Page 1
2 3
State: Where did you find your leadership team?
Blount: I knew I wanted Australians in key positions,
but that was difficult to come by because few
people in country had experience with such a large
enterprise. Also, I was the ugly American, so I
didn’t want to bring in people that I knew from
AT&T. I found many of the senior team who were
native Australians working offshore for big, multinational
companies. The remainder were recruited
from other large companies in Australia or were
promoted from the ranks of enlightened managers
within Telstra.
State: Can you talk about the days leading up
to the launching of the initial public offering?
Blount: We launched Telstra as a public company
on November 17, 1997, over five years after I arrived
in Australia. My senior team and I were involved in
a worldwide road show for three weeks, traveling
the globe to sell the shares of the company in this
initial public offering (IPO). The unions realized that
this was their point of maximum leverage, and it
therefore authorized a nationwide strike. I knew it
was serious. If the union struck, then the government
might call in the military to run the vital telecommunications
infrastructure of Telstra. But I
refused to be held hostage to the union. We went
forward with the launch, and in November 1997,
Telstra became the largest IPO in the year. It was
three times oversubscribed at its first offering.
More than 87 percent of the workers crossed
picket lines on the first day of the strike, and by
the next day, more than 90 percent were back
on the job. As for the other 10 percent, I had just
identified people that we really did not need.
State: What made the workers side with the company?
Blount: The senior leadership team and I had set about on a multiyear
effort years earlier to win the hearts and minds of our employees.
They understood the need for change. All of my direct reports
and I met with workers one day a week primarily to listen to their
concerns and to explain the necessity of massive change within
the company. The company had 5,000 work locations throughout
Australia with 93,000 people, and I do believe that we were able to
hold face-to-face discussions with the vast majority of these within a
five-year period. We also retrained employees we no longer needed
and helped them find positions with the competition. Instead of
guaranteed lifetime employment, we gave them something better,
guaranteed lifetime employability.
State: How do you measure your success at Telstra?
Blount: Well, there are both quantifiable measures and qualitative
ones I would point to. Financially, the company that I left in 1999
was far superior to the one I inherited late in 1991. The number of
employees went down from 93,000 in 1991 to 52,480 in 1999. The
shareholder value or market capitalization of the company went
from $24B to $111.4B over this same period, so the shareholders
enjoyed great financial success. The profit after tax rose from $1.24B
in 1991 to $3.49B in 1999, while the return on equity rose from 14.0
percent to 29.9 percent. Also, we measured carefully, each year, the
overall employee satisfaction, and between 1991 and 1997, these
measures rose dramatically to all-time highs as well. From a qualitative
point of view, I left Australia with a great feeling of satisfaction since I
left behind a strong company with great senior leaders as well as
great leadership at every management level. Finally, the company
was generally recognized by the public, the media, and the government
as a world-class one.
State: You coauthored a book about your lessons learned in
Australia called Managing in Australia. What are the biggest lessons
you learned?
Blount: One, listen to your intuition when making big decisions.
Two, know that there is life after whatever you’re doing now. And,
three, realize that you can overcome almost any obstacle, whether
it’s a 14-hour flight, working in a foreign country, or finding your way
through a different system of government.
 Previous Page | Top
|
