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Rahim Yar Khan Campus

DEPARTMENT OF MANGEMENT SCIENCES

Final Project

Subject: Strategic Management

Presented to:Sir Shahid Yaqub

Presented by:

Zaigham Ali Roll no. 30

MBA Morning (4th, B)

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Acknowledgement

In the name of ALLAH the most Beneficent and Merciful. First of all we

like to thanks ALLAh who blessed us with such capabilities to perform

at all levels of life and secondly we like to thanks sir Shahid Yakoob who provide

us great opportunity to enhance our skills and try to reshape our selves. Although we

have short time to prepare it but the experience was quite interesting. . We tried our

level best in preparing this particular project.

As a student of course Strategic management and all the preaching and guidance of

my course teacher Mr. Shahid Yakoob. I hereby present my final project as required

on firm operating in Pakistan belonging to telecom sector. i.e. Ufone one of the

leading cellular service provider along with value added service and business

strategies. I also hereby present all the facts and figures which I gather about Ufone

from newspapers, websites and from Ufone’s annual report. Due to my job and other

secular activities I couldn’t be able to approach the firm directly, however with the

help of my friends those close to Ufone. I prepared this project for consideration of

approval of my learning and understanding about the said subject.

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Dedication

We dedicate this project to our parents and beloved teachers

especially Sir Shahid Yaqub without their patience,

understanding, support and most of all love, the completion of

this work would not have been possible.

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EXECUTIVE SUMMARY

Ufone (official name: PTML) is a PTCL company, PTML (Ufone) - a wholly-owned subsidiary

has improved its financial performance commenced its operations on

29th January 2001 as a GSM 900 service provider. Since the outset, it has expanded its coverage

and customer base at a rapid pace and established itself as one of the leading cellular service

providers in Pakistan.

During the last year Ufone successfully completed the launching of sites under Phase V in existing

as well as new cities and towns by investing more than US$ 525 million. This has increased the

asset base of Ufone from rupees 20 billion to 27 billion. To further enhance the subscriber base

and strategically position the company in the growing telecom market, Ufone has finalized a

network expansion for Phase VI contract amounting to about US$ 170 Million. Ufone currently,

has network coverage in more than 4,745 locations throughout the country.

Ufone's operational performance has been very encouraging despite stiff competition in Pakistan

telecom market which has led to reduction of prices to bare minimum level. Ufone managed to

improve its revenue and after tax profit by 87% and 54% respectively, as compared to the last year

through aggressive policies and exercising strict control over expenses.

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Table of Contents

Introduction of Ufone 07

Vision & Mission 09

Details of project 10

Purpose of project 11

Slogan 12

Findings 13

SWOT Analysis 14

Competitive analysis 19

EFE Matrix 21

IFE Matrix 25

CPM 29

SWOT Matrix 32

SPACE Matrix 33

BCG(Boston Consulting Group) Matrix of Ufone 37

BCG(Boston Consulting Group) Matrix for products 40

GSM(Grand Strategy Matrix) 41

IE(Internal, External) Matrix of Ufone 42

IE(Internal, External) Matrix for products 44

QSPM(Quantitative Strategic Planning Matrix) 46

Recommended strategy 47

Conclusion & Recommendations 48

Reference 50

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Introduction

History of Ufone

Ufone GSM is a Pakistani GSM cellular service provider. It is one of six GSM Mobile

companies in Pakistan and is a subsidiary of Pakistan Telecommunication Company. The

company commenced its operations under the brand name of Ufone from Islamabad on

January 29 2001. Ufone expanded its coverage and has added new cities and highways to

its coverage network. After the privatization of PTCL, Ufone is now owned by Etisalat.

PTML is a wholly owned subsidiary of PTCL. Established to operate cellular telephony.

The company commenced its operations, under the brand name of Ufone from Islamabad

on January 29 2001.

During the year, as a consequence of PTCL’s privatization, 26% of its shares were

acquired by Emirates Telecommunication Corporation (Etisalat). Being part of PTCL, the

management of Ufone has also been handed over to Etisalat.

During the year July 2005 to June 2006, Ufone continued on the path to success. The

Company further expanded its coverage and has added new cities and highways. Ufone has

network coverage in more than 750 cities, towns and across all major highways of the

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country. During the year Ufone successfully completed the network expansion of Phase 4

in existing as well as in new cities and towns which amounted to more than US Dollar 170

million. As a result the asset base of the Company has increased from Rs. 20 billion to Rs.

27 billion.

Future Plans keeping in view the growth potential of the cellular industry there is no option but to be aggressive in order to remain a potent force in the cellular industry. In order to extend cellular network to new cities, towns and highways and enhance its current installed capacities in existing cities, Ufone has finalized a huge network expansion contract amounting to about USD 550 million, which will enhance the subscribers’ capacity by 10 million. This is the largest ever expansion project of Ufone.

Type PrivateIndustry TelecommunicationGenre SubsidiaryFounded January 29, 2001

Founder(s)Pakistan Telecommunication Company Ltd

HeadquartersIslamabad, Pakistan13-B, F-7 Markaz

Area served2336 cities of Pakistan, GT Road, Super Highway & Motorway

Key people Abdul Aziz, CEOProducts Pre Pay, Post Pay

Revenue▼ Rs.5.1 billion PKR (first quarter 2006-07).[1]

Parent PTCL PakistanWebsite www.ufone.com

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Vision Statement

“To be the leading telecommunication service provider in Pakistan by offering innovate communication solutions for our customers while exceeding shareholder value & employee expectation.”

