chief forges ahead in Australia
Solomon Trujillo's brash style as head of phone company Telstra
has antagonized many. But his success is earning respect.
By Wayne Arnold, The New York Times
Friday, October 13, 2006
Sydney, Australia -
Solomon Trujillo, who has drawn criticism over his running of
Australia's dominant phone company, Telstra, might have expected
vindication last week when he started the company's new
high-speed cellular network three months ahead of schedule. He
ended up all wet instead.
Midway through a presentation by Trujillo in Sydney, fire
sprinklers burst open, dousing the roomful of executives,
analysts and reporters with fetid water. The watery
interruption to Telstra's big introduction, deemed an accident,
nevertheless summed up how Trujillo's brash style has gone over
Trujillo formerly led Denver-based US West and French cellular
operator Orange. The Denver Post reported in December 2002 that
Trujillo left US West during its merger with Qwest, pocketing
more than $71 million in cash and perks.
He was hired at Telstra in July 2005 as chief executive to
prepare the Australian company for a giant share sale. Since
then, he has managed to antagonize not only Telstra's customers
but also its biggest stakeholder, the Australian government.
Telstra's share price has slid more than 25 percent since
Trujillo took over. Prime Minister John Howard has questioned
whether Trujillo deserves his $6.5 million salary. And the
government, instead of selling its 51.8 percent stake all at
once, has decided to sell only a third of it.
Still, Trujillo's tenacity is starting to earn grudging respect
from analysts, bankers and fund managers. They now credit
Trujillo, 54, and his managers with prying open the
once-secretive company, uprooting its entrenched bureaucracy and
starting to overhaul antiquated systems.
Trujillo imported three former US West colleagues and began
reorganizing Telstra. His complaints about how regulations were
killing Telstra's profits prompted an early lecture from the
government, with Howard later castigating Telstra's new
management as "disgraceful."
Australians quickly took a dislike to Trujillo after learning
that Telstra planned to eliminate many of its public phone
booths and to shift more jobs to India and that it was keeping
secret files on its employees. In November, Trujillo introduced
a revamping plan that included at least 10,000 layoffs, a fifth
of Telstra's workforce.
Trujillo's team was also installing a third-generation cellular
network with Ericsson. Not only will the new network offer
nationwide coverage with broadband download speeds, but it will
save on equipment costs.
It was this network that Trujillo started last Friday. "It
marks a significant milestone that is likely to be noted, I
believe, in Australia's history," Trujillo said before the
sprinklers soaked his double-breasted pinstriped suit.
Afterward, he kept his cool.
After reconvening the presentation at a nearby hotel, Trujillo
made it up to waterlogged analysts by telling them he was
opening a tab for them at the bar.