Leading and Managing People - Case Study Example

Leading and Managing People Name Institution Course Date Leading and Managing People Introduction Airtel is One of Africa’s largest mobile telephones. The company was founded by a Sudanese-born Briton Mo Ibrahim in 1998 opening its doors under the name MSI Cellular investment (Mitra 2014). Six years later in 2004, the company was renamed Celtel International, a name that it used till April 2005, when it was acquired by Zain during which the firm had more than 24 million subscribers in 14 countries in Africa (Semakula & Muhumuza 2015). In 2010, Zain was acquired by Bharti Airtel and was effectively rebranded as “Airtel” which remains its current brand name (Convey Africa 2012; BaniK & Nag 2016, P. 1516). Although Airtel started by offering only call services, the mobile telephony has since expanded its products and service offerings to include money transfer and bill payment services. The objective of this paper is to analyse the opportunities and challenges faced by Celtel, Zain and Airtel. The paper will also discuss why leaders might perceive value in broad-based stakeholder engagement as a means of knowledge creation and collaborative action at the various stages of organisational and business development concerning mobile telephony in Africa. Opportunities Airtel’s (Celtel, Zain) decision to invest in mobile telephony in Africa was informed by the enormous opportunity that existed in Africa at the time it was founded in 1998 (Tele 2013). Mo Ibrahim states that in the 1990s, Africa continent was largely ignored by Western mobile telecommunication investors that were afraid of investing in Africa despite the large market that was already available (McElligott 2009). Africa presented opportunity for Airtel considering that it is one of the most populous continents with about one billion people living in approximately 11.7 million square miles (Nokia Siemens 2006). Despite this high population, Africa remained the most underserved telecommunications market globally. For instance, in 1998, Democratic Republic of Congo (DRC) that had a population in the excess of 55 million people then had only 3,000 phones (Wharton University 2015). This provided a huge opportunity for Airtel to conquer this expansive market with its mobile telephony. However, it was not just the gap between demand and supply that provided opportunity for Airtel. Rather, the fact that African countries lacked fixed-line phone networks also provided Airtel with the market opportunity considering that this meant that its mobile phones would face no competition in Africa (Southwood & Ekine 2011). Challenges Despite the opportunities that were available in the African mobile telephony market, Airtel had to deal with numerous challenges. The first major challenge had to do with corruption. According to Mo Ibrahim, all the Western mobile telephones avoided investing in Africa for fear of high corruption in African countries that increased the cost of doing business (Balancing Act-Africa 2017). Before getting operating license, government officials in most African countries would demand kickbacks from firms and these scared Western mobile telephones from Africa. However, Airtel dealt with this challenge by ensuring that only licenses won through open bidding processes are accepted and that the board had to sign off any expense over $30,000. The other challenge faced by Celtel in its initial years in Africa had to do with establishing Celtel’s credibility (Jones, & Campbell 2015). According to Mo Ibrahim, Celtel faced a major challenge establishing its credibility in Africa considering that, as much as the company had highly skilled manpower and good track record in network design, the company had not run its own network in the past (Diso 2008). Therefore, to get a go ahead to operate in African countries, Celtel had to build its competence first and convince industry regulators and telecom ministries in African countries that it is capable of delivering. Celtel also faced a serious challenge building network. Celtel experienced difficulties setting up communication network in place because of poor infrastructural facilities in African countries (Nokia Siemens 2006). Mo Ibrahim gives DR Congo as an example, where the company experienced difficulties doing business as the country had no good roads, and sometimes even the bad roads were lacking. This implies that to move from one place to another, the company’s network staff had to use helicopters (Convey Africa 2012). Besides, electricity was lacking in most of the African countries and this meant that Celtel had to arrange for its own power by refilling generators and replenishing batteries, which was a serious challenge. Airtel also experienced political challenges as it sought to conquer Africa with its mobile communication. Many African countries were ravaged by wars that presented high risk for Celtel. For instance, Celtel entered Sierra Leone at a time when the region was at war (Balancing Act-Africa 2017). This not only put the company’s staff at risk, but also its network resources at