Telecom reveals executive changes - second casualty named

UPDATE TUESDAY: Telecom has provided more detail this morning on ,management changes flagged Monday.

The changes will see the number of members of Telecom’s executive team reduce from 10 to 8.

Wayne Peat, Group HR Director, will be leaving Telecom.

HR responsibilities will be carried out by Jan O’Neill, currently GM HR, Telecom Retail. Jan will report directly to Paul Reynolds but not sit on Telecom’s executive.

Mr Peat's HR director role becomes the second of the two executive team casualties.

The first came on Monday, when it was announced that Telecom Wholesale acting chief executive Nick Clarke would no longer sit on the executive team.

Other changes
Rod Snodgrass, previously group strategy director (and Telecom's representative on the Southern Cross Cable board), will move into the newly-created chief product officer role.

The two corporate services director roles will be filled by Tristan Gilbertson, group general counsel and Tina Symmans, director crporate relations, who will both retain their current responsibilities.

Telecom shares (NZX: TEL), which leapt from $2.055 to $2.155 yesterday on the back of the company's rural broadband win, were up another 0.23% in early trading today to $2.16.

MONDAY: Telecom has announced a series of management changes today, which will kick in whether or not the company is successful in its Crown fibre bid.

From 10 to eight
The company’s executive team will be reduced from 10 to eight members.

Nick Clarke, acting head of Telecom Wholesale since April last year (when the high-profile Matt Crockett departed) is one of the managers who will leave the executive team.

The second has yet to be named.

In a related move, Telecom Wholesale’s “regulated business will increasingly align with Chorus”, although Mr Clarke will continue to report to chief executive Paul Reynolds. The move perhaps provides some insight into where the company sees its Wholesale division sitting after a de-merger.

New, cross-division product role
A third person will also have to leave the executive team – or an existing member switch roles – as Telecom also announced today that it was creating a new executive role, chief product officer, who will coordinate product and pricing across Telecom Retail, Telecom Wholesale's commercial business and Gen-i (units that would have to be hewn apart if the company wins Crown fibre business, which would require structural separation).

Final Crown fibre pitch
Telecom also said today that it had submitted its final proposals for the government’s $1.35 billion ultrafast broadband (UFB) tender.

The company is seeking to partner with the Crown in 25 of the 33 candidate areas, including Auckland, where it is up against Vector, and Christchurch were it is up against Enable.

Telecom refused to comment on the substance of its final bids.

In other changes announced today:

• Chorus boss Mark Ratcliffe, who has been leading a 100-strong Telecom team focussing on the company’s Rural Broadband Initiative (RBI) and Crown fibre bids, will return to his usual role as Chorus chief executive.
• Five existing corporate centre executives – finance, HR, strategy, legal and corporate relations – will reduce to three.

Spokesman Mark Watts said there was no timeframe for implementing any of the changes.

Communications minister Steven Joyce has promised that the remaining Crown fibre negotiations will be wrapped up within “weeks”.

Although the changes are on a parallel track to Telecom's promise to split into two separate companies if it wins UFB business (and indeed, many would see the new, pan-division chief product officer role as more of a merger of interests), Mr Watts characterised them as the company preparing itself for a fibre world.

De-merger planning had already begun, Mr Watts said, so the company was prepared if it did win Crown fibre contracts.

Telecom shares (NZX: TEL) were up 3.54% to $2.05 in late trading.