Caso Harvard - Do You Think We Are So Stupid

ESMT–409–0100–1
ES1001
February 25, 2013 (v)
ESMT Case Study
“Do you really think we are so

stupid?” A letter to the CEO of
Deutsche Telekom (A)
Konstantin Korotov
Urs Müller
Ulf Schäfer
Introduction
When René Obermann took over as Deutsche Telekom’s CEO in November 2006, he knew that
serious challenges and battles were on the horizon. As a board member he had worked with his
predecessor Kai-Uwe Ricke on a change plan, which aimed to turn around years of declining
performance by improving service and cutting costs. Ricke did not stay long enough to see if the
plan would work. The German government, at the time a 32 percent shareholder in DT, and
private equity backer Blackstone Group (which had bought stakes in the telecommunications
giant in April 2006 when the stock price was around €14) grew tired of Ricke’s conciliatory
approach and decided that a new broom was needed to arrest the company’s continuing slide.
This case study won the ecch Best Selling Case Award 2011 and the Human Resource
Management/Organizational Behavior Category Award in the ecch Case Writing Competition 2013.
This case study was written by Konstantin Korotov, Urs Müller, and Ulf Schäfer of ESMT European School of
Management and Technology. Sole responsibility for the content rests with the authors. It is intended to be
used as the basis for class discussion rather than to illustrate either effective or ineffective handling of a
management situation.
Copyright 2009/13 by ESMT European School of Management and Technology, Berlin, Germany, www.esmt.org.
All rights reserved. No part of this publication may be reproduced, stored in a retrieval system, used in a
spreadsheet, or transmitted in any form or by any means - electronic, mechanical, photocopying, recording,
or otherwise - without the permission of ESMT.
This document is authorized for use only in JacquelineToro's Liderazgo-Jacqueline Toro at Universidad Externado de Colombia from Mar 2019 to Sep 2019.
ESMT–409–0100–1 “Do you really think we are so stupid?”
A letter to the CEO of Deutsche Telekom (A)
Deutsche Telekom 2007

Deutsche Telekom was formed in 1996 from the former state-owned monopoly Deutsche
Bundespost. By the end of 2006 DT had seen four consecutive years of falling sales in its
traditional fixed-line phone services. Shortly before Ricke’s departure the share price had taken
its biggest fall during that same period (to less than €11) in the wake of a dire profits warning
and lukewarm income forecasts (refer to Exhibit 1). Compared to Europe’s other former state
telecoms monopolies, such as Spain’s Telefónica and Britain’s BT – DT’s rivals in the new
deregulated marketplace – DT had simply never evolved into the same kind of modern, profitable
provider and seemed doomed to failure. The company still remained one of the world’s largest
telecommunications companies with approximately 248,000 employees worldwide including
approximately 150,000 in Germany and sales of €61.3 billion (refer to Exhibit 2).
Headcount was undoubtedly one of DT’s major problems. With around a quarter million people,
the company was bloated beyond comparison with any of its competitors. Successive CEOs had
been faced with the same need to cut costs and streamline services but were thwarted by the
same inability to dispense with workers, many of whom were civil servants who could not be
made redundant. With the tacit backing of the German government, which was unwilling to
sanction large-scale redundancies for electoral reasons, the unions had successfully protected
their members’ job security ever since DT’s privatization in 1996.
Not only were there too many employees, many of them were also being paid more than the
industry average for their jobs. There was no escaping the fact that DT’s costs were
uncompetitive, even if one assumed it was providing the same quality and level of service as its
rivals. And, arguably, that was the other problem: the huge, well-paid staff was not necessarily
matching its rivals’ performance. Many other European state monopolies had suffered from
profound customer dissatisfaction with their poor service ethic during the initial phase of their
privatization, but DT was still in that hole 12 years on, while many of its rivals had emerged
renewed. In 2006 a total of two million of DT’s fixed line subscribers defected to other providers.
In the public perception the competition was offering services that were as good as if not better
than DT’s, and it was managing to deliver them with a much smaller workforce. At the same
time, DT was far from being at the forefront of product innovation. It was not until March 2006
that it first offered digital television services to subscribers; it had no combined mobile-fixed line
package until that same summer, years after rivals had first offered such deals; and triple-play
phone-internet-TV options were not announced until the final quarter of the year. Other suppliers
had more, better and cheaper products on the market, and consumers voted with their feet.
The product line could be fixed quickly enough. The most pressing problem remained the number
of employees and their high wages. Overall staff costs at DT were running at approximately 25
percent of sales. At France Télécom the ratio was about 18 percent, only 15 percent at
Telefónica of Spain, and as low as 12 percent at KPN in the Netherlands.1 But it was not just
ratios that were giving cause for concern. The end result was a continuing decline in bottom-line
profits. Although DT had the biggest revenue of any European telecoms provider, it could not
“Do you really think we are so stupid?” ESMT–409–0100–1
seem to prevent profits diminishing. On the same day in November 2006, the UK’s former state
monopoly BT reported its operating profit up two percent to $2.7 billion on sales of $9.4 billion
for the quarter ending September 30, while DT announced that its operating profit had fallen by
seven percent to $6.5 billion on sales of $19.7 billion.2
The effect of figures like that was very plain to see, especially for shareholders. DT’s shares were
around seven percent down from the start of the year, while BT’s had risen by a considerably
more attractive 23 percent. There is nothing an investor hates to see more than a falling share
price and it was for that reason that Ricke had to go, despite having been in the job for only four
years. On Obermann’s appointment the share price jumped by over three percent on the German
exchange. Was that just relief at Ricke’s removal or was there something about the new man that
gave promise of better things to come?
Who is Herr Obermann?

