‘CEO mentioned “connectivity” multiple times, yet human connection was glaringly absent’: Reacting to Telstra’s staff cull
Telstra announced there will be 2,800 redundancies by the end of the year.
CEO Vicki Brady said the move would be made in a bid to reset its ‘enterprise’ business, saying: “I appreciate the uncertainty proposed changes like this can create for our people and we will support them through this change with care and transparency. As we propose specific changes, we will talk them through with our teams and union representatives first.”
For a company built around communication, how did Telstra handle the delivery of their own bad news? We ask the PR experts.
Phoebe Netto, Founder and Managing Director of Pure Public Relations
For a telecommunications business that connects millions of Australians, Telstra’s recent ASX announcement has managed to create a disconnect with millions of Australians.
Announcing 2,800 job cuts was always going to be bad news for the telco, but it could have reduced this hit to its reputation by better reassuring customers and addressing their concerns. Instead, the announcement was filled with vague terms and information gaps that left more questions than answers.
By failing to understand the level of detail and reassurance consumers and the media were after, Telstra allowed itself to be hijacked by perhaps the only subject that confronts people as much as layoffs – AI fear. AI is not mentioned anywhere in its ASX announcement. But when outside commentators filled the gap, it didn’t take long for the AI message to take hold.
When it comes to announcements as impactful as this, customers and journalists will inevitably fill information gaps. They will fill it with assumptions, unfavourable commentary, and convenient news hooks like those that linked the layoffs to the rise of AI. The last thing customers want to hear is that fewer humans will be working in customer service roles, but because the media were left to fill in the blanks, that’s the story they were told.
This information gap was exacerbated by a general feeling of distrust for telcos. When speaking to the media, Telstra CEO Vicki Brady said that customer service roles would not be impacted by the workforce cuts. The problem here is that consumers are already frustrated by the quality of customer experience and human connection they receive from telcos. It’s not enough to say that customer-facing roles won’t be impacted, because that only works when there is trust between a brand and its consumers – which Telstra, and arguably most telcos, don’t have.
An announcement of this magnitude should have anticipated this frustration and worked to provide ample reassurance and detail of how Telstra would ensure that customer experience wouldn’t be impacted. Instead, information-hungry consumers naturally asked, “Well, if customer service won’t be impacted, what will be?” and “How will I not feel a disadvantage by $350m in cost cutting?”. This lack of detail only feeds consumers’ lack of trust towards the major telcos.
One thing that Telstra did have the foresight to address proactively was customer anxiety about price increases in the new financial year. But even this reassurance fell flat when in the next breath they vaguely referred to the potential for “greater flexibility to adjust prices at different times and across different plans.” Rather than reassuring customers that they won’t be given price hikes during a cost of living crisis, this zig-zagging left them further unsure of what to expect.
While it might be a hard pill to swallow, Telstra would do well to remember that distrust for telcos and a lack of personal connection with customers means they are already operating from a disadvantage when it comes to having difficult conversations with consumers. When you don’t have much goodwill to work with, you must go above and beyond to show your customers that you understand their concerns and care enough to address them. Unfortunately, this time around Telstra left their customers on hold when it mattered most.
Sally Branson, crisis communications expert
Unfortunately for Telstra, the big brand corporations are in the bad books with the general public. All of the household names with strong brand recognition are suffering for the sins of their fellow big brands – Qantas, Optus, Telstra, and Woolworths. The recent string of public missteps and poor consumer experiences over the past six months has tainted the perception of these large corporations. It’s a classic David and Goliath scenario, with big corporates pitted against the general public, creating an ‘us versus them’ dynamic.”
Redundancy announcements are always tough, and post-Budget Week, when cost of living pressures have dominated the conversation, it feels even worse. While it’s not an ethical move I’d endorse, there’s something to be said about burying bad news in a budget cycle. Telstra have done better with their communication than others, with a clear announcement and explanations regarding the reasons, cost-saving measures, and assurances that services won’t be affected. However, the general public’s trust in big corporate just isn’t there, and conspiracy theories abound, further fueled by fears of AI taking our jobs.
Additionally, and powerfully, the workers’ union has expressed feeling blindsided by the announcement. This not only amplifies the narrative of an ‘us versus them’ argument — big corporations leveraging AI to cut costs versus workers struggling with a cost of living crisis—but also highlights key stakeholder communications haven’t been great. Some people like the ‘blindside’ approach – to control the narrative by getting it out fast and first – but this has not worked in Telstra’s case, given the loud and unhappy response from key stakeholders.
Telstra leadership obviously knows that job losses are a bad news story made worse in a cost of living crisis. To soften the blow they have announced there won’t be any price increases on telephone bills, balancing the negative news with a positive impact for customers. Essentially, the message is “Look, we are doing a bad thing, but at the same time, we are doing a good thing that directly affects our consumers”. This is obviously a strategic communications move and one that acknowledges that bad news often needs a sweetner.
This will not be the only redundancy announcement we see over the next few months, and it’s hard to tie a profit-driven decision to bad news. It will be interesting to see how other companies roll out their bad news, who they inform first and how they communicate. Will they bring all stakeholders, even the difficult ones, to the table and ensure they aren’t blindsided? This will be crucial in making them feel included, and reducing the likelihood of public dissatisfaction.
From a crisis communications perspective, sometimes decisions are hard, awful and unpalatable. It just needs to be done. Fortunately for every company that follows with a redundancy announcement, they can learn valuable lessons from the ones that go before them.
Dr. Neryl East, communication, credibility and reputation expert
For a telco, connection is core business – the Telstra CEO mentioned “connectivity” multiple times in her announcement – yet human connection was glaringly absent in the language chosen.
Telstra’s statement was clinically official, delivered with precision but little heart.
It was all about the “action” being taken, achieving a cost reduction, becoming a more efficient and sustainable business, and simplifying the product set.
If you’re one of the 2,800 about to face a job search, hearing that your boss wants you to feel supported through this difficult time might have rung a little hollow.
Delivering bad news is no easy task for any leader. Doing it in a way that has people hearing the message without shooting the messenger requires a balance of clear, non-sugar-coated language and genuine empathy.
Telstra is likely to have plenty of opportunity to work on the latter quality as it rolls out these changes. Let’s see if they do better.
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