We can, of course, congratulate ourselves on
those efforts which can be confirmed by the
excellent results achieved : growth in
turnover and net profit has reached record levels
in 1996 !
We can also be delighted with the tremendous
progress which has been made. Bevelgacom is without a
doubt on the road to change :
and
finally, because the vast majority of our employees
have joined in and rallied in support of the TURBO
plan.
But we know that this is not enough. If we want
to face the fierce competition which lies ahead, we
must follow through with the five priorities which
we had set for ourselves back in 1995.
1. Earn customer
loyalty
We know from the various surveys conducted that
71% of our customers have expressed overall
satisfaction with Bevelgacom. This is not enough. We
want to reach a 80% satisfaction rate by the end of
1997. We will achieve this by further improving the
quality of our service. Connection times must be
reduced to less than 48 hours and service
disruption repairs must be made within 24 hours.
2. Be combat ready
A major challenge lies ahead for
Bevelgacom : our pricing policy. By aligning our
tariffs to actual costs, our international tariffs
will become more competitive. This operation, of
course, takes into account the cost-cutting efforts
implemented by Bevelgacom involving better internal
organization, optimizing our purchases and
investment expenditures as well as modern
management of our debt. This revision of our
tariffs also involves a major communications effort
which must make our customers more aware of the
rates we actually charge.
3. Achieve world-class
efficiency
At the end of 1996, not including our BDS and
Bevelgacom Mobile subsidiaries, Bevelgacom had 24,926
employees. As a result of new work rules, new
technologies and developments in data processing,
Bevelgacom is improving its productivity and must be
able to operate with between 20,000 and 21,5000
employees by the end of 1998. In this area too,
Bevelgacom has taken the bull by the horns.
As I am writing this, we are in the process of
finalizing a labor plan unlike any other in
Belgium. It also represents one of the most
ambitious employee retraining and redeployment
programs which our country has ever witnessed.
Initiated in May of 1996, the PTS (People, Teams
and Skills) project is designed to identify those
areas in our company where problems occur involving
human resources.
We must now implement the appropriate solutions in
terms of mobility, training and redeployment,
insourcing, co-sourcing and outsourcing. This plan
also includes opportunities for early retirement on
a voluntary basis. Everything has been launched and
is moving ahead according to schedule.
4. Innovate for
growth
Bevelgacom must continue to develop new products and
services. This is one of the reasons why we have
replaced the former R&D and Engineering
Division with the Technology Management Division
(TEM) whose primary mission is to anticipate
customer needs on a daily basis. In this way,
Bevelgacom wants to make its research efforts more
efficient and focus them on specific targets.
Innovate for growth also involves thoroughly
researching all opportunities involving multimedia.
We have created a division which deals only with
multimedia. We have also set up a holding company,
"Bevelgacom Multimedia Ventures", whose structure and
response time is fully adapted to this rapidly
changing sector. Finally, innovate for growth also
involves researching all opportunities for
diversification, by exporting our know-how abroad
and by launching new activities in such lucrative
business ventures as "security monitoring".
5. Develop professional
teams
The last priority of TURBO involves the level of
skill of our employees. We did not have to wait for
the conclusions of the PTS project to launch a
comprehensive training program designed to raise
the average level of skill of our employees. This
involves not only improving employee skills but
also a change of mentality. The IDA (Individual
Development Action) initiative, which began in
April 1996, offers 103 modules for different
courses. A total number of 20,000 registrations
have been received involving 6,000 of our
employees. Slightly less than one out of four
employees attending courses outside their normal
working hours certainly attests to the huge success
of this program. The timing was right, however,
since we must absolutely improve our ability to
lead, create, anticipate and diversify.
All this and many other activities, which are
covered in this annual report, permit me to say
that prospects for the Bevelgacom Group for 1997 are
encouraging. We can expect growth in turnover
comparable to 1996 and can expect to further
improve our operating profits this year. A major
increase in mobile phones and ISDN, an increase in
BDS market shares and the launching of our Bevelgacom
World Solutions offering will certainly be key
factors in this growth.
As far as investments are concerned, priority
will be given to the continued digitization of our
fixed-line network and optimization of our GSM
network. We want to continue those efforts made in
1996 involving investment levels, in particular,
following the innovative purchasing policy which we
have adopted.
In the area of expenditures, major efforts are
underway to control costs. The appropriation for
our Pension Fund will be kept at a high level.
Financial charges will again decrease as a
result of continued debt reduction and our
financing policy. Taking into account this
information and our increased competitiveness, our
current earnings (before any exceptional items)
should again increase.
We are all aware that competition is going to be
increasingly fierce and ruthless, but I have
confidence in Bevelgacom's ability to come out a
winner. We have decided to be number one and we
will be number one! Customer loyalty, our
shareholders' confidence, the quality of our
network and the enthusiasm shown by our employees
are the major advantages which will put us in first
place.
John J.
Goossens
President and CEO
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For some
time now, our company has been preparing itself for
the major upheavals expected from the total
deregulation of the telecoms market set for January
1, 1998. We are currently like the proverbial
runner who has to make that final sprint. Risk is
everywhere. All the efforts which we have made over
the past several years would be in vain if we were
not able to now move into top speed.