René Obermann cut a youthful figure in contrast to his predecessors. He looked even younger
than his 43 years. He liked fast motorbikes and thrash metal. He was the youngest CEO of any of
Germany’s top 30 companies. Although he had been at DT for eight years, the markets might as
easily have reacted with alarm at his elevation to the stewardship of such a vast enterprise -
especially one in such a perilous position.
The image of Obermann headbanging to Linkin Park on his iPhone as he speeds along the
autobahn on his MV Agusta seems irreconcilable with the crippling inertia of corporate
bureaucracy at DT. Obermann was not the archetypal ‘company man.’ Aside from the question
why DT should want him at the head of their table, why did Obermann want to be at DT?
His early history is instructive. After his military service and a two-year apprenticeship at BMW,
Obermann began putting himself through an economics degree at University of Münster in 1986.
To pay his way, he set up his own company, ABC DT, buying and selling telephone answering
machines at a small profit. He bought an ancient BMW that was on its last legs, but looked good,
which helped him as he trooped around the city knocking on doors and flogging his wares. By
1991 Obermann had seven shops, several franchisees and was employing 50 people. Mobile
phones were just taking off and ABC DT branched out into a growing sector. Within four years,
sales were into € millions of euros and the company was snapped up by Hutchison Whampoa Hong
Kong, whose plans to start a mobile phone company reached fruition with Orange. After selling
his shares in the new company, Obermann could have comfortably retired as a very wealthy 32-
year-old. But the prospect of early retirement is not what motivates people like René Obermann.
In 1998 he surprised everyone, except perhaps himself, by accepting an offer to lead the German
sales effort for DT’s mobile phone division, T-Mobile. With such a sparkling entrepreneurial
record, why would he suddenly want to immerse himself in the potentially turgid world of a
corporate behemoth like DT? Obermann explained: “I needed a different perspective. As a
reseller you just take what the network designs and innovation is very limited.” He described the
job at T-Mobile as “a big opportunity” to shape mobile phone services, not just resell somebody
else’s.3
It was an opportunity Obermann seized with a vengeance. Within two years he had graduated
from head of sales to head of T-Mobile’s entire German business, and a further two years later in
2002 he took over the reins of T-Mobile worldwide. With that came a seat on DT’s board and the
rest is history. He is now in a position to shape more than just mobile phone services. But can
someone from such a background shape an organization as seemingly vast and unmovable as DT?
During his time at T-Mobile Obermann made it clear that his approach was to try and change the
organization to suit him rather than to try and adapt to the bureaucracy.
I have learned how to manage or stay alive in a corporate bureaucratic environment and
not bend over too much and not betray my own personality. It was quite a transition,
which I needed some time to get used to, but since I got used to it, I am trying to
4
change it to a more entrepreneurial environment.
Obermann has been characterized as straight-forward, efficient, and boisterous, as a

