University of West London: Airtel Africa SWOT Analysis Case Study

This case study provides a detailed SWOT (Strengths, Weaknesses, Opportunities, and Threats) analysis of Airtel Africa, a major telecommunications provider operating in 14 African countries. The analysis examines Airtel Africa's internal strengths, such as its affiliation with Bharti Airtel, vast experience, and strong brand equity, as well as its weaknesses, including customer support issues and significant debt. It explores the opportunities presented by growing mobile user penetration and the rollout of 4G and 5G technologies in Africa. The study also identifies threats, such as increasing competition from international telecommunication providers, changing consumer behavior, and high spectrum costs. The analysis concludes with a discussion of how senior management can utilize the SWOT analysis to enhance productivity, improve telecommunication services, and make strategic decisions to capitalize on advantages and address existing problems.

Running Head: UNDERSTANDING BUSINESS 0
Understanding Business

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Assessment 2 Case Study
SWOT Analysis of Airtel Africa
SWOT analysis stands for Strengths, Weakness, Opportunities, and Threats; it explains the
market potential of a business and its effectiveness and helps in examining the areas of
development (Pesce, et al., 2018). It is a useful tool that can benefit a business in multiple
ways mainly to advance in the field of work operations by developing an intact strategy. This
analysis includes internal and external factors that can affect a business and its growth. The
internal factors are categorized as strength and weakness, whereas external factors are
categorized as opportunities and threats.
Airtel Africa has been active in the region since the last decade. It these years, it has grown
an infrastructure and immense network services in the 14 major African countries and has
established itself as a reliable and trustable company among the people of African countries.
Today, Airtel Africa is recognized as the second-largest telecommunications service provider
in Africa (Singh, 2018). In addition, in many countries, it either ranks as the number one or
number two telecommunication company. At present, it has a customer base of more than
100 million active users. As a leading telecommunications company in Africa, Airtel has to
continuously work towards improving the services while capping the prices of the voice and
data plans (Musyimi & Kariuki, 2019). Below is the brief SWOT analysis of this company,
that will illustrate the strength, weaknesses, opportunity, and threats that top management of
Airtel should check:
Strength of Airtel Africa:
Airtel Africa is one of the most preferred telecommunication providers among African
people. The main strengths of this company can be defined as:
 It is the subsidiary of Bharti Airtel which is recognized as the leading
telecommunication provider in the world. It is active in the field of mobile and fixed

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communication from the last two decades hence possess vast experience. It can help
Airtel Africa understand the customer requirement, and diminish the competition from
rivals.
 Airtel Africa has a vast management team consists of well-experienced people in the
field of telecommunications which have good knowledge and understanding of local
markets. It has been recently indexed under FTSE 250 in London Stock Exchange and
has high brand equity in the African market that many of its competitors lack.
 Airtel Africa is active in the region from 2010 and has actively worked in these past 9
years to enhance the infrastructure in all the major parts of the African countries.
Today due to the availability of services in the prime and rural high-density areas,
Airtel Africa has been successful to penetrate the market (Dhir, et al., 2019).
 Airtel Africa has an alliance with some of the major telecommunication services
provider like MTN Group that has more subscribers base. Airtel Africa has also
acquired Zain Africa and Warid Uganda operations that have resulted in the boost of
the customer base and revenue manifold.
 Out of the 14 African countries, Airtel Africa is either the number one or number two
services provider, and have a combined customer base of around 100 million.
 Airtel Africa is highly equipped with the latest network technology that differentiates
it among another telecommunications provider. It also offers digital wallet services to
its 100 million users that enables them to transact money globally without having a
bank account.
Weaknesses of Airtel Africa:
Airtel Africa is expanding the reach among new customers at a fast pace. To keep the process
working for the long run, it is building a strong infrastructure. But African countries are
emerging very rapidly, and are believed to the favourite hub for many international

