Master of the harbour

Henrik Poulsen
M.Sc., Finance and Accounting, Aarhus School of Business, Denmark
Career highlights:
2008 President and CEO, TDC A/S
2007 Operating Executive, KKR Capstone
2006 Executive Vice President, LEGO Group

“The telecoms market has limited underlying growth and declining prices,” says Henrik Poulsen. “This is a challenge we share with most of our peers in the European telecoms markets, and a challenge which forces us to focus our efforts; both in terms of reducing cost and complexity and developing our market positions and customer satisfaction.”

Mr Poulsen’s path from a small village in the rural part of Denmark to CEO of a €3.5bn company has taken him past Danish industrial stalwarts, Novo Nordisk and notably LEGO, which he helped turn around during a seven-year stint at the toy legend. Today he faces a similar task at the 130 year-old incumbent telco.

“TDC is a company who, as a monopoly, had a fairly quiet first 110 years, but in the last 20 years has experienced some of the most thorough transformations, with several changes in ownership and introduction of new technologies, at a pace which would leave most businesses breathless,” says Mr Poulsen, running down the list of owners, investments, divestments and technologies since the Danish government decided to privatise TDC in the mid-nineties.

Henrik Poulsen has set high standards for the company. In 2012 TDC is to be the best performing incumbent telecoms company in Europe in terms of profitability, customer satisfaction and employee satisfaction, and progress to this target is already well underway.

Since 2005, TDC has radically changed its strategy. From an expansive strategy with acquisitions of companies across Europe and the Middle East, the Danish telco has divested its entire portfolio of international subsidiaries bar their Nordic companies, lastly with the sale of Swiss mobile provider, Sunrise, to CVC Capital Partners. TDC is now a solely Nordic company with a strong focus on the Danish market and is challenging their incumbent counterparts on the business market in the entire Nordic region. After the sale of Sunrise, TDC is a company with €3.5bn in yearly revenues and a little over 11,000 employees.

“Back in 2005, TDC management saw that there were limited synergies in our portfolio of European companies, and began divesting. In the same period we have improved our EBITDA margin from 28 to 41 percent, so something tells me that it was the right move,” says Mr Poulsen. In 2008 he took over from the Swiss Jens Alder, and had a clear agenda from his first day: “We had to come closer to our customers, understand their needs even better, and reinforce our innovation and marketing,” Mr Poulsen says. “We also had to maintain a strong focus on efficiency improvements and strengthening of our operational processes. And I am happy to say that we have made significant progress – although we are far from finished.”

Take responsibility for the customer
At the heart of Henrik Poulsen’s work are improved customer relations. In a market where the competition is among the fiercest, the customer is not only king, but ruler of the entire universe. TDC has therefore initialised a company wide programme ranging all the way from the CEO to the sales force, with continuous focus and tracking of the customer experience on a weekly basis.

“Getting data and knowing how the customers are responding to our performance on a weekly basis gives us the opportunity to improve and correct mistakes and malfunctioning processes quickly. It raises the heartbeat of the entire organisation and improves our clock speed in the decision making,” Mr Poulsen explains.

And it seems to be working. Fifteen months into the programme TDC has improved a massive six points on the European Customer Satisfaction Index. An almost unprecedented improvement, but the work is far from completed, Henrik Poulsen stresses: “I don’t think you are ever finished improving your customer relations or the processes in a company. It is a continuous journey, which we have just embarked upon. But with the progress we have made in a relatively short space of time, I am confident that we will reach the high targets we set for ourselves.”

Infrastructure as TDC’s legacy
As the incumbent in Denmark, TDC is essentially an infrastructure company built on copper and fibre cables with mobile masts on top, explains Henrik Poulsen. “This is our legacy and our roots,” he emphasises, not without pride, and highlights the epitaph to their 2012 ambition: to remain the backbone of a world class Danish communication society – a point which is underscored by several consecutive top three placings for Denmark in the OECD rankings of the world’s leading communication societies.

TDC will invest well over €3bn in the Danish communication infrastructure across all technologies towards 2020. “We roll out fibre, increase our mobile coverage and implement new and faster technologies. We do this because it’s absolutely necessary to be able to compete in today’s market, and because we are proud of our position as the main provider of communication solutions to the Danish people and businesses.” Henrik Poulsen stays close to the processes, and from time to time spends a day in the trenches with the technicians in the field repairing broken lines and installing new equipment for customers.

That also gives a great insight into the heart of the company, which through its extensive network today offers some of the most sophisticated Triple Play solutions (TV, broadband and telephony) in Europe. And through TDC’s cable TV subsidiary, YouSee, customers can experience cutting edge digital TV and on demand solutions on this platform.

Multi-brand strategy
While TDC has divested on the international scene, the company has been acquiring companies in the Danish market and concurrently positioned a multi-brand portfolio, which offers the company the opportunity to address customers at all technologies in all segments: from no-frills mobile telephony with M1 and low-price broadband with Fullrate, to the premium brand TDC. This strategy invariably results in customers shopping around between different TDC brands, but that is a risk Mr Poulsen is willing to run: “I will rather have some friction between our different brands than open up space for competitors in the market,” he says.

Adaptive employees are key
TDC’s journey from government-owned monopoly to player in a highly competitive market has obviously impacted the employees who have been through massive changes in terms of performance expectations, organisation and culture. While increasing efficiency, all managers have been held personally responsible for employee satisfaction in their part of the business. And it has been possible to improve both efficiency and satisfaction at the same time.

“We have asked a lot of our employees in the previous years, and will continue to do so in the years to come. We have a highly capable, motivated and extremely accountable organisation which demonstrates execution excellence when it comes to delivering in accordance to the strategy. We can only stay strong in this business if we are able to adapt quickly to match the speed with which the technological development accelerates  and accordingly meet the needs and expectations of our customers,”says Mr Poulsen.

Corporate responsibility
This ability to change is also reflected in the company’s approach to corporate responsibility. From being a traditional benefactor of charitable causes, the company has changed its approach to incorporate the competencies of its employees in the partnerships formed with NGOs and the projects invested in.

A good example of this approach is found in the partnership TDC formed with the Danish Red Cross in the beginning of 2009. Here TDC offers know-how and resources to the Danish Red Cross, which is one of three world centres under the international Red Cross responsible for communication and IT in disaster relief areas.

Besides giving Red Cross the necessary financial means to develop their efforts in this area, TDC has sent out employees to help Red Cross in Haiti during the clean-up after the devastating earthquake that hit the impoverished island community in early 2010. This is a partnership which Mr Poulsen is particularly proud of: “When we leverage our expertise to organisations like the Red Cross we do not only do a good deed. We are also showing to the world and to our employees what we as a company are capable of. And we can illustrate to our employees the benefit of their everyday activities to society at large.”

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Author: Travis Esquivel

Travis Esquivel is an engineer, passionate soccer player and full-time dad. He enjoys writing about innovation and technology from time to time.

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