BSNL to be split into zones in pvt sector style
Communications and IT minister Kapil Sibal wants the management of Bharat Sanchar Nigam Ltd to run the struggling state behemoth like a private company and has formulated a new structure in which frontline regional units will have heads with financial accountability. Manoj Gairola reports. Minister minds the managersindia Updated: May 25, 2011 21:42 IST
Communications and IT minister Kapil Sibal wants the management of Bharat Sanchar Nigam Ltd (BSNL) to run the struggling state behemoth like a private company and has formulated a new structure in which frontline regional units will have heads with financial accountability.
Under the new system to be implemented from June, the performance of all the circle heads of the company would be measured in terms of gross revenue earned by them.
The nationwide market has been divided into four zones, with each director on BSNL’s board zone responsible for a zone.
The new plan, orders for which will be announced on Thursday, somewhat resembles the “baby Bells” that emerged in the US when the old Bell Telephone monopoly was broken up in 1984 by the Washington government.
BSNL’s revenues have been falling for the last five years. The company had revenues of Rs 40,177 crore in 2005-06 which dipped to Rs 32,045 crore by 2009-10 when it posted a loss of Rs 1,823 crore.
Though its revenue is not available on its website, the company’s revenues is likely to fall further in the financial year and would be below Rs 30,000 crore and the losses are also expected to increase.
With financials ebbing, the focus is on making circle-wise chief general managers (CGMs) responsible for business.
The circles have been divided into three revenue-wise categories – those with less than Rs 1,000 crore; those with Rs 1,000 crore to Rs 2,000 crore; and circles with revenueshigher than Rs 2,000 crore.The company would measure monthly performance of each CGM. If a CGM is ale to increase revenue of his circle by more than five per cent compared to same period last year, then he would get posting of his choice, with an "excellent" rating by the chairman and managing director (CMD).
But, if the revenue in a circle dips by more than 10 % it will get a poor rating and errant managers will suffer.
Currently, all the heads of circles report to the CMD. Now, they will coordinate with the assigned directors. Rewards will be clearly linked to performance.