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THE 2008 BUSINESS YEAR IN REVIEW Biggest Question of the year – will LIME work?

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“A new name that says what we do, which stands for something, which tells the Caribbean that we’re back and that we mean business.”

Cable and Wireless, now trading as LIME just refuses to roll over and die. In July, Shareholders chided the board for C&WJ losses. Shareholders attending the 21st annual general meeting (AGM) stopped short of blaming the Board of Directors and management team for not intervening sooner to stem losses at the firm. The company, in a year, accumulated $2 billion of losses, wiping out $2 billion of profit in 2006, and sparking concerns about the company’s future here by investors. One particular shareholder said at the meeting that he had expected the company to announce its exit from Jamaica after news that C&WJ’s parent company, C&W PLC was disappointed with its performance. “I came here expecting to attend the funeral of Cable and Wireless Jamaica,” said the shareholder.

But LIME is not going down without a good fight.

LIME has changed CEOs countless times over the last five years and has equally sought to rebrand its mobile service many times in an effort to fight back against Digicel. Cable and Wireless on numerous occasions under different CEOs has sought to transform itself from within, none of which has yet to generate the kind of traction desired. The final attempt is to discard the name it has been known as for over 100 years in favour of LIME an acronym for Landline Internet Mobile and Entertainment.

Suffering from poor customer service across its many business lines and despite costly attempts to fix it, LIME pushes on hoping and praying that the much needed internal transformation will occur sooner rather than later.

But losses are mounting and the CEO turnover continues with the recently appointed Phil Green leaving at the end of this month. In May, the headlines read C&WJ loses $4b – Parent profit dips. Telecommunications Company Cable & Wireless Plc said it was considering a demerger of its business units after it posted a 5.7 per cent drop in full year net profit. The Jamaican company also released results to the Jamaica Stock Exchange that were below expectations. Released after market close, C&WJ reported a $4.2b loss off lower revenues of $23 billion. “We will look at all options,” Finance Director Tony Rice said, adding that it could include a break-up, the sale of some businesses, or borrowing money to return capital to shareholders. “We’re talking about doing something in 2008 and 2009.”

This was the first formal indication that more changes were to come for the struggling company.

Later that month, the headline reads Rodney Davis sues C&W Jamaica – Telecoms claims former boss breached authority. Rodney Davis, terminated last year as Chief Executive Officer of Cable and Wireless Jamaica, has sued his former employers to recover £201,840 (J$28 million), or half of what he said was the agreed settlement when he was shown the door in August 2007. In court documents, Davis said, C&W claimed to have withheld the cash because of alleged breaches of authority by him in contracts executed while he was boss of the Jamaican subsidiary of the UK-based telecoms firm. Davis, who rejects the accusations in court papers as “disingenuous” could not be contacted for comment on the case filed on his behalf by the Kingston law firm, Nunes Scholefield and DeLeon.

There was growing speculation that Cable and Wireless Jamaica would seek to stop the Flow march and roll out its own subscriber television service. Well its now confirmed, Cable and Wireless Jamaica (C&WJ), as well as its wider regional operations, will be entering the market for subscriber television (STV) and the delivery of content, a plan that will pitch it directly against Columbus Communications, parent company to Flow, but also positions the telecoms as a ‘true’ full-service operation.

The announcement confirmed a story carried in 2007 by Businessuite magazine.
The headline of the November 2007 issue of the Businessuite magazine read, “WHO CAN STOP THE FLOW CABLE MONOPOLY?” The following quote is taken from that cover story article. “Unless the remaining players see the wisdom in merging their operations for their survival and for the good of their customers, in the short run, when Flow has completed its acquisitions, it may very well be the only game in town.” On the cover of the same issue, the Cable and Wireless logo was positioned in the lower left hand corner, on a page dominated by the Flow logo.

In August, it’s announced that C&WJ’s borrowings grow to $10 billion – Parent refinances Citibank debt. Cable and Wireless Jamaica’s (C&WJ) long-term debt has more than doubled in a year to just under $10 billion, but the majority is funds injected by its British parent, which has thrown billions of dollars at the company as the new man, Phil Green, nurses it back to health. At its financial year end March 2008, C&WJ owed Citibank NA close to $4 billion, and its ultimate parent $6 billion, but the short-term bridge financing bank loan was subsequently paid off on May 12 “through financing arrangements from a related company”, leaving Jamaica more heavily indebted to its parent.

In September, word is “leaked” that Cable & Wireless is pondering a rebranding to LIME. Telecoms giant Cable & Wireless (C&W) is considering yet another rebranding exercise for its Caribbean operations, this time mulling over the acronym, LIME, which stands for Landline, Internet, Mobile, and Entertainment. An internal memo from a C&W executive read: “We spent the day talking about the transformation of our business and the journey that we’ve embarked on to create a strong Caribbean business, which customers want to work with and colleagues are proud to work for. More specifically, we spent our time looking in some detail at the next phase of our journey. The phase where we create and introduce a new version of our brand, a fresh approach that signals to colleagues and customers that we’ve changed, that we’ve transformed and that we’re becoming the business they want us to be. “We’ll be taking this new version of C&W out to market before Christmas. We are going to rename our business. We’re changing our name because the business we’re becoming bears little resemblance to the business we were because we want to show the world how much we’ve changed. Ladies and gentlemen start preparing because Cable & Wireless Caribbean is going to become LIME- Landline, Internet, Mobile, and Entertainment.”

