Maxis Berhad, with its consolidated subsidiaries (together, ‘Maxis’), is the leading mobile communications service provider in Malaysia with over 11.4 million mobile subscribers as of 30 June 2009. Maxis was granted licences to operate a nationwide GSM900 mobile network, a domestic fixed network and an international gateway in 1993. It commenced its mobile operations in August 1995 and launched its fixed line and international gateway operations in early 1996. Since its establishment, Maxis has been providing a full suite of services on multiple platforms to fulfil the telecommunications needs of individual consumers, SMEs and large corporations in Malaysia. Maxis’ mobile service is offered on a postpaid basis under the Maxis brand and via a prepaid format under the Hotlink brand.
The use of these two distinct brands, underpinned by synergistic values, has enabled Maxis to develop its prepaid business successfully while maintaining growth in its postpaid segment. Maxis has also pioneered and led the Malaysian market in delivering innovative mobile products and services. It was the first to launch 3G services in Malaysia as known as Maxis3G in July 2005, and in September 2006, it became among the world’s first to use HSDPA, a high-speed upgrade of its 3G network, to provide wireless broadband services. It was the first operator to bring the BlackBerry™ and Apple iPhone™ smart phones to Malaysia.
The company in April 2009 unveiled the first commercial NFC-powered service in Malaysia. Maxis provides enhanced postpaid packages to corporate and SME customers, based on its highly successful consumer postpaid plans. These plans are custom-made to meet the needs of enterprises, especially improved communications within and beyond their compound. Maxis’ international gateway services include termination of traffic into Malaysia from international telecommunications companies, supporting Maxis’ own outbound international direct dial (IDD) traffic, collecting international transit traffic and bandwidth leasing services.
A mission statement is a statement of the purpose of a company or organization. The mission statement should guide the actions of the organization, spell out its overall goal, provide a path, and guide decision-making. The mission of this Maxis company are :
* Malaysia’s leading mobile communications service provider
* The nation’s premier integrated communications service provider
Defines and describes the future situation that a company wishes to have, the intention of the vision is to guide, to control and to encourage the organization as a whole to reach the desirable state of the organization. The vision of the company is the response to the question of what do we want our organization to be? Corporative values are the answer to the question of what we believe into and how we are. The vission of Maxis Berhad is : To bring the future to our customers’ lives and businesses, in a manner that is simple, personalised and enriching, by efficiently and creatively harnessing leading-edge technology and delivering a brand of service experience that is reliable and enchanting.
An end that can be reasonably achieved within an expected timeframe and with available resources. In general, an objective is broader in scope than a goal, and may consist of several individual goals. Objectives are a basic tools that underlying all planning and strategic activities. They serve as the basis for policy and performance appraisals.
This is what Maxis stands for :
* We aim to keep everything we do as simple as possible. For example, customers understand what it is we are telling them because we do it in a way that is straightforward and easy to understand. We make things simple for everyone, including ourselves. Keeping things simple also means that everything we say is said in a clear direct tone of voice that is friendly and human.
* Trust is crucial in every successful relationship and this is true between customers and Maxis, just as it is true between the company and its employees. All good relationships are built on trust which inspires confidence, and, assurance, conviction and reliance. To be trustworthy is a way of life.
* Creativity defines us and therefore differentiates us from our competition. It inspires not only our communication style, but also how we answer the phone, design our stores, and deal with challenges. Creative runs through everything we do and everything we say, it’s in our DNA.
* To lead people into new territories we have to be brave. We have the courage to try new things, to take the occasional calculated risk, to go where our competitors have not been. It ensures that we stay at the forefront and that our customers benefit from new and better ways of doing things. It means doing the right thing, rather than the easy thing. It means having the courage of our convictions. Brave is the quality of a true leader.
Given this context within our corporate strategy, in 2011 we reviewed our existing activities and identified new initiatives to create a CR strategy with three pillars. Developing and enriching our community, customers and partners, creating a great place to work and, Advocating environmentally friendly practices. Maxis’ CR initiatives are governed by our CR Philosophies, which prescribe that the initiatives are aligned to our corporate strategy and CR Mission and create value to all our stakeholders. That is, the initiatives must have a positive impact that can be shared across Maxis, our stakeholders and the nation. 1. Developing & Enriching Our Community, Customers & Partners * Being a customer-focused organisation, with a large and complex supply chain, we are uniquely positioned to touch the lives of many people.
