Telstra chief executive and former IBM managing director, David Thodey, sat down with Computerworld Australia ahead of the 100th anniversary of Big Blue and reflected on his time at the company and how it set him up for the toughest role of his career.
Slideshow: Celebrating 100 years of IBM.
Computerworld Australia: How have you grown as a CEO since you managed IBM Australia to your time now at the head of Telstra?
David Thodey: When I left IBM there was about 15,000 people and Telstra now is 55-56,000 of which 41,000 are full time. I stepped from running IBM to running the mobiles division [at Telstra]. At the time IBM would have been $3.5 billion and mobiles would have been $5.5 billion-$6 billion business.
But the biggest change in moving from IBM would be that one is a big, really important company in Australia and the other is a subsidiary. That creates a very big dynamic. Also, when you’re running a company that is very much in the public eye —we touch, what, 3.5 million customers in Australia every week — it is different. We are also a consumer business, an infrastructure business, a complex engineering business, the biggest media company in Australia.
What new skills have you had to acquire for the Telstra CEO role – government relations in particular?
The principles of leadership are no different: clarity of vision, purpose, having a good sense of operational discipline, managing many stakeholders, driving to outcomes…
What really set me on the road were the values and things I learnt at IBM about running large companies. And of course, values and beliefs are what makes companies. There are many other things you need to know about technology and innovation and being a good manager but it is actually about what you stand for.
What are IBM’s and Telstra’s values?
Respect for the individual, commitment to excellence in everything you do, and great customer service. They were the three, but I think they have changed. They’re now innovation, dedication to the client, and trust and personal responsibility. They are similar but reworked a little bit. Telstra’s values are very similar. It is about a customer-centric culture and servicing our customers…
That hasn’t been the case before, though?
That is true. But it is a very important part of our culture now. We have always had very strong values in Telstra… there is this incredible Australian-ness about Telstra. The other [value] is about commitment community — no matter where you go in Australia there is always a Telstra technician somewhere. While Telstra gets a lot of billings, that commitment to community is really important to us.
What was your biggest challenge at IBM and Telstra?
The biggest challenge at IBM would have been that that industry has changed and the company has reinvented itself a number of times. [IBM] was hardware oriented, then it went to services, then software, and I think IBM has gone through than enormous amount of change and so has Telstra. We started as a fixed line copper business, then we moved to a wireless innovator, then moved o a services business and we will move to applications in a slightly different way.
Given your announcement of $800 million investment in your hybrid Cloud offering over the next five years, you’re now a Cloud company, too?
The Cloud side is very important. It is about investing large amounts of capital for long tem returns, but going to a Cloud infrastructure is also consistent with what we do in terms of our core network. But remember we invest $3.5-4 billion every year in capital expenditure; so long run returns are important to us…. Cloud is a pillar but not the only one.
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