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Myanmar state telecom carrier seeks private-sector makeover

Strong growth potential expected as mobile demand continues to rise

Myanma Posts and Telecommunications, Myanmar's state-owned telecom carrier, faces intense competition from overseas companies as the mobile communications market grows.   © Getty Images

YANGON -- Myanma Posts and Telecommunications, Myanmar's state-run telecommunications provider, is pushing to transform its bureaucratic culture and become more competitive in preparation for its likely future as a private company.

The government clearly stated in its Myanmar Sustainable Development Plan that it would "corporatize, commercialize, restructure, or where appropriate, privatize" state-owned entities. And the government is considering turning MPT, which is essentially an arm of the Ministry of Transport and Communications, into a separate corporation under government ownership as a first step.

"The government has already initiated a process to draft the necessary legal framework to corporatize MPT," one officer said. "It is too early to say when, but privatization could happen in the future."

MPT is considered to have strong growth potential, as demand for high-speed mobile service is expected to continue increasing.

An employee at MPT explained that some changes have already been made on the ground. This includes moves to separate operations from the postal service, which is part of the same ministry, to pave the way for the transition.

An executive from the financial sector predicted "MPT may eventually be listed on the Yangon Stock Exchange."

In the meantime, MPT is trying to get its employees to stop thinking like civil servants. It already faces stiffer competition, after the government allowed foreign mobile carriers to begin operating in the once-isolated country.

For guidance, it has turned to Japan. Telecommunications company KDDI is training MPT employees on sales, while Sumitomo Corp., a trading house, is giving pointers on management efficiency.

Five MPT employees recently started a yearlong training program in Japan at KDDI. The program aims to elevate their skills and knowledge, including for sales and marketing, by giving them a firsthand look at how KDDI engages with customers. The trainees "will undergo rigorous hands-on practical training," MPT said.

They are the second group to participate in the program, which started last year.

Su Su Maw was one of the first trainees. She said she was impressed with how KDDI supported sales representatives at large electronics retailers, where the company competes with other mobile carriers, and at its own stores. "KDDI changes the sales approach depending on who they are engaging with," she said.

She also worked at a division that analyzes customer behavior, looking at usage data. "The division had all kinds of information available for analysis from across the company."

Changing the bureaucratic culture at Myanma Posts and Telecommunications is the top priority for the organization ahead of its likely privatization.

The collaboration with KDDI and Sumitomo began in 2014, when MPT signed a three-way deal with the Japanese companies in an effort to reform the state-run carrier. The agreement was specifically aimed at bolstering MPT's competitiveness against Norway's Telenor and Qatar-based Ooredoo, which entered the Myanmar market that year.

MPT, KDDI and Sumitomo have formed a "joint operation" that in effect controls the Myanmar entity's entire telecom business. The Japanese companies have helped MPT reorganize, sending their employees to top posts, including CEO, COO and CFO.

One thing the assignees did was inspire a sense of urgency among MPT employees about rivals eating away at its market share. This changed their behavior, according to a KDDI executive who is now working at MPT.

"In the beginning, they only did what they were told," the executive said of MPT employees. "Now they propose their own sales ideas."

Before the partnership, profitability was the last thing on MPT employees' minds, according to the Japanese. They now constantly monitor data traffic across the country and, whenever traffic falls, are quick to ask why. If the slump turns out to be due to a rival launching a new sales campaign, they lose no time in responding.

Bureaucratic habits may not be entirely stamped out, but MPT and its staffers are beginning to work in more of a private-sector manner.

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