Our ambition is to make this contact an enriching experience for everyone. Simply by providing telecommunication connectivity to remote and rural communities, we can drastically improve people’s lives. But our reach goes further than that. We can offer better products and services to customers who have a choice of service providers. We can build and develop the communities in which we operate, through our Cyberkids Programme initiatives and scholarships. And, we take very seriously our responsibility to positively influence our supply chain so that it is healthier, safer and more sustainable.
2. Creating a Great Place To Work
* At Maxis, we have always said that our employees are critical to our success. We regard leadership as an essential part of our business, especially to fulfil our goals to be the premier integrated communications service provider in Malaysia. Therefore, we invest significantly in leadership development and training, as well as nurturing the talent of our employees. We value the diversity that colleagues bring, with individuals able to see things with different perspectives and fresh ideas. We have measures in place to ensure that our workplaces embrace this diversity. We think also that it is important to get the fundamentals of employment right: health and safety, and benefits and rights.
3. Advocating Environmentally Friendly Practices
* Our sector is evolving rapidly and a significant challenge for us is to keep ahead of the technology curve, whilst understanding and evaluating the sometimes unknown impacts of new products and services. We have to balance the demand for innovation with the responsibility to do no harm. In addition, we are committed to driving efficiencies in our operations in order to reduce our carbon footprint and to manage waste effectively. We also want to advocate this to our partners and customers.
GENERAL ENVIRONMENT ANALYSIS
The external analysis is critical for a firm to understand to be able to realize the opportunities and threats that exist in the industry they are competing in to help achieve a strategic competitiveness. The external analysis consists of a general environmental analysis, industry analysis, five forces analysis, industry competitor’s analysis, and the key success factors for the industry.
General Environment Analysis
In order for a company to effectively compete in an industry, an analysis of its specific industry must be undertaken. This is done to provide the firm with a description of the elements in society that directly effect the industry and the direction managers must take to implement appropriate strategies to survive. This study is commonly referred to as the general environmental analysis. It primarily consists of five primary factors, which are political/legal, economic, socio cultural, ecological, and technological or also known as STEEP Analysis. These five sections describe the external environmental factors a firm must understand to effectively compete in a specific market.
1. Social cultural Forces
* The sociocultural dimension is especially important because it determines the goods, services, and standards that society values. The sociocultural force includes the demographics and values of a particular customer base. Age, gender, and income are examples of commonly used demographic characteristics. * Maxis contributions is to the development of Malaysia must also go beyond paying statutory levies and the jobs their provide. Maxis have to address long-term strategic issues affecting the nation’s ability to grow. They are proud that Maxis is taking an active role in stemming the brain drain, which poses a threat to their progress as a society.
Maxis scholarships, aimed at their employees’ and customers’children, are designed to encourage young Malaysians to reap experience abroad, then come back to share those experiences and contribute to the future of their nation. * Maxis provide full coverage to markets across Malaysia, including Peninsular Malaysia, Sabah and Sarawak (both in Malaysian Borneo). Together with our subsidiaries, Maxis provides a full suite of communications services on multiple platforms to meet the growing needs of individual subscribers, families, small and medium enterprises, large corporations and the Malaysian Government
2. Techological Forces
* Technological forces influence organizations in several ways. A technological innovation can have a sudden and dramatic effect on the environment of a firm. First, technological developments can significantly alter the demand for an organization’s or industry’s products or services. Technological change can decimate existing businesses and even entire industries, since its shifts demand from one product to another. * Maxis was also the first telecommunication service provider to introduce a range of smartphones to Malaysia including the BlackBerry and the Apple iPhone. In 2010, Maxis set an industry milestone by building the largest 3G network with 76 per cent population coverage and by signing the landmark High Speed Broadband Access (“HSBA”) agreement with Telekom Malaysia Berhad as well as the infrastructure share agreement with Tenaga Nasional Berhad. As at 30 June 2011, Maxis 3G footprint coverage was at 81 per cent of the country’s population. In comparison with global mobile operators, Maxis is a leading provider of non-voice services.
