Assignment on payment process and Investment decision of BTS at Robi

Executive Summary

As a under grade student of BRAC Business School, it is necessary to join with a company for

gaining the practical experience of the theoretical know how’s and I got the chance to join Robi

Axiata Limited, one of the renown telecom companies of Bangladesh to do my internship

program. In these three months of internship period I got the opportunity to work under different

section of the finance division and learn the new tasks in the new environment. Along with

gathering the practical experience I have also prepare this report on BTS Investment Decision

and Payment Process to complete the internship procedure. This report is combined

information of the experience on Robi Axiata Limited and what I have learned and came to know

about the BTS investment Decision and payment procedure from personal learning and shared

knowledge. BTS investment decision is a major decision for any telecom industry and Robi

Axiata Limited is not an exceptional in that case rather to hold its current position or improve the

position in the market Robi Axiata has to take this decision more wisely. It is not that easy task

to make such big decision, there is long process involves in it. Although there is a yearly budget

prepared in advance for investment in this sector each year, but any emergency need can affect

this predetermined budget. Mainly the demand for a new investment occurs for two reasons like

to improve present network quality or to increase the coverage area. Whatever the reason is the

investment decision cannot be approved without a proper investigation, survey and analysis.

Before taking such decision the departments of Market Operation, Finance and Technology have

to work so hard to come up with the ultimate conclusion. Basically the need can be identified by

either Market operation department or technology department or by both of the departments.

After proper analysis by these departments the decision making is leave up to the finance

division after cross checking all the pros and cons if the output from the new investment is

satisfactory only than finance department approve the investment decision. Otherwise they have

to look for the alternate decisions of the BTS investment. Once the decision is made for

investment then technology department along with the help of other departments makes an

agreement paper with the owner of the plot which is selected after site investigation for making

the BTS plant. And after all the procedures when the agreement is finalized, the construction of

the plant is started with the enlisted vendors for this task under the supervision of the civil

engineer of Robi Axiata limited. And the vendors are bound perform the task as per their contact

agreement with the Robi. And after work competition of the plant the vendor will make draft bill

and send to the Robi Axiata Limited if the supervising engineer approved the vendors work then

the vendor will be eligible to forward the final bill as per draft bill. But if the supervisor is not

satisfied or find any mismatch between the written and actual work. He will notify to make the

final bill as per the receiving amount of work By Robi. After all the procedure of the finance

division the payment of bill will be transferred to the vendor. Previously in Robi Axiata Limited

there was no systematic way to make the payment process. So there had always been chaos and

miscommunication regarding this issue as well as made payment process lengthier. Which

caused of harass for both the company and vendor. But now Robi Axiata limited is using their

OSO service for making this process easier and harass free. After making the improvement in

their previous system now Robi Axiata is enjoying a calm and quite system for making this

payment to the vendors. Although right now Robi Axiata Limited has not facing any significant

issues regarding their current decision making and payment process, from my observation there

are still some scope to increase the performance which can be made their decision making and

payment process system more stronger. Like in the decision making issues they can give a

second thought while analyzing the number of competition factor, or giving up the investment

decision in EPZ sectors or they may take initiative to introduce the local roaming facility for

decreasing the investment cost. Moreover they can make an online tracking process that will help

to know their updates more easily as well as their relation with the company will be more

transparent. Again they can take some initiatives to decrease the lead time of their payment

process to 30 days from 45 days. This can be helpful to motivate the company vendor

relationship without hampering the company’s structure. These are some little issues which Robi

Axiata Limited can consider for their future structure of the decision making and payment

process.

Introduction

Prologue:

Robi Axiata ltd is one of the major mobile operating companies in Bangladesh that has played

vital role in the mobile operation in Bangladesh. The company has always wanted to serve its

customer the best, so they have always focus on the imprudent of their network quality

throughout the Bangladesh. Base Transceiver Station (BTS) are the core element of the

development of any telecom network. Moreover, during the 3 months of working experience in

Robi Axiata ltd I have got the opportunity to know and work in some aspects related to the BTS.

Hence the report is all about how Robi Axiata ltd is making its decisions for the investment in

the BTS projects and how the invest process completed along with payment procedures

regarding the BTS investment decision.

