Page 140 - Socially-responsible-restructuring-Effective-strategies-for-supporting-redundant-workers

Socially responsible restructuring
Effective strategies for supporting redundant workers

6.10. Teliasonera, Finland (CASE STUDY 10)

6.10.1. Background and context
TeliaSonera AB is a global telecommunications company with a leading position
in the Nordic European countries. The company is also active in other countries
in northern Europe, eastern Europe, central Asia and Spain, with a total of 135
million subscriptions in 2008.
TeliaSonera was established in 2002 following the merger between the main
Swedish and Finnish telecommunications companies, Telia and Sonera. The
separate brand names Telia and Sonera have continued to be used in the
Swedish and Finnish markets. Telia has a history as a state telephone monopoly,
before privatisation in the early 1990s. From 1992 to 2005, Telia undertook
several workforce reduction programmes, cutting its workforce by almost 80%
from 50 000 to 11 000. The main reasons for these reductions were the increase
in competition brought about by deregulation of the Swedish telecom market and
the continuous technological developments in the sector. Sonera went through
similar adjustments throughout the 1990s, with some noticeable differences.
Sonera used to have a monopoly only on trunk network calls, while most (about
75%) of local telecommunication was provided by telephone cooperatives.
Following the introduction of number portability in 2003, mobile prices fell sharply,
which had a major impact on Sonera’s revenues. Financial difficulties were
compounded by the loss of a mobile licence in Germany. The rest of this case
focuses on the experience of TeliaSonera Finland (TSF).

6.10.2. Restructuring and job losses
The TeliaSonera Group employs about 31 000 people. About 5 200 people were
employed in Finland in 2009, compared to 11 600 in November 2000, a reduction
of the workforce by more than a half.
Technological, price and organisational developments are essential drivers
behind the company’s continuous restructuring and labour adjustments. In
Finland alone, hundreds of jobs terminate each year, while hundreds of new jobs
are also created. About 4 500 employees were dismissed from November 2000,
including around 2 000, typically manual workers, who were transferred to other
companies as part of the outsourcing of some activities. Dismissals and
outsourcing were carried out at different times to adjust to changing market
conditions. At the same time, TeliaSonera Finland (TSF) has continued to recruit.
The merger with Telia in 2003 brought a number of organisational changes,
although the company remained largely managed on a national basis. One
important development since the merger has been the increasing focus on

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