BUDGETING AS A TOOL FOR SERVICE IMPROVEMENT IN TELECOMMUNICATION INDUSTRIES IN NIGERIA A CASE STUDY OF MTN NIGERIA PLC, OWERRI BRANCH

Abstract

This study reviewed budgeting as a tool on service improvement in telecommunication industries in Nigeria. The objectives of this study were to examine the historical development of budgeting, meaning and purpose of budgeting, process and types of budget, control and techniques of budgeting and to identify the introduction of telecom services, types and give reasons for quality services as well as give the strategies and finally to give the impacts of budgeting on telecom service improvement. The data collected through questionnaire were analyzed, tabulated and presented using average and simple percentage. The hypothesis was tested using chi-square (x2) at 0.05 level of significance and degree of freedom 5. the sample size no = 30 was used and represented the population size (n). The chi-square (x2) was calculated and compared with the critical value, accepting the alternative hypothesis (Hi) since the calculated value is higher than the critical value. The major finding of this study is that there was significant relationship between budgeting and service improvement in telecom industries. On recommendation, telecommunication industries should apply budgeting in order to improve their standard, service and achieved the firms’ objective.

TABLE OF CONTENTS

Title page-      –      –      –      –      –      –      –      –      -i

Approval page-       –      –      –      –      –      –      –      –      -ii

Certification page-  –      –      –      –      –      –      –      -iii

Dedication-     –      –      –      –      –      –      –      –      -iv

Acknowledgment-   –      –      –      –      –      –      –      -v

Abstract- –      –      –      –      –      –      –      –      –      -vi

Table of contents-  –      –      –      –      –      –      –      -viii

Chapter one

0 Introduction-   –      –      –      –      –      –      –      -1

Historical background of case study-     –      –      –      -3

Problem analysis-   –      –      –      –      –      –      –       5

Purpose of the study-    –      –      –      –      –      –      -5

Relevant research questions- –      –      –      –      -7

Statement of hypothesis-      –      –      –      –      –      -8

Limitation (scope of the study)-    –      –      –      –       8

Assumptions-  –      –      –      –      –      –      –      -9

Significance of the study-      –      –      –      –      –      -10

Definition of terms- –      –      –      –      –      –      -10

Chapter two

2.0 Review of related literature-    –      –      –      –      -13

2.1 Historical development of budget/budgeting- –      -13

2.2 The meaning of budget/budgeting- –      –      –      -15

2.3 The purpose of budgeting-      –      –      –      –      –      -16

2.4 The condition necessary for a successful budgeting       -20

2.5 Process of budgeting-      –      –      –      –      –      -21

2.6 Classification of budget-  –      –      –      –      –      -23

2.7 Budgetary control system-      –      –      –      –      –      -26

2.8 Budgeting techniques-     –      –      –      –      –      -26

2.9 Introduction of telecommunication services    –      -28

2.10 Types of service provided by telecommunication industries-  –    29

2.11 Reasons for poor quality services- –      –      –      -30

2.12 Strategies for ser vide improvement-    –      –      -31

2.13 The impact of budgeting on telecommunication service improvement in Nigeria-   –      –      –      –      –      –      -33

2.14 Payment made by MTN on poor quality service——34

Chapter three

Research methodology-   –      –      –      –      –      -38

Research design-      –      –      –      –      –      –      -39

Characteristics of study population- –      –      –      -39

Sample design and procedures-      –      –      –      –      -40

Data collection instrument-     –      –      –      –      -40

Study instrument-    –      –      –      –      –      –      -41

Administration of data collection instrument-  –      -41

Pilot study, test of validity and reliability of the study instrument  –      – –      –      –      –      –      -42

Procedures for processing collected data-       –      –      -43

Chapter four

Presentation and analysis of data    –      –      –      -46

Brief introduction of the chapter-    –      –      –      -46

Criteria group return, respondents, characteristics and classification     –  –      –      –      –      –      –      -46

Presentation and analysis of data according to research questionnaire  –  –      –      –      –      –      –      -47