Origin of the report:

BRAC University is one of the alleged private universities in Bangladesh which wants the

graduates come out from this university can maintain the international slandered so ithasdesigned

the curriculum of BBA program in such a way where the internship program is mandatory. After

completing 126 credits a student has to go for further 4 credits internship program in a

commercial organization. At this internship period at an organization the students get the

opportunity to learn blend his or her theoretical knowledge with practical experience through

facing the real business world. My academic supervisor Mr. Shawkat Kamal, Assistant

Professor, Coordinator of EMBA Program of BRAC Business School of BRAC University,

approved the topic and authorized me to prepare this report as part of the fulfillment of internship

requirement. The report thus is titled as “Investment decision and payment process of BTS at

Robi Axiata Ltd.”

Objectives:

Investment decisions in the BTS projects are very important for Robi Axiata limited as these

decisions can ensure the growth of the company, number of customers and revenue pattern.

Basically the objective of the report is to develop a model on where Robi Axiata Limited should

invest for a BTS considering some factors. Such as,

• reasons behind the demand of any new BTS

• the major factors that can influence the investment decision on BTS

• Does the investment in BTS can actually solve the problem

• the alternate decisions of not investing in BTS

• After finding the base of the decision making of BTS investment, my further objectives are to

find out:

How the investment process takes place

The associated parties with this investment

The vendor enlistment and payment process

Scope:

Finance department of Robi Axiata Limited is engaged in the various tasks but here in this report

I will be only focusing how the company takes decisions for investment in BTS, how the invest

process is implemented and how the payments are made related to the BTS investment.

Methodology:

During the 3 months of internship period at Robi Axiata Limited, I got the opportunity to work in

the Finance Transformation department and the Accounts Payable section of the Financial

Accounting and Management Reporting department. Besides getting the working experience at

finance department, I have made this report with the information available from the office and

websites under the supervisory of my onsite supervisor, Syed Asif Ahmed, GM Accounts

payable department of finance division.

All the information incorporated in this report has been collected from both primary resources as

well as from secondary resources. The primary data are basically gained from my direct

observations of these three months of working period, my on the job tasks and the shared

experiences and information from my seniors and colleagues from finance and technology

department.

Basically the report is considering two sectors of BTS. Like decision making process and

implementing the investment procedure and the payment process after the investment to the

respective parties. So for making this report mainly I have to go through the three major

departments of Robi Axiata Limited these are Finance Transformation for considering the

decision making process, Technology department for investment process and Accounts payable

Department for payment procedure. But none of the department is managing this process

individually rather all of them are working as a team for completing the whole process of making

the decision to clearing the payment.

At first I had to go and meet Mr. Mosharraf Hossain, specialist, Technology department and take

his interview on how Market operation and Technology department is identifying the needs, how

they are prioritize the new need and how they are taking steps for further decision making

process. I have also come to know from him that how technology department continues the

investment process once the decision is approved by Finance Transformation.

Then I meet with Mr. Afzal Rasul, General Manager of finance transformation who also shared

his experience with me and moreover I got the chance to work with him and learn practically

how they are analyzing the business cases. So from my practical experience and congregate d

experience from him I made the decision making part.

After that I have to meet Ms. Rawshan Akhter, specialist, Accounts Payable section who helped

me to know the agreements are making and also how the operating expenditures related to this

invest are made and controlled. I have also got the chance to work with her and get the practical

experience also regarding this process. Then I met Mr. Salahuddin Hossain, whom I got the

chance to work with, he had brief me about the whole process regarding the Capital expenditure

of BTS investment, using both his experience and my observation I made the report Beside this I

also have to go through the treasury section, OSS service, SCM department and the different

wings of technology department for more detail regarding my topic.

And the secondary data are collected from the Robi Axiata ltd’s official website, public website,

and official documents of the Robi Axiata Ltd.

After accumulating all the information together I used simple qualitative methods to analyze

them to prepare this report.

Limitations:

I have tried my level best to make report flawless as much as possible but due to some

limitations and obligations had to conciliate a little bit, this are-

•  A period of three months is not enough to understand the complete picture of such a huge

process. As a result due to the short time period I got a limited opportunity to work only few

parts of the process practically.

•  Company has their own limitations to disclose some of their confidential information.

•  Available published data was very limited.

In spite of these limitations, sincere efforts have been made to fulfill the findings & objectives of

this report as an effective one.