3. Economic Forces
* Economic forces refer to the nature and direction of the economy in which business operates. Economic factors have a tremendous impact on business firms. The general state of the economy for an example depression, recession, recovery, or prosperity, interest rate, stage of the economic cycle, balance of payments, monetary policy, fiscal policy, are key variables in corporate investment, employment, and pricing decisions. * In 2010, Maxis invested more than RM80 million in network coverage, widening our footprint over remote areas of Sarawak, enhancing network quality in towns and suburbs in Sabah, and expanding broadband coverage to industrial and commercial areas in north Borneo, which is an underserved frontier. * During 2010, Maxis invested RM1.44 billion to build upon the significant modernisation first begun in 2009, expanding the reach and capacity of ournetworks and support infrastructure. Overall, Maxis capital expenditure was RM482 million in the first half of 2011.
4. Ecological Forces
* Ecological economics is a transdisciplinary field of academic research that aims to address the interdependence and coevolution of human economies and natural ecosystems over time and space. It is distinguished from environmental economics, which is the mainstream economic analysis of the environment, by its treatment of the economy as a subsystem of the ecosystem and its emphasis upon preserving natural capital. * Maxis efforts to reduce our carbon footprint began with modernisation of end-to-end network equipment for better energy efficiency.
Additionally, Maxis have adopted more energyefficient DC rectifiers and outdoor shelters which are innovative systems to manage heat in existing shelters and to drive down energy deployment. Maxis have also drawn on renewable energy solutions such as solar to replace diesel powered remote base stations and their have advocated network-sharing, with over 54% of our base station sites shared with other operators. Maxis efforts have been supplemented by tree-planting.
5. Political-Legal Forces
* Political and legal forces are two of the three most important aspects for a business, with social forces being the third. Politics is a changing scene, and the rules and laws will change not regularly but often enough. Political forces are governments and unilateral bodies that decree certain rules, regulations, laws or restrictions with regards the way a country is run. * The Group’s Code of Business Practice declaration applies to all officers and employees who are required to affirm on a yearly basis their commitment to observe the Code of Business Practice. It also provides guidelines for the manner in which all employees should conduct themselves in the workplace while performing their daily duties for Maxis and as a Maxis employee.
TASK ENVIRONMENT ANALYSIS
A corporation’s scanning of the environment should include analyses of all relevant elements in the task environment. Managers need to consider the competitive environment, also referred to as the task environment or industry environment. The profitability of the firm and the nature of competition in the industry are more directly influenced by developments in the competitive environment. Industry can be defined as a group of firms producing a similar product or service. The firm interacts with a more specific environment, the industry. Four main components that exert influence on industry are suppliers, competitors and potential substitutes, potential entrants and buyers.
Michael Porter’s Approach to Industry Analysis
The ‘five forces model’ developed by Michael E. Porter, has been the most commonly utilized analytical tool for examining the competitive environment. It describes the competitive environment in terms of five basic forces such as threat of new entrants, bargaining power of the firm’s suppliers, bargaining power of the firm’s customers, threat of substitute products, and intensity of rivalry among firms.
1. Threat Of New Entrants
* New entrants is newcomers to an existing industry. They typically bring new capacity, a desire to gain market share, and substantial resources. Entry barrier is an obstruction that makes it difficult for a company to enter an industry. Economies of scale, product differentiation, capital requirements, switching costs, access to distribution channels, cost disadvantage independent of size, government policy are examples of entry barriers. * New technology as we know communication technology are very fast and various (MMS, Mobile Portal, VAP, and 3G), compete by new entrants for examples Celcom and DIGI. Maxis come with Hotlink club and brand identity for teenagers. Maxis also come with 8 region of same rate calling rate 0.65 cents.
2. Rivalry Among Existing Firms
* Rivalry is amount of direct competition in an industry. Intense rivalry is related to the presence of the following factors which are number of competitors, rate of industry growth, product or service characteristics, amount of fixed costs, capacity, height of exit barriers and diversity of rivals. * Competition on price with another company Digi, Celcom, Internet phone.Compete also with the coverage and wide of services offered. IT take placed for Maxis to create a web that manage Hotlinkclub.com. provide customer loyalty by type of free services and activities. Besides that is Merge with TimeCel to come with more wide coverage.
