Former Telstra CEO Ziggy Switkowski is tipped to become NBN Co’s newest chief executive, but one academic has predicted he may struggle in the role.
Mark Gregory, senior lecturer at RMIT, says Switkowski could struggle due to his lack of construction knowledge in rolling out fibre optic networks.
“I don’t feel that he has the motivating capability given that there’s still a lot of concern over his tenure at Telstra,” Gregory says.
“I feel that there’s a belief amongst staff at Telstra and also amongst the shareholders that he missed a number of opportunities and that really, Telstra didn’t go anywhere [during his tenure].”
Gregory says Switkowski might also have trouble mobilising a demoralised workforce – he says there could be a high staff churn rate that will require strong leadership in human resource management.
Switkowski is likely to handle this by personalising his management style by visiting and engaging with staff, according to Gregory.
“He’s more of a visible person, but whether or not he’s visible enough and has enough time to be able to get around to put out fires before they take hold – we’re yet to see,” Gregory says.
However, Guy Cranswick, analyst at IBRS, says the CEO of NBN Co does not need construction experience. He says Switkowski’s experience in leading a major Australian telco is enough.
“It’s not as if the executive board of the NBN is … necessarily out there in the field dealing with ducts and that kind of thing,” he says.
“It’s having an appreciation of how to deal with management and how to get the right people, how to ask the right questions, how to make decisions and the right kind of timing.”
Switkowski has extensive experience in the telco industry.
In 1999, he was appointed chief executive at Telstra. He resigned from this position in 2004 and left with a reported payout of $2,092,000, not including leave, entitlements and bonuses. Following his departure, he said he wanted to become a “normal” person again.
“Running Telstra requires near-obsessive commitment to the details of the job," he said.
Switkowski has also held the chief executive role at Optus and Kodak (Australia).
More recently he led the review into practices and procedures at Essendon AFL club following drugs investigations. He also has a history as a nuclear physicist.
As early as May this year, communications minister Malcolm Turnbull was scouting former Telstra employees for a new board for NBN Co, including Switkowski.
“Obviously, Ziggy Switkowski is a person of outstanding ability and experience,” Turnbull told the AFR in May.
More recently, Turnbull told ABC Radio Switkowski was “one of our most distinguished business leaders”.
A Telstra advantage?
Changing the National Broadband Network (NBN) to a fibre-to-the-node network will have significant implications for Telstra's copper network, requiring new negotiations between the telco and the federal government over a key $11 billion agreement between the two. This includes agreements around who will own and maintain the copper network.
While Switkowski led Telstra for more than five years, Gregory says Switkowski’s history with the telco is unlikely to give him much of an advantage in helping to renegotiate a new agreement.
He says while his knowledge of internal workings at Telstra could be of some benefit, too much time has passed since he was involved with the telco.
“Whether or not that will be any advantage really will be outweighed by how the current management at Telstra wants to pursue the possible contracts and the possible renegotiation,” Gregory says.
The politics of the NBN
The NBN has been a politically-charged project, with outgoing CEO Mike Quigley often coming under fire during parliamentary hearings about the project. Just last week, Turnbull confirmed he asked NBN Co board members to resign.
Cranswick says Switkowski will be adept at handling this politicised aspect of the infrastructure project.
“He’s been a CEO of a major telco, he knows about how to deal with politicians and he knows how to deal with shareholders,” he says.
“His tenure at Telstra was fairly good in terms of the relationship with the government at that time. I’m going to assume he has the confidence of not only of the minister but also of other members of … the Coalition government.”
Cranswick says the influence Switkowski will have on the NBN will ultimately depend on how the scope of the project changes from the Labor plan, with the Coalition announcing an NBN audit that will last 60 days, commencing after a new NBN Co board is chosen.
Cranswick said any project changes will determine whether Switkowski is just steering the project or actually driving it.
“It depends how NBN Co is transformed over the next six to 12 months and then we’ll have a clearer sense of what he can do and what the potential is or if he is restricted from other forces that are impinged on him,” he says.