1Company overview:

Axiata Group Berhad is one of the largest telecom companies of the Asia, which has started its

operation in Bangladesh back in 1997 as country wide GSM solution provider is the joint venture

between Axiata Group Berhad Malaysia holding 70% of its share and NTT DOCOMO INC,

Japan holding the rest 30% of the shares, was previously known as Telekom Malaysia

International (Bangladesh). It has started its journey in Bangladesh with the brand name Aktel

and grabs a large portion of the Market of this industry gradually. Later on in March 2010 it was

renamed as ‘Robi’ and the company came to be recognized as Robi Axiata Limited.

Logo and Slogan of the brand:

The telecom brand now Axiata Bangladesh limited now is known to is customers and people As

“Robi”. The bangle word Robi means “the Sun” which is the source of all power,

complementing its name the slogan of the brand is “Jole Uthun Apon Shokti Te...” which is

actually emphasizing the empowerment of the people.

It means Robi will empower their customers and enable them to make a better life. They believe

that, “We are there for you, where you want and in the way you want, in order to help you

develop, grow and make the most of your lives through our services.” They also believe that

“We will keep our promises and deliver. We will innovate, execute fresh ideas and as a

nationwide organization, we will be respectful of our customers and stakeholders.”The Alpona in

the logo is vibrant and modern. It has a very organic soft feel at the same time as providing a

forward moving direction that is interpreting the sign of positivity and focus. The lack of sharp

points and use of large curves provides a feeling of warmth and friendliness. As well the Alpona

is very close to the root of Bangladesh which also simplifying its slogan.

3 Principals of the company:

The company is standing on the eight major principals under the two aspects. Such as;

Principle statement defines how people want to behave with each other in the organization.

These statements are about how the organization will value their customers, suppliers and the

internal community. Robi believes no matter what they do in order to realize their purpose their

employees hold themselves accountable to the following guiding Principles for the organization.

1. The company will be respectful towards everyone.

2. It will be trustworthy by action. As well as will be passionate and creative in all they do.

3. They will keep the things simple in the way of doing things.

4. They will always be ethical and transparent.

5. Demonstrating individual and collective ownership.

6. They believe in an open culture in communication and interaction.

4 Achievements:

Robi has achieved so many awards and recognitions for its brilliant performances in different

sectors in the past few years. And Over the top in the last two years it has also achieved,

The prestigious Frost & Sullivan Asia Pacific ICT Award 2010 for “Emerging Market

Service

“Star News HR EXCELLENCE AWARDS FOR INNOVATION IN HR”.

Re-assessed and rewarded with ISO 9001:2008 certification, Robi received this

internationally renowned Management Standard after complying with all requirements.

5 Products and Services:

Robi is offering two types of product to the general subscribers based on the subscription

category. These are:

Pre-Paid package:

Robi Pre-paid is continuously offering new features and plans to provide absolute freedom to the

subscribers. Robi offers a single Pre-paid package with different tariff plans to meet different

types of needs of their customers which includes easy and multiple migration facility from one

tariff to another. Tariff packages are as follows:

Muhurto, Shorol, Nobanno, Goti, Robi club, Robi prothom, Robi Shasroyee

For the entrepreneurs Robi offers a different package likeUddokta and Easy Load Tariff.

Post-Paid package:

Robi offers a small number of worthwhile Post-paid Packages like, Simple plans, Normal plans.

Robi’s post-paid product comes with various packages. Robi Push mail is a secure and reliable e-

mail solution at an affordable price. Now customers can work as if at their desktop from

anywhere. Customers can know their bill information through Web Bill, E-Bill, SMS, USSD and

Customer Care Center.

Other services: Beside the prepaid and post paid packages Robi also beneficiate its

customer by providing –

Robi Corporate: A cutting edge technology providing the ultimate solution to

 The chain of command of Robi is clear, but the company always maintains an open relationship

throughout the chain. That means without any barrier employees are free to communicate

directly across the hierarchy.

