Mobilink Intrnshp Report

8/8/2019 Mobilink Intrnshp Report

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Internship Report for Mobilink

Submitted By:

Usman Ali

BBA-6(B)

01-111052-094

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Table of Contents

1 EXECUTIVE SUMMARY.................................................................................................................3

2 INTRODUCTION........................................................................................................ ...................5

2.1 CENTRAL BACKGROUND INFORMATION...........................................................................................................................5

2.2 COMPANY BACKGROUND......................................................................................... ..................................... ..........6

3 COMPANY ANALYSIS..................................................................................................... ...............8

3.1 OPERATION ANALYSIS......................................................................................................... ...................................8

3.1.1 Network.....................................................................................................................................................8

3.1.2 Operational Departments.........................................................................................................................9

3.1.3 Subscribers and Market Share................................................................................................................10

3.2 FINANCIAL ANALYSIS.................................................................................................... ...................................... .11

3.2.1 Operational Results.................................................................................................................................11

3.2.2 Balance Sheet Results............................................................................................................................12

3.2.3 Ratio Analysis..........................................................................................................................................123.3 HUMAN RESOURCE ASSESSMENT............................................................................................................................14

3.4 MARKETING ANALYSIS............................................................................................ ..................................... ........15

3.4.1 Electronic Media......................................................................................................................................15

3.4.2 Print Media..............................................................................................................................................16

3.4.3 Advertising Agency and Brand Ambassadors.........................................................................................16

4 ENVIRONMENTAL ANALYSIS.......................................................................................................18

4.1 INDUSTRYAND MARKET ANALYSIS...........................................................................................................................18

4.1.1 Major Product Lines Market Segment.....................................................................................................18

4.1.2 Growth Rate of Entire Industry...............................................................................................................20

4.2 COMPETITOR ANALYSIS............................................................................................. ..................................... ......21

4.2.1 Major Competitors...................................................................................................................................21

4.2.2 Their Market Shares................................................................................................................................23

4.2.3 Their Goals and Strategies......................................................................................................................244.3 TECHNOLOGY ANALYSIS............................................................................... ...................................... ..................26

4.3.1 Technical Methods That Affect the Industry............................................................................................26

4.3.2 Innovation...............................................................................................................................................27

5 DEPARTMENT WORKED DURING INTERNSHIP..............................................................................28

5.1 ACTIVITIES DONE WITHIN CASH MANAGEMENT DEPARTMENT............................................................................................28

5.1.1 Daily Activities........................................................................................................................................28

5.1.2 Occasional Activities...............................................................................................................................29

5.1.3 Month End Activities...............................................................................................................................30

5.2 TASKS PERFORMED DURING INTERNSHIP....................................................................................................................31

5.2.1 Daily Activities........................................................................................................................................31

5.2.2 Occasional Activities...............................................................................................................................32

5.2.3 Month End Activities...............................................................................................................................33

6 IDENTIFICATION OF A MAIN PROBLEM AND FINDINGS.................................................................34

6.1 JOB ROTATIONAND ADVANCEMENT..........................................................................................................................34

7 CONCLUSION....................................................................................................................... ......34

8 RECOMMENDATION...................................................................................................................35

9 APPENDIX.................................................................................................................. ...............36

9.1 WEB RESOURCES............................................................................... ..................................... .........................36

9.2 REPORTS....................................................................................... ...................................... ..........................36

9.3 ORGANIZATIONAL STRUCTURE (EXTRACT).......................................................................................... .........................37

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Table of Illustrations

Figures

FIGURE 1: COMPARATIVE FIGURESOF COVERAGE & CELL SITES......................................................... .............9

FIGURE 2: PRINT ADVERTISEMENTSOF MOBILINK..................................................... ................................16

FIGURE 3: PRODUCTS OFFERED BY DIFFERENT MOBILE COMPANIES.............................................................. ..19

FIGURE 4: GROWTH RATESIN MOBILE INDUSTRY 2005-JULY 2008.............................................................20

FIGURE 5: SEGMENTATIONOF TOTAL SUBSCRIBERSIN JULY 08................................................................. .....23

FIGURE 6: SEGMENTATIONOF TOTAL SUBSCRIBERSIN DECEMBER 07................................................... ...........23

Tables

TABLE 1: AN OVERVIEWOF MOBILINKS NETWORK...................................................... ..............................8TABLE 2: NUMBEROF MOBILINK SUBSCRIBERSFROM 2005-JULY 2008.......................................... ...............10

TABLE 3: MARKET SHARESOF MOBILINKFROM 2005-2007................................................. ....................10

TABLE 4: PROFIT COMPARISONBETWEEN 2007 & 2006.........................................................................11

TABLE 5: BALANCE SHEET COMPARISONBETWEEN 2007 & 2006..............................................................12

TABLE 6: CURRENT RATIO COMPARISONBETWEEN 2006 & 2007....................................................... ........12

TABLE 7: FIXED ASSETS TURNOVER COMPARISONBETWEEN 2006 & 2007........................................ ............13

TABLE 8: DEBT RATIO COMPARISONBETWEEN 2006 & 2007.................................................. .................13

TABLE 9: RETURNON COMMON EQUITY COMPARISONBETWEEN 2006 & 2007...............................................13

TABLE 10: DESIGNATIONSOF MOBILINKS EMPLOYEES........................................................ .......................14

TABLE 11: LISTOF BRAND AMBASSADORSOF MOBILINK........................................................ ....................17

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1 Executive SummaryThe mobile industry of Pakistan has seen phenomenal growth in recent years. The

total mobile subscribers in 2007 were more than 63 million, a growth of more than80% from the previous year. The telecom sector of Pakistan was deregulated in

2003, and mobile industry being a part has seen phenomenal growth ever since.

Many analysts believe that Pakistan is one of the fastest growing telecom markets

in the world.

Currently there are six diverse companies making the mobile industry of Pakistan,

Mobilink being one of them. Other companies include Ufone, Telenor, Warid, Zong

and Instaphone. Mobilink enjoys being the market leader with a 36% market share

as of July, 2008.

Pakistan Mobile Communications Limited (PMCL) launched its operations in August

1994, under the brand name of Mobilink. Initially it was a joint venture between

Motorola and the Saif Group. Later on in April 2000, Orascom Telecom bought 38.6%

stake in PMCL, later increasing it to 68.69%. In April 2001, Orascom Telecom took

over management control of the company and as of December 31st, 2007, Orascom

Telecom owns 100% of the share capital of Mobilink. Mobilink offers both postpaid

(Indigo) and prepaid (JAZZ) solutions to their customers.

Mobilink was awarded a 15-year license in July 1992 to establish and operate a

digital cellular telecommunication system using the GSM 900 standard. Mobilink has

been growing its network ever since, providing 2G, 2.5G, GPRS and EDGE

compatibility. Mobilink is committed in providing the best network to their

customers, which in recent times has expanded to more than 9000 cities and

reaches over 66% of the total population and 99% of the urban population as of

December 31st, 2007.

Pakistan Mobile Communications Limited (PMCL) or Mobilink is currently headed by

President and CEO Zouhair A. Khaliq. Mobilinks headquarter is located in Islamabad

and has eight different departments. All major decisions regarding Mobilink are

taken centrally in Islamabad. To assist with the operations, operational departments

are further located in all four regions, including north, south and AJK.

Mobilinks finances are as strong as its operations and customer base. For the year

ended December, 2007, the total profit after taxation was more than Rs 4bn.

Furthermore Mobilinks fixed assets have shown a rise in 2007, so have the long

term liabilities and shareholder equity.

Mobilink being the market leader is also able to attract the most talented

professionals. Its current employee force consists of more than 4500 unique

individual. Mobilink hiring takes place through its website and is know for offering

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competitive packages to its employees. Furthermore, it training and appraisal

programs are an essential part of the HR department.

Attracting customers is a tough job and that is why the marketing department of

Mobilink develops a number of marketing campaigns to attract customers.

Furthermore it also takes the help of a leading advertising agency of Pakistan and

uses brand ambassadors from various walks of life to promote its products and

services.

