Ericsson’s newly appointed CEO Borje Ekholm put the focus on continuing cost cutting, returning to profit and ensuring stability when he takes up the role in January, while admitting the vendor is “clearly challenged” at the moment.
The appointment, announced earlier today, will see Ekholm take the reins as president and CEO at Ericsson from 16 January 2017, and the news comes three months after long-term leader Hans Vestberg was pushed from the company.
Ekholm joins Ericsson from his current position as CEO of Patricia Industries, a division within Investor (one of Ericsson’s main shareholders), where he has worked for more than 20 years.
He has also been an Ericsson board member for ten years, which gives him a “full understanding of the challenges and the opportunities Ericsson currently faces”, read a statement.
Speaking on a call announcing the news, Ekholm said running a company was very different to being on the board, adding that he would not make any rash decisions on what he plans to change to revive its fortunes.
“It is clear we have to make adjustments to our cost structure, and we have to establish profitability by supporting the demand that exists for our services,” he said.
“Once we achieve a level of profit, we will go for stability and then growth. We will invest in certain areas, make strategic decisions, de-emphasise on certain technology and emphasise in other areas. I feel confident.”
While Ekholm will no doubt have his work cut out, at this very early stage there was no new grand strategy announced.
Most recently, the company announced a loss of SEK200 million ($20 million) and a slump in sales. Ericsson has also recently axed thousands of jobs.
He however was defiant about Ericsson’s recent performance, lauding the previous management for ensuring Ericsson survived in a “difficult market”.
“We’ve seen existing companies go out of business or been acquired, while Ericsson is one of the few that has survived, and that deserves a lot of credit,” he said. “We have stood up in an industry that has been challenged, and we must now formulate a plan of how we will run the company going forward.”
Leif Johansson, chairman of the board, revealed Ekholm was the only person on the company’s list of CEO candidates. He also said it would not be a problem that Ekholm would be based out of the US, given “our large presence there”.
He also revealed Ekholm’s remuneration package is similar to his predecessors. (see image).
Interim CEO Jan Frykhammar will remain in the position until Ekholm joins in January.