And the different divisions of the Robi Axiata Limited are:

• Finance

• Market Operation

• Technology

• Corporate strategy

• Human Resource

• CRL

• Administration

• EPMO &
• Ethics office

And the wings of the finance division are:

Competition Analysis:

There are only few competitors in the Bangladesh telecom industry but there is strong neck to

neck competition among them. Although Robi has achieved different awards for the performance

in the last few years but still it has to fight strong to hold its market position. When Robi entered

in to the market its only competition was the Grameen Phone Ltd (GP) which was the market

leader since that time. But later on after the entrance of Banglalink of Orascom telecom the

market revolt very soon and Robi had to come down to the number three position from the

second position. Till then Robi has to fight with the market leader GP, follower Banglalink as

well as the other mobile operators who are just behind its position like, Airtel of Airtel

Bangladesh limited, Citycell of Pacific Bangladesh Telecom Limited, Teletalk of Teletalk

Bangladesh Limited

According to the 2010 data of BTRC the market position based on the number of active

subscribers of the mobile operators are, GP is the market leader, and then the second position is

of Banglalink, after that Robi followed by, Airtel, Citycell and teletalk.

To give neck to neck competition to each other the mobile operators are coming up with new

packages, tariff plans and other benefits to their customers’ continuously. And the prices of their

packages are also more or similar to each others. Thus the prices of the Pre-Paid packages are:

Experience at Robi Axiata Limited

On the job Responsibilities:

I am lucky to get the opportunity to work at Robi Axiata Bangladesh limited for 12 successive

weeks as an intern at the finance division. In this short period of time it is not possible to go

through all the wings of finance division deeply. Yet I got the privilege to work under the two

wings of finance division; the finance transformation office and the financial accounting and

management reporting departments.

Finance transformation office is a new wing of Robi Axiata Bangladesh limited. That is basically

involved in the all kind of decision making of the projects for any division of Robi by cost

benefit analysis. Apart from that it is involved and associated directly with the other division of

the Robi for making all the investment flawless in effective and efficient way. In this department

I got the chance to work with Mr. Zafrul Hassan, Executive Vice President of finance department

and Mr. Afzal Hossain General Manager finance transformation office as team. Here I was

assign for analyzing the business cases came to the transformation office and help my team to

come up with the ultimate decision for investment in any projects. Like analyzing the decision

making criteria, then compare the cost and revenues and finding out to the NPV, IRR of the

projects to make the final investment decision of different business cases. I have work in some

business cases related to BTS, IBS investment decision which basically helped me to me this

report as well.

Later on I got the opportunity to work in the financial Accounting and management reporting

department in Accounts Payable section in the team of Syed Asif Ahmed, GM Accounts payable

department. Here all kinds of payment procedure are done in this section. Here I got the chance

to observe the whole payment process of any BTS investment decision very closely that was

very effective for me to make this report. I got the prospect to learn the accounting-journals

practically, which previously I learned in theories. Again I was regularly engaged in updating the

local capital expenditure information which is needed to be ready for the quarterly auditing

purpose.

Abstract of job experience:

Journey of Robi Axiata Limited has bought a completely different experience in my life which I

have never obtained before. In the beginning it was so easy for me to adjust in totally a different

atmosphere which was completely opposite of my student life. Gradually I observe the situation

and get to relate with it. From this journey I came to know how to deal with the situations which

may not be favorable always, how to behave adequately in their company, how to do own task,

how to respect other task, how to utilize the time and so on. In the three months I have go with a

strong routine of my daily task and which was monotonous sometimes, but yet I did not give up.

As By this time I was preparing myself mentally strong also by keeping my patience on. For me

it was too easy to hang around with my fellow intern friends in the free time but it was as much

as difficult to go the seniors to take their time to solve my issues. And I learnt to manage that

also. Everyone out of there was very friendly and overwhelming but yet they are very restricted

about their space. So it was my biggest challenge to be a part of them in a friendly manner with

respecting their space also.

My agenda was not only to do the work I was given to, but also do that error free, sincerely and

in time so the afterwards I can be recalled for my performances. It was not easy that in this short

period of time I will be known to all of the office colleagues but I am also happy that I could

successfully build some good and healthy relations with some of my colleagues from the

different departments by my hard work and behavior. And at the end of my internship I can say

besides giving me the opportunity to associate my theoretical learning with their practical

training, Robi Axiata Limited also helped me to grow more as personas as well as an employee.

Those will definitely going to enhance my learning in future.

BTS Investment Decision and Payment Process

Overview of the BTS:

Base Transceiver Station (BTS) is the major part of any Telecommunication infrastructure. The

increase number of this BTS ensures the higher quality service of network in the surrounding

areas under its coverage. So in the expand decision of any telecom company investment

decisions in BTS get the highest priority. Because depending on this investment decisions the

number of customers of that telecom company and its revenue pattern will vary. Robi Axiata

Limited also takes this decision in such way that can ensure its growth in number of customer

and revenue pattern. Currently, in all over the Bangladesh Robi Axiata Limited has at least 1

BTS in every Thana of Bangladesh.