perfectionist with expertise and a workaholic. He was known for identifying himself strongly with
his company T-Mobile, perceiving criticism of it as a personal affront (Handelsblatt). In an
allusion to how he fought and won internal battles against board colleagues, Manager Magazin
named him the “Macchiavelli from the Rhine” and the Financial Times Deutschland noted his
tendency to “quickly roll through the front yards of opponents with a tank.” In such statements
we can find the clues to the less than complimentary nicknames he has been given by the unions
at DT: “The Bulldozer” is one, “Dobermann” another.
Herr Obermann takes charge

Obermann’s appointment by the supervisory board was neither undisputed nor unanimous.
Blackstone had preferred an external hire, but the employees’ representatives and the powerful
unions were able to organize a veto of such changes. Obermann was given the job that was
characterized as an “ejection seat” (Financial Times Deutschland), a reference to the massive
competitive challenges the German incumbent had to master while at the same time having to
manage the conflicting interests of the strong unions, investor Blackstone, and stakeholder
Deutschland.
In the days that followed his appointment, Obermann pointed out that DT’s cost position was a
strategic disadvantage that needed to be addressed and that the service DT provided to
customers was indeed unsatisfactory and a major reason for the dramatic loss of customers. In
the following months, Obermann - supported by new faces in the executive board including his
long time confidant Tim Hoettges, and Dietmar Welslau - formulated a strategy for DT which
included the transition of some 50,000 employees from fixed line division T-Com to a new
company called T-Services. With the transition to T-Services, employees would be asked to work
longer for less money - and deliver a better service to customers.
The letter to the CEO of Deutsche Telekom

On March 9, 2007 a 48-year old technician from T-Com’s Berlin branch sent an e-mail to Deutsche
Telekom’s new CEO, selected members of the board of management, union representatives, and
a few of his colleagues:
Dear Mr Obermann, Mr Hoettges, and Mr Welslau, dear gentlemen on the executive

