If Guy Laurence knew his days as CEO of Rogers Communications were numbered, he hadn’t displayed many signs of an imminent departure. Sources tell BNN Laurence had been his usual upbeat self in the days leading up to the surprise announcement of his exit on Monday. Of course, we now know he’ll be replaced by ex-Telus boss Joe Natale once Natale’s non-compete agreement with his former employer has run its course.
What may not have been evident to Rogers employees (or outside observers for that matter) seems to have been crystal clear to Rogers’ board of directors, according to industry observers. “This is more about the relationship between Guy Laurence and his board,” telecom industry consultant Iain Grant of The Seaboard Group told BNN in an interview. “The fact that Laurence’s successor has already been identified and approved by the board means that this has been in process for awhile.”
In explaining the move to analysts Monday, interim CEO Alan Horn, who is chairman of the board, spoke of Rogers’ desire to have the “absolutely best management possible.” In Natale, Horn spoke of a proven operator, citing Natale’s track record of keeping customers happy. According to a senior official at Rogers, the board has been particularly hung up on Rogers’ customer service ratings, compared to rivals like Telus. A quick Google search yields a YouTube clip of Natale during his time as Telus CEO, describing customer loyalty as “the magic drug of our business.” And as word quickly circulated though the Rogers ranks that Natale was coming aboard, managers were downright giddy on Monday about the prospects for giving Telus a run for its money.
Looking back, perhaps pundits should have paid more attention to the reasoning behind Natale’s departure from Telus last summer, which was that he didn’t want to relocate to Western Canada (in retrospect, a salivating development for Toronto-based Rogers). “It is reasonably well known that Rogers wanted to hire Natale after previous CEO Nadir Mohamed left, but he was unavailable,” analyst Greg MacDonald of Macquarie told BNN in an email. “Management’s comments today support that view.”
And yet, all of this plays down the achievements by Laurence during his tenure at the helm of Rogers. Earlier this year, Rogers proudly proclaimed customer complaints dropped 65 per cent in the second half of 2015. Laurence, meanwhile, championed a whole host of customer-friendly initiatives, including “Roam Like Home,” which he was particularly passionate about. In an interview with BNN, Edward Jones telecom analyst David Heger gave Laurence a top grade for his performance. “I give him an A for the improvement that the company has demonstrated in the time that he’s been there,” he said. “I’m certainly somewhat surprised by the decision.”
Which leads us back to Laurence’s relationship with the board as well as the Rogers family, which controls the company through its voting shares (four of 14 board members are from the Rogers family). “Laurence has a bit of a brash style,” money manager John Stephenson of Stephenson & Company told BNN in an interview. “You have to get along with the members of the family. That’s a very significant portion of Rogers as a company.”