The mobile industry provides three major product lines, which include the consumer

packages, value added services and corporate packages. The consumer packages

include the postpaid and prepaid packages; the value added services provide

entertainment, information and a lot more to their subscriber, while the corporate

packages have been introduced to cater to the needs of large businesses and

corporate clients.

The mobile industry of Pakistan has witnessed phenomenal growth periods over the

years. As of July 2008, the growth rate of the entire industry was more than 40%.There are four major competitors of Mobilink. Ufone is the closest with a market

share of 21% in July 2008, followed by Telenor with 20%, Warid by 18% and Zong by

5%.

I did my eight weeks internship at the cash management department within

Mobilink Treasury. Some of the work that I did during my internship includes making

the cash position, making transfer letters, making encashment and international

payments and working to open new accounts of Mobilink.

The main problem that I identified during my internship period was the lack of job

rotation within the department and not keeping up with the policies of jobadvancements. Some of the suggestions in this respect were the introduction of

compulsory job rotation within department, introducing job specific training to

employees and adhering to the criteria laid out by the HR department for job

advancements in complete faith.

Lastly I would say that Mobilink became the market leader by introducing new

products and services that took full advantage of new technologies over the years

and I hope that it will tend to do so in the coming future and provide stiff

competition to any challenger that poses a threat to its leadership in the market.

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2 Introduction

2.1 Central Background InformationThe telecom sector of Pakistan has seen phenomenal growth over the past few

years. According to the Pakistan Telecommunication Authority (PTA), the total

mobile phone subscribers in 2007 were more than 63 million, a growth of more than

80% from the previous years. During 2006-07, the mobile sector generated Rs 133

billion in revenues, an increase of 48% from the previous years and contributed Rs

63 billion to the national exchequer in terms of taxes and regulatory fees. The

telecom sector contributed 2% to the GDP in 2005-06 and received more than $1.8

billion in foreign direct investment (FDI) in 2006-07 , which is 35.6% of the total FDI

in that period. Furthermore, the telecom sector has also created over one million in

jobs, since its deregulation, making Pakistan one of the worlds fastest growing

telecom markets.

The Pakistan Telecommunication Ordinance 1994 established the primary regulatory

framework for the telecommunication industry including the establishment of an

authority. Thereafter, Telecommunication (Re-Organization) Act no XVII was

promulgated in 1996 that aimed to reorganize the telecom sector of Pakistan. Under

Telecom Reorganization Act 1996, Pakistan Telecommunication Authority (PTA) was

established in January 1997 to regulate the establishment, operation and

maintenance of telecommunication systems, and the provision of telecom services.

The telecom sector was deregulated in 20031.

Currently there are six mobile operators operating in Pakistan, which includeMobilink, Ufone, Telenor, Warid, Zong and Instaphone. Mobilink started its

operations in 1994 as the first GSM cellular mobile service in Pakistan, started by

Motorola Inc. Later it was sold to Orascom, an Egypt-based multi-national company.

Mobilink is the largest cellular service provider in Pakistan. Another company,

Pakistan Telecommunication Mobile Limited (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.

Later, as a consequence of PTCLs privatization, 26% of its shares were acquired by

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

management of Ufone had also been handed over to Etisalat.

Telenor Pakistan is 100% owned by Telenor ASA and adds on to its operations in

Asia. Telenor Pakistan launched its operations in March 2005 as the single largest

direct European investment in Pakistan, setting precedence for further foreign

investments in the telecom sector. In 2004, Warid Telecom International LLC,

1Daily Times July 27, 2007

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purchased a license for operating a nationwide mobile telephony network, (WLL)

and long distance international (LDI) for $291 million US dollars and was the first

venture of Warid Telecom International LLC. Warid Pakistan launched its services in

May 2005. On June 30th, 2007, Singapore Telecommunications Limited (SingTel) and

Warid Telecom announced that they had entered into a definitive agreement

subsequent to which SingTel will acquire a 30% equity stake in Warid Telecom for anestimated $758 million.

China Mobile Pakistan (CMPak) is a 100% subsidiary of China Mobile. The pioneering

overseas set up of China Mobile came through acquisition of a license from Millicom

to operate a GSM network in Pakistan. Millicom had initially bought Paktel in 2003

from Cable & Wireless. Paktel was the first ever company granted license to carry

out cellular phone services in Pakistan. Currently CMPak is operating in Pakistan

under the brand name of Zong. Instaphone is another telecommunication company

in Pakistan. Instaphone was one of the pioneers of cellular industry in Pakistan.

Initially the company was owned by Millicom International; later on Arfeen Group

acquired it. Currently, the license of Instaphone has been terminateddue to nonpayment of license fee to PTA. The company under a renewed license is planning to

role out a countrywide CDMA mobile network and would be the only CDMA mobile

operator in Pakistan to launch first 3G services in Pakistan.

2.2 Company BackgroundPakistan Mobile Communications Limited (PMCL) operates the leading GSM network

in Pakistan and provides a range of prepaid and postpaid voice and data

telecommunication services to both individual and corporate subscribers, under the

brand name Mobilink. Mobilink launched its operations in August 1994 after it was

founded in 1990 as a joint venture between Motorola and the Saif Group and

awarded a license for mobile telecommunication system and services in July 1992.

Later on in April 2000, Orascom Telecom bought 38.6% stake in PMCL, which it later

in February 2001 increased to 68.69% by purchasing Motorolas share in PMCL and

becoming the major shareholder of the company. In April 2001, Orascom Telecom

took over management control of the company. As of December 31st, 2007,

Orascom Telecom indirectly owns 100% of the share capital of Mobilink through

direct stakes held by wholly owned subsidiaries of OTH. By December 2007,

Mobilink had achieved 39.8% in market share, making it the market leader in the

mobile sector of Pakistan2 and had a customer base of more than 32 million by July

20083.

Mobilink offers exclusively designed tariff plans that cater to the communication

needs of a diverse group of people, from individuals to businessmen to corporates

2Orascom Telecom Annual Report 2007

3PTA Website

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and multinationals. To achieve this objective, Mobilink offer both postpaid (Indigo)

and prepaid (JAZZ) solutions to their customers.

Mobilink was also the first cellular service provider to operate on a 100% digital

GSM technology in Pakistan and also provides state-of-the-art communication

solutions to its customers. Mobilinks network is the most extensive in Pakistan,

connecting more than 9000 cities across Pakistan, as well as over 120 countries on

international roaming service. Furthermore it reaches over 66% of the total

population and 99% of the urban population as of December 31st, 2007. Mobilink is

also developing its own optic fiber backbone, to provide its customers with highest

level of voice and data quality with more reliability4 and has invested more than

$2.5 billion in its networks.

Mobilink Vision

"To be the leading Telecommunication Services Provider in Pakistan by offeringinnovative Communication solutions for our Customers while exceeding Shareholder

value & Employee Expectations".

Mobilink's ValuesTotal Customer Satisfaction

Customers are at the heart of our success. They have placed their trust andconfidence in us. In return, we strive to anticipate their needs and deliver service,

quality and value beyond their expectations.

Business ExcellenceWe strive for excellence in all that we do. We aspire to the highest standards andraise the bar for ourselves everyday. This commitment to delivering world-classquality translates into unmatched service and value for our customers and all

stakeholders.

Trust & IntegrityAt Mobilink, we take pride in practicing the highest ethical standards in an open and

honest environment, and by honoring our commitments. We take personalresponsibility for our actions, and treat everyone fairly, and with trust and respect.

Respect for PeopleOur relationships drive our business. We respect and esteem our employees and all

stakeholders. We believe in teamwork, empowerment and honor.