Mission Statement

To become the best cellular communication option available in the country for “u”…………….At Ufone we aim to provide you with wider coverage, superior connectivity, clear signals & voice quality. Wherever you are, Ufone keeps you connected

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DETAILS OF THE PROJECT

Ufone is a Cellular Service Provider founded in 2001 It is also a subsidiary firm of PTCL As of 2008, Ufone employs more than 1,730 people. It manufactures it’s the GSM company providing services to all four continents urban and rural areas., As of 2008, Ufone is the second largest telecommunication company in Pakistan. In recent years the company has endured significant improvement in services to almost 4,745 locations throughout the country.The major competitors of Ufone are domestic companies like

MOBILIINKPakistan Mobile Communications Limited, better known as Mobilink GSM, is a telecommunication service provider in Pakistan. According to PTA statistics, Mobilink has 30.88 million customers by January 2008. Mobilink's Head office is located in Kulsum Plaza, Blue Area, Islamabad

TELENORTelenor (OSE: TEL, NASDAQ: TELN) is the incumbent telecommunications company in Norway, with headquarters located at Fornebu, close to Oslo. Today, Telenor is mostly an international wireless carrier with operations in Scandinavia, Eastern Europe and Asia. In addition, it has extensive broadband and TV distribution operations in four Nordic Countries.

PAKTEL/ CHINA MOBILE/CMPAKPaktel was the first ever company granted license to carry out cellular phone services in Pakistan, set up by Cable & Wireless. It carried out AMPS services until 2004, when the company launched GSM services as well. Its main competitor emerged in late 1990s as Instaphone and soon began to dominate the market. On 4th May 2007, Paktel was renamed to CMPak. And then, on 16th May 2007, China Mobile announced that it had upped its stake in CMPak to 100%. Moreover, PTA (Pakistan Telecommunication Authority) has announced that it may resolve the frequency issue with China Mobile, as it was one of the main reason for pullout by Millicom International Cellular S.A.

WARIDWarid Telecom International is an Abu Dhabi based mobile telecommunication firm providing telephony services in Bangladesh, Pakistan and Uganda.

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ZONGZong is the first International brand of China Mobile being launched in Pakistan. It is meant to empower and liberate the people of Pakistan in every nook and corner of the country

PURPOSE OF THE PROJECT

The purpose of this project is to enhance the ability of understanding the important factors, matrix, and strategy of business. And also to encourage knowing more about the telecommunication sector in Pakistan.Ufone is one of my favorite cellular company. I have being using Ufone since 2003. Over the past few years Ufone developed dynamically. Ufone is the purpose of my project and my communication medium in life.

Market share

With the monthly additions average around 2.5 million subscribers, 2007 has been a phenomenal year for the mobile market growth in Pakistan. Here’s a look at the numbers (from PTA site) for the first 8 Months Of 2007. A quick analysis of this data reveals few trends about market leadership. Mobilink gained the most subscribers (5.45 million) in this period. Its market share has been decreasing gradually but that’s expected with the increase in competition. Telenor was the fastest growing company, 45% of their current subscribers (5.35 million) were gained this year. No doubt that Telenor has emerged as a strong contender. It took a small lead over Warid in March and has been able to maintain it. The rate of growth for Ufone has been impressive as well. It gained 5.32 million of the approx 20 million new subscribers in first 8 months of this year in Pakistan. Paktel has been barely able to reverse the negative trend of subscriber losses.

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SLOGANS

One of the main reasons of the popularity of the Ufone is to use slogan to attract the

customers. The Slogan of Ufone in Urdu is “Ufone Tum Hi to Ho",

In English "it’s all about U”

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F indings:

INTERNAL & EXTERNAL ANALYSIS

INTERNAL ENVIORNMENT

Human Resource ManagementMarketing DepartmentCommercial DepartmentSales DepartmentFinance DepartmentPayroll DepartmentInformation Technology DepartmentEngineering DepartmentAdministrationAuditing DepartmentCustomer Care

EXTERNAL ENVIORNMENT

Economic ConditionsSocial ConditionsCulture DemographicsEnvironmentalCompetitiveTechnologicalConsumer AttitudeGlobalization

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SWOT ANALYSIS

S trength

Ufone has Network Coverage in more than 750 cities, towns and across all major

highways of the country.

Ufone provides International Roaming facility with more than 150 international

operators across 79 countries.

Ufone is proud to have an efficient and friendly customer service through 21 company-

owned Sales & Customer Service Centers and nearly 250 Franchisees across the country.

Ufone has always believed in a solid Commitment to growth, security and reliability.

Therefore, Ufone has always balanced its expansion efforts and quality of service. With a

total current investment of $400 Million.

Utunes was launched on 4th Dec2007 which attracted many people towards Ufone.

Ufone is offering the service of Multi-media Messaging Service (MMS).

As mobile users in the country have reached over 78 million at a very rapid pace.

Ufone has maintained itself as the 2nd largest cellular operator in Pakistan with a

subscriber base of around 16.5 million and a market share of nearly 25%. Ufone has seen a

subscriber growth rate of over 200% in the last year, and since the start of 2005 Ufone

added nearly 5 million subscribers onto its network. A remarkable achievement indeed,

especially considering the fact that two new international players also entered into the

market in 2005.

While keeping its tradition of being the Trend setter in the industry, Ufone changed the

image of mobile phones from a luxury only affordable by the elite, to a necessity affordable

by the common man.

