya Birla Group company, founded in 1995. It was incorporated as Birla
Communications Limited. The company grew steadily to acquire a customer base of 2 million
in 2004. It became a pan-India service provider in 2009 with a subscriber base of above 57
million. Year 2010 marked Idea as the third largest mobile operator of India in terms of
revenue. The company grew at a moderate pace over the years to expand itself in the Indian
market with a subscriber base of 171 million in 2015 offering a wide range of services to the
Indian customers.
Owing to the presence of Airtel and the advent of Reliance Jio in 2016 changed market
dynamics putting pressure on competitors. In 2018, Vodafone and Idea merged to form
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Vodafone Idea Limited:
The merger of Vodafone and Idea in 2018 created India’s biggest telecom service provider-
Vodafone Idea Limited having a customer base of over 408 million. The merger aims to tackle
Reliance Jio with improved infrastructure to provide superior service, improved tariffs and
The merger of two leading telecom service providers of the country would have witnessed a
variety of changes ranging from organization structure, culture to share values, mission and
goals.
The proposed project aims to study the effect of merger on performance, organization structure,
design, culture, phases of growth, changes in leadership and decision-making authorities and a
wide variety of parameters relevant to the ever-evolving telecom market of the country.
The merger of two companies was based on improving products and services, collaborating to
provide efficient service to a large market to customers. Following are some of the goals which
1. Better network: Improved and robust ecosystem of towers which will yield better
network coverage than before. The new entity aims at large spectrum portfolio and more
2. New Technology: The merged entity aims at better services in voice, data, mobile
3. Competitive offers: The changed market due to entry of Reliance Jio requires a highly
competitive skills to serve the ever-changing telecom market. The company aims to invest
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Mission of Vodafone Idea Limited:
• Customers: Be the most loved brand by continuously raising the bar in delivering
simple, delightful experience and meaningful innovations, through new age technologies.
• Team: Be an inspirational, agile and exciting organization that challenges the status
quo, and champions a diverse team that has a winning attitude and thrives on delivering
customer excellence.
delivering sustainable growth, while adhering to the highest standards of governance and
compliance.
Vision
Create world class digital experiences to connect and inspire every Indian to build a better
tomorrow.
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Values
• Digital: Focuses on technology to make things simpler for customers and company
Milestones:
Great place to work- Vodafone India ranked 20th in the LinkedIn Top Attractors 2017
Brand Leadership-
• Vodafone India amongst the Top 10 Most Trusted Brands in India by Brand Trust
Report 2018.
• Recognized among the top 10 Most Admired Marketers – Brand Equity Most Loved
Brands
Business Services
• Vodafone Business Services recognized as the chosen leader for Telecom Carrier -
• Vodafone was ranked second in the Service Category at the CII LEAN National
Product Portfolio
Product Portfolio is the basket of all the products and services that a company has to offer. It
is the sum of all the products the company has been offering from its start and the product it
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has been adding up to meet the changing demand, preferences and technology. It can be
grouped into products, product lines and Individual products suited to the target market.
Drawing an analogy that as the organisation comprises of different departments but, together
they work for the common good of the organisation, in the same way, the product lines are
designed and managed to provide maximum profits to the company. Portfolio management has
works together to produce various products and thus the product portfolio foster’s synergy
2. Product and Technology Innovation: Regular analysis of the product portfolio gives an
idea and strategy to come up with a new variant of a particular product or to launch a
completely new product. It also gives feedback on the present technology used in the
3. Efficient fund Management: The feedback from product portfolio management can
help efficient fund management as the management would know about the investments,
sales and profit from a product line. Thus, an efficient allocation of fund is achieved.
feedback and implementation of the same for the various product is possible when there
5. Identify the target market: Product portfolio’s performance in various markets and with
various user groups helps identify the target market for the product.