Corporate Social ResponsibilityAs the market leader, we recognize and fulfill our responsibility towards our country

and the environment we operate in. We contribute to worthy causes and arededicated to the development and progress of the society

4Mobilink CEO Speaks About 2008 Plans (www.telecompk.net)

8
http://telecompk.net/2007/12/26/mobilink-ceo-speaks-about-2008-plans/http://telecompk.net/2007/12/26/mobilink-ceo-speaks-about-2008-plans/http://telecompk.net/2007/12/26/mobilink-ceo-speaks-about-2008-plans/http://telecompk.net/2007/12/26/mobilink-ceo-speaks-about-2008-plans/


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3 Company Analysis

3.1 Operation Analysis

3.1.1 Network

Mobilink was awarded a 15-year license in July 1992 to establish and operate a

digital cellular telecommunication system using the GSM 900 standard and to offer

telecommunication services in Pakistan. Before that, all previous operations were

using the AMPS technology. Since then Mobilink has been growing its network,

providing 2G, 2.5G, GPRS and EDGE compatibility. Mobilink was the first operator to

start rolling out the Enhanced Data Rates for Global Evolution (EDGE) in Pakistan.

In addition, Mobilink also launched its BlackBerry service in December 2005 throughits GPRS platform. Furthermore, Mobilinks license was renewed on July 6th, 2007 for

a further period of 15 years5.

Mobilink is committed in providing the best network to their customers, which in

recent times has expanded to more than 9000 cities and reaches over 66% of the

total population and 99% of the urban population as of December 31st, 20076.

Table 1: An Overview of Mobilinks Network7



7Mobilink Website

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Not only is Mobilinks network very modern and technologically advance, but it is

also very competitive, when compared to other mobile networks.

Figure 1: Comparative Figures of Coverage & Cell Sites8

8Orascom Telecom Investor Presentation November 2007

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3.1.2 Operational Departments

Mobilink is headed by President and CEO Zouhair A. Khaliq, who reports directly to

the Chairman and CEO of Orascom Telecom Naguib Sawiris. Furthermore the

operations of Mobilink are divided into eight different departments, which are as

follows:

1. Human Resource

2. Administration and Security

3. Sales

4. Marketing

5. Customer Services

6. Corporate Affairs

7. Technical

8. Finance

Furthermore, these departments are further divided into sub departments to ease

operations within Mobilink. Also all major decisions are taken centrally, inIslamabad. These decisions for example include, the financing required by Mobilink

(local and foreign), decisions regarding import of goods etc.

Furthermore, to assist the operations of Mobilink, which include more than 500

franchises and 16 Customer Services Centers, operational departments are located

in all the four main regions:

1. North

2. South

3. Central

4. AJK

3.1.3 Subscribers and Market Share

Mobilink had a great advantage for years as being the only GSM mobile operator in

Pakistan, however with the entrance of Ufone in 2001 and later on by Telenor, Warid

and Zong, the competition in the mobile sector is heating up. However the

subscriber base Mobilink has remained steady and growing as seen in the table

below:

Table 2: Number of Mobilink Subscribers from 2005-July 20089

Year 2005 2006 2007 July-2008

Subscribers 7,469,085 17,205,555 26,466,451 32,056,336

% Change - 130.3 53.8 21.1

Although the number of subscribers has increased over the years, the same cannot

be said about the market share of Mobilink, which has gradually decreased over the

9PTA Website

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year. However, although the market shares of Mobilink might have decreased over

the years, but it still remains the market leader in the mobile sector. The market

shares of Mobilink are as follows:

Table 3: Market Shares of Mobilink from 2005-200710

Years 2005 2006 2007Market Share 51.4% 46.3% 39.8%

Change - (5.1%) (6.5%)

3.2 Financial AnalysisNo company can remain in business if it cannot sustain and grow its profits and

telecom companies are no exemption. If Mobilink wants to remain the market leader

in the mobile industry and wants to satisfy its customers, it itself needs to remain a

profitable company.

Mobilink is a private limited company and due to this reason, its financial

statements are not made public. However it does provide its financial information to

different financial institutions and companies that have invested in Mobilink,

examples include companies that have bought TFCs issued by Mobilink.

An extract of the Balance Sheet and Income Statement for the year 2007, can be

seen in the appendix.

3.2.1 Operational Results

Table 4: Profit Comparison between 2007 & 2006

Description December 2007 December 2006

In Pak Rupees

Revenue 70,914,424,384 55,871,865,120

10Orascom Telecom Annual Reports 2006-2007

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Profit Before Interest & Tax 15,603,089,144 12,545,001,838

Profit Before Taxation 6,976,257,786 7,372,726,009

Profit After Taxation 4,151,660,417 4,100,392,601

As major portion of Mobilink is on prepaid basis, including SIM sales, securities andbalance recharges the revenues for Mobilink have increased from December 2006

to December 2007, this increase is because of the large increase in the consumer

base of Mobilink in 2007. The increase in revenue has led to an increase in the profit

before interest and tax, and although the costs of services and selling and

administrative charges in 2007 haveincreased from the past year, the increased

revenue helped in off setting the increase in the expenses.

Another problem in the profit and loss statement of Mobilink is the increased

financial charges or interest charges for the 2007. In the mid of 2006, Mobilink

issued a TFC more than Rs 3 billion, and the interest of which is paid semi annually.

Furthermore, most of Mobilinks growth is financed through long term loans, which

have also increased in 2007, increased the financial charges.

The increase in financial charges and provision of taxes in 2007, ultimately lead to

profit after taxation, which when compared to the profit of 2006, to not increase by

much. The increase is only 1.25% from the previous year.

3.2.2 Balance Sheet Results

Table 5: Balance Sheet Comparison between 2007 & 2006

Description December 2007 December 2006

In Pak Rupees

Fixed Assets 138,159,488,742 104,896,145,585

Current Assets 16,313,779,738 18,193,085,605

Current Liabilities 51,742,026,278 50,934,936,367

Shareholders Equity 23,523,324,157 16,329,320,280

Long Term Liabilities 79,207,928,045 55,824,974,543

As the above table shows, there has been a significant increase in the fixed assets

of Mobilink in 2007; this has been due to the increase in the property, plant and

equipment, long term deposits and other receivables and license fee. However, the

current assets have decreased, but not by much. This small decrease is mainly due

to the decrease in stocks in trade.

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The current liabilities have also increased in 2007, again by not by much. This

increase in current liabilities is associated with the increase in short term financing

and the current portion of long term financing.

The increase in shareholders equity is associated with the increase in the

shareholders equity and the increase in the accumulated profits, while the increase

in the long term liabilities is associated with the large increase in long term

financing and the license fee payable, which was made due, to the renewal of

Mobilinks license.

3.2.3 Ratio Analysis

3.2.3.1Current Ratio

Table 6: Current Ratio Comparison between 2006 & 2007

2007 2006

0.31:1 0.35:1

Current ratio is a liquidity ratio that measures how easily a company can pay off its

current liabilities using its current assets. For Mobilink although most of its revenues

are on a prepaid basis but still the current assets fall short to pay off the current

liabilities in both 2006 and 2007. Furthermore the current ratio has fallen in 2007,

which again shows that there arent enough liquid assets to pay off the current

liabilities and may affect Mobilinks solvency in the short term.

3.2.3.2Fixed Assets Turnover

Fixed Asset Turnover, an asset management ratio, shows how effectively a company

uses its fixed assets. That is using its assets to generate sales. Most of Mobilinks

assets are fixed, major of which include cell sites and other equipment. As the

figures show, the ratio has decreased in 2007, from 0.53 to 0.51.

Although the decrease is very small, the major reasons associated are the large

increase in the fixed assets and the small increase in sales. The fixed assets rose by

29.3%, while the revenue rose by 26.3%. The major reason for the small increase in

the sales could be associated to the rather small increase in the total subscribers in2007, as compared to 2006.

2007 2006

0.51 0.53Table 7: Fixed Assets Turnover Comparison between 2006 & 2007

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3.2.3.3Debt Ratio

2007 2006

84.7% 86.7%Table 8: Debt Ratio Comparison between 2006 & 2007

The Debt Ratio measures the percentage of funds provided by sources other than

equity. For Mobilink, most of its growth is funded through long and short term

financing, and even though Mobilink has expanded its operations during 2007, but

still the debt ratio fell in 2007, but only by 2%, which is mainly because of the large

increase in the total assets, when compared to long term liabilities. The rise and fall

of current liabilities and currents assets respectively is not much.