Ufone increased its Focus on the youth segment (which comprises 50% of the

population), with the Prepay brand.

Ufone has the ability to Retain its existing customer base with a high level of customer

satisfaction via optimum network service and a 24 hour call center facility.

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It has the post paid service that is normally to attract the Business class people. Most of the

business and elite class people use post paid and other services offered by the Ufone.

Ufone has a subscriber base of 18.97 million as of October 2008.

Ufone was the first cellular Company in Pakistan that introduced the  service of

GPRS and hence took the competitive advantage.

Ufone has some exciting and energetic SMS packages that made SMS almost free. They

are offering Rs. 25, Rs.50, Rs.100, Rs. 150 SMS packages which its subscribers really love

it.

Ufone has some very exciting and low call packages like “5 ka 15”, “u-one”, u circle”, “

Ufone ghanta”, “Ufone has some very exciting and low call packages like “5 ka 15” , “u-

one”, u circle”, “ Ufone ghanta”, “U fine life package” and “ prepay Public Demand” etc

which attracted lots of customers towards it and many other cellular company users are also

switching to it.

Ufone post paid is also offering black berry set that is useful and tempting for the

Business class.

Ufone currently caters for international roaming to more than 195 live operators across

119 countries and introduced International roaming facility for Prepaid subscribers in Saudi

Arabia, United Kingdom, United Arab Emirates, Singapore, Portugal and Kuwait with

lowest rates, featuring no security deposit and activation charges.

GPRS Roaming facility is available with more than 75 Live Operators across 59 countries.

Variety of Value Added Service.

Coverage on GT Road 60%.

Established customer base including lower middle class. Less rate than competitors.

WEAKNESSES

Ufone does not have the proper lists of its customers. It has the list but this list is not

authentic which is increasing the unauthorized use of its sim specially pre pay. Ufone have

to  take serious steps to properly list its customers to ensure that there is no misuse.

It has many franchises in the whole country but as its customers are increasing day by day

so its present franchises are not enough to fulfill the needs of it customers.

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Ufone also face problems and its network get jammed on special occasions like Eid,

Christmas, New year etc

Ufone has the problem of voice quality. Though its coverage area is vast and it covers

more than 750 towns and cities in Pakistan but the voice quality is not as good as it  should

be.

Behind on Excessive Demand. This is Ufone's biggest weakness is not attempting to meet

the demands

Poor Organizational Structure. Centralized structure failed to provide proper guidance

over instruction and policies

Stagnant Profitability. As compared to financial assets, Ufone is not close to expected

profitability

Overly Dependent on PTCL. Subsidiary of PTCL, it is dependent on PTCL.

Not targeting the rural areas at the moment.

Less coverage in remote areas.

Its coverage on Southern part of Pakistan is quite good but in northern areas its coverage is

a bit poor.

In Ufone web support is not available.Its customer’s service staff needs training because

at many franchises their employees are have been complained about behaving rudely.

Ufone is plagued with some internal problems like when it is privatized to Etisalaat being

the part of the PTCL many employees were not happy with the pay scale that they were

offering.

OPPORTUNITIES

Ufone could develop some new and innovative services to attract customers and some of

the suggestions are as under which will help them to increase their revenues:

It should introduced International SMS packages like local SMS. Already Ufone is offering

lowest International SMS rates but if they introduce some package like this it will get lots

and lots of success.

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They should also introduce some International call packages to Middle Eastern countries

because there are lots of Pakistanis who are living in those countries so people will

definitely be tempted towards such package.

In “ Ufone ghanta” package time of the package should be extend two more hours so that

more & more people will use this service and causing Ufone to generate more revenues &

hidden charges should be removed.

Ufone should develop some new franchises in remote areas so that people will get more

and more benefit from it and it will help to increase their customers.

As in Pakistan Youth is almost the 50% of the population so Ufone can take advantage of

this demographic situation and should introduce more and more services and packages that

attracts youth towards it.

Ufone should extend its network coverage area to Northern part of the country as well

because in that part not too many companies are giving services and if Ufone give its

service there then it will definitely attract people and its number of customers will shoot

like a rocket.

It should also introduce some packages for Internet users on mobile if it do so then many

people will switch from other networks towards it.

If Ufone enhance its voice quality then definitely it would be prefer more by customers.

Ufone should import technological equipments from China because they are giving the

best technology at very low rates so it will not only help Ufone to be ahead technologically

but also will help Ufone to decrease its cost.

Ufone can surprise its competitors by introducing “Ufone kiosk”. These will be ATM like

machines and that will give 24-hour service to Ufone subscribers to load the balance just

like they take money from ATM.

THREATS

As Ufone is cellular company and there is cut throat competition among cellular

companies in Pakistan. There are six other companies also working in Pakistan so Ufone

would have to face some growing competitive pressures.

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Pakistan is facing some serious economic problems now days so that would also effect

Ufone. The current recession in market is not good for any kind of business including

telecommunication.

In Balochistan and FATA where Ufone already has network coverage is in danger

because of critical situation and operation being held there. Investment of Ufone is in

danger.

Ufone penetrated in the market from 2005 to 2007 quite rapidly but since then it is

experiencing a bit slower growth.

By the arrival of China Mobile Company (Zong) in cellular industry of Pakistan the

Ufone and other companies now have to face the severe competition. As Zong is

introducing some various attractive packages of both SMS and calls to attract customers.