floors,
Your repeated letters to the staff with different (and yet ultimately the same) content
have motivated me to write this letter.
In what follows I will use “you uncapitalized,”a because I will not always address you
(personally), but the many managers, executive board members, and supervisory board
members, who are or have been responsible for our company.
The last reason has been your repeated demand for us employees to generate a greater
commitment to the company. I can only reply that I and most of my fellow-workers have
more commitment to the company in our little fingers than the entire management
squad together. And I’ll tell you why.
This Telekom is and has always been my life. I began my career here and it was here
that I wanted to finish it. I have watched the Post Office become Telekom and
subscribers become customers, but unfortunately I have also seen our company, in
which everyone was at everyone else’s service, turned into a business in which everyone
just thinks (or must think) of themselves; where each part of the business simply tries to
keep its own area clean and skim off as much as they can from the other parts, even if
this leads to far greater gaps in the other parts than anyone could ever fill. I have seen
how our staff has been turned into human capital, and how we are all regarded as
nothing more than a cost factor that must be (and is intended to be) got rid of as
quickly as possible.
However, you and your predecessors have been coming and going. There’s hardly any
question here of company commitment.
You come, you reorganize, and you do so with an arrogance and a high-handedness,
without listening to any warnings that it is not possible to maintain, let alone increase,
quality and reliability. Nor did a single one of you care about the consequences of your
decisions. You move on with filled pockets to do the same thing with the next company,
ruthlessly leaving behind you a mess that was getting larger every time.
And when we, who have always done good, competent and highly motivated work, who
have always known how to satisfy customers’ wishes, and who were the best
telecommunications company over a long period of time, must now listen to you telling
us that we are too bad, too expensive, not motivated, lazy and unproductive, then we
feel very angry about this effrontery.
a
In the German language, the capitalized “Sie” is used in letters to address a single person or a well-
defined group of people formally; the uncapitalized “sie” addresses rather an anonymous group of
people.
But as if it were not enough for you to insult us in this way, you now tell it to the world,
causing our reputation and of course our share price immense harm. You ruthlessly
befoul your own nest just so you can put through your own (or whoever’s) short-term
job-cutting and outsourcing plans in order to distract from the mistakes made by your
predecessors. This is simply unbelievable and a breach of trust that can never be
excused or made good.
Do you find that this letter lacks respect? Who is entitled to respect? We, the staff who
have dedicated our lives to Telekom and our customers, who again and again have given
and continue to give the interests of Telekom and its customers priority over our own
private lives? We who have made Telekom the best, most competent, customer-friendly
and efficient of all the communications companies? Or do you seriously expect respect
for what you and your predecessors have done to us and our Telekom?
Over the last few years, you and your predecessors have increasingly bound us in chains,
you have deprived us of well-functioning tools and blinded us by imposing systems on us
that do not make the work any easier, but only increase control mechanisms while at
the same time hugely reducing effectiveness. You have destroyed internal and external
communications by rigorously switching off call numbers and hotlines that worked and
replacing them with collective numbers that don’t work and pointless spillover
concepts, thereby reducing both internal and external availability to zero. You have
destroyed knowledge, competence, and jobs where they were indispensable, by posting
highly qualified staff to completely new and unknown work fields or to Vivento,b or you
have “persuaded” them to take early retirement, age-related part-time posts, or
severance pay.
By closing down hundreds of T-Punktec and dismissing thousands of highly qualified

