Privatization and technological capability development in the telecommunications sector: a case study of Sri Lanka Telecom

This paper presents a framework for examining the development of the technological capability in a telecommunications firm after privatization. The framework is based on the value chain concept, which identifies the primary and support activities of a telecommunication service provider. It uses a three-step procedure to analyze the technological capability needs and develops indicators to measure the extent to which such technology capabilities have developed after privatization. The elements and indicators were determined from an in-depth understanding of the technical, managerial, and operational processes in telecommunications firms. The framework is then applied to Sri Lanka Telecom. Information on the firm's technological capabilities was collected through in-depth interviews with top and middle management. This information was analyzed to compare technological capabilities before and after privatization. Based on the comparison, we find that technological capability development in Sri Lanka Telecom progressed substantially after privatization. (C) 2005 Elsevier Ltd. All rights reserved.