Ufone have to develop strategies to counter their strategy and to survive in the market.

The key threat to Ufone is also some adverse Government policies of implementing Tax

on telecommunication industry that will ultimately affect the revenues.

There are some rumors about the shares of PTCL in the market. Being the Subsidiary

company of PTCL, Ufone will also be affected by that.

Telenor is giving higher rumenration to its employees as compared to Ufone so many of its

skillful and competent employees are going there. That will affect the company’s

profitability in the long run.

Some Pressure groups are protesting on the Towers that are installed in residential areas.

Their opinion is that it is not good for health of people to have such towers near their

homes that cause radiations.

Ufone have to revise the list of subscribers who are legal and authorized. Because now

the Government has warn to take strict action if any company would not keep such record.

Another threat Any new company from foreign countries e.g. Orange and Vodafone.

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COMPETITOR ANALYSIS

The competitive environment for mobile telephony in Pakistan is tough and Ufone’s is a

major player of the market. Primary competition is of course between four mobile

operators for the share of the market. But there is other potential source of competition,

which should also be taken into consideration

DIRECT COMPETITION:

Direct competition to Ufone service is with thee licensed mobile world in today’s

market. These are:

Mobilink.

Warid telecom.

Telenor.

Zong

INDIRECT COMPETITION:

The indirect competition is from:

Fixed line services.

Card payphone services.

Prepaid calling cards.

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Massive expansion in penetration and quality of fixed line, payphone and prepaid calling cards

can effect mobile business environment.

Economic Scenario of Pakistan makes this observation relevant because mobile services are

still comparatively much expensive and customer may prefer to use cheaper, more readily

available alternatives

Target Market

Ufone has the target market concerning youth in the nation. This target market of youngster

comprises 40% of the population. Ufone has targeted the corporate class for

which the Ufone is customizing the packages in order to preserve the existing small businessman.

Gender: Both Male & Female

Target Class: Middle & Lower Middle Class

Targeting: Mainly they are targeting to youth, if we look at their ads, which are

shown on the TV, we got the clear idea.

Income Group: Rs. 15,000 & above

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Industry Analysis: The External Factor Evaluation (EFE) Matrix

An External Factor Evaluation (EFE) Matrix allows strategists to summarize and evaluate economic, social, cultural, demographic, environmental, political, governmental, legal, technological, and competitive information. The EFE matrix consists of five steps process.

Five-Step process:

• List key external factors (10-20)

Opportunities & threats. You have to prepare a list of all external factors which will affect the EFE matrix. These factors should be two points to be kept in mind these are opportunities and threats

• Assign weight to each (0 to 1.0)

Sum of all weights = 1.0Now you have to arrange them according to their weight age that which factor is most important. It should be weight age in % ages. The sum of the total of all the factors should always be one.

• Assign 1-4 rating to each factor

Firm’s current strategies response to the factor: how well firms response to these factors.

• Multiply each factor’s weight by its rating

Produces a weighted scoreHow the firm will respond to these factors external factors. Such criteria are known as rating.

• Sum the weighted scores for each

Determines the total weighted score for the organization.Highest possible weighted score for the organization is 4.0; the lowest, 1.0. Average = 2.5

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EXTERNAL FACTOR EVALUATION (EFE) MATRIX of Ufone

Key External Factors Weight Rating Weighted Score

Opportunities

1 Globalization 0.12 4 0.48

2 Publicity & Marketing 0.06 3 0.18

3 Can target Corporate 0.08 3 0.24

4 Develop New value Added services 0.10 4 0.40

5 Extend Coverage to Northern Areas 0.05 3 0.15

6 introduced International SMS packages like local SMS & call package

.06 3 .18

7 develop some new franchises in remote areas .08 4 .32

8 Introducing “Ufone kiosk”.Just like ATM.

.05 2 .10

Threats

1 Old Stable Companies & arrival of China Mobile Company

0.10 2 0.2

2 PTCL cellular license 0.08 2 0.16

3 Price War 0.05 2 0.10

4 Government Interference 0.12 3 0.36

5 Pressure groups & health issues due to towers in residential areas.

.05 2 .10

TOTAL 1.00 2.97

EXTERNAL FACTOR EVALUATION (EFE) MATRIX

Total weighted score for the Ufone external factor is 2.97 which is above average.

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EFE of Ufone Products:

EFE of Postpay

Opportunities: Weight Rank WxR

Increase expiry date

No balance consumption during hold

Free SMS

Packages

Free minutes on use of maximum balance

.10

.10

.10

.15

.15

2

2

1

2

2

.20

.20

.10

.30

.30

Threats:

Prepay

Mobilink

Telenor

Zong

High taxes

.10

.10

.08

.08

.04

2

3

1

1

1

.20

.30

.08

.08

.05

1.00 1.80

EFE of Prepay

Opportunities: Weight Rate WxR

Packages for executives

Internet facility

.10

.10

3

3

.30

.30

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Increase expiry date

No balance consumption during hold

SMS packages

Low call rates n Ufone Ghanta packages.

