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BSNL then known as the Department
of Telecommunications had been a near monopoly during the socialist period of
the Indian economy. During this period, BSNL was the only telecom service
provider in the country. MTNL was present only in Mumbai and New Delhi. During
this period BSNL operated as a typical state-run organization, inefficient,
slow, bureaucratic, and heavily unionised. As a result subscribers had to wait
for as long as five years to get a telephone connection. The corporation tasted
competition for the first time after the liberalization of Indian economy in
1991. Faced with stiff competition from the private telecom service providers,
BSNL has subsequently tried to increase efficiencies itself. DoT veterans,
however, put the onus for the sorry state of affairs on the Government
policies, where in all state-owned service providers were required to function
as mediums for achieving egalitarian growth across all segments of the society.
The corporation (then DoT), however, failed to achieve this and India
languished among the most poorly connected countries in the world. BSNL was
born in 2000 after the corporatisation of DoT. The corporatisation of BSNL was
undertaken by an external international consulting team consisting of a
consortium of A.F.Ferguson & Co, JB Dadachanji and NM Rothschild - and was
probably the most complex corporatisation exercise of its kind ever attempted anywhere
because of the quantum of assets (said to be worth USD 50 Billion in terms of
breakup value) and over half a million directly and indirectly employed staff.
Satish Mehta, who led the team later confessed that one big mistake made by the
consortium was to recommend the continuation of the state and circle based
geographical units which may have killed the synergies across regions and may
have actually made the organisation less efficient than had it been a seamless
national organisation. Vinod Vaish, then Chairman of the Telecom Commission
made a very bold decision to promote younger talent from within the
organisation to take up a leadership role and promoted the older leaders to a
role in licensing rather than in managing the operations of BSNL. The
efficiency of the company has since improved, however, the performance level is
nowhere near the private players.
