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How TalkTalk is supporting the SME market with lower prices

SME market SME market
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Ewan McIntosh

Dido HardingDido Harding CEO, TalkTalk discusses creating a distinct culture, leading a rugby team not a rowing team and leaving a legacy.

Hot Topics: How has your background in retail shaped your thinking around business in general?

Dido Harding: I spent almost twenty years in retail in some way shape or form. The largest chunk was at Tesco and it teaches you to start from the customer and work back. That’s not how most technologies work and I think that makes us very different as a business because we genuinely try to start from the customer and that means we are constantly challenging the conventional wisdom of the telco sector particularly. My chairman’s favourite phrase is ‘we want to zig where the world zags’. It’s great to work with a group of people who think differently from the sector we’re in.

HT: You took the CEO role at TalkTalk in 2010. In what ways is the CEO role different to the other executive positions you’ve fulfilled?

DH: There’s lots of books that have been written on that subject! If you come up through retailing you have big functional roles. If you’re in publishing, for example, you’re an MD and you progress through taking on increasingly large MD Roles. So my background has been doing bigger and bigger functional roles and then the first truly cross functional job you do is as CEO. It’s important to remember that with the CEO role, you’re leading a rugby team not a rowing team. With a rowing team everyone, other than the cox, is basically doing the same thing and they’re all the same shape and size. Whereas with a rugby team, people are completely different shapes and sizes and have got very unique individual skills. So in terms of the leadership aspect of the CEO role, you’re leading a team of people who are very, very different and that’s hugely challenging. The other bit that no one sees until they are the CEO, particularly of a publically quoted company, is that a very large part of the role is doing things outside of the company rather than inside it. The second factor makes the job very different even in comparison to being the divisional CEO of a business much bigger than mine.

HT: I understand that you value mentorship and development of employees highly. Who do you turn to for advice?

DH: I count myself as very lucky in that I’ve worked closely with a number of really impressive Chief executives who are all very different. I saw Terry Leahy (former CEO of Tesco) over a long period of time, Justin King (former CEO of Sainsbury’s) is also amazing, and I also worked directly for Geoff Malcahy (former CEO of Kingfisher). A large part of learning, is not through someone telling you, it’s by watching other people do their jobs. Then probably my biggest mentor is a chap called John Gildersleeve who is the main reason I’m here. He was the Chairman of Carphone Warehouse, and when I first joined Tesco 14 years ago John was my boss. If ever I have a really big issue I will go and seek his advice.

HT: I know customer service is something which you have focused on a lot since you joined the business. How do you achieve great customer service?

DH: Getting better at providing services to our customers is not a crash diet, it’s a new way of life and rather like dieting it’s never ending. I think the very best service organisations don’t think they do a very good job at all and they’re constantly thinking they can do better. We know we can do better and the secret, if there is one, is learning how to properly hear the feedback from your customers. Often you think you’ve heard it but you’ve convinced yourself that a customer didn’t really mean that – let’s try and do something slightly different. It’s having the courage to really hear it and then work out how you change the way the business works to deliver what the customer actually wants, rather than what the business has always been set up do to do. I’ve learnt that you improve service inch by inch and you’re only as good as the last interaction your customer had with you.

HT: How do you define the culture of the business and how have you changed it since you’ve been on board?

DH: When I joined most people didn’t say they worked for TalkTalk, they said they were ex-something. People were ex-Carphone Warehouse, ex-AOL, ex-Tiscali etc. We started with this kaleidoscope of cultures and with no-one having a real sense of identity. One of the big goals has been to set out what we wanted the business to stand for and create a culture in our own right. I think one of the things that people here are most proud of is that we’ve become a distinct place. If you want to keep the entrepreneurial core of a business you need to maintain the ability for people to be individuals. This is the most diverse group of folk I’ve ever worked with in every sense; in terms of sex, race, age, technical discipline and we have to use that to our advantage to compete against companies that are massively bigger than us. We’ll be a better rugby team and a more fun place for those people to work because they can be themselves and they can take some risks that maybe the bigger corporates can’t.

HT: How is your work in TV an example of that?

DH: A year ago lots of people were quite dismissive of what we were doing on TV but we’ll have nearly 1million TV customers by the end of the year. We’ve added more TV customers than all of our competitors put together over the last six months because we’re tapping into a new market; we’re zigging where the world zags and that’s a fun place to be.

HT: How to you attract and retain the best talent in the business?

DH: It’s partly through the creation of meaning in the workplace. For example, I think engineers want to believe that they are solving difficult problems and that they’re doing things that other people aren’t doing. My commercial people genuinely want to feel like they are making Britain better off. It’s not just about making money. It has never been the case that increasing peoples pay when they were unhappy meant they would stay longer. They need to feel engaged and valued and if we can have our people do stuff that in other companies they wouldn’t be considered ready for, we give them a real sense of purpose. We also have a counter-cultural view in that we will celebrate people being promoted outside of the company. If we’re doing a good job underneath them, there will be people to take on those jobs and grow.

HT: I understand the B2B arm of TalkTalk is a real growth area so how do you ensure you have a strong proposition for both the SME market and large corporates?

DH: I think the B2B market is actually much more complicated than the consumer market. What a business with less than five employees needs for their connectivity compared to what Unilever needs is completely different, so the thing you have to do, if you’re a relatively small company like us, is keep it really simple. We’re now very clear about where we want to be and where we don’t. We have a great business with partners where we provide the connectivity and the partner deals directly with the end company. For example, we’re never going to serve the government directly – it’s too complicated. But we can provide connectivity to businesses that provide integrated technology solutions to government or to Goldman Sachs or to Unilever. So we can build a big corporate data business through working with partners, where we’re providing much the best value data connectivity on the back of our network. That’s the number one growth area. The other growth area is our direct, small business propositions. One third of the SME market don’t have transactional websites and if the country is going to grow we need our SME’s to grow. We can provide value for money connectivity at the small end of the SME market. We just re-launched our business broadband and brought the prices down dramatically so we see the opportunity to grow market share in that space and help businesses save money.

HT: What’s the continued vision for TalkTalk, where do you want to be in three to five years?

DH: I’d love to say that in five years’ time there are many fewer people that are digitally excluded in the country, that many more businesses are using connectivity and that we’ve played a really big role in making that happen. We want to be a company that has changed the service model, simplified it and be recognised as providing good service, not just a cheap service. That’s the legacy I’d really like to leave. So in five years’ time I’ve no idea what our new product idea will be, but it will be something because the thing you can be certain with in this sector is that in five years’ time our customers will be wanting to do more on their pipe coming into their homes. If I’ve done my job we will have a mad idea that we’ll be launching in five years’ time to grow the business even further.