The road ahead

Top leaders gather for Madrid event

Embracing our customers and the future – two of the key messages to come out of the annual Telefónica Europe Management event in Madrid.

Around 200 delegates heard from Telefónica Europe CEO Matthew Key, Telefónica chief financial officer Santiago Fernandez Valbuena and Jajah CEO Trevor Healy before brainstorming hot issues during informal breakout groups and getting the chance to put their questions to the senior team during a Q&A session.

Opening the event, Matthew Key looked back on performance in 2009 and outlined the challenges and opportunities ahead.

“Financially, 2009 was a good year for us in very tough conditions,” he explained.

“We outperformed our markets, continued to make the business a great place to work and did well in putting something back into the communities we operate in.”

Among the highlights, the UK business continued to lead the way, where it was the only operator to grow in every quarter.

Telefónica O2 Germany was named the top employer in the country and there were early signs the business is starting to benefit from Telefónica’s investment in the network and acquisitions.

Telefónica O2 Ireland performed very well in an extremely tough market, Telefónica O2 Czech Republic had a hard year but made good progress on the customer journey, and the Slovakian business achieved an 87 point customer satisfaction score on the way to being named Mobile Operator of the Year.

“Slovakia’s customer experience results were exceptional,” said Matthew, “but I think that is one area we really need to improve on this year across the patch.

“We’ve done some astonishing things to delight our customers in past years, but I just feel we lost our mojo a bit in 2009.

“We need to step up our game in this area in the year ahead.”

Success in 2010

Matthew also looked ahead and outlined what he thinks a good year will look like in 2010.

“We need to get on the front foot with our competitors and lead the market,” he said.

“We need to ensure our existing customers have no reason to leave us and that other customers want to join us.”

Matthew also wants Telefónica Europe to enhance its position in digital communications during 2010, so the likes of Google and Apple start seeing the company as a competitor to be reckoned with, as well as a valued partner.

And he stressed the importance of giving something back, both to Telefónica and the wider community.

Digital world

Introducing Jajah CEO Trevor Healy, (see In Depth for more details), Matthew also spoke about the need to embrace the future of digital communications.

“Our industry has fundamentally changed to the extent that we are now operating in a communications industry, no longer telecommunications,” he said.

“Our competitors are changing too and, more and more, we’re seeing companies such as Apple thrive because they offer an eco-system containing everything a customer wants.

“Our challenge going forward is to embrace the future, not see digital as the enemy. We simply have to compete and I’m confident Jajah will be fundamental to our solutions going forward.”

One step ahead

Trevor spoke to delegates about the opportunities available to Telefónica in the digital world and the importance of staying ahead of the game.

“Great opportunities are built at times of great change,” he said. “I firmly believe that together we have the opportunity to add great value for our customers and do great things.

“But if we want to be winners in the digital world we need to spot the next big thing and be fleet of foot.

“Telefónica was ahead of the game in spotting the importance of the smartphone, but we have to identify what the next generation device will be, so we don’t have to play catch-up.”

Financial challenge

Delegates also heard from chief financial officer Santiago Fernandez Valbuena, who challenged Telefónica Europe to begin really paying back on the substantial investments made in the business.

He said: “Among many things, the past four years have seen you spread the virus of customer-centricity across all parts of our Group, infecting everyone.

“You’ve also brought a refreshing honesty. You take few prisoners and don’t hide your weaknesses.

“These are the kinds of attributes that Telefónica invested in and increasingly we need to see that investment being repaid. Now is the time to really deliver.”

Working together

The conference was held directly after the fifth annual Telefónica Management Summit, which saw around 1,300 managers from across the Group gather for an update on recent performance and an insight into the company’s future strategy.

Chairman César Alierta opened the event by explaining how the Group had turned the financial crisis into an opportunity – emerging as the second largest telecommunications operator in the world and gearing up for future growth.

Chief operating officer Julio Linares then gave an overview of the Group’s 2009 performance and explained how Telefónica hit its targets on customers, growth, efficiency and investment despite tough financial conditions.

The event was also a chance to introduce bravo! – Telefónica’s first ever group-wide transformation programme.

This major new initiative has been launched with one aim in mind – to make Telefónica the best global communications company in the digital world.

Matthew said: “bravo! is a big thing. It is about maximising our potential in this new digital communications market, learning from one another and anticipating industry trends.

“It’s another important step towards ensuring we get the best out of our global business.”

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