Ericsson announces changes to executive leadership team

NEW DELHI: Swedish telecom giant Ericsson has announced a series of organizational and structural changes to strengthen strategy execution to drive growth and profitability.

Hans Vestberg, President and CEO, Ericsson, says: "We are not satisfied with our overall growth and profitability development over past years. We are today announcing further actions to accelerate strategy execution and to drive efficiency and growth across the company even harder. We will create a leaner, more fit for purpose organization, to cater for the needs of different customer segments and to faster capture market opportunities. As 5G, the Internet of Things, and Cloud drive the next phase of industry development, the time is just right to make these changes."

Overall company strategy execution will be strengthened through an organizational structure aligned around type of customers and type of business. The new structure will have five business units and one dedicated customer group for Industry & Society, in line with the company focus on core business, targeted growth areas and cost and efficiency.

Core business - Two Networks business units, Business Unit Network Products and Business Unit Networks Services, will focus on incremental improvements in networks business performance, capturing opportunities in 4G and extending leadership into 5G. The two business units will leverage the combined strength in products and services with BU Networks Services focusing on Managed Services, Network Roll-Out and Customer Support and BU Network Products combining Radio and Transport.

Targeted growth areas - The two new IT & Cloud business units, Business Unit IT & Cloud Products and Business Unit IT & Cloud Services, will together with a new Business Unit Media, have a strong focus on profitable growth as a natural next step after a period of investment. This will involve focus on software sales and recurring business to complement the already strong business in Consulting & Systems Integration and the Broadcast Services business. For the rapidly growing Industry & Society business a separate Customer Group will be introduced to improve scaling and time to market.

Cost and efficiency - The company remains fully committed to drive cost reduction and efficiencies, including delivering on its SEK 9 b. net savings efficiency program during 2017. The new organization is designed to enhance efficiencies and cost structures through more end-to-end accountability and less duplication across portfolios and capabilities.

The new Group structure is optimized to bring both enhanced customer value with business units having full responsibility for business performance and end-to-end skills. Regions are being re-shaped to mirror the new business units with focus on sales and delivery quality. This will be complemented by stronger global functions that can build scale in respective areas.

Vestberg continues: "The changes we are making will make it easier for our customers to do business with us, whether they are an operator, a media company or from another industry. The changes will also take into account the different characteristics, needs, and pace of each of the businesses we are in. I am convinced this will make us even more competitive and enable us to grow both our company and our earnings".

The new organization will be effective as of July 1, 2016. As of Q1, 2017, financial reporting will be made according to the new structure. The new organizational structure aligns company reporting with strategy execution in a simpler and more transparent way. Additional information on reporting will be presented at the Capital Market Day on November 9, 2016, and restated numbers will be presented at the beginning of 2017.

Following this announcement, the Executive Leadership Team (ELT) will consist of the following members as of July 1, 2016:

Hans Vestberg, President and CEO (since 2010)

Jan Frykhammar, Executive Vice President, Chief Financial Officer and Head of Group Function Finance & Common Functions. Frykhammar currently holds the position as Executive Vice President, Chief Financial Officer and Head of Group Function Finance (since 2009)

Arun Bansal, Senior Vice President and Head of Business Unit Network Products. Bansal currently holds the position as Head of Business Unit Radio (since 2014) - new member of the ELT

Per Borgklint, Senior Vice President, Chief Innovation Officer and Head of Business Unit Media. Borgklint currently holds the position as Senior Vice President and Head of Business Unit Support Solutions (since 2011)

Bina Chaurasia, Senior Vice President, Chief Human Resources Officer and Head of Group Function Human Resources (since 2010)

Ulf Ewaldsson, Senior Vice President, Chief Technology Officer and Head of Group Function Technology (since 2012)

Niklas Heuveldop, Senior Vice President, Chief Customer Officer and Head of Group Function Sales. Heuveldop currently holds the position as Head of Global Customer Unit AT&T - new member of the ELT

Chris Houghton, Head of Region North East Asia (since 2015) - new member of the ELT

Fredrik Jejdling, Senior Vice President and Head of Business Unit Network Services. Jejdling currently holds the position as Head of Region sub-Saharan Africa (since 2013) - new member of the ELT

Anders Lindblad, Senior Vice President and Head of Business Unit IT & Cloud Products. Lindblad currently holds the position as Head of Business Unit Cloud & IP (since 2014) - new member of the ELT

Nina Macpherson, Senior Vice President, Chief Legal Officer and Head of Group Function Legal Affairs (since 2011)

Helena Norrman, Senior Vice President, Chief Marketing and Communications Officer and Head of Group Function Marketing and Communications (since 2014)

Jean-Philippe Poirault, Senior Vice President and Head of Business Unit IT & Cloud Services. Poirault currently holds the position as Head of Consulting and Systems Integration - new member of the ELT

Rima Qureshi, Senior Vice President, Head of Region North America and Chief Strategy Officer. Qureshi currently holds the position as Senior Vice President, Head of Group Function Strategy and Head of M&A (since 2014)

Charlotta Sund, Senior Vice President and Head of Customer Group Industry & Society. Sund currently holds the position as Head of Region Northern Europe and Central Asia (since 2014) - new member of the ELT

Elaine Weidman-Grunewald, Head of Group Function Sustainability and Corporate Responsibility - new member of the ELT

In addition to the ELT members Ericsson today also announces the following appointments effective July 1, 2016:

Peter Laurin, Head of Region Northern Europe and Central Asia. Laurin currently holds the position as Head of Global Customer Unit Vodafone

Jean-Claude Geha, Head of Region sub-Saharan Africa. Geha currently holds the position as Head of Business Line Managed Services

Gustav Brismark, Chief Intellectual Property Officer and Head of IPR & Licensing. Brismark currently holds the position as Vice President, Patent Strategy and Portfolio

Hans Vestberg, President and CEO of Ericsson says: "As we move into a new phase of the company development I want to give a special recognition and thanks to the leaving ELT members. They have been instrumental in building our market leadership and setting us on our current path of change."

The following individuals will leave the Executive Leadership Team effective July 1, 2016:

Magnus Mandersson, Executive Vice President (since 2011) and Head of Segment and Business Unit Global Services (since 2010). As of July 1, 2016, Mandersson will hold the position as Head of Segment Global Services, Executive Vice President and Advisor to the CEO.

Jan Wäreby, Senior Vice President and Head of Group Function Sales (since 2014). Wäreby will retire from Ericsson as of November 30, 2016.

Anders Thulin, Senior Vice President, Chief Information Officer and Head of Group Function Business Excellence and Common Functions (since 2013). Thulin will leave the company as of July 1, 2016, to pursue opportunities outside the company.

Angel Ruiz, Head of Region North America (since 2010). Ruiz will continue with the company as Chairperson of regions North and Latin America.

Mats H. Olsson, Senior Vice President and Head of Ericsson Asia-Pacific (since 2013). Olsson will leave Ericsson as of July 1, 2016.