Bold steps to turn the ship

Joseph Waring
17 May 2012

Telecom CEO of the Year

Napoleon Nazareno

Last year's winner:XL's Hasnul Suhaimi

Best Emerging Market Carrier

Smart Communications

Last year's winner:XL
Business segments:Mobile voice and data, m-payments, m-health
CEO/President:Napoleon Nazareno
Key stats (end of 2011; Smart & Sun):63.7 million subs; mobile revenue of $2.41 billion (102.1 billion pesos)

Last year was a big year for Smart Communications, and April 18 was a big night for the Philippine mobile operator, walking away with three trophies at our annual awards ceremony in Bangkok.

In 2011 the company acquired third-ranked rival Digitel (Sun), invested $1.7 billion (70 billion pesos) in its fixed and wireless networks, and embarked on a major reorganization program.

The acquisition, which president and CEO Napoleon Nazareno calls a "game-changer", not only expanded the telco's market share from about 50% to 68%, it also has given the operator additional resources to invest in a more aggressive way going forward.

Like many incumbents, its revenue growth was flattening, so together with parent company PLDT it launched a data modernization program at the beginning of 2011 to transition from the voice era to the data age. It increased its 3G coverage and capacity, and rolled out its FTTH program. At the same time, the company took steps to introduce more intelligence into its backroom.

Most of the mobile initiatives were scheduled to be completed by the middle of this year and the rest by yearend. Its 3G coverage will reach 95% of the population and all the base stations will be LTE ready by the end of the year.

The CEO says the "bold" corporate restructuring was not only a major shift in mindset but also in the way it does things. "We have implemented the last phase of the transformation by moving toward the convergence of fixed and mobile in our go-to-market strategy. To be honest, this is difficult to do because the cultures are different between the fixed and the wireless worlds."

The company now is organized by its key market segments, with four business units: consumer, home, enterprise and international (overseas workers). He says it's too early to tell if the redesign will deliver the results it's looking for, "but strategically our objective is to change our people's mindset".

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