Vodafone’s new CEO says “We’ve not been good enough” as she plots mass job cuts
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Vodafone’s new boss Margherita Della Valle has told markets the company’s performance “has not been good enough” as she set out her roadmap for turning the struggling telco around, including more than 10,000 jobs going over the next three years.
Della Valle inherited the job after a spell as interim chief, stepping in after the sudden departure of embattled former boss Nick Read.
Saying “Vodafone must change,” Della Valle has said the company is “too complex” and will need radical simplification to deliver.
Revenue was broadly flat in the financial year just gone, at just shy of £40bn.
“My priorities are customers, simplicity and growth. We will simplify our organisation, cutting out complexity to regain our competitiveness. We will reallocate resources to deliver the quality service our customers expect and drive further growth from the unique position of Vodafone Business,” Della Valle said this morning.
Vodafone’s share price has tanked in recent years whilst the boardroom has become home to a number of active investors.
Vodafone once again warned of underperformance in Germany, a key market for the firm, but said it felt it had strength in a growing Vodafone Business segment.
“More importantly, the comparative performance of Vodafone has worsened over time, which is connected to the experience of our customers,” the firm said, but “there are also material differences between our Consumer and Business segments, with Business growing in nearly all European markets.”
The simplification of Vodafone will include the slashing of 11,000 jobs over three years.
Margherita Della Valle – more like Cruella de Vil?
Russ Mould, investment director at AJ Bell, said the Vodafone boss’s strong comments were “just the sort of message the market wants to hear.
He quipped, “Margherita Della Valle – more like Cruella de Vil.”
“The recently appointed boss of Vodafone had some harsh words for her new charge as she made the stark assertion that performance had not been good enough, indicating the need for change and unveiling swingeing job cuts.
“This is just the sort of message the market wants to hear as Della Valle becomes just the latest Vodafone boss to attempt to turn around the troubled mobile operator.”
Like her predecessor Nick Read, he said “Della Valle has been at the company for some time and needs to demonstrate she can really be the breath of fresh air the company needs.”
“With her strong words accompanied by a plan to remove 11,000 staff from its payroll in just three years, Della Valle has signalled she is not messing about.
“But it will take more than just streamlining the business to make it relevant for the 21st century world of telecoms.”