3.2.3.4Return on Common Equity

Table 9: Return on Common Equity Comparison between 2006 & 2007

2007 2006

17.6% 25.1%

Return on common equity, a profitability ratio, measures the extent to which the

shareholders of a company are getting returns on their investments. The ratio for

Mobilink has decreased significantly in 2007, a decrease of 7.5%. This decrease can

be associated to the small income available to the shareholder. Most of the net

income has to be paid out in financial charges, which leaves less or the

shareholders, which in 2007, expanded their investment in the company.

3.3 Human Resource AssessmentMobilink, the largest cellular company of Pakistan, is made of a team of over 4500

of unique individuals. They are the best minds in the industry today, being exposed

to the best practices and an enabling environment.

Employees at Mobilink are treated as a big family, where their growth is as

important as Mobilinks. Capability building programs equip employees with all the

skills and techniques needed for them to realize their ambitions, while diversity and

wellness initiatives help employees further reach new heights and achieve their

goals.

Mobilinks hiring takes place through its website which is being powered with a

partnership with Rozee.pk, one of Pakistans premier website. This website provides

updated information on job openings, as and when they happen. Furthermore the

website is divided into three sections, all providing information accordingly:

Internship Candidates

Entry Level Candidates

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Experienced Candidates

All employees at Mobilink are designated accordingly, which is as follows:

Table 10: Designations of Mobilinks Employees

Grade/Employee Post Designation DescriptionAssociate A-2 (Junior Associate) Entry Level/Fresh

Candidates

A-1(Senior Associate) Min 2 yrs. Experience

Required

Specialist S-2(Junior Specialist) Min 4 yrs. Experience

Required

S-1(Senior Specialist/Asst.

Manager)

Min of 5-6 yrs. Experience

Required

Manager M-2 Manager

M-1 Senior Manager/HOD of

Sub Departments

Director Departmental Head

Furthermore Mobilink employees receive a number of fringe benefits which include

gratuity funds, post paid mobile packages, credit cards and discounted

memberships with Citi Bank, employee loans, blackberry handsets, transport

facilities for ladies, health club and Jinnah Stadium memberships etc.

Training of employees is taken an integral part of the HR department of Mobilink.

Training Calendars are published for employees, informing them about training

dates and their descriptions. These training sessions take place both within and

outside the city. Employees are even sent abroad for training. These include

managers and directors within Mobilink, to polish and enhance the management

and leadership skills further.

Appraisal of employees is as important as training for any organization and Mobilink

is no exemption. Mid Year and Yearly appraisal are conducted by line managers of

each employee. Input from the employee being appraised is also taken to enhance

the benefits of the appraisal activities. This input includes both their job objectives

and responsibilities but also suggestions on what line managers could do more for

support.

3.4 Marketing AnalysisIn todays contemporary business world, marketing plays an important role.

Mobilink that has a number of competitors in the mobile industry, need to use their

marketing plan and strategies effectively to attract customer loyalty.

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The marketing department at Mobilink anticipates, and satisfies the customers

communication needs. This includes consumer behavior research and translating

this research into services and pricing plans. The Marketing team also helps in

identifying new business opportunities and develops plans to exploit those

profitably. It also designs and implements brand strategies and communication

plans.

The major ways in which Mobilink markets itself and its products are through the

following ways:

Electronic

Print

3.4.1 Electronic Media

The major way in which todays organizations promote its products and services is

through television, not only because its economical but also because the visual and

audio aids help in promoting its product.

Mobilink uses an aggressive advertising campaign on television to promote its

products. These advertisements, while communicate an image of modernity and

newness, still tend to show the heritage of Pakistan. The heritage of Pakistan and

its people signifies Mobilink, as being the favorite cellular company of Pakistan.

Mobilink has also for years, has tried to create different personalities for its brands:

Indigo and Jazz, to distinguish them from other competing brands. Mobilinks Indigo

brand relied heavily on two factors toward establishing its brand equity: brand

ambassadors that exuded style and sophistication, and a unique classy look that

permeate all forms of its Indigo brand communication. It also played on the

aspirations of young business professionals through the atmosphere and the locales

ofIndigos ads.

On the other hand, the Jazz brand creates an image of fun, catering more to the

youngsters and teens of the country. Not only that, it has also over the years

created an image of bond among the members of the Jazz members, achieved due

to the lowest rates and packages that Jazz has to offer. With Jazz advertisements,

its all about having a show and tell tableau.

Other ways, in which Mobilink is marketing its products, is through its website and

radio. The website of Mobilink is built in a way to provide updated information about

its products, with dedicated pages for both its brands, Indigo and Jazz. Furthermore,the website also contains a gallery feature, from where users can view a wide array

of print and television advertisement, created by Mobilink over the years. The use of

Radio has also been used to promote the packages of Mobilink. Advertisement on

radio, mostly inform listeners on the new packages and their details.

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3.4.2 Print Media

Print advertisements are another major way in which Mobilink advertises its product

to the masses. Print media advertisements are printed in major English and Urdu

newspapers across Pakistan. The messages of these advertisements are mainly of

new packages that Mobilink may introduce over time.

Figure 2: Print Advertisements of Mobilink11

3.4.3 Advertising Agency and Brand Ambassadors

Mobilink uses the services of International Advertising (Pvt) Limited (IAL) SAATCHI &SAATCHI. IAL was established in 1966. IAL clients include PIA, P&G, Devan Mushtaq

Motor Company (DMMC), PSO, Engro Foods Limited, National Foods and Sony

Ericsson etc. Furthermore, it became the first agency to affiliate itself with an

international agency- SAATCHI & SAATCHI, a top player in the global advertising

arena12.

Furthermore, Mobilink uses its brand ambassadors to promote its products in both

the electronic and print media. These brand ambassadors come from the fields of

acting, modeling, singing and cricket and are few of the most famous and talented

stars of Pakistan. The brand ambassadors are as follows:

Table 11: List of Brand Ambassadors of Mobilink

Name Profession Brand Being Promoted

Iman Ali Model Jazz

11www.brandsynario.com

12IAL SAATCHI & SAATCHI website (www.ialideas.com)

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Wasim Akram Cricketer Jazz

Vaneeza Ahmed Model Indigo

Zainab Qayum Model Indigo

Shan Actor/Model Indigo

Strings Singers Mobilink World

Furthermore, stars like Shahid Afridi, Shoaib Malik, Shakeel, Behroze Sabzwaari,

Sunita Marshall and Samina Pirzada have also appeared in Mobilink advertisements,

from time to time.

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4 Environmental Analysis

4.1 Industry and Market Analysis

4.1.1 Major Product Lines Market Segment

Mobile Industry has been very effective in introducing new and innovative products

and services over the years. The major product lines can be segmented into, three

categories, which are as follows:

1. Consumer Packages

2. Value Added Services

3. Corporate Packages and Services

These product lines have a range of different services, catering to different marketsegment.

4.1.1.1Consumer Packages

The consumer packages of the mobile Industry include the prepaid and postpaid

packages being provided by the different cellular providers of Pakistan.

Prepaid packages, due to their nature is the most common type of package being

used today by millions of Pakistanis. Prepaid packages provide a sense of

affordability, whereby consumers have the option of only recharging their accounts,

when needed. This affordability has led to a massive increase in the prepaid

subscriber base, with everyone from housewives to teenagers; to electricians to

small shop owners all using prepaid packages. The main user segments of prepaid

packages include the lower, middle and middle upper class of the country.

Furthermore, a number of people use prepaid packages as a second number, which

also include people from the upper class..

Mobile companies today have used immense popularity of prepaid packages to

introduce packages that are targeted to different segment. These include Telenors

Djuice, targeted towards teenagers and young individuals and Mobilinks Ladies

First, targeted towards house wives. Furthermore, packages that bill at 1min, 30

second and per second have also been introduced by mobile companies.

Postpaid packages were introduced, keeping in mind, the businessmen andexecutives. Postpaid packages, due to their nature provided the benefits of

connectivity 24/7, without the fuss of scratch cards and recharge of accounts.

