The Australian Telstra challenge

The new chief executive of Telstra - Australia's largest telephone operator - has his work cut out for him.

by The Economist
Last Updated: 23 Jul 2013

Currently making losses of about $23.2m a year, the state-owned company has to be prepared for eventual privatisation while still being hemmed in by regulations.

Sol Trujillo, a Mexican-American with plenty of experience in the industry, has moved fast to deal with the challenges. First, he has announced job cut plans amounting to 25 per cent of the company's staff. He also has plans to reduce red tape, as well as setting in place a round of new investment. 

Trujillo is concerned that the government will give competitors the right to piggy-back on a $3 billion broadband fibre network investment, an issue that he will need to fight. His big management lesson is the 'parasitic competition' that broke out in the US in the mid-90s when the Baby Bells had to open up their networks to competition. The result, Trujillo believes, was that few companies wanted to invest and there was a decline in America's broadband industry.

Source: Calling Canberra
The Economist May 13 2006
Review by Morice Mendoza

Find this article useful?

Get more great articles like this in your inbox every lunchtime

Read like a CEO: James Reed

The recruitment boss discusses the books that give him business ideas and management inspiration.

What British business can learn from the French

Forget the cliches - our old rival is hotbed of management innovation and is leading...

Want to encourage more female leaders? Openly highlight their achievements

A study shows that publicly praising women not only increases their willingness to lead, their...

Message to Davos: Don't blame lack of trust on 'society'

The reason people don't trust you is probably much closer to home, says public relations...

Dame Cilla Snowball: Life after being CEO

One year on from stepping back as boss of Britain's largest advertising agency, Dame Cilla...

How to change people's minds when they refuse to listen

Research into climate change deniers shows how behavioural science can break down intransigence.