Telefónica, which owns O2 UK, has launched a major restructuring that could see sweeping changes across the business.
The restructuring sees the creation of a Global Resources operating unit to drive profit by leveraging and unlocking economies of scale.
Observers say the move could see Telefónica combining its purchasing power, creating a similar structure to the joint venture procurement company set up earlier this year by France Telecom and T-Mobile.
The new unit will also drive Telefónica’s transformation into a global company. This unit will be overseen by Guillermo Ansaldo, until now the head of Telefónica Spain.
Telefónica has also created Telefónica Digital, which will be headquartered in London and headed up by Matthew Key, formerly head of Telefonica Europe. It will have regional offices in Madrid, Sao Paulo, Silicon Valley and certain strategic hubs in Asia.
Its brief is to drive into the digital market as it seeks to go beyond mobile. It aims to leverage any growth opportunities in the market, drive innovation in the digital sphere, strengthen the product and service portfolio and maximise Telefónica’s large customer base.
This unit will be made up of 2,500 highly skilled professionals from Telefónica’s New Global Services Unit (vertical businesses), Terra, Tuenti, Jajah, Telefónica R+D and Media Networks, among others.
The company will also streamline the business into two large blocks, Europe and Latin America. Operations in Spain will be included in Europe. Observers said the move will allow the Spanish division to be brought into line with the rest of the European group allowing its working practices, which are currently seen as outdated, to be modernised.
José María Alvarez-Pallete, head of Telefónica Latin America until now, will oversee Europe, while Santiago Fernandez Valbuena, previously general manager of strategy, finance and corporate development, will be in charge of Latin America. This change entails the addition of Ángel Vilá to the executive committee as head of finance and corporate development.
The new organisational structure will revolve around a nine-member Executive Committee, backed by a Transformation Committee composed of the company’s senior managers.
The company said this structure stems from months of strategic debate lead by Telefónica’s executive chairman and with the participation of the company’s senior executives.
The company said the strategy was approved today by the executive commission of the board of directors.