TIDM61QS
RNS Number : 9204L
Telefonaktiebolaget Lm Ericsson
18 May 2022
Ericsson changes Group structure and Executive Team to execute
on growth strategy
-- To capitalize on the convergence of software and services and
deliver growth in the core business, a new Business Area Cloud
Software and Services is introduced, combining Business Area
Digital Services and Business Area Managed Services. Per Narvinger
will head up the unit and will be a member of the Ericsson
Executive Team.
-- A new Business Area Enterprise Wireless Solutions, comprising
Cradlepoint and Dedicated Networks, is created to drive the growth
plan for enterprise. George Mulhern is appointed head of the unit
and will be a member of the Ericsson Executive Team.
-- To simplify and digitalize overall ways of working, a new
Group Function Global Operations is introduced. Moti Gyamlani will
head up the unit and will be a member of the Ericsson Executive
Team.
-- Arun Bansal, Jan Karlsson and Peter Laurin will leave the Executive Team.
-- The new Group structure will take effect June 1, 2022.
Ericsson's (NASDAQ: ERIC) strategy is to be a leader in mobile
infrastructure and to establish an enterprise business. Today,
Ericsson announces changes to the group structure and Executive
Team to position itself to execute on its strategy and growth
ambitions while continuing to invest in R&D to maintain its
technology leadership. The new Executive Team roles and the new
organization will take effect June 1, 2022.
Business Area Cloud Software and Services
To lead in the mobile infrastructure business, a Business Area
Cloud Software and Services is created by merging Business Area
Digital Services and Business Area Managed Services. This will
enable Ericsson to capitalize on the convergence of cloud, software
and services. Through the new structure, Ericsson will be able to
leverage investments in R&D, increase cloud native expertise
and build its combined offerings for automation and AI for service
delivery. This will allow Ericsson to build on the success in
recent years which includes strong development in the cloud native
5G core portfolio where 16 out of the 20 largest operators globally
have chosen Ericsson. Managed Services has undergone a significant
transformation in recent years with the introduction of the
AI-driven Ericsson Operation Engine, enabling proactive and
predictive network and IT operations and optimization, and a shift
towards a more software-driven offering.
Per Narvinger is appointed Senior Vice President and head of
Business Area Cloud Software and Services and will be a member of
the Ericsson Executive Team. Narvinger is currently Head of Product
Area Networks within Business Area Networks.
Jan Karlsson, currently head of Business Area Digital Services,
will leave the Executive Team and instead drive the development of
the Global Network Platform, reporting to CEO Börje Ekholm. As
previously communicated, Peter Laurin, currently head of Business
Area Managed Services will leave Ericsson for opportunities outside
Ericsson.
"Through the new Business Area Cloud Software and Services we
provide solutions that will help our customers automate the
increasingly complex networks for cost advantages and speed to
market. By combining the two business areas we can coordinate our
investments in orchestration and AI solutions leveraging insight
from our network operations. This will allow us to remain a
technology leader in a constantly evolving market. I look forward
to working with Per as we take the next steps in reaching
Ericsson's growth ambitions. I also want to thank Jan and Peter for
their contributions to the Executive Team. They have both been
instrumental in executing on our focused strategy and Ericsson's
turnaround", says Börje Ekholm.
Business Area Enterprise Wireless Solutions
A new Business Area Enterprise Wireless Solutions, comprised of
the current Cradlepoint business and Dedicated Networks, is created
to take full accountability and focus to develop solutions to meet
the growing needs of enterprises and create a dedicated
go-to-market organization for enterprise customers including
leveraging the established relationship with service providers. The
new Business Area will enable Ericsson to build on recent success
which includes strong growth for Cradlepoint as 5G coverage
increases on the US C-band and the launch of Ericsson Private 5G
(EP5G) in several leading markets.
George Mulhern is appointed Senior Vice President and head of
Business Area Enterprise Wireless Solutions and will be a member of
the Ericsson Executive Team. Mulhern is currently CEO of
Cradlepoint.
