Olaf Swantee cuts a swath through senior management at mobile-phone giant created by Orange-T-Mobile merger
The new boss of Everything Everywhere, the UK's largest mobile-phone company, began his first day in the job on Thursday by axing or demoting more than half of his senior management team.
Olaf Swantee, chief executive of the company created by the merger of Orange and T-Mobile last year, announced a swath of senior level departures as he unveiled a new streamlined "leadership team".
Swantee, a high-flying executive at Orange's parent company France Telecom, hacked back Everything Everywhere's top team from 26 to 10. A key casualty was Richard Moat, the company's deputy chief executive and finance director, who was passed over for the top job this summer. Moat was seen as the natural successor to Tom Alexander, who quit as chief executive in July. He is one of six executives leaving the company; a further 10 vice-presidents were effectively demoted.
The new leadership team includes no executives from T-Mobile, leading analysts to question whether the merger of the UK's third- and fourth-biggest mobile operators was really the "merger of equals" it was billed as at the time.
"There is certainly a sustained theme [of former Orange executives taking control of the company]," said Mark James, a telecoms analyst at Liberum Capital. "There's still a 50:50 ownership structure, but it does seem a lot more orange than pink [T-Mobile's corporate colour]."
Matt Hatton, director of Machina Research, said: "It was almost inevitable that the axe was going to fall more heavily on T-Mobile. It was never quite seen as a merger of equals because one of them [Orange] had a much stronger position in the market. It was never really a merger."
Swantee said the new "simple team" would help "accelerate the execution of our key plans and priorities". Additions to the management team include Marc Allera, former sales and marketing director at 3, who has been hired as chief sales officer.
The merged company, which operates the mobile phones of 28 million Britons, has been tasked with delivering £3.5bn of cost savings to its owners, France Telecom and Deutsche Telekom, but so far has achieved synergies of just £203m.
Everything Everywhere's revenue from mobile customers, excluding that spent on handsets, dropped 3% to £1.5bn in the first half of the year compared with a 1.8% increase at Vodafone's British business. The company also lost a further 1.2m pay-as-you-go customers in the period,
Analyst say the company has struggled under the pressure of trying to match the expectations of its demanding parents. "It's always going to be quite tough trying to please two parents rather than one," said James. "Everything is a bit harder if you've got to run everything by a committee."
Swantee said he had begun a strategic review of the company which is likely to lead to more job losses. Everything Everywhere has axed more than 1,200 jobs since the merger. Some were told of their looming redundancy by a colour-coded "traffic light" system. Middle managers and back office staff were shown a red light at mass meetings and told their jobs were "at risk". Other staff saw a yellow light, meaning they had to reapply for their jobs.
The company also told 40 call-centre employees in Darlington that they could only keep their night-shift jobs if they moved to offices in the Phillippines. It was later forced to apologise.
Swantee, who declined to speak to the Guardian, said he would decide whether or not to ditch the ailing T-Mobile brand by October.
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Source: http://www.guardian.co.uk/business/2011/sep/01/everything-everywhere-olaf-swantee-management-cuts
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