risk as well. According to Mo Ibrahim, the only way to be accepted in Sierra Leone was to make it clear to the warring factors that Celtel was a neutral company with no affiliation whatsoever (Convey Africa 2012). Similar wars and conflicts were commonplace in African countries, such as DR Congo. Additionally, some African countries were not allowing telecom traffic across boundaries (Ibrahim 2012). This implies that Celtel had to negotiate with both governments involved to be allowed to link communication across borders, which were not just costly, but also time consuming (Global Telecoms Business 2015). Stakeholder Engagement Stakeholder engagement is important for the success of an organization and this applies to all companies, including those in the mobile telephony. Because no business operates in a vacuum, every business regardless of size has stakeholders that are affected or have an interest in the operations of a company (Bourne 2012, p. 16). A stakeholder, therefore, is any person or body corporations with an interest in a company or affected by the operations of a company. Typical stakeholders of a company include employees, customers, suppliers, government, investors, sponsors and the community. Engaging this group of stakeholders is something that leaders in the mobile telephony consider important for at every stages of business development in the mobile telephony. Stakeholder engagement is particularly important at various stages of development of mobile telephony because its gives the leaders the opportunity to listen to the people who will be affected by the business. Accordingly, this enables mobile telephony leaders to understand the stakeholder issues that needs to be taken into consideration when setting up the business and any risks that needs to be avoided to ensure the success of the business (Thulkanam 2014, p. 22). For instance, before Celtel opened its doors in Africa, it had to engage the stakeholders, particularly the governments of the African countries before venturing into these countries. As Mo Ibrahim states, credibility was one of the challenges that the firm faced when it first entered Africa (Ibrahim 2012). However, Celtel managed to overcome credibility issues by engaging the respective governments of the countries it ventured into by proving to them that the company is capable. Through such engagements, Celtel received a go ahead from the governments that were hesitant to accept the company. Stakeholder engagement is also perceived to add value as far as knowledge creation is concerned because it enables a company to understand the nature of the environment it operates or intends to operate. The stakeholders on the ground are the ones with perfect information about the market (Menoka 2014, p. 63). Therefore, leaders in the mobile telephony industry find stakeholder engagement valuable as it enabled them to understand the market needs. For instance, Mo Ibrahim stated that, before deciding to introduce a mobile telecommunication service in Africa, he had to engage different stakeholders, such as the customers (Ibrahim 2012). By engaging the customers, the company was able to understand the needs of customers who were to be the subscribers of its services in terms of the tariffs to offer in line with their income and abilities. This way, Celtel was able to charge tariffs that subscribers were willing to pay. Conclusion Celtel (Zain, or Airtel) is a major mobile telephony in Africa today controlling a significant market share. However, as illustrated, Africa presented a huge market opportunity for Celtel considering that it was ignored by Western mobile telephony companies that saw it as a risky market. The lack of competition in the market provided Celtel with a huge opportunity in the early years. Nevertheless, Celtel had to overcome many challenges that included corruption, establishing credibility, building network, political, cultural and financial challenges. However, the company managed to overcome these challenges through effective leadership. Part II Background Leadership is critical to the success of all organizations. A leader influence the success of an organization by developing the vision, objectives, purpose and targets for the organization and rallying people to ensure their achievements. As the business environment increasingly become complex and dynamic, leadership has become more important than ever before. Evidences across industries paints the same picture as it is clear that successful companies are led by good leaders while failed companies are led by bad leaders (Greer 2013, p. 34). Completing this assignment has particularly enlightened me about the nature of the business environment that I am just about to enter by highlighting not just the opportunities available but also the challenges and the leadership skills that I will need to navigate this complex business environment. This report highlights completing the previous assignment has highlighted for me the possible opportunities available in the Mobile telephony industry and implications for future leadership skills needed to take advantage