Vodafone hints at more streamlining to come

Vodafone is continuing its transformation program and has begun to realign itself, we’re told in a blog post from Vodafone Germany, authored by Head of Media Relations Tobias Krzossa.

“The company is now consistently pursuing its chosen path of realignment. Vodafone therefore wants to make itself even simpler, faster, leaner and therefore more powerful in the next two years.”

The post talks about more efficient processes and optimized structures, and a ‘focus is on even better interaction options and simpler products and services for customers.’

“Costs should be reduced primarily by dismantling complex structures and modernizing network elements and IT systems. Investments in strong networks, simple products, improved customer accessibility, advertising and the growth areas of IoT and cloud are being increased. Always with the aim of improving the customer experience.”

This ‘transformation program’ will result in a financial impact of around 400 million euros over the next two years, we’re told, and material, operating and personnel costs will be reduced. The latter will be achieved through ‘savings and relocation of around 2,000 jobs’ – and also because ‘manual tasks will be carried out through increased automation in the future.’

“As in the past, Vodafone wants to proceed in a socially responsible manner when it comes to personnel changes. Growth areas such as the cloud and IoT business as well as customer-related positions, especially in the corporate customer sector, are to be strengthened with experts.”

in corporate speak words like ‘simpler’, ‘leaner’ and ‘realignment’ usually means shedding staff or divisions in some capacity, and it’s never the sort of thing you want to hear your own employer start peppering into comms, internal or external. While always garnished with a positive spin, trimming down certainly seems to be the order of the day for the wider Vodafone machine.

Earlier this month, Vodafone finalised a deal to sell its Italian unit to Swisscom for €8 billion. This This followed the sale of its Spanish business to UK-based investment firm Zegona Communications for €5 billion in October last year. Both transactions were pitched as part of a wider rejigging of its European footprint.

The firm will now be organised into five business divisions: Germany; European Markets; Africa; Vodafone Business; and Vodafone Investments, and some top brass changes were also detailed as part of the Swisscom announcement.

Meanwhile in the UK, the firm is eagerly waiting on an Ofcom ruling as to whether its proposed merger with Three can go ahead. Both firms take any opportunity possible to make the point that combining into one entity – which Vodafone would own 51% of – is essentially the only way they can carry on.

Vodafone is a big company, one of Europe’s biggest, but the overall picture presented by these recent moves is one of staggered retreats on various fronts, with one of its largest divisions – Germany – now making some additional overtures towards future slimming down.

Our sister publication Light Reading described all this as ‘managed decline’ recently, pointing to exits from India and The US over the last decade or so, and divestments of its tower footprint into Vantage Towers.  

This was also discussed on the Telecoms.com podcast at the time of the deal with Swisscom earlier this month, which you can watch/listen to here.