3. Threat Of Substitute Products Or Services
* Substitute products which is products that appear different but can satisfy the same need as another product. The existence of products outside of the realm of the common productboundaries increases the propensity of customers to switch toalternatives. Its includes buyer propensity to substitute, relative price performance of substitute, buyer switching costs, perceived level of product differentiation, substandard product and quality depreciation. * For example reduce demand of Maxis services compete with Digi with new technology (internetTv and 3G). Besides that, internet charting and conferencing free service make Maxis enforced to reduce the service charge. Maxis improve the price by provided some free services like free sms and free football result.
4. Bargaining Power Of Buyers
* The bargaining power of customers is also described as the market of outputs and the ability of customers to put the firm under pressure, whichalso affects the customer’s sensitivity to price changes. Buyers can affect industry through their ability to force down prices, bargain for higher quality or more services, and play competitors against each other. * Price of SMS forced down from 0.60 cents to 0.01 cents. In fact, Maxis provide wide coverage in Malaysia by merge withTimecel. Maxis have a high technology server and satellite technology upgrade to capture the wide range of communications services.
5. The Bargaining Power Of Suppliers
* Suppliers can affect an industry through their ability to raise prices or reduce the quality of purchased goods and services. The bargaining power of suppliers is also described as the market of inputs. Suppliers of raw materials, components, labor, and services(such as expertise) to the firm can be a source of power over the firm,when there are few substitutes. * Price raised charge for satellite provided by Telekom. Maxis request more variety of services like MMS, 3G, mobile conferencing using more type of server at manyplace from northern Malaysiato the southern.
A SWOT analysis generates information that is helpful in matching an organization’s or a group’s goals, programs, and capacities to the social environment in which they operate. It is an instrument within strategic planning. SWOT analysis can be understood as the examination of an organization’s internal strengths and weaknesses, and its environments opportunities, and threats. Maxis Berhad started their operations in the year 1995 being the leading mobile communication service provider in Malaysia with more than 11.4 million mobile subscribers up to date. (Maxis Berhad, 2011)
SWOT is the acronym for Strengths, Weaknesses, Opportunities and Threats where it will be used to assess the business as it is important for companies to analyze SWOT on their companies. It will also be analyze in this report on how the strengths will be used to overcome the weaknesses as well as the opportunities overcoming the threats. Strengths and weaknesses will be analyzing on the company’s internal factors whereas opportunities and threats will be analyzing on the company’s external factors.
There are several main telecommunication in Malaysia comprising Digi, Celcom, U-Mobile and Maxis. As compared to the above competitors, Maxis’ strength is that Maxis had a wider coverage in most towns around Malaysia and also covers north-south highways. Also, compared with other competitors, the customer service quality is better in terms of efficiency. Maxis is one of the pioneer telecommunication companies apart from Celcom and has the latest technology HSDPA(3.5G) or Fibre-to-the-Home (FTTH) .
Competitors gain market share. Celcom has been rather aggressive over the past one year, and is expected to continue with this momentum. We are cognizant that Maxis’ market share may come under pressure. However, we think Maxis has turned the corners, and is on track to winning back subscribers and revenue market shares, now that it had reverted to the more popular 30-second charging blocks. Besides that, Maxis does not offer triple play of mobile, broadband, and pay TV. Growing enterprise business may entail more capex, and Maxis can only selectively grow its enterprise business.
Young demographics that is data hungry. 32% of the Malaysian population is under 15 years old, which is a prime target for broadband services over the next 15 years. New mobile devices, for example iPhone (“4G”) and recently launched iPad drive demand for broadband services. Under-served broadband population offers great growth opportunities. Selective enterprise opportunities as Maxis build backhaul capacity mainly for wireless broadband it can target some of the lucrative enterprise business using the same backhaul network. Potential for triple play if tie-up with content provider or broadcaster.
Digi’s launch of the iPhone last week could put further pressure on Maxis. Aggressive broadband promotions by wireless competitors, including WiMAX players. ARPU under competitive pressures. Adjustments to interconnect rates may pressure Maxis’ earnings as the company is a net receiver of calls.
Courtney from Study Moose