Major parts of a BTS site are:

1.BTS- the core element of the site which cannot be shared with other operators

2.Tower/pole, Shelter/ room, Battery, Generator, rectifier- which can be shared with others

Budget for BTS investment:

In every year at time of annual budget preparation for Robi, the allotted amounts are fixed for the

BTS investment for the upcoming year. If in the upcoming year Robi wants to spread the

network more aggressively then the amount will be more than the previous year. Otherwise it

keeps almost similar amount on an average for the BTS investment every year. Generally Robi

does not exceed the budget for investment. But if in case there are any serious crises or

emergency need for BTS, Robi make the decision for cross the budget or not by holding the

meeting and group discussion among the Top level management.

Reasons behind the demands of new BTS:

Generally the demands for any new BTS arise for the two major reasons. These are:

To increase the indoor or outdoor network coverage and

To increase the capacity of current network coverage

The first reason, increase demand for the improvement of network coverage is generally

identified by the Market Operation (MO) Division. From their surveys of the customer

satisfaction, regional offices, or customers complains they come to know about the weak

network coverage. If the problem is beyond then certain limit then MO division informs the

technical department about the rising complains and asks to take necessary steps. And the second

reason demand for improving the capacity of the current network coverage is identified by the

technical department itself. After getting finding the demands for the new BTS the Planning

department of technical division goes for an analysis and makes a draft proposal considering the

cost and revenue to the Finance transformation Office (FTO) for the approval of the project.

Factors influencing the investment decision:

Basically the draft send to the FTO from Planning Department is more or less an assumption of

the future profit from the investment. But the planning cannot get in to the in-depth analysis

regarding the investment. So when FTO gets the proposal it goes for an in-depth investment from

the information collected through the MO department and Technical department and analysis of

the proposal for making the decision flawless. So after getting the proposal at first the proposal is

evaluate with some factors. Such as,

a. Demography of the proposed area for the new BTS: The demographic condition of the

proposed area has large influence on the investment decision like,

 i.Population size: the proposed are for BTS may have huge number of population

which may seems lucrative for future profit coming from that area. But in real the

population size will not matter as much as finding out the actual number of target

customer from that population is important. Like the target are may have 10000 of

population but among them only 3% are my target customer. Then investing in that

area will not prove a wise decision. On the other hand if the scenario is totally vise

versa, target customers are filling a large portion of the population then investment

decision will be a profitable one.

ii.Age break down: The target customers of Robi belong to the age group of 15 years

to 65 years. If the numbers of potential customers are large in numbers who are out

of network in the proposed location for BTS, then the investment decision should

be must. But if the numbers are not vivid like maximum people above 65 years and

below 15 years then there could be taken an alternate decision of investment of

BTS.

iii.Per Capita Income of the people: Per capita income of the people is one of the

major criteria for evaluation for investment is any new BTS. Because the proposed

area may have large number of target customers but they do not have the enough

capacity of income to spend it on the mobile. In that case the investment decision

will not be profitable. Like a area around Rangpur where target customer can be

high but per Capita income is not enough to spend on mobile. But if the existing

customers are large in numbers then the investment decision can be taken.

iv.Number of community location: If the community locations such as school,

college, university, office, shopping malls, mashjids etc are large in number then

the place will require a strong network as the number of user are large in number

then the investment decision should be taken. It can enhance the chance of increase

the number of new customers if the network and services are satisfactory in that

region. But if location does not have so much social gathering then an alternate

decision can be taken for the few customers.

b. Completion Analysis: Before any new investment the competition analysis is must.