Åsa Tamsons will continue in her role as Senior Vice President
and head of Business Area Technologies & New Businesses which
will continue to focus on developing new business solutions to
accelerate growth across Ericsson's core and enterprise businesses
- building on the successful model established to incubate new
growth businesses, such as Dedicated Networks and Cradlepoint.
"With this change we are taking important steps in our journey
to execute on our strategy. The new Business Area Enterprise
Wireless Solutions will provide the focus and conditions we need to
thrive in the enterprise market and secure the next wave of success
for this business. We are also excited to continue to invest in new
businesses for our long-term growth through the proven model
established in Business Area Technologies & New Businesses. I
want to extend a warm welcome to George as he joins Ericsson's
Executive Team", says Börje Ekholm.
Group Function Global Operations
The company is also changing its group function structure by
adding a Group Function Global Operations. This function will
combine the many support functions that are currently spread across
the Company, including Sourcing, IT, Digital Transformation, Group
Sales, Real Estate and the operations parts of the People and
Finance Functions. By creating a global operations function,
Ericsson will be able to run its global operations more effectively
and consistently across the organization.
Moti Gyamlani is appointed Senior Vice President and head of
Group Function Global Operations and will be a member of the
Ericsson Executive Team. Moti is currently working as Head of Group
Sourcing.
"Global Operations is created to achieve best-in class customer
and employee experience by simplifying and digitalizing end-to-end
process flows in the company. By creating this function, we will be
able to better serve the needs of our customers and better support
our people, making us more agile and more competitive. It is great
to welcome Moti to the Executive Team and look forward to working
together with him to create a world class global operations
function", says Börje Ekholm.
Executive Team changes
Arun Bansal, currently Executive Vice President and Head of
Market Area Europe and Latin America, will leave the company to
pursue other opportunities and will therefore step down from his
EVP role with immediate effect. He has been with Ericsson since
1995 and has been in his current role for the last five years. The
Acting Head of Market Area Europe and Latin America will be
announced separately.
"Arun has been leading our Market Area Europe and Latin America
for the last five years and has been instrumental in driving change
across the organization, and in establishing and nurturing some of
our most important customer relationships. I wish Arun all the best
in his future endeavors", says Börje Ekholm.
"After turning around the company, Ericsson is entering a new
phase of growth. The changed group structure that we announce today
represents exciting opportunities for our people, our customers and
our business and will allow us to continue to grow our core mobile
infrastructure business and capitalize on the fast-growing
enterprise market. Within 2-3 years, we want to achieve our
long-term goal of growing faster than the market and an EBITA
margin (excluding restructuring costs) of 15-18% for the Group. I
look forward to working together with the new Executive Team, and
the whole Ericsson team, as we accelerate our work to execute on
our strategy, strengthen our company culture and continue to grow
the company with increased profitability", concludes Ekholm.
Reporting segments
Following the new group structure, Ericsson will have the
following reporting segments:
-- Segment Networks (unchanged)
-- Segment Cloud Software and Services (corresponding to former
Digital Services and Managed Services)
-- Segment Enterprise (Enterprise Wireless Solutions and
Technologies & New Businesses). On completion of the
acquisition, Vonage will form a separate Business Area included in
this segment.
-- Segment Other (including media businesses and one-offs)
The new segment reporting structure will be applied from Q3
2022. Restated financials for new segments for 2020 - 2022 will be
published in September 2022 ahead of the Q3 quarterly report.
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About Ericsson
Ericsson enables communications service providers to capture the
full value of connectivity. The company's portfolio spans Networks,
Digital Services, Managed Services, and Emerging Business and is
designed to help our customers go digital, increase efficiency and
find new revenue streams. Ericsson's investments in innovation have
delivered the benefits of telephony and mobile broadband to
billions of people around the world. The Ericsson stock is listed
on Nasdaq Stockholm and on Nasdaq New York. www.ericsson.com
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END
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May 18, 2022 04:23 ET (08:23 GMT)
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