Cable & Wireless aims to serve the world

The first privatised firm in telecoms, BT’s main rival is setting its sights
firmly on world domination in the provision of internet-based services by
expanding its already widespread global presence. By Nic Paton

From its beginning in the 1860s, when it was at the forefront of developing
telegraph technology, Cable & Wireless has grown into one of the UK’s
leading telecoms firms.

The company started as a conglomerate of four telegraph companies, which
merged to form the Eastern Telegraph Company, in turn becoming Imperial and
International Communications and then, in 1934, Cable & Wireless.

Nationalised after the Second World War, in 1981 it was the first telecoms
firm to be privatised, preceding BT by three years. It was also the company
behind the Mercury payphones that sprung up on Britain’s high-streets during
that decade as the first serious rival to BT.

The company now operates globally, divided into two divisions, Cable &
Wireless Global and Cable & Wireless Regional. The Global operation
encompasses Europe, the US and Japan, while the Regional arm takes in 33 other
countries, particularly the Caribbean and, most recently, Guernsey.

Within Europe, it operates in the UK, France, Italy, Germany, Spain,
Portugal, Belgium, Holland, Austria, Switzerland, Sweden and Russia.

Overall, the group employs 26,000 staff, of which around 13,000 work for
Cable & Wireless Global. Last year it reported pre-tax profits of £61m on
sales of £5.9bn.

The company’s strategy for the moment is to focus on building C&W Global
into "a world leader in internet services for business customers".

Recruitment

A total of 1,500 staff were recruited globally last year, of which 400 were
based in the UK. The tough market conditions, which have seen the cost base
being reduced by 40 per cent, means recruitment is being radically cut this
year. The UK target for the next 12 months is to recruit 100 staff.

Cathy McNulty, senior vice-president HR, at Cable & Wireless Global,
says the 50 new UK graduate recruits last year will be reduced to nine or 10,
mostly in the financial areas.

Graduates join a two-year job placement training scheme, moving jobs three
times a year to gain as wide a range of experience as possible. Training
modules are focused on building up their skill levels through a combination of
online training, assessment centres and telescreening.

Graduates must apply online and the vast majority of CVs are now received
via e-mail, says McNulty.

Retention

Staff turnover, at 12 per cent, is about level with the industry average.
Compulsory redundancies this year mean that rate is likely to come down.

The company offers a range of flexible working options, including a final
salary pension scheme and, for new recruits, a ‘lifetime benefits’ plan. There
are also various share save and purchase schemes in place.

Staff are covered by life insurance, have private healthcare, dental care
and subsidised childcare vouchers. Work sabbaticals, job sharing and reduced
hours’ packages are also available.

Women who have been with the company more than 12 months can take eight
weeks’ maternity leave on full pay, after which it reverts to 10 weeks on the
statutory minimum.

After 10 years service, workers are entitled to an extra day annual leave.
Call centre staff have exactly the same terms and conditions as other
employees, stresses McNulty.

Discretionary benefits include long-term invalidity benefit, payment of
professional subscriptions, season tickets, cheap car leasing and discounted
gym membership.

Training and development

Cable & Wireless has outsourced its training and development to
Accenture, part of a five-year contract announced in December worth an
estimated £80m.

A core team of eight remain at Cable & Wireless to deal with strategic
training and development initiatives. A further eight people work on delivering
technical training needs.

The majority of training and development is carried out online. On 1 April,
Cable & Wireless rolled out a new performance management system accessible
from the desktop, including an e-HR system, again run by Accenture. This links
into the formal review process, including the creation of personal development
plans.

Where appropriate, for instance for customer service or technical, operation
and network training, training is carried out in a classroom or ‘shop floor’
setting.

Like many in the sector, Cable & Wireless has moved away from planning a
set number of training days for staff or new recruits, expecting training to be
an ongoing, constant process.

Performance management

Key performance indicators are a central part of the appraisal process at
Cable & Wireless. Indicators are drawn up designed to drive forward
objectives, says McNulty.

HR is closely linked to the business strategy, which is currently focused on
reducing costs, increasing organisational efficiency, improving performance and
enabling business managers to manage more effectively.

The company’s values – team work, integrity, innovation and customer action
– are linked to the performance management system (see above) through the
office intranet.

Succession planning meetings are held at group level three times a year, a
similar number of times at global level and cascade on down the business.

HR priorities for the year

Perhaps inevitably given the tough state of the sector, focused on managing
costs and supporting the business to reach its financial objectives.

HR factfile

Cathy McNulty
Senior vice-president HR, at Cable & Wireless Global

McNulty joined Cable & Wireless
in 1997, having started her career with BT before moving into investment
banking. Starting in head office, she rose to become HR director of the
Regional business before transferring to the Global side last year.

She became senior vice-president HR, at Cable & Wireless
Global on 1 April, succeeding Avery Duff.

The best part of the job, she says, is that it is such a
fast-moving environment. "You really feel you are making a difference,
adding something to the bottom line. You feel you can have a direct impact on
the business."

The downside, in such a global business, is the amount of
travelling involved and the hours involved. "Often I will be at my desk at
7am for a conference call with Tokyo, but then I’ll need to do one for the US
at 4.30pm. You need a lot of energy," she says.

McNulty is not on the Cable & Wireless board and her salary
was not disclosed.

Size of HR team

120 people globally, of which 65 are based in the UK.

HR department structure

The Global HR team is aligned to the businesses, therefore,
McNulty has staff in the UK, US and Japan and spread across Europe. The team
divides into HR business partners, specialists, the outsourced function and
service management.

Ratio of HR to employees

About 1:80/100 within the UK

Among business partners – the operational side of the HR
function – it is closer to 1 to 175/200.

Key HR initiatives

The HR team has been closely involved in looking at the design
of the global sales force, in particular whether it should be structured
geographically or on a sector basis.

How she spends her time

– change management, key appointments
and organisational design issues

– is spent on retention and compensation issues

– on succession planning, talent and reward structures and
driving performance

– on enabling the business to be managed more effectively

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