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Vodafone’s Product Portfolio
1. Basic Plans:
a. Prepaid Plans: Monthly prepaid plans for the subscribers are available with
subscriber has to do in a month to remain active on the network. This was done
to ensure that the telecom operator has an active subscriber and it generates small
on the network. Also, the industry has been bleeding money, and this would ensure
b. Post-paid Plans: It has postpaid plans which have subscribers from corporate,
Idea Limited. This plan is an offering to the family as the end-users. It allows a
family to share their postpaid plans. This not only ensures improved revenue but
2. Internet:
b. Broadband plans: Vodafone had also ventured into fibre-net and broadband
c. Dongles & Mobile WiFi: They have dongles to access internet for laptops.
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3. Content:
recognised the need for content over the 4G network. The consumption of content
is on the rise, which directly means an increase in the use of Mobile Data. Thus, the
company has collaborated with on-demand content providers like Amazon Prime
Core Competencies:
1. Assets and Infrastructure: The merger entity that is Vodafone Idea has become the
2. Market Share: Leading in terms of total active subscribers, inclusive of all 2G, 3G,
4G subscribers.
3. Efficient Supply chain and operations: The company after the merger has a good
reach in both rural and urban area. Idea had a very good presence in rural India, and
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c. 387 million active subscriber base as registered on Visitor Location Register
(VAR)
technologies and bringing technology from outside India to Indian markets would be
simple.
The Vodafone Idea Ltd. has gone through a merger which has resulted a substantial change in
the structure. The structure has been specifically designed to tackle the threat of external
environment, with the increasing rise of threat from other players in the market like Jio. To
address this problem, the management has decided to come up with a flatter structure. This
flatter structure will give the most beneficial to the organisation. However, the introduction of
this new structure has faced criticism from the organisation’s employee and the issues raised
by this new structure is mentioned below. The structure released by Vodafone Idea Ltd. during
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The structure is headed with CEO being at the top, the second level are the CXOs
which compromise of CTO (Chief Technology Officer), CMO (Chief Marketing Officer),
COO (Chief Operating Officer), etc. The CIO (Chief Information technology Officer) has been
placed below CTO. For all other CXOs the below level includes Senior Vice-President
then Vice-President. General Manager is placed below Vice President and finally and the
Though the current management have come up with flatter hierarchy structure to tackle the
external environment. This new flatter structure comes with its own problems. To make the
structure flatter, management has removed bands in the hierarchy and due to which lot of
employees are asked to work in the same band when earlier they were not. Due to which many
employees got demoted and asked to work on lower band and similarly many lower band
employees were also promoted to higher band. Also, these employees in their previous
organisation of Vodafone and Idea had different pay scale for same designation in the new
structure. All these restructures of designation caused unrest among the employees.
Looking at all those problems raised and unsatisfaction of the employees, the top management
of Vodafone Idea ltd has promised to come up with a better hierarchy structure in the future.
Structural Dimensions:
In this section, we look at the structural dimensions of Vodafone Idea Ltd. based on the
1. Formalization – After the merger there is high documentation and formalization for the
regulations and policy in the company while the documentation for the procedures and job
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2. Specialization – Since the merger, as mentioned above due to flatter hierarchy many
employees of different bands from two organisation have been asked to work on same level.
This has created unrest among the employees. All these has contributed of having very less
chance for employees to switch their work domain. Any work which requires a high speciality
like the IT work is outsourced. Though the management has promised to provide opportunity
to variability in the work, currently the specialization is moderate to high in the company.
3. Hierarchy – The main objective of the new structure is to create a flatter hierarchy so that
it is more suitable to tackle the threat of external environment. Post-merger the no of levels in
4.Centralisation - During our interviews, we have come with the conclusion that most of the
decisions are taken at the Vice-President level & even the General manager has also informed
us that any decision which would have any major impact were taken only by the higher
levels. Hence, the currently the organisation is highly centralised with most decisions taken at
higher level.
may get overwhelmed with their current work, and managers who were previously effective
start making mistakes as their span of control expands. System starts to feel jolts of turbulence,
and this could lead to failure unless a way towards growth is discovered
The “Greiner Curve” can be used as a reference to think about the crisis that organizations
experience. With the help of it, one can realize the root cause of the variety of problems that
an organization is likely to experience in the fast growing business. Even beyond that, problems
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can be anticipated before they occur using this model, so organizations can meet them with
As an organization grows, the different phases that it goes through can be explained by the
Greiner’s Growth Model. Companies from small design shops to giant manufacturers, real
estate companies to service firms, all experience these variety of stages. Every growth stage is
faced by some sort of “crisis” and some sort of major change is needed for the organization to
keep on growing.
