A View from the Top – David Thodey Interview – Part 1: Why Enterprise Social Networking?

In her article “Why No-one Uses the Corporate Social Network”, where Charlene Li bemoans the lack of leadership participation, David Thodey, the then CEO of Australia’s largest Telecommunications company, was highlighted as a rare exception. Not long after the article was published, David Thodey retired from Telstra and on to his next challenge. The accolades following his 6 year rein at the top of Telstra were spectacular. In the words of Telstra Chair Catherine Livingstone “David has been an outstanding chief executive for our customers, shareholders and employees. His passion for customer service and instigating true cultural change has had an enormously positive effect on our company, which has been reflected in our financial performance in recent years”. The business press was no less generous with Business Insider headlining their article on the announcement of his retirement with “David Thodey is leaving Telstra, having doubled the value of the company Australia once loved to hate”  and the Sydney Morning Herald with “Mr Thodey has been credited with a remarkable turnaround in Telstra’s fortunes, taking its share price from a historic low just four years ago and lifting it to a 14-year high”. We were fortunate recently to be able to catch up with David to gain his reflections on Enterprise Social and the part it played in helping achieve Thodey’s vision for the company.

To provide some additional context to Thodey’s achievements at Telstra; Telstra is Australia’s privatised national telecommunications carrier, with some 38,000 staff treading the familiar path of many national carriers world wide, toward the end of last century. Telstra’s privitisation happened toward the end of the 1990s. As Australian citizens, we were offered the opportunity to buy into a modest allocation of shares. Here was a large bureaucratic public institution about to have the magic wand of commercial imperative employed, at a time where the Internet and mobile telephony were taking off. Sitting as the current monopoly owner of the required digital infrastructure, who wouldn’t want to invest? I, as many others did. I even took out full allocations in the names of my wife and children to make sure we made the most of this ‘once in a lifetime’ opportunity. To our dismay the following decade or more saw a procession of imported CEOs, erosion of their market share by more agile competitors and a share price that was going backwards rapidly. At the risk of sounding overly patriotic, it was endearing to find a homegrown CEO led the turnaround, after the often tumultuous tenures of his predecessors.

While much has been written about Thodey’s business achievements, this article is about his unique contributions to the use of Enterprise Social to empower and change a business. Like Charlene Li, we are passionate about the potential power of Enterprise Social. Prior to our interview, we had the opportunity to apply our social networking analytics to some historical Yammer use data during Thodey’s tenure; so we were well prepared for our interview.

Our interview took place appropriately in one of the offices for improving digital productivity at Australia’s national research organisation, the CSIRO, the organisation Thodey now chairs. It is not often we get to talk candidly with CEOs of major corporations that have embraced social. Our first question therefore was to ask Thodey to tell us his story and what drove him to want to embrace enterprise social networking to the extent that he had.  With little reflection his initial response was “ineffective communications”, quickly followed by an “e-mail only” culture. Additionally he felt information silos were reinforcing an internal only focus, often at the expense of the external customers. Of course this is no surprise to Enterprise Social Networking (ESN) zealots like us, but it was nice to have this reinforced from the start. Expanding on this Thodey then went on to talk about CEO specific issues, where communications both into and out of the CEO’s office are carefully monitored. In this context it is close to impossible for the CEO to get to the ‘truth’ of a given matter, or to indeed have unfiltered authentic dialog with staff beyond his or her direct reports.

The discussion moved on to hierarchy and process. In essence these were seen as the ‘enemy of effective communication’, yet we did sense an acknowledgement of a ‘necessary evil’. Thodey was adamant though that “processes must be enablers for getting work done, not impediments” and therefore should not take precedence over the right outcomes, which unfortunately is often the case. For us it was enlightening to hear from someone at the very top of the hierarchy bemoaning its existence. An analogy might be someone who has worked hard to afford a penthouse suite at the top of the tallest building in the city. From there you can get the best views of the city below, the parks, other buildings, the traffic, the more seedy areas, as well as impending weather events and potential impacts. Unfortunately, unlike the occupant of this penthouse, the CEO must always wear these special glasses with rose tinting, which nicely filters out the seedy areas, the traffic and makes sure that the sun is always shining.

Thodey admitted to being curious more so than excited by the prospect of Yammer at first. Being a baby boomer with a strong exposure to technology (he previously had been the local IBM MD), the curiosity is always there, but with a healthy cynicism of the hype that often pervades the IT industry. His moment of truth however came when he saw Yammer used by a young service centre operator, having to deal with a technical enquiry about a Nokia 6010 mobile phone. It was apparent that when this phone was released the operator was probably still in junior primary school, so he did what came natural and put a request out onto the network. The response was rapid and willing, with no evidence of process or hierarchical compliance. The customer was going to get a response in close to real-time. This is what played to Thodey’s keen sense of customer service and the prioritisation of positive outcomes, over process. He was hooked and wanted to get Yammer properly set up as a fully functional and endorsed service.

In Part 2  and Part 3 of this series we will cover Thodey’s personal experiences with the introduction and ongoing use of the platform in his role as CEO.