Sprint Announces Layoffs, May Close Call Centers

Despite the cutbacks, CEO Dan Hesse tells investors the company is making progress with its customer service.

William Gardner

January 9, 2009

2 Min Read
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Sprint Nextel's continuing loss of customers is being matched by employee layoffs as the company said it's cutting 160 employees at its former Virginia headquarters and plans to close as many as 20 more call centers this year.

Speaking at Citigroup's annual Global Entertainment, Media, and Telecommunications Conference on Thursday, Sprint CEO Dan Hesse said the company closed 11 call centers last year and could close as many as 20 call centers this year. The company also said it's cutting 160 jobs in Herndon, Va., as a result of the shift of its former WiMax Xohm operation to Clearwire. Some Xohm employees were moved to Clearwire, which is 51% owned by Sprint.

The company has been losing subscribers at a rapid rate -- it lost 1.3 million in its third quarter -- and is likely to drop below 50 million when it reports its fourth quarter financial results next month. Even so, Sprint is likely to retain its No. 3 position based on subscriber population behind AT&T and Verizon Wireless.

Hesse told the financial meeting that the company is making progress in its "customer experience," noting that every Monday morning top management meets to evaluate the previous week's customer care numbers. Hesse said there has been improvement in recent weeks as the managers focus on "churn" -- the total number of lost subscribers -- and on "calls to customer care." Phones are being answered quickly now, Hesse said, adding that 60% of the company's employee emphasis is on customer care.

The other key parameters of "building a good brand and improving profitability" are based on the customer experience, which explains the emphasis placed on keeping customers happy, said Hesse.

Hesse said there won't likely be any more layoff announcements until the next financial report is announced.

Sprint may get a reprieve soon. The company on Thursday was named the exclusive carrier of the Palm Pre, a new touch-screen smartphone that debuted at this year's Consumer Electronics Show.

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