“Crisis” can be defined more as a turning point, but for a lot of people it can create a sense of
dread and create panic. But when you look from a broader sense, there is no real need for panic
as these crisis stages can have a planned approach and that is the reason why we call these
points as “transitions”.
This model was originally proposed by Larry E. Greiner in 1972 with five stages of growth.
But in 1998, a sixth phase was added in an updated version. We believe Vodafone Idea is
currently in the 6th phase of its life cycle which is explained below:
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The newly added sixth phase recommends that growth may continue through mergers,
outsourcing etc. The crisis that the company faces is of “Identity” and the way forward is to
This is exactly what Vodafone and Idea did to target the Indian market, they merged into a new
entity and pooled in their resources to combat the new competition. The longer a phase would
last, the harder it is to transition, but Vodafone-Idea has been able to successfully
surpass that.
This typology is one of the most important classifications that an organization needs to go
through. There are 4 broad regions: Defender, Prospector, Analyzer and Reactors. After
analysing Vodafone Idea’s current standpoint, we believe the company is somewhere between
Defender
These are relatively stable companies who are operating with a model to defend their current
market share. There is seldom much need to make any changes to the organization structure or
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deviate from the current existing operation. As a mature company, Vodafone Idea has almost
all its procedure defined, and this gives it an element of a defender. But since it’s in an
extremely unstable telecom market, we can’t define it as having a full-on Defender strategy.
Analyzer
An analyzer is a company that tunes its products depending on its competitors. In a more
“dynamic” domain, they will not usually make the first moves. Similarly, after the advent of
Reliance Jio, the market is extremely dynamic with different companies launching new
products regularly. In such a market, an essence of an analyser is needed to combat the new
changes. With Vodafone Idea continuously evaluating its competitors and offering different
plans and dynamically changing discounts to its customers, we believe an element of Analyzer
Growth Opportunity
As the number of new subscribers grow all over India, it was expected that Vodafone or Idea
would be able to target only 40% of this new customer base as individual companies, but now
after the merger with their consolidated resources it is expected that Vodafone Idea can capture
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Further, even though new competitors like Jio have taken over the market share in terms of
total subscribers, it is interesting to note that in terms of 4G subscribers specifically, the market
share of Jio has been steadily decreasing while that of Vodafone Idea has been increasing over
the last few quarters. This is mainly due to the old 2G/3G consumers of Vodafone Idea
Growth Strategy
The main focus of Vodafone Idea to combat the current unstable market is on cost cutting.
Circle and Zonal office infrastructures are being consolidated. The number of sales and
distributors have been significantly cut down, further a lot of underperforming branded retail
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The company is focusing more on acquisitions of active users, and the focus has been shifted
to acquiring higher end value consumers. Centralised credit and collection is also leading to
lower costs, bad debts and churn. Simplifying portfolio is also helping to lower the number of
calls to call centres per customer. Vodafone Idea is also following combined advertising and
Impact of Environment:
boundary (external to the organization) and has the potential to influence all or parts of the
organization.
1. Task environment
Task Environment includes the sectors with which an organization interacts directly on a
frequent basis and they have the ability to directly influence the organizational goals and
performance.
Examples:
Industry competitors:
For Airtel, Vodafone and Idea, the then 1st, 2nd and 3rd largest telecom operators in the
country, entrance of Reliance Jio into the market in September 2016 was a major blow and
the scale of it was not anticipated. This had a major impact on the telecom industry and has
led to many changes in the Indian telecom industry. All the small players like DoCoMo,
Aircel, etc. Have been acquired by other players and lot of consolidation activities
happened. One of the most important factors of interest is the merger between Vodafone
India Limited and Idea Cellular Limited, initiated for talks in 2017 and the merged entity has
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Post-merger, the new entity took about 9 months to come up with the re-organization process
and bring all the employees of both the organizations under one organizational structure.
Market Consumers:
The consumers’ attitude towards mobile communications has changed over the last 3 years
where they have the option to choose from various telecom players products and have an upper
hand.
