Wahid to spruce up Telekom


By B.K. SIDHU

A COMPANY that has not lived up to expectation - that was how a senior official at Telekom Malaysia Bhd described the telco he works for in terms of product delivery, customer service , and to some extent, its financial performance and the attitude of its workforce.  

He is not wrong. There are many instances when it takes forever to get your house phone line fixed; making a complaint can sometimes set you on a wild goose chase; and trying to get your TM streamyx working again, an arduous task.  

Going by what some experts say, Telekom’s weaknesses are its customer service and branding; it has too many products; and too large a workforce, among others.  

But Telekom has its strengths too – a diversified product portfolio; a cash pile of RM2bil as at end March 31, 2004; no foreign exchange exposure to worry about; and a shareholder in Temasek Holdings, whose potential could be tapped.  

Opportunities are aplenty. From leasing networks to content and application resale; capability to offer pay-on-demand TV via its cable network, and most importantly, it can bundle all its products together and sell them to its existing 4.5 million fixed line users.  

Datuk Abdul Wahid Omar

Its biggest threat, said a consultant, is its inability to move fast enough.  

In view of the government’s efforts to reform government linked companies (GLCs) and the fact that Telekom is getting a new group chief executive officer in Datuk Abdul Wahid Omar effective July 1, is there a quick fix for this telco?  

Here are some suggestions gathered from consultants, analysts, industry observers and Telekom officials who requested anonymity.  

·One thing that needs to be ironed out very soon is the role of the board, which is to provide guidance, not meddle with the day-to-day operations.  

·There exists a very strong team of second liners in Telekom. 

But an infusion of fresh talent is vital and some form of compensation for the second liners necessary. Perhaps it is timely to re-visit the entrepreneur employment scheme, which provides an opportunity for current employees to become entrepreneurs.  

·Wahid has to ensure that Telekom's 27,000 employees change their mindset and become pro-active. The employees are used to the norm and there is too much protocol. So it is up to Wahid to uncover the talents to ensure that things are done more professionally at the telco.  

·With technological advancements, the job of 7 people can be done by 2, thus a staff reduction is seen vital. A voluntary separation scheme should be considered as Telekom has the funds to do it.  

·Streamlining of the operations and increasing efficiencies is a top priority. By July 1, the assets and network infrastructure of Telekom would be reorganised into new units - TM Wholesale (which owns assets and network infrastructure and leases them out) and TM Retail (which will concentrate on retail products).  

So when the government decides to unbundle the last mile, Telekom will be prepared with different pricing structures for its retail and wholesale offerings.  

·The current board needs to be trimmed. It should also be made up of professionals and entrepreneurs with solid backgrounds. Foreign personalities from Europe and US can provide the international perspective needed for a company like Telekom.  

·Temasek Holdings' acquisition of a 5% stake in Telekom is an opportunity for the telco to develop joint ventures and cooperative efforts with SingTel and StarHub. But at the same time, Telekom’s direction should not be determined or influenced by SingTel.  

·Benchmarking in terms of quality of service that is offered by its regional peers is what Telekom should look at. A re-look at the branding of both Telekom and its cellular unit, Celcom (M) Bhd is vital since competitors like Maxis Communications and Digi.com Bhd have continued to strengthen their brand presence.  

·Sourcing for investment opportunities in cellular companies abroad is vital if Telekom wants to increase its revenues in the cellular business so that both foreign and local cellular revenues account for 70% of its income instead of the current 50%. 

In the case of Telekom, its reform is not entirely financial - it is a business turnaround.  

And the CEO should not be afraid to crack the whip as he would be benchmarked against the key performance index.  

Telekom's image would improve substantially if the perception of it being a slow giant was changed. And this improvement begins with the first contact with a potential customer. 

Over to you, Wahid.  

 TELEKOM : [News]   [Stock Watch]

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