Sprint – Restructuring is a Painful Process; Deal With It

Implications: Dan Hesse has been on the job for a little over 7 months. So far he has done a solid job.

Analysis: Wall Street has been expecting some kind of overnight turn around in Sprint.  I have said since December that it will take awhile before we see any positive changes that would make Wall Street jump up and down in joy.  Hesse has made solid and good decisions in less than a year.

Hesse took over this company at its lowest.  Sprint had completely spiraled out of control.

None of the changes were for the happiness of analysts.  All of the changes made to date were for the sake of Sprint.  Hesse has reshuffled top management.  I believe Steve Elfman was an excellent choice to take over technology.  Elfman has worked in the trenches before and has done so with Dam Hesse at Terrabeam.

Hesse changed the name of the company Sprint.  Hesse was able to bring together a pantheon of major telecom players, which resulted in the new Clearwire venture.  Hesse was able to create a financial environment that enabled his company and 6 other companies to move ahead on their next gen wireless plans.

In my analysis:  "Sprint’s New Board Member – Mr. Whitworth Here Are a Few More Thoughts", I made several suggestions to Sprint’s board.  I had said:
    -    Hesse needs to overhaul his executive management team
    -    Dump the Nextel network (of course over a period of time)
    -    Improve Customer Service 

In my analysis, "Sprint – Restructuring 101 – Things Will Get Worse Before They Get Better", I said that Dan Hesse needed to focus first on assessing the company’s financial status.  Next take short term steps to stop any bleeding.  Next he needed to focus on developing a vision for the company.  Followed by the development of a strategy to get to where he wants Sprint to end up.  He needs to take some very basic and fundamental steps to shore up Sprint before he can start spending billions.

Bottom line, Hesse has done all of the things I suggested plus more.  Sprint is in horrible condition what does the public expect; a quick fix?  It ain’t gonna happen.

There is still plenty of work ahead.  It is all in the execution.  At a minimum, investors need to be grateful Hesse got past many of the major strategic issues so far.  The mere fact Hesse is engaging the employees in the frank manner he has is therapeutic for all employees and actually made energize the employees to work even harder and smarter.

I suggest investors think about cutting Hesse some slack.  The last crew of executives could not have come even close to what he has done in 7 months.  Remember the last set of guys floundered for almost 5 years.  Hesse has made positive moves in 7 months.