Tips for the new Telkom CEO, Sipho Maseko

New CEO will eventually be paralyzed by majority shareholder pressure. There may be a new CEO but it will be business as usual. Seems Telkom just wants someone to fill a seat.
 
NeoAtlas said:
New CEO will eventually be paralyzed by majority shareholder pressure. There may be a new CEO but it will be business as usual. Seems Telkom just wants someone to fill a seat.
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or their pockets
 
Here's a tip: Whatever your major shareholder (Gov.) tells you to do, do the opposite.
 
Tips, what tips? His hands were tied before he even accepted the job. I don't see any changes happening.
It's a pity.
 
My tips:
(1) Create a TelkomCEO user account on MyBroadband. It doesn't matter whether this account is managed personally by the CEO or an admin and PR-ish (but not too PR, PR=BS for the most part) person but rather whether the account provides a communications channel from Telkom's executive to the community. Company representatives for Telkom particularly in its customer service arena would also be needed.

(2) Telkom's first duty is a fiduciary one to the shareholding interest of its shareholders and creditors. This requires that Telkom run like a proper business and maintain and deliver value on the capital invested as well as settle its liabilities on the terms agreed and maintain the capacity and credit worthiness expected by creditors. Telkom's second responsibility is to its customers which include customers who compete with it. Telkom's third responsibility is to the national electronic communications network of which it is a major owner. Telkom's fourth responsibility is to the people of the Republic of South Africa under whose laws it enjoys its very existence. Telkom has no responsibility outside of its fiduciary duty to a shareholder to the government of the day or to the ruling party. A responsibility to the people and the Republic is not a duty to the whims of corrupt or inept politicians. If Telkom is allowed to be run as a business the other responsibilities fall into place naturally.

(3) Don't think of Telkom as the "incumbent" the term is dated and has little usefulness. With LTE and mobile communications in general Telkom is not an "incumbent" but one of several industry players and actually one of the smaller players. It is really only with the last mile copper network that Telkom is an "incumbent". By being "the incumbent" Telkom is placed in the position of being thought of and thinking of itself as an entity that grew out of being a monopoly and which requires protectionist policies to survive this is not the way to work. Telkom has market dominance in some things and is a key stakeholder in the national electronic communications network by virtue both of its last mile assets and its extensive investment in fibre. Telkom cannot survive as the "incumbent teleco" and needs to be a "mobile communications and internet company" the future is - as I am sure you know and all of your staff with sense are expressing - in mobile data; just remember mobile is about a lot more than radio technologies and "wireless".

(4) Revisit the submissions of Telkom on LLU. Telkom seriously missed an opportunity to move forward and needs to ensure that it doesn't fall into the trap of waiting to be severely damaged by the regulator. The more regulatory the approach with respect to LLU the less business sense it will make. Take the initiative if you want to fulfill your first responsibility.

(5) Be ready to loose your job and watch your efforts be destroyed. The government has a history of stuffing things up and you might end up with a temporary board that is packed to undo your hard work. Take Kipling to heart.

(6) Sort out the competition commission fine issue before it bites Telkom hard. An acceptance that the practices of the time where noncompetitive is a good start.
 
Paul good post there. However, the hands of the CEO will be tied. Even if he wants to do any of the good deeds you mentioned he has to bow to the majority shareholder.
 
Paul Hjul said:
(1) Create a TelkomCEO user account on MyBroadband. It doesn't matter whether this account is managed personally by the CEO or an admin and PR-ish (but not too PR, PR=BS for the most part) person but rather whether the
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Definitely need feedback from the end-user, but it'd be better to engage with ISPA and the ISPs, etc - ISPs will want to drive down costs, and ISPA would keep them honest and realistic. As much as I'd love to stand up and shout my demands, as a whole, the end-users are unrealistic.

Paul Hjul said:
(2) Telkom's first duty is a fiduciary one ...
Telkom's second responsibility is to its customers which include customers who compete with it.
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There is actually no legal order of preference for this. These are part of his duties, not prioritized, and it's up to him to order them to make the best business - For example, Jeff Bezos (Amazon) puts his customers first, and pretty much doesn't give a crap about the shareholders - they're welcome to sell their shares and leave, but they don't, because they trust him long-term. We need a CEO that knows what's to be done (ignore the bottom line for a while and get more fixed lines on board - the standard, accepted method of ramping up a telecoms company).

Paul Hjul said:
the people and the Republic is not a duty to the whims of corrupt or inept politicians. If Telkom is allowed to be run as a business the other responsibilities fall into place naturally.
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I think if Telkom were to start getting more customers and filling their mandate (both to connect previously disadvantaged people, and get more money), the political pressures would evaporate. Government's just sticking their nose in because the company is failing and the higher-ups think they know better, when they don't.