staff, your predecessors, again ignoring all the warnings by the experts, destroyed these
competent interfaces to the customers, thereby driving the customers in masses to our
competitors, and now you boast that you have created new T-Punkte and recruited a
few hundred new employees, now that the horse has long bolted and we have lost so
many customers. Do you really think we are so stupid as to praise you for it?
The service contact points, the second direct interface to the customers, have
continued to have their staff reduced in masses—with the usual arrogance and again
despite all warnings—with the consequence that our figures in opinion polls have sunk to
the lowest ever recorded. The cheap solution was to use unmotivated and ignorant
external workers with no company commitment (!) whatsoever to replace the colleagues
who had previously been thoroughly “removed”, and then to be surprised at the
increasing chaos and the increasing dissatisfaction amongst customers.
And now you are planning to castrate the third direct interface to our remaining
customers, the service element, by huge cuts in staff and by motivating the remaining
staff to provide a better service by paying them less and making them work longer.
b
Vivento is a labour service company founded and owned by Deutsche Telekom that absorbs redundant
employees of Deutsche Telekom after restructurings in order to make them available to companies inside
and outside of Deutsche Telekom.
c
“T-Punkte” are the Point-of-Sales of Deutsche Telekom in Germany.
It’s obvious where that will lead, but since at your level decisions are never reversed,
not even if you know that you are making a huge mistake, service and efficiency will
once again suffer hugely in an enterprise that already has its back up against the wall.
The vultures are already waiting for the bits you will leave behind you, killing off the
last few employees still remaining. But that of course is something you will not
experience at first hand, since you will already be on the way to the next company.
You are always using the “usual market wage” as comparison, and compare us with
mostly unskilled laborers, with dilettantes who have neither learned this job nor have
any connection whatsoever with Telekom or our customers. If we are lucky, they are
former electricians but we have already encountered turf layers (no joke) and similar
“specialists” in the Main Distribution Frame.
This is the same as wanting to own a Mercedes but using the Trabantd as price
comparison, and only wanting to pay that price.
We would prefer to make Telekom the best again, preferably today rather than
tomorrow! We also know how it can be done and what must be changed! We are in favor
of changes that improve the service and customer-friendliness! We know what the
customers want and how we can offer it to them! If you are serious about being the best
communications enterprise again, speak to us! We have enough ideas, and motivation!
We know the customers and the company and we know where there are serious
problems! We also know where far too much money is being wasted, where personnel
are wrongly assigned, and where knowledge is wasted or where processes must be
adjusted! Take us with you on the path to a better Telekom! Use our ideas, our
commitment, our willingness for change and our flexibility!
As long as your objectives for the management are based on the reduction of personnel,
the clearance index and fast inquiry figures, and not on customer and staff satisfaction,
the generation of new field of business (e.g. Telekom goes IT) and hence on increasing
revenue and securing jobs, there will never be any real progress and no chance of
surviving on the market.
I am, however, (unfortunately) pretty certain that that is not your objective at all, that
these fine words are only empty shells to allow you to pursue the demerger, and that
you are not at all open to reasonable proposals, since you already have the next and the
next-but-one steps in the pipeline and because you never want to or can rethink let
alone reverse decisions already made.
You prefer to listen to external consultants such as McKinsey who have no interest
whatsoever in Telekom and apply the same mix of break-up and personnel reduction to
every company, always leaving behind them frustrated and unemployed workers. If that
is the case, then you should at least have the courage to make your intentions public.
Stop treating us as if we were stupid and, at least as long as you run our company,
support the employees in public and don’t run us down.
As executive board and management team for this company, you have a responsibility
not only to the shareholders (which you are not satisfying with the counterproductive
measures you have announced anyhow) but also a social responsibility to us employees!
d
The “Trabant” was one of the two automobiles of East Germany made of mainly cheap plastics. It is
considered an inferior, unmarketable product.
We employees are the company! We are not responsible for the state of Telekom. One
cannot simply drive us ruthlessly into a professional, social and financial disaster; one’s
social conscience should prevent this! However, my fear is that this appeal will fall on
deaf ears, both yours and those of McKinsey.
However, you should not be surprised if - after you have abandoned the rapidly sinking
ship Telekom, no doubt with, like your predecessors, a generous settlement for your
excellent services for Telekom - you see a locust when you look in the mirror.
I could go on and on writing in this way, since I have many concerns, but I do not want
to end this letter with angry words. For this reason, to conclude, I would like to once
again offer my/our assistance in dealing with the challenges before us. Use our
competence and our will to survive in order to re-establish our company in the market;
we have a much greater interest in this than you, since there is no new executive board
or supervisory board position waiting for us, but instead low wages and/or
unemployment that threaten our very existence.5
The reaction to the letter

