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Rogers CEO shakes up top staff in bid to return to growth

Guy Laurence, CEO of Rogers Communications Inc., holds a media briefing at the company’s head office in Toronto May 23, 2414.

Fred Lum/The Globe and Mail

The new chief executive officer of Rogers Communications Inc. has unveiled a sweeping plan to reset the company's management structure, fix customer service issues and reignite its growth.

Guy Laurence, the British executive who took over as CEO in December, conceded that "we are not on form" as a company, but he said the restructuring announced Friday will allow Rogers to turn its prospects around in the coming years and become more agile.

The plan brings several high-level departures that will shake up the company's senior ranks and shift members of the Rogers family away from daily operations to focus on long-term strategic goals. It also takes aim at poor customer service by promising to unravel a tangled mess of corporate structures and separating consumer concerns from business priorities.

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The restructuring comes amid an intensely competitive telecommunication's landscape. For Rogers that has meant limited growth in wireless customers, recent declines in cable subscribers and a lagging stock price.

The new setup gives Mr. Laurence firm control of operations and puts deputy chairman Edward Rogers, son of the late founder and CEO Ted Rogers, in line to one day take over as chairman. Mr. Rogers currently holds an executive post as well as heading a family trust that controls the company through multiple voting shares.

Under Mr. Laurence's plan, Mr. Rogers is giving up his operating duties to focus on the board, but sources say he is believed to be in line to one day replace chairman Alan Horn when he steps down. His sister, Melinda Rogers, is also leaving her role as a senior vice-president but she will remain on the board.

Mr. Laurence said he and the Rogers family discussed the new arrangements for months and everyone agreed to the changes.

"They're still members of the board, we're still friends, we still talk every day," he said Friday.

He added: "The family is one of our biggest assets, okay? This is a Canadian family business, let's be very clear about that."

However, he said the overall company is beset with several challenges, including failing to adequately serve customers.

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"We don't know how to play as an orchestra," Mr. Laurence told reporters after a five-hour briefing with the company's 200 most senior staff. "We're not a growth company at the moment, but I believe we can return to growth."

Mr. Laurence said Rogers has "neglected our customers over recent years" – something he insisted staff told him as he visited more than 10,000 of them across the country in recent months. He promised Rogers will return to its roots.

That starts with unravelling its policies to get at the root problems with customer service, which has spurred customers to abandon Rogers at higher-than-desirable rates. Some 17,000 business processes have been built up over three decades, and "it's been like spaghetti, right?" Mr. Laurence said. "It makes sense at the time but when it goes cold, it's very difficult to unpick."

He made it clear changes won't happen overnight, or even in a matter of months, but rather over two to three years. In the meantime, "we will go through some bumps on the quarterlies," he said.

But there will be a clear focus on customers, growth and especially pushing content across all platforms. Mr. Laurence must position the company to take maximum advantage of its landmark $5.2-billion, 12-year deal securing national broadcast and digital rights to NHL games – which even its own executives have described as daunting.

Tim Casey, an analyst with BMO Nesbitt Burns, said investors should take a long-term outlook. "These challenges represent deeply ingrained business practices and cultural issues within the company. We do not view them as easy or quick fixes," he said in an analyst's note. "We expect a transition period at the company before we see a meaningful impact on performance."

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As Mr. Rogers and Ms. Rogers cede their operational roles, Frank Boulben, the former head of marketing at BlackBerry Ltd. who has worked with Mr. Laurence at Vodafone, takes over the strategy division on an interim basis.

The restructuring also splits the company's huge communications division into three, creating consumer and business units and uniting all customer experience functions under one team that reports directly to Mr. Laurence.

As a result, current president of communications Rob Bruce is leaving the company at the end of the year, but will stay to run the consumer business unit until then. "We don't have a job big enough for Rob" after the changes, Mr. Laurence said, noting that he will leave the company "with his head high."

On Wednesday, two senior marketing leaders, executive vice-president John Boynton and senior vice-president Shelagh Stoneham, were let go. Rogers has begun internal and external searches for three interim appointments at the executive level, and more management changes could be on the horizon.

For now, "we're getting on with it," Mr. Laurence said.

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