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Yammer breaks down Telstra's management layers

Telstra CEO David Thodey credits social media network Yammer with breaking through 10 layers of management to get employees talking directly to him.
Written by Josh Taylor, Contributor

Enterprise social network application Yammer has "transformed" Telstra and created much more personality in the company, according to CEO David Thodey.

Image: Telstra

Thodey made the comments in a speech to the Trans Tasman Business Circle in Sydney today. He said he was initially hesitant to use the service, which has been around since 2008, but within eight months, Telstra had more than 20,000 users on the internal Yammer network, with frank conversations with the CEO about what products do and don't work within Telstra.

"It has solicited a degree of honesty and openness. There's occasionally a little bit of stuff that comes out, but I tell you I never jump in. It's self-managing, because other people jump in," he said.

Telstra is now the eighth-largest user of Yammer in the world, and the second in the list of companies most engaged on the network. Thodey said that Yammer transformed the company, and created more personality within Telstra.

"It's been, I think, the biggest change in Telstra in terms of breaking down all 10 layers of management and thinking that David Thodey is Mr Thodey. I'm not Mr Thodey, I'm David Thodey."

Yammer was purchased by Microsoft in June 2012 for US$1.2 billion.

Thodey's speech focused largely on the increasing power of the customer, which follows in the footsteps of speeches on shifting the focus to customers by rival CEOs at both Optus and Vodafone.

While the Australian government is heavily focused on the idea of moving further into Asia, in what is termed the Asian Century, Thodey said he believes the focus should be more on the customer.

"I think this is the century of the consumer, and those who do not respond will get left behind," he said.

As with Optus and Vodafone, he said this requires companies to completely change their culture.

"If you don't create a culture of service in your business, and you really don't redefine processes, and really get in and do the hard boring stuff, all of this means nothing. You can't gloss it over with a bit of digital fun; you need to get into the core of your business."

He said customers are not interested in how difficult it is for a company to serve them.

"All they are interested in is getting served and getting a rich experience," he said. "We've got to make it so easy for the customer they just say thank you."

He said it is difficult to get customer service at the forefront of what a company does, because people are already trained to do other things. However, he said that it was a cultural change, and highlighted the work Commonwealth Bank had done in this area.

"They've really kept at it and at it, and have really created a different business out of it."

Thodey said his ultimate goal as CEO is to turn Telstra from an incumbent operator to a company Australia is proud of.

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