.15

.06

.10

.10

3

2

2

2

.45

.12

.20

.20

Threats:

Postpay

Mobilink

Telenor

Zong

High taxes

.10

.10

.10

.10

.05

4

4

3

2

2

.40

.40

.30

.20

.10

Total 1.00 2.97

Internal Factor Evaluation Matrix- IFE Matrix

A summary step in conducting an internal strategic management audit is to construct an Internal

Factor Evaluation (IFE) Matrix. This strategy formulation tool summarizes and evaluates the major

strengths and weaknesses in the functional areas of a business, and it also provides a basis for

identifying and evaluating relationships among those areas. Intuitive judgments are required in

developing an IFE Matrix, so the appearance of a scientific approach should not be interpreted to

mean this is an all powerful technique. A thorough understanding of the factors included is more

important than the actual numbers. Similar to the EFE Matrix and Competitive Profile Matrix

described in Chapter 3, an IFE Matrix can be developed in five steps:

1. List key internal factors as identified in the internal audit process. Use a total of from ten to

twenty internal factors, including both strengths and weaknesses. List strengths first and then

weaknesses. Be as specific as possible, using percentages, ratios, and comparative numbers.

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2. Assign a weight that ranges from 0.0 (not important) to 1.0 (all important) to each factor. The

weight assigned to a given factor indicates the relative importance of the factor to being successful

in the firm’s industry. Regardless of whether a key factor is an internal strength or weakness,

factors considered to have the greatest effect on organizational performance should be assigned the

highest weights. The sum of all weights must equal 1.0.

3. Assign a I to 4 rating to each factor to indicate whether that factor represents a major weakness (rating

= 1), a minor weakness (rating = 2), a minor strength (rating = 3), or a major strength (rating = 4). Note that

strengths must receive a 4 or 3 rating and weaknesses must receive a 1 or 2 rating. Ratings are thus

company based, whereas the weights in Step 2 are industry based.

4. Multiply each factor’s weight by its rating to determine a weighted score for each variable.

5. Sum the weighted scores for each variable to determine the total weighted score for the

organization. Regardless of how many factors are included in an IFE Matrix, the total weighted

score can range from a low of 1.0 to a high of 4.0, with the average score being 2.5. Total weighted

scores well below 2.5 characterize organizations that are weak internally, whereas scores

significantly above 2.5 indicate a strong internal position. Like the EFE Matrix, an IFE Matrix

should include from 10 to 20 key factors. The number of factors has no effect upon the range of

total weighted scores because the weights always sum to 1.0.

INTERNAL FACTOR EVALUATION

matrix for Ufone

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Total weighted score for the Ufone internal factor is 2.74 which is above average.

IFE of prepay:

KEY INTERNAL FACTOR

INTERNAL STRENGTH Weight Rating w. score

Network coverage .08 3 .24

Unique offers & packages .12 4 .48Marketing & Advertising .10 3 .3Financial position & sales Deptt. .10 3 .3Payroll Department & HRM .05 3 .15Latest Technology .06 3 .18

Administration .04 2 .08

Customer Care & Feed back .10 3 .3

INTERNAL WEAKNESSES

Lack of Franchises .04 2 .08

Network problem on special occasions. .04 3 .12

Behind on Excessive Demand .05 3 .15Poor Organizational Structure .04 2 .08

Global Expansion(Less coverage in remote areas).

.10 2 .2

Northern areas coverage .08 1 .081 2.74

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Strengths Weight Rate WxR

Base for Ufone

Greater market share

More contribution in profit

Attractive packages

Meet customers demand

.15

.10

.10

.08

.09

3

3

3

3

3

.45

.30

.30

.24

.27

Weaknesses

High rates

Less duration of SMS packages

Some time disturbance

Less use by executives

Limited duration of packages

.08

.08

.12

.10

.10

1

2

1

1

1

.08

.16

.12

.10

.10

Total: 1.00 2.12

IFE of post pay:

Strengths Weight Rate WxR

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Greater market share

Use by executives

Billing system

Meet customers demand

Good quality service

.10

.12

.10

.10

.13

4

4

4

4

4

.40

.48

.40

.40

.52

Weaknesses

High rates

Less use by general public

Less packages

Less duration

Less market growth

.08

.10

.07

.10

.10

2

2

2

2

1

.16

.20

.14

.20

.10

Total: 1.00 3.00

CPM-Competitive Profile Matrix

EFE is used to collect competitive intelligence information from external environment. It not

focuses on internal issues. Whereas CPM is little different from EFE it also consider the internal

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issues and best feature of CPM that it allow to compare the competitor critical success factor with

your organization.

•    Find out critical success factor.

•    Assign weight to each factor depend up how important the specific factor for the organization

success.

•    The weight range from 0.0 to 1.0 lower number shows no or minimum importance and high

weight show more importance of factor to the company.

•    Assign rating to each factor depends upon how well organization respond to that factor.

•    Assign a 1-4 rating to each critical success factor to indicate how effectively the firm’s current

strategies respond to the factor. (1 = response is poor, 4 = response is extremely good)

•    Multiply each factor’s weight by its rating to determine a weighted score.

  Sum the weighted scores.

•    Average total weighted score is 2.5.

The above CPM matrix compares the oil marketing companies on importance factor. The total

calculated figure tells the exact situation.

The Competitive Profile Matrix (CPM) identifies a firm's major competitors and their particular

strengths and weaknesses in relation to a sample firm's strategic position

In a CPM the ratings and total weighted scores for rival firms can be compared to the sample firm.

