Oman Telecommunication Company commonly known as Omantel is the pioneer telecommunication company service provider in Oman. Omantels headquarters are situated in Muscat Omans capital city. The biggest percentage of the share capital is controlled by Omantels mother organization, the United International Telecommunication Investments, and Projects. The remaining 49% is owned by the government. Omantel Company has an estimated 2,800 employees and equity of $1.5 billion. Omantel Company has grown to be an International destination and has over ten submarine cables destined in Oman which include Falcon and OMRAN among others.
On 29th June 2014, Mr. Talal Said Mamari was appointed as the Chief Executive Officer (CEO) of Omantel Telecommunications Company. Mr. Talal had vast experience in the Telcom sector and had served before his CEO appointment as Omantels Chief Finance officer. Mr. Talal was instrumental in the 2005 Initial Public Offer (IPO), Omantels restructuring, and the merger involving Omantel and Oman mobile. Mr. Talal is a board member of many companies as well as investment funds like Worldcall Telecom, United Securities Investment Fund, and Infoline. In September 2017, Mr. Talal was subsequently appointed a non-executive board member of Omantel Company.
Omantel has many affiliate companies including WorldCall, Omantel France SAS, Oman Data Park Limited Liability Company, Internet of things LLC and First Issue S.A.O.C. Muscat is the most populous city in Oman and has attracted heavy capital investments of companies from Asia, Europe, and Africa.
Omantel specializes in provision of Digital Telephony services, General Internet, Mobile service packages and Mobile connectivity.
This Case Study aims at achieving the following objectives;
(i) Establish the positioning of the company regarding technology and strategy in expanding the global market share.
(ii) Establish how the company runs operations and strategies.
Omantels success strategies
(a) Technological Management.
Omantel has employed many technological management tools in its day to day operations. Enterprise Resource Planning abbreviated as (ERP) has been put in place to manage Omantels functions and operations. ERP is commonly sued in the Human Resource department and other functions that require real-time processing in the organization. Omantel implemented the ERP system on a database developed using the Oracle system. The company is led by the desire to be the leading telecommunication provider in the country, Omantel received many advantages that came with the implementation of ERP management information systems. The main aim of implementing ERP was to meet the United Nations regulations requiring all companies to adopt ERP systems as well as to satisfy the companys customers. ERP is a technological management tool that runs a companys operations in an organized strategy. Omantel Company runs all its operations around the ERP system, and this has enabled the company to achieve transparency in all financial transactions, has saved on manual operating costs. It has also offered the management, and the employees with real-time data processing and acquisition have enhanced creativity and innovation for the entire company (Maguire et al., 2010).
Omantel offers the banking sector in Oman internet services based on the GSM technological platform. Bank customers can access services like paying for utility bills, approve online financial transactions, check account balances, funds transfer as well as access mini statements using the e-banking system.
Omantel has partnered with many leading companies in Oman like the airports and the public authority for civil aviation in offering technological solutions. Omans growth and development of industries is based on a standardized network that is highly restricted on fixed mobile telecommunication. Omantel has signed agreements with companies and industries in Oman to provide high-quality technological management services.
(b) Financial Management
Oman Telecommunication Company monitors its finances through the monthly, quarterly, half-year and annual financial statements. The statements prepared to portray a compact positive financial trend as evidenced in the financial statements of 2016 where the company recorded a 3.2% positive index. This is an indication of a company enjoying financial freedom of high cash flow retention and minimal debt levels. The company has high liquidity which is reflected by its current ratio of 1.02 having total assets at 31% and total liabilities at 27%.
The financial reports of 2016 portray a company that is a market leader in the Sultanates telecom operators and providers (Alraja, 2016). Omantel Company has heavily invested in fixed and mobile line services. By the end of accounting period 2016, Omantel had invested RO 826 million. Omantel has its shares quoted in the Muscat Security Market. The share capital stood at RO 546.7 million in 2016, an increase from RO 505.4 million in 2015. This investment in the capital market accounts for 6.6% of the entire market capitalization.The past five years have seen a rapid growth in revenues which is attributed to increased usage of the mobile and fixed networks which provide a 38% of revenues earned by Omantel Company. This significant growth is attributed to the increased usage of wired and wireless communication media. On the other hand, revenue collection on the prepaid services and handsets declined by 3.4% and 29.6% respectively in 2015.
