Since taking over the reins at South African fixed-line operator Telkom less than a year ago, CEO Sipho Maseko has been tasked with cutting costs and improving the struggling company’s reputation as well as revenue.
But his cost-cutting measures haven’t been received as well as he had hoped. “I’ve cancelled all of the bottled water, people are not happy; I’ve cancelled Christmas lunches, people are not happy. They’ll be saying that some of the proposals around cost cuts are too aggressive,” he said in an interview with Bloomberg.
According to the publications, part of Maseko’s plan to turn the company around, is to retrench as many as 1000 managers, and wants to reduce Telkom’s 21,000-strong workforce by almost a third over the next five years.
“The decision follows a contract with Boston-based Bain agreed about a week after he started at Telkom, which is 40 percent owned by the South African government and 11 percent held by the Public Investment Corp., the company that manages state pensions,” Bloomberg wrote.
Maseko added that by working with Bain, it made a lot of things easier when he started. “Consultants turn stuff around very quickly. I actually started working for Telkom immediately. That is why it was easy for us to take a lot of decisions in the first week.”
Retrenching staff is never an easy task, but Maseko realises that it’s the company’s future – and his – that is on the line. “I’m accountable for the strategy, I’m accountable for the development of the strategy. If the strategy fails, I’m the one who’s going to get shot. It’s me.”
Charlie Fripp – Consumer Tech editor