From the Middle East to the world: building a global telecom operator

Dubai, UAE, 5 April 2010 – Driven by its financial strength, and forced by increasing competition and market saturation have their own Gulf Cooperation Council (GCC) telecom operators unprecedented international expansion programs initiated in 2004 to life. Going global, however, comes with a new set of challenges. be the operator that most effectively address these challenges in the best position? to capture above-mentioned maximum value from their investment and earn a place among the world’s leading companies, according to a new study by Booz & Company.

Overcoming borders and break boundaries

Before 2004, the GCC was established combined operating in six markets outside their home countries. Today, that number at 78, with the government policy in the GCC countries, stimulating this drive for corporate globalization. Since the profitability and financial strength of the GCC operators have increased, so too has the competition in its home mar? Markets. This created a wave of globalization, as the operators seek growth through mergers and acquisitions. The reported value of GCC established “cross-border M & O Activities 2004-2009 more than $ 33,000,000,000th

Going global, however, comes with a new set of challenges. “The leaders of the GCC operators to successful global growth by ensuring that their companies are properly positioned sure to capture the maximum value from their international investments”, Karim Sabbagh, partner says at Booz & Company is the leading provider of business success communications, media and technology practice.

Building a solid foundation for globalization

As operators pursue global expansion, its market and operational footprints tend to develop in three stages: from a domestic focus to a regional focus to a global focus – most GCC operators are in the first two stages of this development. There are five types of challenges that the GCC operators in their quest to go fully address global: governance models, organizational models, management processes, values and culture need, and talent management.

Governance Models: a limited oversight to the strategic direction

Corporate governance is an ongoing challenge. “To succeed in global competition, GCC operators have to governance from its current oversight role to levy a fundamental mechanism for streamlining the strategic planning through its subsidiaries, which orientations and value creation within the whole group,” said Mohamad Mourad, a principal with Booz & Company . In the past, most GCC telecom operators in protected markets with high margins and little outside pressure to get results was. Consequently, some of these operators legacy systems of governance, which often hinder them, for they proceed as global.

To overcome the governance challenges of globalization to meet the operators of the remaining organizational challenges. There are a number of measures to help more effective corporate governance. GCC operators review and adjustment of the composition of their boards in the control by integrated more closely with the senior management of international subsidiaries. You should engage these leaders the opportunity to in strategic decisions at the enterprise level, and to standardize decision-making in the whole group.

GCC operators should also examine and redefine decision rights, create the right balance between control and autonomy in corporate headquarters in Toch? Iaries. “This will ensure that creating a clear decision, the rights of cement capacity at headquarters, implementation and enforcement of an important business objective imperatives, and provides sufficient? Cient authority for each international subsidiary, in order to make effective decisions based on local challenges within the parameters of the corporate imperatives, “said Sabbagh.

Finally, GCC should ensure operators that their corporate imperatives represented properly represented within its subsidiaries through the training of managers, which the company is on the boards of subsidiaries. These representatives must be able to recognize and analyze the problems arising in the subsidiary, and align it with the overall corporate strategy.

Organizational models: the obstacle for the Global Business Enabler

There is no single organizational model, the best thing for opera is GCC? Ren is looking for growth but will be magnified as they go global, to inefficiencies that currently exist in their organizational structures. These inefficiencies can also be wrong spans of authority, through layers of management and administration paternalistic models. The inability of support functions such as Human Resources and Shared Services to meet with global needs can also hinder growth.

In order to overcome organizational challenges, the GCC operators to restructure to support, integrate and manage global operations. While avoiding some redundancies and inefficiencies first, if there are aggressive expansion policy, should the central core functions that are appropriate to support and promote all subsidiaries will be developed as quickly as possible. “GCC operators should look for the global expansion also clarified the role of the Corporate Center, a careful assessment of the effectiveness of the central standardization and control of the effectiveness of local government,” said Mourad.

Standardized management processes: from the ad hoc Best Practices

As operators go global, they often need to improve the flow of information? tion to provide for effective decision making. To do this, they must be standardized, complete, integrate and institutionalize strategic management processes in a careful and measured way. Process challenges exacerbated if the operator does not take place already has effective management systems and processes, particularly the strategic and financial planning processes, as they start to expand internationally. Furthermore, as the operator of the acquisition of new operations, they also acquire the legacy systems and processes of the new subsidiary, to the systems and processes to be effective decision-frag? Implemented, and monitor the necessary information and to manage performance across the organization to support available.

To be successful, operators need GCC to develop and replicate best practices out at home and across national borders. “You should try to global standardization and its potential com-Balance? Competitive advantages with local adaptation and the ability to use local differentiation capabilities,” commented Sabbagh. As they integrate their processes and IT platforms with which to expand the acquired company, companies should also standardize systems and processes to allow a degree of local flexibility, while avoiding an overreliance on ad hoc initiatives. Periodic review to determine cycles.

Values and cultures: from a closed to an inclusive ethos

GCC operators are at various stages in the development of global corporate cultures. Many continue to redefine its old values and cultures, be inward and not easily adaptable to global organizations that can fight in different regions with different dynamics.

The value and challenges the culture of global expansion, should GCC operators established a corporate culture that can successfully cross boundaries. They should present their global presence to differentiate their own, non-negotiable values and properties, as well as national and corporate values, attitudes and practices to identify in its subsidiaries. You should recognize the diversity in their organizations, determine how to use it, and build relationships with key players in each geography. “Global operators should also find ways to engage employees in the organization and instill a unified sense of pride,” said Mourad.

Talent management: from a reactive to a proactive strategy people

“Go As a global company, their talent requirements become more complex with increased demand for skills and a lack of managers with enough international experience,” said Sabbagh. To meet the challenges of globalization talent and the right people in the right position, the operator should start by increasing awareness among GCC leaders and executives of the importance? Tung of talent management. To a successful, global organizations, the operators need to identify, measure and record the maximum value from their talent base. You should segment employees based on their impact on the performance of the organization, develop tailored value propositions for each segment, the balance business needs with specific segment needs, and this cascade over their people processes.

With this strategic base for talent is present, GCC will enable operators to create talent pools begin to fill international positions. They should determine a standard profile for coordinating international recruitment and secondment and recruitment efforts across geographies to achieve consistency. You should also get in the recruitment of executives to invest in a position to fill international positions prior to a particular need.

GCC operators should programs for the development of the design to the creation of the necessary skills in order to drive the performance in an international organization. They should also establish align employee compensation and incentive systems with its global objectives, consistent and objective assessment tools and processes. These programs and systems must be flexible enough to geographic, cultural adaptation and leadership style differences between the subsidiaries.

Finally, effective leadership succession strategy is critical to achieve continuous growth in a global organization. “GCC operators should identify high-potential leaders and their opportunities in high-impact initiatives that will prepare them for international assignments, and participate in the continuous monitoring of their contentment and the willingness for greater leadership role,” said Mourad.

Tomorrow’s world leader

Many operators GCC are looking for international expansion and growth, and some hope to a place among the world’s leading global enterprises demand. The operators that the best chance of achieving this are those who are able to successfully transform their structures, have to be systems, and processes by which their people effectively and efficiently perform and compete anywhere in the world.