Proceedings

Romtelecom has undergone a major transformation over recent years, successfully
managing to respond to the challenge of becoming more efficient and developing a
portfolio of alternative services, in addition to traditional fixed telephony offer. The
company currently offers to its customers a wide variety of services: voice, data and
broadband Internet services, combined packages that include IT equipment and
complex solutions for IT & C.
3. RESEARCH RESULTS
3.1. Research method
This paper is part of a broader study conducted during 2005-2010. The study uses
multiple sources to collect evidence, namely: regulatory package for
telecommunications, publicly available information, including Romtelecom’s annual
reports and regulatory authority reports on company studied, as well as methodologies
developed by the company for computing the costs of regulated services. The access
to these data was relatively easy, being public information. We had the opportunity to
compare the sources, which allows us to provide a more comprehensive and
conclusive picture of the phenomenon.
The regulatory package has been provided by the regulator and it allowed us to cover
all aspects regarding the legislation that studied company must deal with.
Romtelecom’s annual reports allowed us to understand the history of the organization,
the change it went through and how the regulation has had an impact on its results.
Regulatory authority reports on Romtelecom helped us to confirm or invalidate
certain conclusions drawn from analysis of data collected from company reports.
In the last part of the analysis we have tried to overlap the information obtained over
the theoretical framework, so we can respond to the questions raised in this paper.
3.2. Case findings
This section of the paper contains a brief description of the organization in order to
understand the entity's management control system, followed by a summary of the
effects generated by the regulations on management control system and performance
measurement.
With the full liberalization of the telecommunications sector, Romtelecom has been
forced to cope with the rigors of competition, which is why both the strategy and
structure had to be adapted to the new conditions.
As a former monopoly operator, with a vertical structure, Romtelecom experience
problems with the rigidity of its structure, overloaded in relation to the tasks required
and difficult to model, in a dynamic environment such as telecommunications. Taking
into account the three main forces acting in the telecommunications sector and,
implicitly, on analyzed entity - customers, competition, changes – it has been
observed the need to "reinvent" the business. In 2007, Romtelecom has launched a
comprehensive process of business reengineering in order to improve internal
processes. In essence, this redesign is to create two business units and a support unit.
The two business units are: wholesale, covering infrastructure management and
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