Furthermore, as competition rose in the mobile industry and new entrants came;

postpaid packages were made more affordable. The work of Warid in this concern is

an example, creating postpaid packages as affordable as prepaid ones. The main

market segments, towards which the postpaid packages are targeted, include small

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and medium businessmen, industrialists, bureaucrats and people of the upper class.

However with the affordability of postpaid packages, people from the middle class

have also been seen using post paid packages.

4.1.1.2Value Added Services

Value Added Services have become an essential tool for generating revenues for

mobile companies today. Starting in the early years, from wallpaper and ringtones

download, today mobile companies provide a range of services to their customers.

Some of the popular services include, religion services, music services, which

includes song dedication, voice and timed messages, sports and cricket services,

food and recipe services, WAP/GPRS/EDGE, themes, wallpapers, games and

ringtones downloads, credit share, MMS, voice mail, email, missed call alert,

conference call, mobile TV, web2sms and many more.

Value added services have been designed by companies, so that there are services

for every segment of their users and that these services completely satisfy them, as

and when needed.

4.1.1.3Corporate Packages and Services

Cellular providers in Pakistan are also providing corporate clients with services

catered to them. Corporate clients due to their huge operations have special

requirements. Mobile packages and tariffs; secure email and instant web

connectivity, being some of the most important issues.

Today mobile companies provide BlackBerry solutions, Mobilink and Warid beingforefront in this technology, furthermore to add to this innovative service,

companies today are providing SMS marketing feature, SMS management facility,

fax mail, Wireless connectivity through EDGE, private numbering plans, closed user

groups and mobile email to their corporate clients.

All above features and many more have helped corporate clients to manage their

operations effectively and efficiently.

Figure 3: Products Offered By Different Mobile Companies

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4.1.2 Growth Rate of Entire Industry

The mobile industry has seen phenomenal growth over the years. Today there are

five major competitors competing for their subscriber base, increasing the services

provided, reducing their call rate and having aggressive marketing campaigns.

Simply put, competition is heating up in the mobile industry.

In July 2008, according to Pakistan Telecommunication Authority (PTA), the total

subscriber base in the mobile industry reached to more than 89 million to

89,325,296. This was an increase of 41.4% from December 2007. Although this is

phenomenal growth, analysts believe that it mould be even higher, if taxes would

have not increased, in the financial budget.

The mobile industry has seen phenomenal growth over the years, as seen below:

As the above figure shows, the mobile industry saw phenomenal growth from 2005-

2006. According to PTA, on average 2.3 million subscribers were added every month during 2006-07.

Furthermore, in 2003-04 the sector was offering 466,068 direct and indirect

employments, which in 2006-07 more than doubled to 1,366,698 employments.

Also the cellular mobile density or mobile penetration in the total population has

also increased over the years. In July 2008, the mobile density reached 55.62%. Itwas 54.7% in Dec 2007 and 39.94% in Dec 2006, according to official figures.

Also during 2006-07 the revenue of mobile industry was Rs.133 billion, an increase

of 48% from pervious year

However, none the less, the growth has subsided since 2006, from 170.2% in

December 2006 to 80.7% in December 2007, the major reasons of which include

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Figure 4: Growth Rates in Mobile Industry 2005-July 2008


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the crackdowns on SIM registration, rising taxes and the general economic

conditions of the country.

4.2 Competitor Analysis

4.2.1 Major Competitors

4.2.1.1Ufone

Pakistan Telecommunication Mobile Limited (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.

Since its inception, Ufone changed the image of mobile phones from a luxury only

affordable by the elite, to a necessity affordable by the common man. Ufones

primary focus always remained on their valuable customers, introducing services

over time to fulfill their need and demands. Ufones slogan has always remained

Its all about U.

As a consequence of PTCLs privatization in 2006, 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. Now, under the

management of Etisalat, Ufone tends to concentrate on customer needs and

benefits and its management is even more determined than ever to be the leading

cellular player in the market, because Ufone has been known for providing superb

propositions and quality service to its customers and tends to keep that reputation

in the future.

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

subscriber base of over 18 million in July 2008, according to PTA and a market shareof 21% during the time period. Currently, Ufone has network coverage in more than

750 cities, towns and across all major highways of the country. It also provides

international roaming to more than 195 live operators across 119 countries.

Currently Ufone is under the agreement with Huawei, which will provide its future-

oriented EnerG GSM solution to expand Ufone's network to cover over 2200 cities,

towns, villages and all major highways in the country. The network also allows Ufone

subscribers to enjoy high-speed wireless data service and enables the telecom

service provider to evolve into 3G smoothly.

4.2.1.2TelenorTelenor Pakistan is 100% owned by Telenor ASA and adds on to its operations in Asia

together with Thailand, Malaysia and Bangladesh. Telenor acquired the license for

providing GSM services in Pakistan in April 2004, and had launched its services

commercially in Islamabad, Rawalpindi and Karachi on March 15, 2005 and on

March 23, 2005 Telenor started its services in Lahore, Faisalabad and Hyderabad.

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Telenors investment in Pakistan is the single largest direct European investment in

Pakistan.

By the end of July 2008, the total subscribers of Telenor exceeded 18 million, with a

market share of 20%. Telenors network covers more than 3000 cities, towns and

highways throughout Pakistan. Furthermore, Telenor Pakistan has more than 5,000

cell masts throughout Pakistan, making it the 2nd largest network in Pakistan and 3rd

in terms of customer base.

Telenor has a strategic alliance with Nokia Siemens Networks for expansion in

Pakistan. With USD 1 billion already invested, Telenor has extended agreements

with its vendors, including Nokia Semens for network expansion and services until

2009. The agreements will result in USD750 million worth of orders from Telenor

Pakistan.

4.2.1.3Warid

Warid Telecom is a joint venture between Abu Dhabi Group & SingTel Group. In

2004, Warid Telecom International LLC, purchased a license for operating anationwide mobile telephony network, (WLL) and long distance international (LDI)

for $291 million US dollars and was the first venture of Warid Telecom International

LLC. Warid Pakistan launched its services in May 2005 and is based in Lahore.

Abu Dhabi Group is one of the largest business groups in the Middle East and the

single largest foreign investor in Pakistan. Abu Dhabi Group entered into a strategic

alliance with Singapore Telecom. Subsequent to this transaction in July 2007,

telecom giant SingTel acquired 30% percent equity stake in Warid Telecom, Pakistan,

for US$758 million- valuing the company at an enterprise value of $2.9 billion. This

partnership is part of a strategy to support Warid Telecoms continued growth and to

enhance its market position.

In July 2008, Warids total subscribers were more than 15 million subscribers and

enjoyed 4th position in the market with a market share of 18%. In June 2008, Warid

Telecom announced it would invest $1.5 billion by end of this year and $2.5 billion

by end of 2009 to expand and modernize its network in Pakistan.

4.2.1.4Zong

China Mobile Pakistan (CMPak) is a 100% subsidiary of China Mobile. The pioneering

overseas set up of China Mobile came through acquisition of a license from Millicom

to operate a GSM network in Pakistan. With ambitious plans to cater to the fastest

growing Pakistani market and to win over the ever demanding Pakistani customer,CMPak's edge comes from the experience and expertise of running the world's

largest telecom service and the commitment they make to setting quality and

customer relations standards. ZONG is the first International brand of China Mobile

being launched in Pakistan.

On 22nd January 2007, Millicom International Cellular S.A. announced that it would

sell its 88.86 percent stake in Paktel Ltd. to China Mobile for $284. On 4th May

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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%. It later rebranded branded

Paktel to Zong.

In July 2008, the total subscribers of Zong were more than 4 million and enjoyed 5 th

position in the market with 5% share in the market. So far CMPak has invested more

than US$ 700 million in the telecom sector in Pakistan and an additional US$ 800

million will be invested till the end of year 2008.