This comparative analysis provides important internal strategic information. Ufone Competitive

Profile Matrix is provided in Table. In this matrix market share, growth rate and financial strength

are the most important critical success factors, as indicated by a weight of 0.60. In market share

Mobilink is leading but in the growth factor Ufone is leading with the weighted point of 0.40

Competitive Profile Matrix (CPM)

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Critical Success Factors (CSF)

Weight Rating Weighted Score

Rating Weighted Score

Rating Weighted Score

Rating Weighted Score

Market Share 0.15 4 0.60 3 0.45 1 0.15 3 0.45

Growth Rate 0.10 1 0.10 3 0.30 4 0.40 3 0.30

Financial Strength

0.08 3 0.24 3 0.24 4 0.32 3 0.24

Management 0.12 4 0.48 3 0.36 3 0.36 3 0.36

Coverage 0.10 4 0.40 3 0.30 2 0.20 2 0.20

CCS 0.13 4 0.52 3 0.39 3 0.39 2 0.26

Advertising & Marketing

0.06 2 0.12 3 0.18 3 0.18 4 0.24

Brand Name 0.10 4 0.40 2 0.20 3 0.30 3 0.30

Packages & Offers

0.09 2 0.18 3 0.27 3 0.27 4 0.36

Price Competitiveness

0.07 2 0.14 3 0.21 3 0.21 4 0.28

TOTAL 1.00 3.18 2.90 2.78 3.00

The ratings values are as follows: 1 = major weakness, 2 = minor weakness, 3 = minor strength,4 =major strength.

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As indicated by the total weighted score of 2.78, Zong is weakest. Because it is at its initial position as compare to competitors. With the point of 3.18 Mobilink is leading. Only eight critical success factors are included for simplicity; this is too few in actuality

Threats-Opportunities-Weaknesses-Strengths (TOWS) Matrix

The Threats-Opportunities-Weaknesses-Strengths (TOWS) is also named as SWOT analysis. A TWOS Analysis is a strategic planning tool used to evaluate the Threats, Opportunities and Strengths, Weaknesses, involved in a project or in a business venture or in any other situation requiring a decision. This is an important tool in order to formulate strategy. This Matrix is an important matching tool that helps managers develops four types of strategies: SO Strategies (strength opportunities), WO Strategies (weakness- opportunities), ST Strategies (strength-threats), and WT Strategies (weakness-threats).The most difficult part of TOWS matrix is to match internal and external factor. Once the objective has been identified, TOWS are discovered and listed. TOWS are defined precisely as follows:Strengths are attributes of the organization that are helpful to the achievement of the objective.Weaknesses are attributes of the organization that are harmful to the achievement of the objective.Opportunities are external conditions that are helpful to the achievement of the objective.Threats are external conditions that are harmful to the achievement of the objective.

Steps for developing strategies:

There are eight steps involved in constructing a TOWS Matrix:1. Rank external opportunities2. Rank external threats3. Rank internal strength4. Rank internal weaknesses.5. Match internal strengths with external opportunities and mention the result in the SO Strategies cell.6. Match internal weaknesses with external opportunities and mention the result in the WO Strategies cell.7. Match internal strengths with external threats and mention the result in the ST Strategies cell.8. Match internal weaknesses with external threats and mention the result in the WT strategies cell.

SWOT MATRIX OF UFONE

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Strengths–S

S1. Capital & financial positionS2. Network Coverage & voice qualityS3. ResourcesS4. Trend setterS5. Unique offers & packagesS6. High Growth RateS7. Advertising & marketingS8. Focus & retain customers

Weaknesses – W

W1. Northern areas CoverageW2. Subsidiary of PTCLW3. Low Market ShareW4. Weak MISW5. Old Staff Less motivated & unfamiliar to IT.

Opportunities – O

O1. GlobalizationO2. Publicity O3. Can target corporateO4. New value added servicesO5. Covering Northern AreasO6. New Product (Ufone kiosk)O7. Penetration

SO-Strategies

S1,O1 Expand S2, O5 Increased coverage & franchisesS3,O7 Penetration S1,O3 Acquisition & Make the post paid package more attractiveS4,O6 Increased loyalty & brand imageS7, O2 Attract new customers.

WO-Strategies

W1,O5 Enhance coverage & market shareW3,O3 Acquisition

Threats – TT1. Old Stable CompaniesT2. Attractive Packages By CompetitorsT3. Price WarT4. Government InterferenceT5. Pressure groups & health issues

ST-Strategies

S1,T3 Cost Leadership S3, T2 Penetration & co branding with others like banks..S4, T1 Market LeaderS5, T2 Introduce new packages & services.

WT-Strategies

W3,T2 Downsizing

The Strategic Position and Action Evaluation (SPACE) Matrix

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The Strategic Position and Action Evaluation (SPACE) Matrix is another important Stage 2

matching tool of formulation framework. It explains that what is our strategic position and what

possible action can be taken. It is not closed matrix. It is prepared on graph. It is closed matrix.

This follow counter clockwise direction. It contains four-quadrant named aggressive, conservative,

defensive, or competitive strategies. The axes of the SPACE Matrix represent two internal

dimensions financial strength [FS] and competitive advantage [CA]) and two external dimensions

(environmental stability [ES] and industry strength [IS]).

These four factors are the most important determinants of an organization's overall strategic

position.

