Sending all the right signals

By VIKKI BLAND

Telecom New Zealand is taking measures to ensure that, among other things, no present or future customer will be billed for being "an arrogant bastard"

Along with a corresponding charge, those were the words Auckland businessman James Storrie found itemised on his Telecom bill in February last year.

Telecom was swift to apologise and compensate for both the insult and charge, which were placed by an exiting employee. It was the right response and Storrie remained a customer.

However, five years ago, Telecom's response to the incident may have been quite different, admits Trisha McEwan, Telecom's group general manager human resources.

"Rather than apologise, Telecom would probably have just said 'oh well'," she admits. "There's a humility that's creeping in."

Telecom is putting the finishing touches to a raft of new HR strategies, developed over the past two years, and which include a new leadership framework and redefined set of desirable employee behaviours.

McEwan, a former group general manager HR for Fletcher Challenge, says the new strategies are designed to foster a collaborative, customer-centric, convergent culture within Telecom, and have been added to employee performance criteria.

"[We define] culture as the living dynamic interplay of all the shared beliefs, values, norms and practices that operate consciously and unconsciously within an organisation.

"So if culture is deemed the sum of the way we do things around here, then we are [now] doing things differently as well as doing different things."

The capacity to do things differently is understandably important as the telecommunications industry and its customers are constantly evolving.

McEwan points to an increasing demand for converged telecommunications products - for example, tools for people who want to send and receive email from their mobile phones, or divert fixed-line calls to their mobiles.

However, while this means Telecom customers end up using products from a number of Telecom divisions - mobile, directories, internet (Xtra), business and residential - McEwan says there has traditionally been little communication, product knowledge or understanding between those divisions.

"If you are going to take to your customer converged products, you have to have a convergent culture - people who can think across all product and service sets. You have to get close to customers because customers have more choice these days. We know that."

McEwan says her team will soon finalise a document which will make Telecom's cultural requirements crystal clear to potential employees.

"We'll be doing quite a bit of external marketing to get our message across. We want to attract people able to work across structural boundaries, to deliver ahead of demand, to meet the needs of customers before they find they have a need. That's how we compete in the market. To get the right people you need a clear employment proposition. It keeps you honest."

She says Telecom has traditionally taken a lot for granted and concedes the changes being made to its HR strategy and culture are driven, in part, by incidents like James Storrie's bill.

"The Big Brother perception is totally not what we want. It's not like we're showing one face to the public and then running around [internally] saying well, they're a bunch of ...

"It might sound corny, but we want to be able to care about our customers, to touch them."

And Telecom has a lot of customers to touch. It has the lion's share of the telecommunications market in New Zealand with over 3.4 million customer connections, and it gained a further 900,000 in Australian connections when it acquired Australia's third largest telecommunications company, AAPT, in 1999.

Xtra, Telecom's internet division, is also New Zealand's largest internet service provider with 420,000 customers at the end of March.

McEwan says Telecom is conscious of the people qualities it wants and will continue to develop behaviours which underpin its new leadership model and Telecom values.

But how does a company employing 6814 people in two countries develop behaviours? What happens to employees that don't measure up or are averse to change?

In the past, Telecom has not been squeamish about redundancies.

For the financial year 1997/98 the company made 955 people redundant; for the period July 1, 2002 to April 30 this year, that number was 388.

In the past 12 months, Telecom New Zealand has hired more than 1350 permanent employees, all carefully selected according to the behavioural qualities it now seeks.

McEwan says three in four employees who left Telecom in the past 12 months did so voluntarily. Turn that around: a quarter who didn't want to go had to.

Telecom will always have redundancies, says McEwan firmly. However, she is emphatic Telecom is not dropping off people in a bid to create a new breed of employee.

"We're thinking about strategy first, then structure, and finally about what sort of people we need to support that structure. We are swapping people out; when we see a gap we act on it.

"But people leave for all sorts of reasons. They retire, they can't do their job any more, or they can't go to where the company wants them to go with a job.

"And with the rate of change in this industry, jobs seriously cease to exist."

McEwan says Telecom's cultural investment will be measured carefully. "Human resource strategy must marry up with central business strategy and have a solid business case.

"We will conduct a culture survey every two years and will monitor the media in both Australia and New Zealand. In New Zealand we are starting to see media coverage that reflects what we want to promote."

And if media coverage reflects something Telecom doesn't want to promote? McEwan isn't fazed.

"There's nothing wrong with public accountability; we have to be big enough and strong enough to stand up to that."