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4.2.2 Their Market Shares

According to official figures in July 2008, there were a total of 89m subscribers

(89,325,296) in the mobile industry, Ufone had 18 million (18,368,074) subscribers

and was second in market share to Mobilink, followed closely by Telenor with

18,329,428 subscribers, a difference of just 38,646 subscribers. This difference was

3,312,712 subscribers at the end of 2007. Warid was forth with 15 million

(15,774,299) subscribers. Warid has also lost to Telenor in terms of market share

since 2006, when it was third in the industry. In July 2008, Zong had 4 million

(4,446,024) subscribers and was fifth overall. Instaphone had only 351,135

subscribers during this time.

Figure 5: Segmentation of Total Subscribers in July 08

In 2007, Ufone still remained second (14,014,044) in terms of mobile subscribersand Telenor third (10,701,332), followed closely by Warid (10,620,386), which

remained forth. Zong was fifth (1,024,563) and Instaphone sixth (333,081). The

total subscribers in 2007 were 63 million (63,159,857).

Figure 6: Segmentation of Total Subscribers in December 07

4.2.3 Their Goals and Strategies

4.2.3.1Ufone

Ufone is one of the major competitors of Mobilink and has sustained a good market

share over the years. It has remained second overall for a number of years.

However just recently, Telenor, which had gained third position in 2006, in the

industry, is giving strong competition to Ufone and even achieved second position in

the first quarter of 2007.

The main goal of Ufone is to provide its customers with the most effective and

efficient manner of communication. The main goal of Ufone has always been of

providing its customers with the state of the art services at the most simplest rates

in the industry. Its goals have always revoloved around U (its customers), which can

be seen in its punch line or slogan its all about U. Furthermore, by accomplishing

its goal, Ufone would be able to sustain its market share in the industry and remain

in the second position and defend its position from competitors like Telenor.

The main strategies of Ufone to accomplish their goals surround around providing

services that fulfill the needs of the society at all levels of the society. Ufone was

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the first mobile company to stop charging for incoming calls, first to introduce GPRS,

first to start bundle SMSpackages and recently its call rates have greatly reduced

and have become even simpler. Furthermore its commitment can also been seen

from the fact that its slogan of its all about u has not changed over the years.

4.2.3.2Telenor

Telenor since its inception in 2005, has been an aggressive company, trying to gain

market share from other competitors, first it took the third position from Warid

(another company that started in 2005) in 2007 and is now giving stiff competition

to Ufone (currently second13) and is favorite in gaining the position from its rival

company.

The main goal of Telenor is to help its customers get the full benefit of

communications services in their daily lives. This is also reflected in their vision,

which is were here to help. The main goal of Telenor is to provide services, which

take use of the latest technologies and are also new to the industry, thus providing

their customers with the full benefits of communications, which other companiesare not able to provide. Telenors slogan or punch line also reiterates their goal

which is the smart call. Henceforth, by accomplishing its vision, Telenor would be

able to take the second position in the industry and can then provide competition to

the market leader-Mobilink.

The strategies used by Telenor to achieve its goals is by beingcreative, that is

providing new and modern services, that take advantages of new technologies but

are also easy to understand and use. Some of the creative products introduced by

Telenor over the years include: EasyLoad, SmartShare, mobileTV, largest network of

EDGE, PicShare, international packages like Djuice and many more. All these

services are very creative, never been introduced before and helping all itscustomers around Pakistan.

4.2.3.3Warid

Warid started its operations in May 2005, and enjoyed a good market share in the

industry, however it has lost its subscribers to its competitors in recent years,

leading to its loss of position in the industry. The main goal of Warid is to maintain

and strengthen its current market share and increase to positions, which it earlier

held in the industry.

The major strategy used by Warid is to create a sense of confidence among its

customers that it is the best network for their lives. That is it provides the best

calling and sms rates, including the value added services. Its slogan, life ka

network also provides emphasis to this point.

Warid had earlier efficiently promoted its postpaid packages as affordable as its

prepaid packages, a strategy that increased its postpaid customers significantly in

13As of July 2008 (PTA figures)

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the mobile industry, at a time when overall post paid connections were decreasing.

Currently its agreement with SingTel will also provide emphasis to its goals and

associated strategies.

4.2.3.4Zong

Zong, a recent entrant in the mobile industry is a subsidiary of China Mobile. Zongs

inception was the result of the takeover of Paktel by China Mobile in 2007. Being a

new entrant in the mobile industry, its goal is to gain market share, currently Zong

is a small part of the industry, but however it aims to increase its market share

reach above 10% by 2010.

The main strategy of Zong in this concern is to allow people to communicate at will,

without worrying about tariffs, network coverage, capacity issues or congestion. Its

slogan Say it All, provide the emphasis to their strategy.

Currently Zong is providing packages with the lowest call rates. Furthermore it has

also introduced features, which were not present earlier. These include change of

happy hours, changing SMS packages and internet packages on the discretion of itscustomers.

4.3 Technology Analysis

4.3.1 Technical Methods That Affect the Industry

Mobile networks are one of the most technical aspects of any mobile company and

the technology changes affecting the networks have changed considerable, since

the first mobile company Paktel was introduced in Pakistan.

Paktels networks ran on Advanced Mobile Phone System (AMPS). AMPS was the

analog mobile phone system standard developed by Bell Labs. AMPS were a first-

generation cellular technology that usedseparate frequencies, or "channels", for

each conversation. AMPS used considerably more computing power in order to

select frequencies; however cell centers couldflexibly assign channels to handsets

based on signal strength, allowing the same frequency to be re-used in various

locations without interference. However it suffered from some weaknesses when

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compared to today's digital technologies. Since it is an analog standard, it was very

susceptible to static and noise and had no protection from eavesdropping using a

scanner.

However with the introduction of Mobilink in 1992, Pakistans mobile industry

entered into the second generation of mobile networks with GSM. GSM (Global

System for Mobile Communications) is the most popular standard for mobile phones

in the world. Its promoter, the GSM Association, estimates that 82% of the global

mobile market uses the standard. Its ubiquity makes international roaming very

common between mobile phone operators, enabling subscribers to use their phones

in many parts of the world. GSM differs from its predecessors in that both signaling

and speech channels, which are digital, and thus is considered a second generation

(2G) mobile phone system. This has also meant that data communication was easy

to build into the system. GSM also pioneered the short message service (SMS),

which is now supported on other mobile standards as well. Most GSM networks

operate in the 900 MHz or 1800 MHz bands.

Currently all mobile networks of Pakistan have entered the 2.5G. Mobile networks

entered the 2.5G, by implementing the General Packet Radio Service (GPRS). It is a

packet oriented mobile data service available to users of GSM. GPRS can be used

for services such as Wireless Application Protocol (WAP) access, Short Message

Service (SMS), Multimedia Messaging Service (MMS), and for internet

communication services such as email and World Wide Web access. Later on,

Enhanced Data rates for Global Evolution (EDGE) was introduced, EDGE is an

upgrade that provides a potential three-fold increase in capacity of GSM/GPRS

networks. Although EDGE is a 3G technology, but it is considered a part of 2.5G

technologies, however sometimes separately referred to as 2.75G.

Currently the Pakistan Telecommunication Authority is planning to launch 3G

licenses in Pakistan, starting from the end of 2008. 3G networks enable network

operators to offer users a wider range of more advanced services while achieving

greater network capacity through improved spectral efficiency. Services include

wide-area wireless voice telephony, video calls, and broadband wireless data, all in

a mobile environment. Additional features also include HSPA (High Speed Packet

Access) data transmission capabilities able to deliver speeds up to 14.4Mbit/s on the

downlink and 5.8Mbit/s on the uplink. Furthermore 3G networks offer a greater

degree of security than 2G predecessors.

4.3.2 InnovationThe mobile industry of Pakistan is considered by many as the most innovative

industry of Pakistan. Innovation means introducing new things or methods, and the

mobile industry has kept this promise by introducing new and innovative services

for years.

