Study Uncovers Efficiency Gaps within European Mobile Communications Providers

A study of the operational efficiency of mobile communications providers, conducted by Barkawi Management Consultants, shows clear performance gaps. In the framework of the evaluation, the operational efficiency of over 60 European companies was analyzed. Taking the specific features of the respective national markets into consideration, Barkawi Management Consultants uncovered deficits in the operational structures of the individual mobile network operators.
Although European national cellular markets show great differences, for example in market saturation, utilization time, as well as in sales trends, one large commonality was identified in provider strategy: In total, com-panies in the mobile network operators industry have slowed the adopted consolidation rate in human resources management, and in the year 2004 increased their staff on average by 6 per cent, which can be explained by an amplified customer focus. As a matter of priority, additional employees were hired in the areas of marketing and sales, as well as in product development. Despite increasing customer count, customer services and the so-called “support functions” employees were strengthened only slightly. In the study, employee productivity was compared to actual performance targets such as sales volume, profit and customer growth. Barkawi Management Consultants was therefore able to evaluate the efficiency of the respective employees.
On average, 2,139 customers per employee were registered in Europe in the year 2004. Although mobile network operators in Germany lie above the European average with 2,794 customers per employee, they lay con-siderably behind the Spanish Telefónica, who took a top position with 4,558 mobile subscribers per employee in this comparison category. In another analysis phase, the study established a link between profit prior to tax and deduction (EBITDA) and the number of customers. The two Swiss providers Swisscom and Orange placed 1st and 3rd respectively in the efficiency ranking. The Belgian supplier Proximus was ranked 2nd.
Overall, the personnel development does not reflect the companies´ progressive and distinctive business development. As the study shows, there is a very high share in the companies´ development intensive but provisional work processes between individual departments, these are charac-terized by a lack of distribution of competence and responsibility, as well as by absent controlling mechanisms. Such performance gaps appear primarily in cross-departmental projects. Furthermore a great optimization potential remains untapped with automation, particularly in the area of customer service. Customer data, whose systematic evaluation could, for example, produce valuable competitive advantages in the form of product development opposite competitors, more often than not, goes unused due to undefined administrator responsibilities and lack of data management. In addition to the deficit in communication between branch offices and company headquarters, the study also mentions the missing formulation of business process targets, as well as insufficient controlling mechanisms as an example of efficiency deficits with the mobile communications providers. Outsourcing is an essential factor for the increase of efficiency. However, this potential is only implemented in small measures. Almost half (48%) of the outsourced employees work in customer service, followed by IT (17%). “Opportunities in this area go unnoticed. Passing certain activities on to specialized service providers allows for concentra-tion on core competencies.” states Roland Wolf, project lead of the study in the Telecommunications business unit with Barkawi Management Consultants.
At present, Barkawi Management Consultants is conducting the sixth “Operational Efficiency of European Mobile Operators” study. The study is simultaneously being carried out in Asia-Pacific and Latin America.

About the “Operational Efficiency of Global Mobile Operators” study: The Telecommunications business unit of Barkawi Management Consultants conducts a study of the operational efficiency of mobile communications providers at a global level every year. Barkawi Management Consultants analyzes the relative efficiency of employees of a company organization on a departmental level comparing it to actual performance reached within a financial year, using sales, profit and customer growth, as well as department-specific key figures as a measure. In the context of the “Operational Efficiency of Global Mobile Operators” study more than 150 mobile network operators are examined worldwide from Europe, Asia-Pacific and Latin America.

About Barkawi Management Consultants: Barkawi Management Consultants is an international management consultancy with proven expertise in After-sales Services and Logistics. Barkawi Management Consultants supports global aftermarket organizations in developing service strategies and achieving operational excellence. Barkawi Management Consultants focuses on technology-driven industries such as Aerospace, High-tech, Industrial Machinery, Telecommunications and Transporta-tion Systems. Customers include large multi-nationals with capital-intensive and logistically complex business models, such as DaimlerChrysler, Deutsche Bahn, Deutsche Telekom,