Because base on this analysis the success of the investment decision can vary. Some

major criteria’s for evaluating the competition of the proposed area are:

i.Number of Competitors at that area: if the number of the competitor are small

in number in that proposed area the investment decision should be taken to grave

the potential market considering the other factors. But if the competition is high in

that area then also the investment decision should be taken to grab the

competitor’s customers by providing better service and network.

ii.Position of market share of the area: market shares show the position of Robi

subscriber in that particular area among the competitors. If the market share is

high at the proposed location but network coverage is poor than the investment

decision should be taken. Otherwise it can be the cause of lost of the exiting

customers. But if the market share in that particular location is not satisfactory

then before taking the investment decision the original reasons for the low market

share should be found out and the steps should be taken according to the

problems. And it may not require for a heavy amount of investment of BTS

always. Like,

Besides finding out the own lacking, finding out the reasons behind the

competitors strong market position can be another beneficial tool for the

investment decision.

iii.Market penetration: It means what is percentage of Robi subscriber of total

percentage using mobile phone at that particular region. Like 60 % of population

is using mobile phone at that particular area and only 20% of them is Robi

subscriber. So market penetration is 20% for Robi at that area. If this number is

low again need to find out the actual problem to come up with ultimate solution.

But if the number is high but still there is poor network coverage then definitely

need to improve the network coverage of that place.

c.Existing network quality of the area: To find out the existing network quality is

another important tool to determine whether there is any need for the increase of the

current BTS capacity or not. There are two criteria to find it out. These are:

Like network coverage of Robi is very poor in Cox’s bazaar or Sent martin’s island as well as

number of customer are also few or there can be a huge demand of networks only in few seasons.

Rest of the time of the year demand is below average. In such cases, such big investment

decision will not be profitable; hence the alternative decision s of BTS investment will be more

appropriate here.

After considering the above stated criteria’s, then the second steps requires the analysis of all the

direct, indirect costs and revenues, taxes etc related to the project considering all the small details

and find out the ultimate Net Present Value and Internal Rate of Return to find out whether the

project will prove actually profitable or not in the long run. If the results satisfactory only then

the projects are approved for the further process otherwise the project is stopped there and asked

to take alternate decision in spite of investment of any new BTS project. As the ultimate base

line of any project is profit earning. If the project fails to generate profit then there is no meaning

to engage such big amounts it those projects.

Alternatives of BTS investment: if the investment decision of new BTS is not profitable but

still there may be some need for improve network condition or otherwise there might be chance

of losing customer. In such scenarios the alternate decisions of not investing in BTS can be

taken. Like,

IBS: Investment in IBS inside Building Solution which is also known as micro

BTS can be an alternate solution at less investment. It has the power to increase

the network capacity lower than a BTS but higher than a Repeater. This can

extend the network capacity at Indoor as well as at some level to the outdoor also.

Repeater: Repeater is another alternate option of not investing it BTS. It has the

lowest capability to extend the network than BTS and IBS. It can only ensure the

strong network support at indoor. And sometime the capacity is limited to a floor

of a building. It can be used for only the network problems inside a building. it

grabs the signal from the nearest BTS and pass it on the other BTS where network

condition is weak.

Site sharing: if it is not possible to go for a whole BTS site for the network

improvement than, site sharing can be another option. Like if in an outdoor where

network is weak but a whole site investment is not profitable than company can

take the rent of other operator’s BTS site and install only a BTS over there. It can

solve the problem as well at lower investment rate.

Investment Agreement procedure: After receiving the approved project by the FTO, planning

department hand over the project to Site Procurement and Infrastructure (SPI) department of

technical division for the further process. Then the SPI department sends a team of 4 members to

the site for the survey and other details. Generally this team has members from-

department set the promising location for the site via GPS system. But often they found

that the location may not be suitable for the site at the field visit. In such condition

whatever the alternate decision is taken by the team, to monitor and allow that a member

from the planning team joins the team.

1 from SPI department: for identifying the most appropriate location for the site. If the

pre set location is not appropriate for the site like, it can be pond or EPZ area then they

cannot take the place. So for taking an alternate location from which the site will get

maximum advantage a member of SPI department joins the team. And the alternate

location can be-

1.Land: that will be called as Green Field site or

2.A building: that will be called a roof top site.

1.from civil department: for finding out infrastructure detail and identify the right

1 from finance department: for the negotiation of the rent and other issues. When all

department meet with the owner of the location for further negotiation. If it is a green

field location then Robi generally purchase the land for the site. But it is not possible all

the time. As the land can be a government land or the owner may not want to sell the land

in such cases, the want to take the lease of the land. Even taking lease is not possible then

they try to take Land for rent. Even the owner is not ready for the rent then they drop this

location and found another one. But if the owner is ready to sell / lease/ rent then the

further negotiation process proceeds according to the approximate value of the land of

that area. And after the negotiation the value for the rent/ lease or sell is set.