In recent years, most of the innovative services have been introduced by Telenor;

these services being innovative took the Pakistani market by storm and have

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become part of our daily lives. Examples of these services include Easyload and

Smartshare. Although Telenor is seen as the most innovative company right now, we

cannot diminish the contributions of other competitors to the Pakistani mobile

industry. Some of the innovative services introduced by the different service

providers are as follows:

Introduction of dynamic SIMs by Ufone

Introduction of GPRS capabilities of Ufone

Introduction of voice controlled services by Mobilink

Introduction of Bundle SMS packages by Ufone

Introduction of voice SMS by Telenor

Introduction of emergency credit buying by Mobilink

Introduction of dedicated website for downloads by Warid

Introduction of credit share by Telenor

Introduction of BlackBerry services by Mobilink

Introduction of mobile television by Telenor Introduction of caller tunes by Mobilink

Introduction of backup of contact lists by Ufone

These and many more services have helped make the mobile industry what it is

today. With innovations, being the hallmark of the mobile industry of Pakistan,

future prospects are bright. Also with swap of mobile operators becoming very easy

using Mobile Number Portability (MNP), and competition based on tariffs, innovation

becomes a must to create a competitive advantage. Furthermore, introduction of

3G services in the years to come would also increase the innovative service

provided by the mobile operators. Future innovation would take advantage of the

current network capabilities and additional benefits of 3G networks, including the

high speed data transfer services.

5 Department Worked During InternshipI did my 8 weeks internship at the cash management section of the treasury

department of Mobilink. The cash management section is one of the three sections

of the treasury department. The organizational structure extract of the finance

department can be seen in the appendix of the report.

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The importance of cash management is immense for a company, including Mobilink.

If at any time a company fails to payoff an obligation when it is due, because of the

lack of cash, the company is insolvent and insolvency is the primary reason firms go

bankrupt. Efficient cash management means more than just preventing bankruptcy.

It improves the profitability and reduces the risk to which the firm is exposed.

At Mobilink, the main responsibilities of the cash management sections include the

collection, concentration, and disbursement of cash. It includes its efforts of timely

collection of income from its major sales centers and franchises. Revenues attained

from international roaming partners are needed to be encashed efficiently as well.

Furthermore, paying off the liabilities generated through daily operations and

financing activities and finally developing short-term investment strategies for

Mobilink. Some of the activities done within cash management are as follows.

5.1 Activities Done Within Cash Management Department

5.1.1 Daily Activities

5.1.1.1Opening Cash Position

The opening cash position is created daily and contains the following sections:

1. Cash in hand: Contains the closing balances of all the major franchises and

sales centres of Mobilink. It is added to identify the amount of money that

would come into the bank accounts of Mobilink. There are more than 500

major franchises and business centres in this list.

2. Details: The details contain the major bank accounts of Mobilink. These

include the major current and saving accounts in which major collection

comes. There are more than 40 such different accounts. Furthermore some

accounts are for specific purposes, for example MCB account is used to paycommissions for the franchises and NBP-Mirpur is used to pay the taxes in

AJK. Furthermore different saving accounts pay different interest rates, Askari

Bank with the highest of 13.65%.

Other categories include the DSRA (Debt Servicing Reserve Accounts);

these are used for debt servicing of long term loans. These are saving

accounts, with the purpose of collecting money till the repayment amount is

achieved, after which, as a part of standing instructions, the following

collections are transferred to main saving or current accounts. Cash Margin

Accounts, these are lien marked accounts for specific purposes like credit

cards and different guarantees. Overdraft Accounts, these includes thenumber of accounts, with which Mobilink has overdraft facilities. Fixed

Deposit Accounts, theses are the accounts with which Mobilink has some

fixed deposits, if any. Short Term Loan Accounts, theses are the accounts

used when Mobilink wants any short term loans. Foreign Currency

Accounts, there is only one foreign currency account of Mobilink, which is

with CitiBank and is used for off shore marketing expenses and international

receipts. Sinking Fund Accounts, maintained by Mobilink, contains funds

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that are set aside to pay the license fee, paid out to PTA and Utility

Accounts, to pay utility bills of Mobilink are the other types of accounts.

3. Liabilities: In this section, major liabilities for the month are recorded in the

following categories: taxes, commissions, payroll, and repayment of loans,

roaming partners payments, payments against Form M and Link Direct

International (LDI), a subsidiary of Mobilink payments. The liabilities areupdated as needed, with amounts; bank used for paying off and date of

payment.

4. Cheque Float: In cheque float, the major liabilities of different vendors are

recorded. They are divided into three different regions, which include

Islamabad, Karachi and Lahore. The intimidation of the cheques released

comes from the accounts payable department, while the clearance coming

from daily bank statements. All payments of vendors are made from CitiBank.

5. LC and ICs: This section includes the Import Contract (IC) and Letter of

Credit (LC) payments that have to be paid out for the foreign transactions

that take place with Mobilink. The intimation comes from the Trade

department of Mobilink Treasury.

6. The Main and Forecast summary: The Main Summary includes both the

revenues and liabilities of Mobilink on a given day, while and the Forecast

Summary is made for the current & following month.

5.1.1.2Cash Transfers

The cash transfer take place every day and includes the transfer of collections and

payment from and to different banks. The major collection of funds takes place in

Allied Bank Limited, Habib Bank Limited, Standard Chartered Bank and United Bank

Limited. These banks receive the most collection on daily basis but pay less

interest, thus all collections from these banks are transferred to a bank that paysmore interest, currently transferring to Askari Bank, as it pays a better interest rate

of 13.65%. . Also transfer of collection funds from other banks can take place as and

when required by Mobilink. Furthermore all transfer of funds for paying off liabilities

take place from ACBL to the bank required. These transfers for paying off liabilities

take place as required, and are not usually on daily basis.

5.1.2 Occasional Activities

5.1.2.1Encashment

Occasionally, international roaming income is received by Mobilink from othercellular operators around the world. However as these receipts are in foreign

currencies and are thus needed to be encashed, on an intimidation from the bank.

Furthermore according to the SBP Foreign Exchange Policy, companies can only

keep 35% of the total foreign exchange earned in their foreign currency accounts,

the remaining 65% needs to be converted to PKR.

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5.1.2.2International Payments

Furthermore occasionally Mobilink has to pay for international roaming charges to

international cellular operators or other international payments, like paying for

training activities for Mobilink employees. Payments can either be made by debiting

the foreign currency account maintained with CitiBank or by debiting the PKR

account and obtaining foreign currency exchange rate against that amount andpaying off the liability.

5.1.2.3Account Opening

As needed, the department will open new accounts with banks as needed, which

could be for specific reason, for example the new HSBC overdraft account or just to

facilitate the vendors or franchises of Mobilink. Furthermore requirements with

current banking accounts are changed as and when required, including the interest

rate offered, lien marked and overdraft facilities. Document required for account

opening are as follows:

1. Account opening form duly signed by the CEO2. Request letter on company letter head

3. NTN Certificate

4. Certificate of Incorporation

5. Memorandum and Article of Association

6. CNIC and Passport of all Board of Directors and Signatories

7. Signature cards signed by all signatories and stamped

8. Form 29

9. List of board of directors

10.Board resolution

5.1.2.4Credit CardsMobilink provides corporate AMEX card to directors and above. Activities regarding

credit card applications, their payments and limits enhancement etc are handled by

the department.

5.1.3 Month End Activities

5.1.3.1Interest Income Sheet

The interest income is calculated for those accounts that either pay interest semi

annually or on the 1st of each month. There are total 8 banks in this list, including

Bank Alfalah and NIB. Furthermore this includes the TDRs booked by Mobilink. Allthis information is passed onwards to the accounts department of Mobilink.

5.1.3.2OD Sheet

Mobilink takes on overdraft facilities daily from different banks, which gets off set

from the collection, however sometimes it is not offset and remains outstanding. On

the outstanding amount, interest payments are to be paid and are calculated at the

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month end and passed on to the accounts payable department. However the actual

payments are made on quarterly basis while accrual is calculated on monthly basis.

5.1.3.3Calculation of Cash Flow Statement

Cash Flow Statement consists of three major parts:

1. Capex (Capital Expenditures)2. Opex (Operating Expenditures)

3. Financial Charges

Revenue information is received from the revenue monitoring department (Finance

Operations) bifurcating the total revenue earned form postpaid and prepaid

connections. Average revenue earned is 7-8 Billion PKR. Furthermore information

regarding financial charges is taken from the financing department of Mobilink

Treasury.

