Verizon's CEO talked about the company's mistakes that led to customer losses.
Verizon has acknowledged its mistakes.
A Verizon store is shown. | Image Credit: Fierce Wireless
During a virtual meeting on Friday, Verizon's new CEO, Daniel Schulman, addressed the reasons behind the company's 13,000 layoffs and described the next steps, according to Barron’s.
Verizon Takes Responsibility
Schulman admitted during the webcast that several errors contributed to a decline. Over the past five years, the company's market share decreased by 5 to 7 percent, which impacted revenue. To compensate, the company increased rates, but this was counterproductive and raised the churn rate (customer turnover) to about 0.25 percent.
Schulman also stated that Verizon's customers are less happy than those of other carriers, attributing this to employees lacking the resources to complete tasks.
The CEO stated that substantial layoffs were required to reallocate resources toward creating customer value. He said that without the layoffs, the company's market share could have further declined and that small measures would not have sufficed.
Schulman's efforts seem to be yielding results. He revealed the company performed well over the Thanksgiving holiday. He concluded the meeting by wishing employees happy holidays and encouraging them to finish the quarter strong.
Schulman May Be Steering Verizon in a Better Direction
Schulman bears a great deal of responsibility. He has a strong history of enhancing company performance, though some decisions have not been successful.
The solid performance during Thanksgiving suggests a possible shift for the company, but conclusions remain speculative without concrete data.
Schulman also seeks to expand the business unit, mentioning that the company intends to serve major cloud service providers.
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The CEO did not elaborate on his new strategy for the company, but AI will be central to the transformation to lower costs and streamline processes. Schulman has previously cited friction caused by overly complex promotions as a problem. Customer service is also a key focus.
Promising Developments
It remains to be seen if Verizon can regain its leadership position, but it is encouraging that the company acknowledges its errors. There are reports that Verizon is losing money on its recent deals. The carrier is committed to offering customer value, even without direct price cuts. This shows the company is serious about pleasing customers and regaining their favor.