Presentation and analysis according to hypothesis  -66

Analysis of other data      –      –      –      –      –      -75

Discussion of findings-     –      –      –      –      –      -75

Chapter five

summary, conclusion and recommendation    –      -81

Summary  –      –      –      –      –      –      –      –      -81

Comprehensive summary of the findings –      –      -81

Summary of the study     –      –      –      –      –      -82

Conclusion drawn from the findings –      –      –      -84

Recommendation based on the conclusion-    –      -86

Suggestion for further studies  –      –      –      –      -86

            Bibliography-    –      –      –      –      –      –      –      -88

            Letter of introduction       –      –      –      –      –      –      -91

            Questionnaire   –      –      –      –      –      –      –      -92

LIST OF TABLES

Table                          Title of Table

Analysis of questionnaire returned

History of budgeting/budget

Meaning of budgeting/budget

Purpose of budgeting

Condition for successful budgeting

Process of budgeting

Classification of budget

Budgetary control system

Budgeting techniques

Introduction of telecom services

Types of telecom goods and services

Causes of poor quality service

Strategies for service improvement

Impacts of budgeting on telecom service improvement

Computation of hypothesis I

Computation of hypothesis II

CHAPTER ONE

INTRODUCTION

Budgeting is the most important techniques whereby long-term strategies are converted into short-term action plans. Every organization including telecommunication requires not only planning but also a well co-ordinated plan to improve the quality of service was rendered to their customers in order to achieve the organization goals.

Budgeting as a predetermined objectives, represents what is most likely to happen after a careful consideration of the priorities of the company and the constraints of the company. It provides a standard for comparism with the result actually achieved.

According to the Chartered Institute of Management Accountants (CIMA), “A budget is a   financial or qualitative statements prepared and approved prior to a defined period of time, of the policy to be pursued during that period for the purpose of attaining a given objectives. Thus budgets and the resulting variance would serves as a guide to current operation and service improvement in the telecom industries.

This study would review budgeting and service improvement in telecom industries as follows:

Historical development of budget/budgeting

Meaning of budgeting

The purpose of budgeting

Conditions necessary for a successful budgeting

Process of budgeting

Classification of budgets

Budgeting control system

Budgeting techniques

The introduction of telecom services

Types of service provided by telecom industries

Reasons for poor quality services

Strategies for service improvement

The impact of budgeting on telecom service improvement in Nigeria

HISTORICAL BACKGROUND OF CASE STUDY

The historical background of MTN Nigeria Plc, according to Ezeifedi (2009) was launched on may 16th, 2001 as part of the MTN group Africa and become the first GSM network operator. The company started its commercial operation on the GSM network at Lagos as it’s headquarter, followed by Abuja, Portharcourt, Enugu, Owerri and other states in the country.

In January 2001, MTN paid for one of the GSM license in Nigeria at US $85 million and as at date, in excess of $1.8 billion has been invested in building mobile telecommunication infrastructure in Nigeria. Since August 2001 MTN moved it’s services across Nigeria and providing services in not less than 223 cities and more than 10,000 villages across the 36 states of the country (Nigeria) and the federal capital territory Abuja.

According to Ezeifedi (2009:9), “the company introduced yellow Balm in January 2003 which was commissioned by the former president Olusewgun Obasanjo. This digital microwave transmission was the most extensive in infrastructure in all of Africa which helps to enhance call quality on MTN Network.

He further say that “in the year 2004, MTN expanded its network coverage or capacity from the number prefix 0803 to 0806 as the first GSM operator to have adopted an additional numbering system. In 2007, its network capacity was further expanded to 0703 and 0706, and finally in 2009 0813.

MTN Nigeria Plc also introduced a self help toll-free 181 customer care line through which subscribers can resolve their frequently asked questions free of charge.

MTN’s overriding mission is to be catalyst for Nigeria’s economic growth and developmental potentials not only through the provision of world class communication but also through innovative and sustainable corporate social responsibility initiative.