The technician’s letter to René Obermann did not stay secret. The original e-mail was not only
sent to the management board but also to the unions and to a “few colleagues” of the
technician. Someone then forwarded the e-mail to others and it eventually spread throughout DT.
The e-mail soon became a hot topic within DT. Several recipients responded to the author. Within
two weeks, he had received nearly 1,000 e-mails from colleagues from all DT businesses -
“everyone is backing me,” he was reported to have said.
Having reached a large enough audience, it was only a question of time before the e-mail was
leaked outside DT. An entry on the news Website Heise made the entire text of the e-mail
available to a larger public. Shortly afterwards, the most popular German news Website Spiegel
Online posted an article that linked the full text of the e-mail and reported about the positive
reactions of many DT employees. Several other media followed – fuelling a major public
discussion. Several media tried to get an interview with the technician, but for months he
refused , explaining: “We have to clarify our problems internally, without public debates. We
support our company. Deutsche Telekom does not deserve bad publicity.”6
However, the discussion now continued even outside DT. On several Websites, in forums and in
letters to the editors of different media the public reacted strongly to the e-mail, reflecting the
strong feelings many Germans have regarding DT. Spiegel Online reported about readers who sent
letters recommending that the technician be awarded a medal of honor, the
“Bundesverdienstkreuz,” or even a monument. Other readers said that the letter to the CEO was
not only applicable to DT, but also to other companies and industries, at times turning the author
of the e-mail into an icon in the fight against capitalism and globalization.
Exhibit 1: Stock price development Deutsche Telekom 1996 (IPO) - 2007 (in €) and
Jan-Dec 2006
Source: Deutsche Telekom.
Exhibit 2: Selected financial data from Deutsche Telekom Group: Financial report
2006
billions of € Change 2006 2005 2004 2003
compared
to prior
year (%)a
Revenue and earnings
Net revenue 2.9 61.3 59.6 57.3 55.6
Of which: domestic (%) (4.5) 52.9 57.4 60.6 61.8
Of which: international (%) 4.5 47.1 42.6 39.4 38.2
Profit from operations (EBIT) (30.6) 5.3 7.6 6.3 8.3
Net profitb (43.3) 3.2 5.6 1.6 2.1
Net profit (adjusted for special factors)b (17.4) 3.9 4.7 3.7 2.4
EBITDAa, c, d (18.9) 16.3 20.1 19.4 18.6
EBITDA (adjusted for special factors)a, c, d (6.2) 19.4 20.7 19.6 18.5
EBITDA margin (adjusted for special factors) (%)a (3.1) 31.7 34.8 34.2 33.3
Balance sheet
Total assetse 1.3 130.2 128.5 125.5 136.2
Shareholders’ equitye 2.2 49.7 48.6 45.5 43.5
Equity ratio (%)a, e, f 0.3 35.8 35.5 34.2 31.9
Financial liabilities (in accordance with consolidated (0.5) 46.5 46.7 51.1 64.1
balance sheet)
Net debta, d 2.4 39.6 38.6 39.9 51.1
Additions to intangible assets (including goodwill) and 20.9 13.4 11.1 6.6 7.6
property, plant and equipment
Cash flows
Net cash from operating activities (5.4) 14.2 15.0 16.7 15.1
Cash outflows for investments in intangible assets (18.6) (8.5)n (7.2)n (6.4) (6.4)
(excluding goodwill) and property, plant and equipment
(in accordance with cash flow statement)d
Free cash flow (before dividend payments)a, d (27.3) 5.7n 7.8n 10.3 8.7
Free cash flow as a percentage of revenuea (3.9) 9.3n 13.1n 18.0 15.6
Net cash used in investing activities (4.2) (14.3) (10.1) (4.5) (2.3)
Net cash used in financing activities 74.4 (2.1) (8.0) (12.9) (5.8)
Employees ees
Average number of employees (full-time equivalents 1.8 248 244 248 251
without trainees/student interns) (thousands)
Revenue per employee (thousands of €)a 1.1 246.9 244.3 231.5 221.3
T-Share - key figures
Earnings per share/ADS (basic and diluted) in (43.5) 0.74 1.31 0.39 0.50
accordance with IFRS (€)b, g
Weighted average number of ordinary shares 0.4 4,353 4,335 4,323 4,302
outstanding (basic) (millions)g, h
Weighted average number of ordinary shares 0.4 4,354 4,338 4,328 4,307
outstanding (diluted) (millions)g, h
Dividend per share/ADS (€) (0.0) 0.72i 0.72 0.62 0.00
Dividend yield (%) j (0.1) 5.2 5.1 3.7 –
Total dividend (billions of €) (4.0) 3.1i 3.0 2.6 –
Number of ordinary shares carrying dividend rights 4.0 4,338l 4,173 4,171 4,167
(millions)k
Total number of ordinary shares at the reporting date 3.9 4,361 4,198 4,198 4,198
(millions)m