5.2 Tasks Performed During Internship

5.2.1 Daily Activities

5.2.1.1Creating Opening Cash Position

Updating the balances of the major current and saving accounts maintained by

Mobilink, these include accounts maintained in CITI, DB ACBL, ABL, HBL, SCB, UBL,

MCB, NBP, NIB, FBL and RBS. Furthermore balances are also taken of accounts from

whom any payment may be due, to assess the funds, to be transferred on the next

day. Some accounts are to be adjusted like SCB account is to be adjusted to the lien

marked amount.

Updating the cheque float, this includes adding new cheques released on that day.

The information of the new cheques released, is received from the accounts payable

department and then using the DB direct & CITI banks website to see the cheques

that have been cleared from the CITIs current accounts maintained in Islamabad,

Lahore and Karachi. Furthermore, updating the cash in hand section as and when

information is received. The information is received from the operations department

within the finance department, and as the information of more than 500 franchises

and sales centers is not easy to get daily, the information is only updated 2 or 3

times a week.

5.2.1.2Cash TransfersAfter calculating the amount of liability to be paid out from various banks on the

following day, transfer letters are prepared to transfer funds to the bank in which

they are required. Furthermore, all major collections, that comes from four major

banks, which includes Allied Bank, United Bank, Habib Bank and Standard

Chartered, is transferred to Askari Bank daily. The instructions for fund transfers are

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on the same day pay order basis and all instructions to the banks are forwarded

through fax and then confirmed.

5.2.1.3Other Activities

Filing the photocopies of the transfer letters that were faxed daily was another task

that I performed. Furthermore original transfer letters were also needed to be sent

out to the respective banks and also updating the payments file daily were some of

the other tasks performed daily.

5.2.2 Occasional Activities

5.2.2.1Encashments

As soon as Citi bank provides us with a notification on an encashment, a conversion

rate is asked, to convert the 65% of the total amount to Pakistani rupee. When the

bank provides us with the detail, an inward remittance rate sheet is made, which

shows the total remitted amount, the 35% and the 65% amount of the amount, inboth foreign currency and Pakistani rupee. Furthermore a letter to Citibank is also

made, issuing them the authority to convert and transfer the 65% of the

encashment into the account and also transferring the 35% of the amount to the

dollar account of Mobilink.

Lastly a Form R is made to notify the SBP that 65%of the total amount has been

converted to Pakistani rupee, as stated by the foreign exchange ordinance of

Pakistan and lastly all the above letters are attached, with the original notification

letter and then sent to Citi bank to go through with the transaction. As part of my

internship, I had to make all these letters and then send them to the bank.

5.2.2.2International Payments

As stated earlier, international payments are made either on international roaming

charges or international charges made by the different departments of Mobilink.

As soon as our department receives the Payment Authorization Form (PAF), which is

used for inter department expenditures and approvals, with the completion form

and the original invoice, a payment order and a purchase requisition or the original

invoice for non departmental expenditures, the department issues an letter to the

bank for the payment, including the amounts and all banking details like the SWIFT

No, beneficiary bank name and the account title.

Furthermore a Form M is also submitted to bank, which gives them the authority todebit our PKR account and buy the foreign currency at a conversion rate agreed.

These letters are then forwarded to the bank, for the transaction to take place. As

part of my internship, I had to make all these letters and then send them to the

bank.

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5.2.2.3Account Opening

Mobilinkoften open accounts as to help out with operation, including, during my

internship with Barclays and UBL. As a task, all the main items were provided to the

banks. The main items provided to these bank included the Memorandum and

Articles of Association, Letter of Incorporation, Board Resolution, Form 29, which

shows tells about the director of a company and the NIC or passports of all thepeople in the board of resolution and NTN certificate. All these documents are

attested by the company secretary of Mobilink and are provided to the bank, with

the bank account opening form and request letter from Mobilink.

5.2.2.4Credit Cards

Credit card of SCB AMEX are provided to all directors and above of the company

and when they want to either increase their limits or wanted to give out advance

payment s into their credit cards because they were going abroad, or any other

expense, letter of authorization are sent to the Relationship manager handling the

Mobilink AMEX card. These letters of authorizations are made after discussions with

the HOD and his final signing of the letters. As part of my internship tasks, I had tomake these letters of authorization.

5.2.3 Month End Activities

5.2.3.1Interest Income Sheet

Each month all the banks to which interest was accrued are calculated. First all of

the bank statements for the period are collected from the accounts department and

then using the applicable rates, all the balances are added to the interest income

sheet and the interest income is calculated. As part of my internship, I had to

calculate the interest amount for the month.

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6 Identification of a Main Problem and Findings

6.1 Job Rotation and AdvancementThe main problem that I have identified within the treasury department as a whole

is the lack of job rotation within the department and not enacting on the job

advancement rules.

According to my findings, no official job rotation takes place within the treasury

department, even though the employees informally try to learn about the working

of other departments through their peers. They show keen interest in learning new

things as all the operations within the department are interlinked.

Furthermore the only time, officially, when an employee is told about the working of

another part of the department, is only when he is moved to that part, for example,

when an employee initially working for trade department is transferred to off shorefinancing because of shortage of employee. This learning should not be considered

as a job rotation, because this shift is permanent for that given employee.

Furthermore, at Mobilink, the rules and procedures for job advancements are laid

out however it has been seen that junior executives, especially those at associate

level are not promoted to specialist levels, even though they have fulfilled the main

requirement- years of experience with Mobilink. This creates dissatisfaction within

the employees.

7 ConclusionThe mobile industry has seen phenomenal growth over the year, showing growth

rate of more than 80% in 2007. This growth is not new to the industry, as previous

years have shown substantial growth as well. This growth is a direct result of the

increased competition in the mobile industry, resulting into better services at

reduced rate. Furthermore, this has favorably affected our economy as a whole,

generating revenues for the government, through direct and indirect taxation and

creating employment opportunities for the people. The mobile industry of Pakistan

is considered by a majority of prospective employees as the best industry for a job.

Although the mobile industry has seen substantial growth over the years, many

observers feel that the industry may become saturated and will show lower growthrates as a result of increased taxation and the general economic conditions of

Pakistan. Although the concerns may be valid to some extent, but with PTA,

introducing the 3G platform in the coming years and a major part of our population

still without mobile connectivity, especially in distant villages, there is still optimism

that the mobile industry will not become saturated and there is still place for

competition in the industry.

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Mobilink has been in operation since 1994, and since then has become the market

leader by providing its customers with the state of the art products and services.

Mobilink has for years enjoyed a good market share of the total industry; its current

market share is 36%14.

Even though Mobilink has been a market leader, for so many years, providing the

most technological advanced products and services, it has for a number of years

been facing strong competition from Telenor and Ufone, which has resulted in a

decrease of its market share. This has led Mobilink to a policy of diversification, by

introducing products like Mobilink PCO and WIMAX services. Although Mobilink has

diversified, it still is providing competitive products and services for its core

products-Jazz and Indigo.

Finally, internships are an important part of the academic program, as they provide

us with the practical experience during our academic career. I am very grateful that

I received an internship at Mobilink as it was a great learning experience on how a

multinational company works and further improved my skills of team working andcritical decision making.

8 RecommendationAs identified earlier, the problem that I identified was the lack of job rotation within

department and not enacting on job advancement rules and procedures. Some of

the recommendations to this problem are as follows:

Firstly I would recommend that the department officially start job rotation. The

major benefit of which would include even more motivated employees, with

enhanced skills.

One of the major arguments against job rotation is that without it, employees will

perform only one task and will become specialized in that particular job.

Furthermore, the argument also suggests, that with job rotation, only general

information is imparted to employees, not essentially helpful in doing complex

tasks. However, in todays business environment, multitasking is becoming more

and more essential and thus rotation becomes essential in making employees

multitask.

Furthermore, the organization structure of the trea

Documents

Mobilink Intrnshp Report