The 107 strategic appointments Cell C CEO Jorge Mendes has made since joining the network operator played a crucial role in the short-term progress of its turnaround strategy, he says.
Mendes, who assumed the role of top man at SA’s fourth-biggest mobile operator last July, replacing Douglas Craigie Stevenson, is tasked with turning the company’s fortunes around.
Over the 15 months since his appointment, he has been on a hiring spree, on-boarding experienced veterans in SA’s telecoms sector across key executive roles, including CFO, chief of staff, strategy and business transformation, head of growth and retentions, chief growth officer and chief of data and analytics.
During a media dinner, held in Johannesburg with Mendes last night, he explained the new hires are key to his vision to strengthen the debt-laden company’s balance sheet, as it implements a renewed growth strategy and fends off increasing market competition.
The new appointments, he explained, have been responsible for supporting Cell C’s strategy, including implementing the newly-launched brand refresh, growing the mobile virtual network operator (MVNO) business, increasing the retail distribution network, executing the objectives of the consumer-facing business, modernising the network and growing Cell C’s SME-focused unit.
“We've made over 107 appointments within the last 15 months, so our executive committee team of nine is complete. It’s been very calculated; some people have moved within the organisation, so there have been promotions, restructuring, and external and internal appointments.
“Our multi-operator roaming strategy is complete and there have been improvements in network speed. Our MVNO data revenue is growing 20% year-on-year, and data traffic is growing 20% year-on-year. The network capacity is good and shows growth.
“We’re back to growing our fibre business as a reseller, and we’re building our enterprise business focused on SMEs and large enterprises. Blue Label’s Comm Equipment Company is being integrated back into Cell C, and we are seeing growth in that area too.”
According to Mendes, while most of the newly-hired employees are new to Cell C, they are not new to the telecoms industry and possess skills, expertise and experience – crucial attributes that will continue to grow the company’s market share.
The company is looking to become profitable within 24 months, with building a healthy workforce, strong partnerships and stakeholder relations being key to the organisation’s “customer-centric” strategy, he noted.
Over the years, Cell C incurred R5 billion of shareholder debt, and its majority shareholder Blue Label Telecoms previously said it expects to start seeing returns on its multibillion-rand investment in the mobile operator in 2025. Blue Label has invested close to R7.5 billion in the mobile operator.
In August, the mobile network operator unveiled a new brand identity and logo, introduced as part of its turnaround strategy, to better position itself to gain a bigger share of SA’s tightly-contested telecoms market.
This included introducing new products and services, taking its business-to-business unit to the next level, rebuilding its digital channels from the ground up, as well as digitising its retail stores, to offer customers a seamless omni-channel experience.
“The rebrand is going well, and in all fairness, all the KPIs are treading in the right direction. The reality is that it’s only been two months since our brand refresh, but customers are growing and we have big plans for Black Friday.
“We are building our enterprise unit and have on-boarded more than 40 business partners, and we are now busy trying to sign some government deals. Our fibre business is still small, with only 13 000 customers, but we are planning to grow that unit too.”
Cell C is the largest provider of MVNO services in SA, although MTN and Vodacom have launched platforms of their own.
“We've re-signed new contractual agreements with MVNO partners First National Bank and Capitec, and we’ve signed a new deal with Old Mutual. We’ve cut prices significantly to make our partners more competitive. We’ve re-priced prepaid services and created a new customer value management capability.
“Our strategy was to significantly reduce costs for roaming fees with Vodacom and MTN, and that has been done. We now have 13 MVNO partners; we want to ensure we continue to grow the network and dominate that space.”
Cell C is transferring licences to The Prepaid Company (TPC), a subsidiary of Blue Label.
JSE-listed Blue Label has a non-controlling 49.5% stake in the operator, and is looking to get an additional 4.04% stake via TPC, in order to get control of Cell C.
“The matter is now in the hands of the Competition Commission for approval. We are hoping for a favourable decision from regulators and we can only hope for the best, and that the deal goes through.”