of global opportunities. Analysis As a professional aspiring to venture in the mobile telephony industry, completing the previous assignment has highlighted for the numerous opportunities that are available in this industry, especially in Africa. I have learned that Africa presents a huge business opportunity for mobile telephony. Although the situation might have changed since Celtel ventured into the African market that remained largely ignored by Western mobile telecommunication firms because of the perceived risks that included lack of buying power, political, and cultural risks as well as poor infrastructure, Africa no doubt still presents a huge market for mobile telephony despite the increased entry of firms in the industry (Trilling & Fadel 2009, p. 25). I have learned that Africa has a population or about 1 billion people. However, there is still vast population that remains underserved by the existing players in the industry. However, in order to take advantage of these opportunities, one needs to have the right leadership skills to be able to navigate the complex global business environment. First, because of the globalized nature of the business environment, I have made to understand that a leader needs to have cross-cultural sensitivity skills to succeed. Presently, companies operate in a global market place that has brought people from different cultural backgrounds together. As such, a good leader must be able to understand, respect and embrace cultural differences by promoting cultural diversity right from hiring (Rost 1993, p. 16). By promoting cultural diversity, a company is able to attract and retail talented workforce that acts as a source of competitive advantage considering that diversity brings people with different views, opinions and ideas together and this promotes creativity and good decision making. Completing the previous assignments has also pointed the need for a leader in the mobile telephony to be an effective risk manager. I have learned that every opportunity comes with some risks. For instance, when Mo Ibrahim identified a lot of opportunities in Africa mobile telephony industry, there were a lot of other risks that were involved, including political, social, and economic risks. However, these risks did not deter him from exploiting the opportunities he saw in the market. Instead, he managed the risks effectively and this enabled the business to grow and prosper despite the risks involved (Trilling & Fadel 2009, p. 25). Accordingly, this points that a leader in the mobile telephony industry like myself who intends to lead a business in the industry in the future needs to have effective risk management skills. Additionally, completing the assignment has made me learn that modern leaders need to have effective people management skills. Employees are viewed as a source of competitive advantage. However, for employees to be productive and to deliver, they must be motivated and positively influenced to work towards the achievement of organizational goals. However, this is only possible when a leader has good people management skills, such as being able to inspire and rally followers towards a given vision and goals. This highlights the importance of modern leaders adopting transformational leadership styles that focus on creating vision and inspiring people to ensure their achievements. Lastly, completing the assignment has highlighted the need for modern leaders to be team players in order to be able to take advantage of the opportunities available in the market. Leaders need to work closely with the people they manage to ensure the success of the companies they lead. For instance, Mo Ibrahim had to work closely with his staff to ensure that the company conquers and succeeds in Africa (Ibrahim 2012). As such, it is critical that leaders like myself adopt a participative leadership style that involves delegating work to members of the staff and involving them in decision making to ensure success. Other leadership skills that I have learned as being necessary include effective decision making, problem-solving and strategic thinking skills. Conclusion Leadership is certainly the cornerstone of business success. Leaders set the direction by creating the vision and positively influencing subordinates to ensure the achievement of the visions. By completing the previous assignments on leadership and people management, I have learned that, to take advantage of the opportunities available in a market, a leader needs to have certain core skills that include cross cultural sensitivity, risk management, effective people management skills, effective decision making, problem solving and strategic thinking skills. References Balancing Act-Africa 2017, Celtel has no plans to invest in Zimbabwe, says Pieters, viewed 21 January 2017 http://www.balancingact-africa.com/news/telecoms_en/6033/celtel-has-no-plans-to-invest-in-zimbabwe-says-pieters Banik, A., & Nag, T 2016, “Bharti Airtel and Zain: A journey into new territories,” Global Business Review, vol. 17, no. 6, pp. 1516–1521. 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