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telecommunications providers (Vadra, 2018). To take on the rising competition, Airtel Africa
has to first improve the internal functioning. The major weaknesses of this company are listed
below:
 In the telecommunications market, providing active customer support is one of the
most important factors. It has been seen that customers often change their
telecommunication service provider when they are not satisfied with the quality of
customer support (Lovelock & Patterson, 2015). So, as Airtel Africa is a new entrant
in compare with other companies, in the African market, it needs to expand the
support operations exponentially.
 Airtel Africa has recently secured a loan of $ 2 billion in June 2019. Whereas, the net
revenue of the company stands at $ 450 million in the same year. Airtel Africa has to
pay a debt with an annual interest of approximately $110 million. This can block the
company from expanding its operations at a fast rate, and competitors can leverage
this situation to take advantage of the situation.
 African countries pose a very low mobile user penetration rate. This may extend the
cost of the operations of Airtel Africa, and to acquire the new buyers, it is necessary
for the company to draw the new buyers with cheap and reliable plans.
Opportunities for Airtel Africa
As a leading telecommunications service provider in the 14 African countries, Airtel Africa
has many opportunities that depend on the external factors which can affect the growth of the
company (Epstein, 2018). Some of the primary opportunities are highlighted below, by taking
advantage of these, Airtel Africa can grow and become more productive.
 The mobile user penetration in the mobile telecommunication sector in African
countries today stands at 59 per cent. It is forecasted to grow by 70 per cent by the
end of 2023. Airtel Africa can use this opportunity to leverage new users and grow its

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mobile subscribers. This will help this company to increase its establishment and
boost the revenue as well.
 The number of 4G users is also expected to take a leap. Airtel Africa is equipped with
upgraded technology that enables high-speed internet at a very low cost (Sánchez &
Carro, 2017). This can be used to influence new mobile users and increase subscribers
as well.
 5G technology will debut in African countries by the end of 2019. Airtel being a giant
in telecommunications service can leverage this opportunity to connect with the next-
gen mobile users. The penetration of Airtel Africa into the 5G channel will help it
stand out from another telecommunications provider.
 Airtel Africa is number one or number two telecommunications company in many of
the African countries. By expanding the outreach and enhancing the services Airtel
can increase the customer base in countries like Kenya where it has around 9 million
subscribers out of the total of 38 million mobile users.
Threats to Airtel Africa:
African countries have the inclusive scope of growth in the field of telecommunications; with
the availability of smartphones at very affordable prices as low as $50, it is estimated that
mobile users will increase manifold (Wasserman, 2018). It presents a threat to Airtel Africa
as its competitors are also eyeing on this opportunity. Hence this company needs a
contingency plan to tackle some of the threats that are explained below:
 Low user penetration in the telecommunication market and high competition from
rivals make Airtel Africa vulnerable to the changing trends in the industry. Also, in
the past decade, African countries have grown as a big hub for mobile services users.
Due to which, many international telecommunications service providers are eyeing on
the emerging African market.

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 Airtel Africa has a consumer base of 100 million users and ranks as the leading
telecommunications company in the 14 African countries. But, with the change in
consumer behaviour due to external factors, like cheap data plans from rivals can
influence the users to switch to them.
 The high cost of the spectrum can force Airtel Africa to increase the prices of the
plans and maintain the cost of operations. This can also be a major factor that will
promote people to search for another telecommunications service provider.
 5G is about to emerge in the African countries, Airtel Africa being a leading
telecommunication company has to actively buy the spectrum as soon as possible
(Skouby & William, 2017). But, 5G spectrum may also attract the leading
international telecommunication organization to invest in the emerging African
market. This may escalate to the entry of new competitors and can affect the 5G
operations of Airtel Africa.
Critical analysis of how the SWOT analysis might be used by the senior management of
the organisation.
SWOT analysis provides an opportunity of take a whole team together and encourages
participation development of the team in the strategy of business. As a planning tool it
promotes the understanding between the team members, of serious issues bearing on the
success of the organization and develop awareness among the workers. It can be used as a
part of the strategy review in the annual plan of the organization. It can used to reacting and
responding positively to the environment changes for the organization. It explores new
initiatives by focus on the efforts of the employees and resources, then redirect them. It works
as a part of crisis and emergency planning and develop a performance of individual.
The SWOT analysis can be used by the senior management of the Airtel Africa company for
understanding the strengths and weaknesses that can be leveraged to reduce the impact of

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threats by handling opportunities in the right way. This will help in enhancing the
productivity and telecommunication services in the African countries. Senior management
should use the SWOT analysis to help the whole organisation or an entity to gain an
understanding of the current or future status with reference to its stated goal or in the
marketplace (Phadermrod, et al., 2019). This can help the entities to see the viable advantages
and positive views so they can develop the plans to capitalize them, and also help in address
the existing problems of deficits. Decision-makers will be able to determine whether the plan,
product or project is practising good and verify the requirements to make it profitable and
successful by identified the SWOT factors (Fernandes, 2019). This analysis intends to help
the entity or an organization to utilize its resources with its viable environment.

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