Interview: ex-O2 CEO Ronan Dunne’s reflections

Interview: ex-O2 CEO Ronan Dunne’s reflections

Ronan Dunne’s time at O2 has taken him from the launch of the first iPhone to the 19-hour network outage. As he exits the UK market for a top job at US network operator Verizon, he gives some insight into his time leading one of the market’s most iconic brands.

…My first day at O2 ended in hospital

‘My first day was back in 2001 and we were doing the same sort of stuff that we have been in my past week – preparing for an IPO. I have been in the organisation for exactly 15 years, so in some respects it’s déjà vu. The first day in the office was actually in a hotel in Canary Wharf where we were doing an analysts presentation.

‘Halfway through the presentation I noticed my arm was getting really sore and I was getting really hot. I’d got an infection right in the fluid of the joint of my elbow. After going to an NHS drop-in centre, I ended up in hospital for five days with an intravenous drip. So I actually ended my first day at O2 in the NHS in Chertsey.’

 …Why natural coach Mark Evans will succeed

‘We’ve created a strong team with real values and purpose. Taking on my role, Mark [Evans] will be great at leading with the O2 culture we’ve created and the O2 team that’s so valuable, because he’s a real natural coach. He steps out of his door everyday aiming to be a winner, but he’s also someone who is forensic about what he does. He tries to put in place the conditions to be successful, and I’m absolutely sure he will be.’

…We did the iPhone deal in nine days

‘I’d love to say that because it was Apple everyone knew they’d sell a billion iPhones. The truth is we didn’t, we all thought it would be iconic.

‘Apple was negotiating for a long, long time with another operator, that may be red and may be based in Newbury. But they weren’t making the progress they wanted. We got a call over the weekend and Steve Jobs office reached out to [Telefonica chairman] Cesar Alierta, saying: “do your UK guys want to come and see me to talk about the iPhone?”

‘Matthew Key [O2’s UK CEO at the time] raced out to Cupertino. When he saw the phone he was absolutely convinced it would be a success. It was a step change from everything we’d seen from anyone else.

‘Apple sent a few people over to Slough a day or two later. We worked for seven days – basically day and night – and famously shook hands over sandwiches we’d run out to get in the Slough M&S. It took us around nine days to do the deal, when they’d been talking to the other people for nine months.’

…On iPhone launch day I bought coffees for customers in the queue

‘The thing that appealed to Apple was not the financial package, because as anyone who deals with Apple knows, you do things on Apple’s terms. The thing that made the difference was that we brought them to the O2, which wasn’t open, and showed them what we could do. We also mocked up instore what the retail experience would look like for us selling the iPhone. They realised that we thought about this in the same way that Apple did.

 ‘Steve Jobs came to London for the launch. He and Matthew [Key] sat on stools, a bit like Val Doonican or Westlife, and did a set in the Oxford Street store. It was definitely rock star stuff. I just put on a t-shirt and bought coffees for people who were standing outside the store in Wimbledon.’

…Since EE formed O2 has got stronger

‘The merger of T-Mobile and Orange to form EE was a big factor in the market at the time. But interestingly, history records that that was completed on 1 December 2010, and in the period from then to now, EE has actually lost five million customers and we’ve gained three million. So although it was a big event in the market, we weren’t affected because we had strong differentiation in the brand.

 ‘In some respects it diluted the Orange brand, which had been very strong in the market before that. And I don’t think I’m being unfair on EE if I say the iconic mobile brands in the UK have been O2 and Orange.’

…Despite the looming merger, 2015 was one of my proudest years

‘From the time that I started my strategic review in the summer of 2014 all the way through to now, although everyone in the business didn’t know from the start, there was a long period of potential disruption from our core purpose of getting out there and serving customers.

‘2015 was one of my most satisfying years in the business because we performed so well.’

 ‘I don’t think I’m being unfair on EE if I say the iconic mobile brands in the UK have been O2 and Orange’ employee satisfaction, customer market share and profitability. Although it was a hugely challenging period, the relentless focus we had on customers and brand was actually the right thing both for employees and for the customers.

‘Our colleagues had three questions they wanted the answer to: “Will I have a job?” “Who will I be working for?” and “What will be the name above the door?” We weren’t able to answer any of the questions while the process was going through, because other than me no one knew definitively who would be part of the combined business if the transaction was approved.

‘What we did was say if we make O2 impossible to ignore you’ll have a chance to shine. So if you have an interview with the CK Hutchison folk or you have an interview with a headhunter, the best context for the interview was to say “Yeah, I’m from that winning O2 team”. It ended up being the best campaign we’ve ever run.’

…My darkest day was the network outage

‘I don’t regret anything, but my worst day, our darkest day, was when the network was down for 7.9 million customers for 19 hours. It proved that everything that we’d invested in customers paid off, because actually our customers came to the rescue on that day. They championed the fact that people on O2 didn’t have that experience and that’s why they were loyal to us.

‘On that very darkest day, when every 15 minutes I was being phoned by the press asking “has he resigned yet?” – that was a seminal moment because our customers said when you’re a fan you’re willing to forget. That was really, really important because we had a thing at the time about fan love, and making one million more fans was one of the parts of our programme.

‘It was undoubtedly the most difficult day I’ve ever had in my life. When we look back on it, it was evidence that the strategy of putting our customers first was working.’

…doing right and doing good, two sides of the same coin

‘Five years ago I committed to deliver 20% of my time to youth employment and youth engagement. It proves to me the thing that I’ve always believed in, that doing well and doing good are two sides of the same coin. If you set up a business with the right values and the right purpose then you can be financially successful and be proud to be part of the organisation.

‘When our people are at a dinner party or at the bar in a pub and are asked who they work for, they are proud to say they work for O2. It’s not every person that can say honestly hand on heart that about who they work for. I think we’ve created a genuinely differentiated company, not just in telco, but I think this is one of the finest companies in the UK.’

…Invisible infrastructure needs recognition

‘The biggest value-add product that’s being shipped around the UK everyday is data. It’s the invisible infrastructure as well as the visible infrastructure that need to be brought together in a far more holistic way. That means things such as investment in the future for mobility because any digital strategy needs to be mobile led.

‘It’s not that you shouldn’t be putting fibre in the ground. But fibre is only one part of the equation. Interestingly, fibre gets a government and taxpayers subsidy and wireless doesn’t. It’s an interesting conundrum, reflective of the fact that’s kind of old legacy telecoms rather than current relevant telecoms policy.’

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