Paul Hjul said:
(4) Revisit the submissions of Telkom on LLU. Telkom seriously missed an opportunity to move forward and needs to ensure that it doesn't fall into the trap of waiting to be severely damaged by the regulator. The more regulatory the approach with respect to LLU the less business sense it will make. Take the initiative if you want to fulfill your first responsibility.
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Telkom missed a giant opportunity here. It's obvious that at some point LLU will happen. Telkom should have embraced it, and led the way - that would have made them a friend of the industry. Instead, they unleashed the lawyers and napalmed all the bridges to the ISPs. Stupid, stupid.
 
kooldude said:
Paul good post there. However, the hands of the CEO will be tied. Even if he wants to do any of the good deeds you mentioned he has to bow to the majority shareholder.
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There are so, so many things he can do without majority shareholder approval - lower costs, push for faster ADSL roll-out, etc. The shareholders can stop him doing it, but after the fact. And if the plan works to get more customers on board, chances are government would back off and take a wait-and-see approach.
 
Please continue on the spectacularly short sighted path of your predecessors, run Telkom into the floor face first, then split the company up into its smallest parts, sell those to the highest bidders. Then sit back and watch actual competition happen.
 
I have some advice. Take a stand and stick it to the man. Find a balance between doing what is needed for the average consumer/business consumer and profitability. Oh wait, isn't that the basics of running any service based organization?
 
elvis_presley said:
Definitely need feedback from the end-user, but it'd be better to engage with ISPA and the ISPs, etc - ISPs will want to drive down costs, and ISPA would keep them honest and realistic. As much as I'd love to stand up and shout my demands, as a whole, the end-users are unrealistic.
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This forum is not exclusively limited to "end-users" and I definitely don't want Telkom's CEO to pretend to be an end-user help desk - which is why I said that a Telkom Customer Service Rep is also needed. JvZ's presence adds something.

There is actually no legal order of preference for this. These are part of his duties, not prioritized, and it's up to him to order them to make the best business - For example, Jeff Bezos (Amazon) puts his customers first, and pretty much doesn't give a crap about the shareholders - they're welcome to sell their shares and leave, but they don't, because they trust him long-term. We need a CEO that knows what's to be done (ignore the bottom line for a while and get more fixed lines on board - the standard, accepted method of ramping up a telecoms company).
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My remark is directed at the difference between a fiduciary responsibility and a fealty relationship - Telkom's duty to the government as a shareholder is not one of fealty. Moreover the responsibility is not to make the greatest short term returns nor is it to deliver no short term returns in order to satisfy long term sustainability or anything in particular. It is a duty to recognize that Telkom is a public traded company who has shareholders (including the government) who have assumed a certain risk by investing in Telkom and whose investment is to be treated with proper regard. Shareholders may trade their shares - unless the company violates its fiduciary responsibility and the shares tank. Moreover it has a similar duty to its creditors.
Starbucks for example has outright told shareholders who have an issue with the companies stance on marriage equality etc ... that they are welcome to sell their share and find another company delivering the same returns. So if Telkom represents a particular strategy and profile for itself for investors it cannot violently diverge and become a higher risk entity or deliver no yield or in the name of government interest adopt a strategy placing creditors at greater risk.
The South African government is hurting other shareholders.

Many companies in the service industry place customer needs first as a strategy to satisfy their responsibilities, I think this is different to identifying that a company in a regulated industry (and in general) forms relationships with customers and competitors. The point being made though is that if you are fulfilling your responsibilities to your shareholders and have a strategy that puts customers first etc ... you still have a "second responsibility" to the industry where you operate before party or government or whatnot responsibility.

It is about having an honest and transparent approach to business, informing the public (as a public company) through the appropriate channels (as a listed company) of the proper position of the business and its risks etc ... Rather than trying to hide behind SENS rules against disclosure at a public regulatory hearing. Its deciding on a strategy and on shareholder approval executing that strategy even if the largest shareholder is inconsistent.

I think if Telkom were to start getting more customers and filling their mandate (both to connect previously disadvantaged people, and get more money), the political pressures would evaporate. Government's just sticking their nose in because the company is failing and the higher-ups think they know better, when they don't.
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I doubt it to be entirely honest. The political game is an ideological issue.

Telkom missed a giant opportunity here. It's obvious that at some point LLU will happen. Telkom should have embraced it, and led the way - that would have made them a friend of the industry. Instead, they unleashed the lawyers and napalmed all the bridges to the ISPs. Stupid, stupid.
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Well Telkom needs to seriously re-evaluate its legal strategy - if it hasn't already done so in the last 18 months.
 
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