(c) Risk management
Business organizations succeed depending on how that particular organization responds to challenges that come with tough economic situations and ever-changing customer demands for satisfaction in services offered. A company grows if it can respond to customer needs especially in pricing its products to match what the customers are willing and able to accept in the market. Being customer sensitive and responsive helps the company to grow, in revenues, profits, and market all products available to the customer. Companies employ many methods to attract and retain customers through the provision of incentives. These incentives eat up the companys profits especially if the company is launching a new product in the market (Prakash and Mathew, 2014).
Investing in Technology is quite demanding and is a capital-intensive venture. Omantel recorded the lowest profits between 2012 and 2016 due to the huge financial investment in acquiring WorldCall Impairment and Voluntary End of Service Program. Omantel recorded 26.1% in 2014, 9.6% in 2015 and 22.7% in 2016 as profit increase.
Omantel Company is putting itself in a position to be able to compete favorably with other telecom providers not only in Middle East region but also in the world. The company has laid down measures to cushion against customers from competing companies. There is increased pressure emanating from the socio-political world to reduce costs especially in the voice calls and data usage costs. This is a risk that Omantel is looking at deeply as it can eat into its customers and in the end, reduce Omantels revenues and profits. It is a risk to be mitigated. Competing companies in telecom are rolling out products and services that match customer needs, and this is likely to affect Omantel. How Omantel responds is something to wait and see (Shatat, 2014).
Human Resource Strategies in OmantelOmantel Company has adopted the four pillars of Human Resource Management. These are Employee training and capacity building, well knowledgeable management, organizational culture and Personnel positioning in the organization.
Omantels top managerial role is placed in the hands of a total of eight board members. The chairman and other five members are appointed by the government while the remaining two are elected by the shareholders during the annual general meeting. The board is responsible for approving financial statements, declaring dividends, appointing the C.E.O and other top management officers. Also, appointing an independent auditor for checks and controls of the financial documents, laying down the rules and regulations of the company, ensuring the company acts according to the provisions of the companys act (Prakash & Matthew, 2014). The board also takes part in the appointment of regulatory executive human resource and audit committees (Mishra et al., 2014).
Omantel Company has highly invested in capacity building for its employees through workshops, in-house training, teambuilding activities and seminars aimed at expanding the employees capacity and output at work. The human resource department imparts new skills and knowledge to employees trains them on the latest and up to date technology which enables them to meet job targets and the ever-increasing customer demands. The company employees are trained to acquire knowledge and skills on all products and services offered by the company which enables them to be a one-stop shop. This ensures that the company minimizes on referrals and transfer cases. The number of employees is greatly reduced which in turn reduces the expenditure on salaries.
A well-equipped employee who is varnished with what a company offers stands a high chance of vertical mobility within the organization. This is a function of Human Resource department that continuously encourages employees to advance in knowledge based on what the company offers so that in the long run, the employee can be considered for upward mobility (Al-Mutairi et al., 2014).
Strategic positioning at Omantel Company
`Omantel Telecommunications Company has entered into a joint venture with the leading global networking and device company Huawei to aid in installing Lamppost solutions in the major cities of Oman starting with Muscat. Lamppost is a technology that will have the features of sensing and mimicking human behavior as well as features that allow car parking on a digital surveillance capability. This will place Omantel Company ion a global competitive picture and hedge the companys competitive advantage globally. Omantel will become the first company in the entire world to have Lamppost technology.
Omantel has also put to use high speed and bandwidth broadbands by CDMA and EVDO wireless media. These very new developments and innovations in technology have been designed to cater for the increasing population in responding to customer demands. The Code Division Multiple Access (CDMA) is one of the fastest growing broadband providers operating in 4G.
Omantel is continuously growing and has opened new branches in Al Mabela and Al Amerat. The two branches are a way of transforming innovativeness to create a broader network of customer base together with enhancing a consumer experience with a digital touch. With this digital information, the company has placed itself above customer expectations and at the same time upholding commendable retail practices hence enriching the lives of the clients.
The online customer portal is attractive and appealing to the eye. Omantel has opened links in the form of digital company platform that provides customers with smart touch points, permanent self-care terminals and express points where customers can easily access Omantel products on 24 hours a day basis.
Omantel sustainable social responsibilities in Oman
Corporate Social responsibility Explanation
Education Sector Omantel championed the smart classroom project which offers Information Technology, Mobile IT laboratories that are offered in the rural areas and highly improvised IT laboratories in newly established Technical colleges. Omantel has offered modern and innovative techniques in secondary and tertiary institutions that respond to the needs of t...
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