2. General Environment:
This includes the environment factors that have indirect impact on the
Environmental Uncertainty:
Environmental uncertainty stems from having insufficient information about the external
environment to the organizations. External elements include factors like new technologies,
Depends on the number and dissimilarity of the external elements like Competitors, Suppliers,
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a. Government Regulations:
(DoT) time and again come up with various regulations, some of which have the power
to change the strategies of telecom operators. For example, the e-KYC (Electronic Know
Your Customer) regulation brought by the Government had brought the companies on
their toes to ensure that the eKYC machines are present in all the touch points by the
deadline. And this also makes it easy to acquire customers if the eKYC process is
b. Customers:
Customers in our country are slow to adapt to new technologies or when there is handset
c. Other Factors:
Some other factors like any change in technology requires changes in the Infrastructure
heavy industry which leads to increase technology adoption time and also huge costs of
implementation. In India, by the time any new technology is implemented pan India, US
The rate of change in the external environment defines the stability of the industry.
In case of Vodafone Idea Limited, important factors that contribute to make its external
environment unstable are new technologies and aggressive competitors which are
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a. New technologies:
VoLTE (Voice over LTE) technology introduced by Jio enables voice calls over data
Hence almost all the telecom players in the country back then, around 3 years ago in
2016 when this technology was at its peak, faced a bottleneck to bring this VoLTE
service live for their customers. But Jio had worked around this by introducing an in-
house Reliance Jio mobile phone series called ‘Life’ which came at a nominal price of
Rs. 1500 and has made voice calls free. While voice calling generated about 40% of
revenues for all the telecom operators at that point, this was a table turning move
by Jio.
b. Aggressive Competitors:
Again, Jio was the biggest threat amongst the competitors as Jio was in a loss
leadership phase and gave away free introductory services to customers for 6 months to
build the customer base. It has become difficult for Vodafone to compensate for free
services with high quality services and had to reduce prices to be able to stay in the
market.
Hence Vodafone Idea in the Unstable and complex domain and therefore falls in the High
Uncertainty region. As per the theory we have studied, below are the factors that the
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Vodafone Idea is following all the factors except Organic structure and decentralized way of
working. Mostly because it is an old organization and a big organization and has grown to
follow a mechanistic structure and follows the decentralized working style. But the
strong integrating roles, planning, extensive boundary spanning and high-speed response are
Organisational Culture:
As per the interview taken and secondary research done by us, we have studied and tried t find
the best organisational fit for this new merger born company. As we know the merger was
targeted to solve the threat from external environment, but still now most of the focus is going
As per organisational cultural chart, the organisational culture of Vodafone-Idea ltd. falls
somewhere between bureaucratic culture and also some of adaptability culture. More
Some of the specified reasons why it falls under bureaucratic and adaptability are mentioned
below.
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Bureaucratic Culture
• Organization is busy with merger, sorting & creation of internal orientation and
stable environment.
• New ideas & initiatives are not given priority at this stage.
• Opportunity to change of work domain is less as due to merger lot of people have come
Adaptability Culture
Perrow’s Model
Perrow’s work analyses how Technology relates to different organisational characteristics. The
advantage of Perrow’s framework is that it can be applied to a wide variety of tasks and beyond
core technologies. He defined the tasks into two dimensions – Task Variability and Task
Analysability. Task Variability refers to the degree to which a task is routinised and similar
the degree to which non-formal procedures are required to meet non-standardized exception
procedures for dealing with exceptions, thus, low variability and high analysability.
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2. Non-Routine There is no set procedure to meet the uncertainty (low analysability), and
3. Craft, it has variability and standard procedure for most of the tasks, but at times, the
set procedures. But the Analysability is high because the work can be automated and the
According to our inferences from the interviews conducted of the Vodafone Idea
Ltd. employees, we found that the tasks there is of Engineering type, characterised by high
analysability and high variability. The employees have to address variety of tasks hence highly
variable. But the organisation over the years have developed set standard procedure to tackle
the tasks and problems. Since it is a big organisation with different departments, there are
always some people who would have seen a type of problem and already has a solution to it.