Once the rent is set, then the team made a Memorandum of Understanding (MOU) with the

owner of the land. In the MOU all the clause and policies are written in detail. Like detail

information of the owner, detail description of the property, rent, payment process( generally

yearly), advance amount, permission for making shelter/ room on the property, utility etc. after

that the team made a Technical Site Survey (TSS) report holding each and every single detail of

the site survey for the planning team. A TSS report includes the-

Once the TSS and MOU is made, these are send to the SPI department for making the internal

approval note and meeting minutes. Which includes the detail information regarding-

Objective of the projects

Summary of all the terms and conditions- demised premise, term of

tenancy, commencement date, expiry date, utility, termination clauses, etc.

Summary of negations and payment terms- negotiation committee,

monthly rental, payment schedule, and further payment terms etc.

Justification details

Terms and condition of the approval note

Recommendation of approval

After preparing these reports, these are approved by SPI department according to the Limit of

Authorization (LOA). Then the reports are sent to the accounts payable section finance division

for further process. After getting the reports finance verify the technical justification, Meeting

minutes, and approval notes. Then they open a vendor maintenance form with the detail

information of the owner of the property and cost center creation form with the detail

information of the site. Then finance compliance determines the vat, tax of the site. Like

After determining the vat and tax of the site, the information are inputted into the System and

create a vendor invoice for determining the payment sector. Generally these payments are done

under the heading of Site and space. Then printed invoice are sent to the LOA for approval.

After the approval of the invoice it is send to the treasury section for making the checks. In the

treasury section they deduct all the vat, tax and make check of the net amount and forward this

check to the SPI department. Then the SPI will meet again the property owner with check of

advance payment and 2 copies of agreement paper. After the signing the agreement paper by the

both of the parties the agreement will be valid and the rental period will be started.

Vendor Enlistment process: Basically for the BTS site the vendors are divided into 4 parts.

Owner of property: where owner of the property becomes the vendor after negotiation

vendor for the company..Company goes in a agreement with the vendors T least for 15

years divided in to 3 sections of each 5 years. If sites are profitable than the agreement

extends or if the site fails to earn profit the contract may come to an end with in the 5/ 10

years.

Civil work: for the civil work Supply Chain Management department give circular in the

newspaper for tender. Then SCM collect quotation from the Vendors. And after the cost

benefit analysis in a meeting they select the vendor panel for each segment. Like,

After selection of the vendor panel, company goes with the agreement with each of them

individually minimum for 1 or 2 years. And after every two years the agreement can be terminate

or renew with the existing vendors. Agreements includes all the details like, terms and

conditions, maximum duration to complete the work, delivery area mostly nearer zone to the

vendor to minimize cost, payment schedule, Liquidity and Assiduity Damage (LAD) etc are

written clearly.

Equipment purchase and installment: Robi mainly export the equipments from Hawaii

China, Ericson, Z.E.T. but the installments are done by the local vendors. It can be the

same vendor who will be doing the civil work or can be different vendor as well. But the

vendor enlistment process will be same for the local vendors.

Processes of making the site: once the agreement is made, planning department takes over

the roof of the building or the land. Then planning department decided whether to make room or

pre fabricated shelter depending on the property condition. In the mean while engineer from the

civil departments also check the building status and prepare the layout. And then the site is over

to the civil department for the further process.

After that civil department creates Purchase Requisition from the vendor list and send the PR to

supply chain Management Department. The PR consists of all the valuable details regarding the

site construction. And it is also clearly stated in the PR that what will be the maximum limit of

the payment for the vendor. Then Supply Chain Management selects the vendors from the

vendor panel, convert the PR to Purchase Order (PO) and send the PO’s to every selected

vendors. Again the PO has all the details including time duration for the construction work, who

will be the engineer in charge (EIC) etc. After that the selected vendors will go to the site and

start the construction work under the observation of the EIC. The EIC will monitor the whole

work and if found any work unsatisfactory, he has the right to stop and make them do it again.

Generally vendor gets maximum 45 days to complete the whole site. After implementation of all

the equipments the sites becomes on air and civil department handover it to the Regional Office.

