Ericsson Gets a Wake-Up Call
There's a good chance that Börje Ekholm, the incoming Ericsson CEO, will have been offered scores of opinions about what he should do when he takes the hot seat in January next year -- in addition to further cutting costs, that is. (See Cost Cutting Must Continue, Says Ericsson's New CEO.)
But if he's to take on board any views, those of Ericsson's customers should be at the top of the list, right?
Well in this case, those views have been made very public. Richard Damm, the Head of Innovation at Telia Company , has written an open letter about the state of the vendor company, and it doesn't make for pretty reading.
Damm essentially says Ericsson should get back to what it's really good at (mobile infrastructure development), pull back on its professional services focus, innovate in the cloud technology market (and not focus on cost-cutting efforts) and make sure it wins in the 5G market: "Win 5G. It's that simple. Just bloody win," he writes.
Telia is Sweden's national carrier and (as you'd expect) a long-time customer of the Swedish vendor. (See Telia Zone Set For 2016 Launch.)
Damm is also a former Ericsson executive who held a number of roles during a ten-year stint that began in January 2005, so he has a view of the vendor from the inside and out. His roles at Ericsson included:
- Head, Business Development, Cloud (products, services and partnerships)
- Head, Product, Cloud Accelerator
- Head, Product Management, Service Delivery & Strategies, Mobile Advertising
- Head, Product Lines Digital Media & Connected Home
- Regional Sales Director (Central Europe, Middle East and Africa) for the Managed Service and SaaS (Cloud) application offering
- Global Account Manager (responsible for all sales efforts at a Tier 1 global mobile operator)
So this guy has form.
And he doesn't pull his punches about the sector in general. "Ericsson and the Telecom sector as a whole has a meta level problem of being a shit industry right now," he notes.
Ericsson has had a troubled year -- losing a CEO, watching its share price slide, announcing job cuts and posting its first net loss in years. (See Eurobites: Ericsson Confirms Swedish Job Cuts, Ericsson Swings to First Net Loss in 4 Years and Ericsson Ejects CEO Vestberg.)
In such a situation, the reaction of many a company would be to reach out to an important customer privately, not engage in public and hope any fuss does away. Or, alternatively, just ignore it and hope no one notices (a common approach to problems or challenges, but we all know that's the worst course of action, don't we... don't we?).
So it's credit at least to Ericsson's Chief Marketing and Communications Officer, Helena Norrman, that she has responded on a public platform in a message board response to Damm's letter, and stated that the letter would be shared with the vendor's leadership team.
It seems clear that Damm has honest intentions here and that he isn't on some sort of vendetta -- he wants Ericsson to succeed. Is he right? Will anyone take any notice?
For me, the big question raised by Damm is whether the services business is one with which Ericsson should persevere. Is that holding the company back? Do you agree with Damm?
Maybe Ekholm will agree and make services the focus of his cost-cutting agenda. We'll probably find out by the time the industry hits Barcelona for MWC 2017.
— Ray Le Maistre, , Editor-in-Chief, Light Reading