SPACE Matrix for UFONE

Financial Strength (FS) RAITNGS

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1. Revenues 5.0

2. Return on investment 4.0

3. Working capital 4 .0

13.0

Competitive Advantage (CA)

1. Resources & Assets -2.0

2. High growth rate -1.0

3. Advertising & Marketing -2.0

4. Competition capacity utilization -3.0

5. 2nd largest cellular company in Pakistan. -1.0

6. Good speed & superior voice quality. -3.0

7. Customer focus. -3.0

8. Computerized complaint cell -3.0

9. Successful brand -2.0

10. Attractive packages. -3.0

-23.0

Environmental stability (ES)

1. Technological changes -3.0

2. Rate of inflation -4.0

3. Demand variability -3.0

4. Government Interference -1.0

5. Tough competition - 2 .0

-13.0

Industry Strength (IS)

1. Financial stability 5.0

2. Resources utilization 5.0

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3. Profit potential 4.0

4. GPRS Technology 5.0

5. Scope in Ruler areas 4.0

23.0

Conclusion

FS average is 13/3 = 4.33

CA average is -23/10 = -2.3

ES average is -13/4 = -3.25

IS average is 23/5 = 4.6

Directional Vector Coordinates: x-axis: 4.6+ (-2.3) = 2.3

Directional Vector Coordinates: y-axis: 4.33+ (-3.25) = 1.083

The UFONE should peruse Aggressive strategies………

SPACE MATRIX FOR UFONE

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Aggressive strategies of Ufone are:

Integration Intensive Related diversification.

BCG GROWTH-SHARE MATRIX FOR UFONE

Companies that are large enough to be organized into strategic business units face the challenge of

allocating resources among those units. In the early 1970's the Boston Consulting Group developed

AggressiveConservative

Defensive Competitive

(2.3, 1.083)

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Aggressive

IS

FS

CA

ES

a model for managing a portfolio of different business units. The BCG growth-share matrix

displays the various business units on a graph of the market growth rate vs. market share relative to

competitors.

BCG Growth-Share Matrix

On the vertical axis, market growth rate provides a measure of market attractiveness. On the horizontal axis, relative market share serves as a measure of company strength in the market.

The growth-share matrix defines four types of SBUs:

CASH COW - (LOW GROWTH, HIGH MARKET SHARE)

A business unit that has a large market shares in a mature, slow growing industry. Cash cows

Require little investment and generate cash that can be used to invest in other business units.

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Ufone

STAR - (HIGH GROWTH, HIGH MARKET SHARE)

A business unit that has a large market shares in a fast growing industry. Stars may generate

Cash, but because the market is growing rapidly they require investment to maintain their lead. If

successful, a star will become a cash cow when its industry matures.

QUESTION MARK - (HIGH GROWTH, LOW MARKET SHARE)

A business unit that has a small market shares in a high growth market. These business units

Require resources to grow market share, but whether they will succeed and become stars is

unknown.

DOG - (LOW GROWTH, LOW MARKET SHARE)

A business unit that has a small market shares in a mature industry. A dog may not require

Substantial cash, but it ties up capital that could better be deployed elsewhere. Unless a dog has

some other strategic purpose, it should be liquidated if there is little prospect for it to gain market

share.

Ufone SBU

Post paid Prepaid Ufone mobile

BCG

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Ufone understands the value of words and the need to communicate effectively and efficiently at

all levels of society, which is why company’s primary focus is on U. Ufone offers,

Prepay

Postpay

& Ufone Mobile

services in the Telecom sector. The telecom market’s growing rate in Pakistan is higher than any

Asian country. Ufone offers lower rates and better network then other already established cellular

companies. All living standards have been captured by Ufone, like Students, Labour and

Businessmen; etc.Ufone aims to provide with wider coverage, superior connectivity, clear signals

& voice quality to their valued customers

BCG MATRIX of Ufone by products point of view

Ufone RELATIVE MARKET SHARE

MARKETGROWTH RATE

PREPAY

STARS QUESTION MARK

POS PAYS Ufone Mobile

CASH COWS DOGS

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Star:

Ufone.

Prepay.

Strategies:

i. Integration

ii. Intensive

Cash Cow:

Postpaid

Strategies:

i. Product development.

ii. Diversification

iii. Retrenchment

iv. Divestiture

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Grand Strategy Matrix

In

Grand strategy matrix Ufone lie in 1st quadrant because it has strong competitive position and rapid market growth…..

Suitable strategies of quadrant 1st for Ufone are

1. Market Development

2. Market Penetration 

3. Product Development   

4. Horizontal Integration

5. Forward Integration

6. Backward Integration

RAPID MARKET GROWTH

Quadrant II

Quadrant I

Ufone

WEAKCOMPETITIVEPOSITION

STRONG COMPETITIVE POSITION

Quadrant III Quadrant IVSLOW

MARKET GROWTH

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7. Related Diversification                                                             

IE Matrix of UFONE:

The Internal-External (IE) matrix is another strategic management tool used to analyze working conditions and strategic position of a business. The Internal External Matrix or short IE matrix is based on an analysis of internal and external business factors which are combined into one suggestive model.

The IE matrix is a continuation of the EFE matrix and IFE matrix models.

The IE matrix belongs to the group of strategic portfolio management tools. In a similar manner like the BCG matrix, the IE matrix positions an organization into a nine cell matrix.

The IE matrix is based on the following two criteria:

1. Score from the EFE matrix -- this score is plotted on the y-axis2. Score from the IFE matrix -- plotted on the x-axis

The IE matrix works in a way that you plot the total weighted score from the EFE matrix on the y axis and draw a horizontal line across the plane. Then you take the score calculated in the IFE matrix, plot it on the x axis, and draw a vertical line across the plane. The point where your horizontal line meets your vertical line is the determinant of your strategy. This point shows the strategy that your company should follow.

On the x axis of the IE Matrix, an IFE total weighted score of 1.0 to 1.99 represents a weak internal position. A score of 2.0 to 2.99 is considered average. A score of 3.0 to 4.0 is strong.