Cost and payment process of the investment: the cost of the BTS sites are divided in to

two parts-

Payment of operational expenditure: After getting the proper documentation the first

check will be disburse through the SPI department. But from the second issue all checks

will go to the Regional offices from the Treasury department via OSS department. Then

the RO will deliver the checks in the respective sectors.

Payment of capital expenditure:

i)Price of land: if any private land is selected for the site Robi mainly purchase the

land. After the negotiation of the land Robi purchase the land following the general

procedure of land purchase. And the payment can be made on check.

ii)Equipment purchase and installation: the equipments are export from the particular

vendors that Robi has for each segment. And the whole purchase and payment

process is held on LC. And the associated banks with Robi for the LC are- CTN,

SCB, and EBL. But the payment of the local vendors are making through the One

Stop Service (OSS).

iii)Payment for the civil work: After the work completion the vendor submit a draf

invoice to the OSS department. After receiving the draft invoice OSS will input the

bill in the system under the particular vendor detail. And after checking SAP will

forward the bill to the respective department from where the PR was issued. And for

completing this task OSS will take maximum 2 days thus this civil work bill will go

to the civil department.

Then the Civil department will send the draft bill to the EIC (technology warehouse)

for the final verification. If EIC is satisfied with the draft bill he will sign and send it

back to the civil department. But if he thinks the actual work does not value as much

as the bill shows he will correct it according to the amount of good receive by the

company. Like vendor send a bill of BDT 700000 but EIC approved BDT 600000

after comparing the work. Then EIC will prepare the Good Receive (GR), Work

competition certificate and will send the paper to the compliance department. And it

may take maximum 15 days to complete this task.

The compliance department will check the price and rate of all the elements used in

the work and compare those with the vendor agreement, according to the agreement

vendors are bound to provide materials at the stated price. If the prices are higher than

the stated price then the company will not provide the extra charge. But if due the

market price condition price raise, then the vendor has apply in the finance

department for the approval note for the extra price. Otherwise vendor will be paid as

per as the contract. Then the time duration of the work competition will be checked, if

the work is not done within the time limit compliance will charge LAD and resend

the document to the OSS department. And it may take maximum 3 days to complete

this task.

After that OSS again check the draft bill scan and store the information in the SAP

and send the bill of BDT 600000 with valid reasons to the vendor for sending the

final bill. Again OSS gets only 1 day for doing this task.

After getting the draft bill vendor will send the final bill to OSS again. And they will

get 3 days for sending the final bill after getting the draft. Then OSS will send the

final bill to the Accounts payable division of finance department. After getting the bill

accounts payable will verify the final bill and the relevant documents. If there is any

need they will communicate with the compliance department for the explanations.

This process may maximum 5 days.

And then they will park the bill into the SAP system after invoice verification. Then

the parked invoices are posted by the Limit of Authority. After this posting the bill

will be approved by the system. Then the documents will be forward to the treasury

section of corporate finance for preparing checks against the invoice. And will take

another three days for parking, posting and forwarding the bill.

After check preparation according to the invoice verification by treasury department

it will be forwarded authorization signature. And then the check will be signed by the

respective authority and send back to the OSS. That may take maximum 5 days in

total Again OSS will inform the vendor that the check is ready and then vendor will

collect the check from OSS. And it will take a maximum a day for informing the

vendor.

Thus the total payment process will be incorporated within 38 days and considering

any delay it can take maximum 45 days to complete the process.

Recommendations

Robi Axiata limited is following a long but sound system for making the investment decision and

the payment process of the BTS, which is making the whole system easier. Each department has

their own work, so for a single project there are multiple departments are directly associated with

it. This is helping to reduce the working chaos as well as smooth the process. It is not easy to go

through the whole process in such a short time but yet after analyzing the whole process there are

only few spaces where I can suggest them for reconsideration. Like,

1. At the time of analyzing the factors before considering the investment decision, Robi

wants to invest in such places where competition is high as well as Robi’s market

position is weak. The issue is to snatch competitor’s customers. But I personally believe

that, It can be prove wrong as Robi is at the third position in the completion, where as it’s

two major competitors GP and Banglalink are in much better position with lucrative

packages. So before going with high investment set up new BTS plant in such areas Robi

should at least ensure that it will increase its customer. For that Robi can invest in the

new facilities, advertisements before such big investment. Otherwise it can go with the

alternate investment decision.

2.In the mobile industry of Bangladesh currently the operators are only allowed to share