But will the move to LIME help Cable & Wireless? , asks Businessuite, which is an attempt to reposition a company from 13 different businesses to One Caribbean business. According to an industry watcher, “The Jamaican consumer and for that matter the Caribbean consumer has over the years fallen out of love with C&W. Like many relationships, they continued to live with C&W because ‘no betta no deh’. Along come Digicel, younger, energetic, modern, and man looking fine. The consumer does not need much to convince them to leave C&W for the new suitor and so they do in droves. C&W, on the other hand, rather than recognize what is happening, starts to cuss and criticise the new player, who simply ignores them and continue to woo the consumer with all manners of gifts and new toys.

The consumer falls deeply in love with Digicel and many vows never to go back. Some consumers however play it safe and give C&W “bun”, by flirting and entering a relationship with Digicel, while at the same time holding on to C&W. Other consumers see the new player and prefer to stick with the evil they know.

When Miphone enters the scene, the consumer cannot believe their luck, some jump ship and leave C&W and Digicel, others give C&W and Digicel “bun”; and still others, the vast majority, and stick with whom they have.

Now, in that situation, C&W has to try to woo the consumer back, they have to find out why the consumer left them and under what conditions they will return. I am yet to see a communication programme or campaign from C&W that speaks to this issue. Digicel on the other hand is showering the consumer with love, adoration and gifts; ensuring that it will have to take tremendous efforts by C&W and Miphone to woo them away. What C&W needs to understand is what is commonly known as “brand affinity.”

Speculation is finally confirmed in November when it’s announced that C&W will rebrand as ‘LIME’. Cable & Wireless unveiled their rebranding in the Caribbean as ‘LIME’ representing their four services: Landlines, Internet, Mobile and Entertainment/cable television – for which they have applied to the Broadcasting Commission for an islandwide license in Jamaica. The new brand will launch across its 13 Caribbean markets: Anguilla; Antigua; Barbados; British Virgin Islands; Cayman Islands; Dominica; Grenada; Jamaica; Montserrat; St Kitts and Nevis; St Lucia; St Vincent and the Grenadines; and Turks and Caicos.

In November, it’s reported that Sales at LIME, all but stagnated in its first half year, but having strangled close to a billion dollars from the company’s cost of doing business, President Phil Green has teased more than a quarter billion dollars of operating profit from the struggling operation, beset by rivalry. Revenues of $11.27 billion at September 30 represented a slight 1.3 per cent gain on the six-month income recorded in the comparative period in 2007. But the earliest sign of the company’s improved performance was gross income, which rose 66 per cent to $7.4 billion from $6.28 billion year on year, due to the $550 million sliced off out payments to local and international carriers on whose network C&WJ calls terminated, and another $430 million from other cost of sales.

Within those numbers, signs of how Green hopes to revive the loss-making company are emerging. However, by the end of November, the announcement comes. Phil Green has resigned as Cable & Wireless Jamaica (C&WJ) President, making him the fourth president, in as many years, to leave the struggling telecom. Come January 1, Geoff Houston will head the local operations as Country Manager, whilst Green will remain in the group. Green remains Chairman of LIME Caribbean and Chairman of Cable & Wireless’ Macau business.

As one industry watcher commented “The Jamaican consumer and for that matter the Caribbean consumer has over the years fallen out of love with C&W. Like many relationships, they continued to live with C&W because ‘no betta no deh’. But that was before Digicel, younger, energetic, modern, and then came along CLARO with a lot of money to spend.

But you have to give LIME credit for fighting back and refusing to let the odds beat them, even when all the odds seem to be against them.

Dr. Anita Davis-DeFoe, an author and international business thought and management consultant, when asked her assessment of this business case, commented, “So often if a company has dominated a market for a long time, and new competitors enter, instead of creating a proactive visionary strategy based upon systematic and consistent marketing of a rebranding message, as well as enhanced customer service and product innovations, they end up with a fragmented reactionary approach that is not based upon systemic assessment and a need to respond to market and consumer taste shifts.

There are a number of organization development and change management tools that Cable and Wireless, now LIME can use to construct such a strategy; but the constant staff changes, the loss market share, inconsistent and inadequate marketing approaches are indicators to me that this is a company that has not taken the time to analyze all of its organizational systems, identify gaps, and then construct action plans focused on employee engagement, change management, and a communications strategy, both internally and externally; which may very well include a name or logo change. But doing that in the absence of an organizational assessment is merely placing a band-aid on a bleeding wound, and I hope that is not the case, because if it is, there will be more operational agony to come. This company needs an organizational and management consultant team to analyze its processes and functioning at all levels so that it can determine how best to regain its competitive edge.”

LIME may be struggling but it’s certainly not out for the count. This is a company that has shown grit and a strong and determined will to live and for that they must be given credit; many would have thrown in the towel by now.

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Shareholders of GraceKennedy Limited will this morning meet to consider and, if thought fit, approve a recommendation for a three-for-one stock split.

If approved, shareholders will receive three stocks for each one that is currently held.

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Caribbean Hotels Named In Jetsetters’ 2016 Best Of The Best

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