Sources of Conflict:
We analysed the possible sources of conflict in Vodafone Idea ltd. and the same has been
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• Goal Incompatibility:
Before the merger the similar departments of Vodafone and Idea has different strategies
on how they function. However, after merger people from two groups have come
together with different strategies which have created confusion. More over the roles of
all departments have not been clearly defined. As a measure to tackle the external
environment, the bands have been decreased which has resulted confusion between
• Differentiation:
Differentiation occurs when the departmental norms and rules are enforced upon people
which hinders their ability and aptitude consistent. Due to merger, the no. of levels has
been decreased and people of upper bands and lower bands earlier are now asked to
work on the same level. Also new rules and formulation are made, all these factors have
caused in differentiation.
• Task Interdependence:
For a telecom company like Vodafone Idea, many departments are interconnected and
depend on each other for smooth functioning. This has resulted a clear reciprocal
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• Limited Resources:
The merger has resulted in the formation of one of the largest telecom company in India,
as both Vodafone and Idea has high presence and customer base initially, Vodafone has
high customer base in the urban market and Idea has a string presence in the domestic
market. The merger of both has resulted in the formation of a company which will have
customer from both side of the spectrum. But due to external threats like Jio, the profit
margin of the company is taking a hit and to run a huge infrastructure and large number
of staffs, it needs continuous revenue. The merger is hoping to come up with a well-
defined strategy to use these current limited resources to overcome this threat.
Way Forward
Post the turmoil that Vodafone and Idea faced in the market after the entry of Jio into the market
with predatory pricing, the need to bounce back as an organisation and new strategies.
They have to remove scepticism among the employees and help them to gain their maximum
efficiency. Also, the organisation needs to work on feedback from employees and the stake-
holders after the restructuring of the organisation. It has to gain back its lost market in the
industry and also venture into latest technologies to continue to remain relevant with changing
technology, demographics and preferences of the consumers. Here are few points upon which
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1. Indian market has immense growth opportunity. Because of the size of market, Indian
market is very attractive market. There is opportunity in field of high-speed internet and
broadband sector. With the advent of IOT the number of connected devices has been
increasing and thus Vodafone Idea needs to be watchful to tap into those segments.
2. The company should accelerate the delivery of benefits of merger to its employees. Till
now it has gained some success in this. For example, it has introduced work from home
option for its employees, thus making the work a little flexible. The organization should
3. Focus on strategic markets is the need of the hour. Today the subscriber is not satisfied
with just mobile calling and the internet. It needs further value-added services like content,
games, etc. to keep them engaged over the internet. Thus, Vodafone Idea should venture
4. Vodafone Idea has largest assets in 4G, so they should strategize to bring more
5. They should raise fresh capital and be ready with their new plan to embrace 5G
References:
1. https://www.ideacellular.com/about-us/history
2. https://www.financialexpress.com/industry/vodafone-india-all-you-want-to-know-
about-telcos-journey-here/596209/
3. https://discover.vodafone.in/about-us/home?section=consumer
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4. https://www.livemint.com/Companies/rPju0LUcHUizRBbXH7ecdL/How-Mukesh-
Ambanis-Reliance-Jio-shook-up-Indias-telecom-ma.html
5. https://www.dailyo.in/technology/vodafone-idea-telecom-reliance-jio-airtel-4g-5g-
offers-deals/story/1/26388.html
6. https://www.vodafoneidea.com/who-we-are/overview
7. https://discover.vodafone.in/about-us/awards-achievements
8. https://economictimes.indiatimes.com/industry/telecom/telecom-news/voda-idea-
merger-a-big-corporate-milestone-market-heading-for-stability-telecom-
secy/articleshow/65625887.cms?from=mdr
9. https://www.vodafone.com/business/news-and-insights/press-release/vodafone-is-
first-global-iot-provider-to-pass-50-million-milestone
10. https://www.vodafone.com/content/index/what/technology-blog/vodafone-to-unveil-
latest-milestone-in-onap-capabilities.html#
11. https://www.businesstoday.in/sectors/telecom/how-vodafone-idea-merger-will-affect-
its-consumers/story/281839.html
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