a Calculated on the basis of millions for the purpose of greater precision. Changes to percentages expressed as percentage points.
b Adjusted prior-year comparatives. Adoption of IAS19.93A. Non-recurrence of amortization of actuarial losses, including taxes: 2005: EUR 7 million; 2004: EUR 1 million; 2003:
EUR 0 million (before taxes). Please also refer to explanations under Note 29 in the notes to the consolidated
financial statements.
c Deutsche Telekom defines EBITDA as profit/loss from operations before depreciation, amortization and impairment losses.
d EBITDA, EBITDA adjusted for special factors, net debt, and free cash flow are non-GAAP figures not governed by the International Financial Reporting Standards (IFRS) or U.S.
Generally Accepted Accounting Principles (U.S. GAAP). They should not be viewed in isolation as an
alternative to profit or loss from operations, net profit or loss, net cash from operating activities, the debt reported in the consolidated balance sheet, or other Deutsche
Telekom key performance indicators presented in accordance with IFRS or U.S. GAAP. For detailed information and
calculations, please refer to the “Development of business” section of the Group management report in this Annual Report.
e Adjusted prior-year comparatives. Adoption of IAS 19.93A. Recognition of actuarial losses in equity, including deferred taxes on these losses: 2005: EUR 1.0 billion; 2004: EUR
0.3 billion; 2003: EUR 0.2 billion. Please also refer to explanations under Note 29 in the notes to the consolidated financial statements.
f Based on shareholders’ equity excluding amounts earmarked for dividend payment, which are treated as short-term debt.
g Calculation of basic and diluted earnings per share in accordance with IFRS as specified in IAS 33, “Earnings per share.” The share/ADS ratio is 1:1.
h Less treasury shares held by Deutsche Telekom AG.
i Subject to approval by the shareholders’ meeting. For more detailed explanations, please refer
to the “Development of business” section of the Group management report or the information under Note 13 in the notes to the consolidated financial statements in this
Annual Report.
j (Proposed) dividend per share divided by the Xetra closing price of the T-Share at the reporting date or on the last trading day of the respective financial year.
k Less treasury shares held by Deutsche Telekom AG and those shares that, as part of the issue of new shares in the course of the acquisition of Voicestream/Powertel, are
held in trust for later issue and later trading as registered shares and/or American depositary shares (ADSs).
l Balance at the reporting date.
m Including treasury shares held by Deutsche Telekom AG.
n Before payments for the acquisition of network infrastrucure and licenses in the United States totaling EUR 2.1 billion in 2005 and payments for the acquisition of licenses
totaling EUR 3.3 billion in 2006.
Source: Deutsche Telekom.
Endnotes
1
The bulldozer: René Obermann takes on the unions at Deutsche Telekom. The Economist, May 17, 2007.
http://www.economist.com/node/9184597 (accessed May 25, 2007).
2
Ewing, J. Deutsche Telekom: Obermann’s Challenge. Businessweek, November 13, 2006.
http://www.businessweek.com/stories/2006-11-13/deutsche-telekom-obermanns-challengebusinessweek
-business-news-stock-market-and-financial-advice (accessed May 25, 2007).
3
The tie-less mobile chief who's spoiling to take on his Telekom masters. The Guardian, August 20, 2005.
http://www.guardian.co.uk/business/2005/aug/20/mobilephones (accessed May 25, 2007).
4
Ibid.
5
Halten Sie uns wirklich für so dumm? Spiegel Online, March 21. http://www.spiegel.de/
wirtschaft/0,1518,473094,00.html (accessed May 25, 2007).
6
Streitz, M. Protest-Mail an Vorstand: Telekom-Mitarbeiter feiern Kollegen. Spiegel Online, March 20,
2007. http://www.spiegel.de/wirtschaft/0,1518,472838,00.html (accessed May 25, 2007).
10

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ESMT–409–0100–1

ESMT Case Study

“Do you really think we are so

Deutsche Telekom 2007

Who is Herr Obermann?

Obermann has been characterized as straight-forward, efficient, and boisterous, as a

Herr Obermann takes charge

The letter to the CEO of Deutsche Telekom

Dear Mr Obermann, Mr Hoettges, and Mr Welslau, dear gentlemen on the executive

By closing down hundreds of T-Punktec and dismissing thousands of highly qualified

The reaction to the letter

Source: Deutsche Telekom.

Source: Deutsche Telekom.

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