The paper "Leading and Managing People" is a great example of a Management Case Study. 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 analyze 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 organizational 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, the 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 an 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, the 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 an 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 licenses, 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 a 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.
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