On the y axis, an EFE total weighted score of 1.0 to 1.99 is considered low. A score of 2.0 to 2.99 is medium. A score of 3.0 to 4.0 is high.

Your horizontal and vertical lines meet in one of the nine cells in the IE matrix. You should follow a strategy depending on in which cell those lines intersect.

The IE matrix can be divided into three major regions that have different strategy implications.

Cells I, II, and III suggest the grow and build strategy. This means intensive and aggressive tactical strategies. Your strategies should focus on market penetration, market development, and product

development. From the operational perspective, a backward integration, forward integration, and horizontal integration should also be considered.

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Cells IV, V, and VI suggest the hold and maintain strategy. In this case, your tactical strategies should focus on market penetration and product development.

Cells VII, VIII, and IX are characterized with the harvest or exit strategy. If costs for rejuvenating the business are low, then it should be attempted to revitalize the business. In other cases, aggressive cost management is a way to play the end game.

IE Matrix of UFONE

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5 = Ufone and Prepay

7 = Postpaid

Strategies:

Hold and maintain

i. Market penetration.

ii. Product development.

Stage-3 (Decision Stage)

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Ufone

Prepay

Postpaid

Prepay

Ufone

Prepaid

The Quantitative Strategic Planning Matrix (QSPM)

The last stage of strategy formulation is decision stage. In this stage it is decided that which

way is most appropriate or which alternative strategy should be select.

Steps in preparation of QSPM

1. List of the firm's key external opportunities/threats and internal

strengths/weaknesses in the left column of the QSPM.

2. Assign weights to each key external and internal factor

3. Examine the Stage 2 (matching) matrices and identify alternative strategies that the

organization should consider implementing

4. Determine the Attractiveness Scores (AS)

5. Compute the Total Attractiveness Scores

6. Compute the Sum Total Attractiveness Score

Quantitative Strategic Planning Matrix (QSPM) of Ufone

Quantitative Strategic Planning Matrix (QSPM)SELECTIVE STRATEGIES Product Development Market PenetrationKey External Factors Weight Attractiveness Total Attractiveness Total

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Scores (AS) Attractiveness Scores (TAS)

Scores (AS) Attractiveness Scores (TAS)

Opportunities1 Globalization 0.10 3 0.30 2 0.202 Marketing 0.15 4 0.60 3 0.453 Acquisition 0.08 3 0.24 2 0.164 New Product

Development0.06 3 0.18 3 0.18

5 Northern Areas 0.10 3 0.30 2 0.20

6 Develop some new franchises in remoteareas

0.12 4 0.48 2 0.24

7 Introducing “Ufone kiosk”.Just like ATM.

0.10 3 .30 2 0.20

Threats1 Old Stable

Companies0.10 4 0.40 3 0.30

2 Attractive Packages By Others

0.10 3 0.30 2 0.20

3 Price War 0.04 3 0.12 2 0.084 Government

Interference0.05 3 0.15 2 0.10

TOTAL 1.00Strengths 1 Investment 0.10 4 0.40 4 0.402 High Growth Rate 0.10 4 0.40 3 0.303 Advertising 0.12 3 0.36 3 0.364 Net Work

Portability0.10 3 0.30 3 0.30

5 Ufone Mobile 0.07 3 0.21 3 0.216 Resources Assets

And People0.10 3 0.30 3 0.30

7 Location And Geographical Coverage

0.10 3 0.30 3 0.30

8 Government Dealing

0.09 3 0.27 3 0.27

Weaknesses1 Lack of Franchises 0.05 2 0.10 1 0.052 Coverage 0.08 1 0.08 1 0.083 Less Market Share

& behind the demand

0.05 2 0.10 2 0.10

4 Weak MIS 0.04 2 0.08 1 0.04SUM TOTAL ATTRACTIVENESS SCORE

1.00 6.27 5.02

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Recommended strategy………

We select the two strategies Market Penetration and Product development. There

total attractive score is 5.02 and 6.27 respectively. The strategy Product

Development has big score that’s why we select him.

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Conclusions and Recommendation

Ufone is 2nd largest cellular company in Pakistan. More committed towards growth.

Telecom industry is most growing industry of Pakistan still huge investment required for

coverage. The market also has strong competition after the entrance of China Mobile

Company as player. Competitors are hiring professionals to entertain the consumer which

is resulting technological implementation and value added services. People are worried

about call rates they don’t prefer any particular company. Consumer searches good service

with lowest call rates, although companies are minimizing call rates this will result more

growth in the market. Ufone bring amazing packages to attract the customers. Ufone

promote their product through TV commercial, Newspaper, Radio, Internet etc. The choice

of people is Ufone because Ufone price level is low and affordable that every one can say

“It’s all about U”

Ufone could develop some new and innovative services to attract customers to increase

their revenues as well as it customers:

It should introduced International SMS packages

Ufone has strong financial position & more competitive advantages then other

cellular companies so he should more focus on his strategies.

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He should grow and maintain his position.

They should also introduce some International call packages to Middle

Eastern countries.

In “Ufone Ghanta” package time of the package should be extended.

He should pay more attention towards postpaid services

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References:

www.ufonegsm.com.

www.google.com

www.pta.com.pk

Naeem Waraich

Rana Shoaib

www.wikipedia.com

www. Answer.com

www.scribd.com

Ufone franchise Rahim yar khan in city center…..

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