Yahoo Finance Optus CEO resigns after outage but is she just a 'scapegoat'? And who could replace her?
Optus's parent company Singtel has confirmed Kelly Bayer Rosmarin's resignation.
Optus CEO Kelly Bayer Rosmarin has fallen on her sword after the chaotic outage that brought Australia to a grinding halt, but the flailing telecommunications giant won't save its reputation without "authentic change".
Bayer Rosmarin - who was appointed in 2020 - dodged the question about whether she would remain at the helm when she fronted a senate inquiry on Friday over the November 8 blackout but didn't manage to survive the weekend as parent company Singtel announced she'd stepped down.
Gladys Berejiklian - no stranger to controversy herself - has been named as a contender to take over Bayer Rosmarin's role, but given the level of public distrust in Optus, she too would have her work cut out for her, with the outage just another nail in the coffin after exposing the personal data of millions of Australians.
"The old adage rings true for the resignation of Bayer Rosmarin: heads must roll," Dr Mariano Heyden, Professor of Strategy & International Business at Monash Business School said.
Bayer Rosmarin's fall could be considered "symbolic scapegoating" amid public pressure as it separates the brand from the "villain", pouring blame in one person's direction, Heyden explained.
This does create an opportunity for Optus to make significant changes but could also be a "short-term reaction to stop the bleeding without directly addressing root causes".
"CEO turnover is an opportunity for the organisation's board to take accountability for misfortunes and create a context for thinking about authentic change," Heyden said.
"Repairing public trust in Optus cannot solely be achieved by simply changing the CEO, rather, it also needs to be a by-product of authentic change in the way they conduct business.”
This comes as exasperated Optus customers claimed they were unfairly charged international roaming fees while overseas and in Australia — even after requesting the feature be turned off, putting their mobiles into flight mode, and removing their SIM cards. And another outage in Melbourne.
Bayer Rosmarin has spent the past two weeks in damage control, apologising for the mayhem caused when 10 million Australians, 400,000 businesses - including Commonwealth Bank, Westpac and ANZ - and much of the wider population felt the impact of services going down. Payments couldn't be taken, people couldn't reach their loved ones or colleagues and the public transport system went down.
Of particular concern was that triple-0 calls failed during the outage.
Who is being considered to take over Optus CEO role?
It's still early days but there's already speculation about contenders, including a proven executive from parent company Singtel. Here's a couple others.
Gladys Berejiklian: The former NSW premier is currently the executive of Optus's enterprise, business and institutional division but could be a risky option as she was found to have engaged in serious corrupt conduct by an ICAC inquiry (she has appealed).
Michael Venter: The former Commonwealth Bank executive been the chief financial officer since 2021 and has the interim job. He has overseen healthy profit and was in the role when 425,000 new mobile subscribers were added.
Peter Kaliaropoulos: Noting he has the credentials is an understatement. He was managing director of Optus business division and has since had leadership roles at Singaporean telecommunications giant StarHub and Kuwaiti telecoms firm Zain Group. He was announced as chief operator officer in the same statement with Bayer Rosmarin's resignation.
What did Optus boss Kelly Bayer Rosmarin say in her resignation?
“On Friday I had the opportunity to appear before the Senate to expand on the cause of the network outage and how Optus recovered and responded. I was also able to communicate Optus’s commitment to restore trust and continue to serve customers,” Bayer Rosmarin said.
“Having now had some time for personal reflection, I have come to the decision that my resignation is in the best interest of Optus moving forward.
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“It’s been an honour and privilege to lead the team at Optus and to serve our customers.”
Optus wasn't aware of triple-0 outage: 'Not acceptable'
Optus has been lashed for its handling of the outage, as thousands were left without service, and businesses, hospitals and train services were impacted.
The Australian Communications and Media Authority (ACMA) has begun an investigation into Optus’s compliance with the rules on emergency calls.
A total of 228 calls to triple-0 failed to connect during the outage, leaving Optus puzzled as to why.
“We absolutely believe that the triple-0 system should have worked and it’s critical for all Australians the system can be relied upon,” Bayer Rosmarin told the Senate.
She admitted it was “indisputable that, on that day, our performance was not acceptable”.
Australians were incensed over Optus' offer of 200GB of data to remedy lost trust over the outage, with many demanding far more significant compensation.
Businesses that lost revenue and those unable to work in the outage have been told to keep receipts of their losses to potentially recoup them.
"We recognise the need for Optus to regain customer trust and confidence as the team works through the impact and consequences of the recent outage and continues to improve," SingTel Group CEO Yuen Kuan Moon said in a statement.
Chief financial officer Michael Venter has been appointed as Optus's interim CEO.
Optus outage: What you need to know
Who was impacted? An estimated 10.2 million mobile, landline and broadband customers and 400,000 businesses were without service from early November 8, with Optus stating services resumed about 6.00pm AEDT.
What caused the outage: Company parent SingTel said a fault in Optus's safety mechanisms caused the outage. Optus earlier said the company's network was affected by "changes to routing information from an international peering network" after a "routine software upgrade".
Is it a cyber attack? Fair question given 1 in 2 Aussies had their data compromised last year, but no.
Why does it matter if I am not with Optus? You could argue the vast majority of Australia was impacted in one way or another. People couldn’t communicate. There was a story of a Sydney woman missing her mum’s final moments. Triple-0 calls and hospitals were caught up. The trickle-down to non-Optus customers was evident when public transport couldn’t be used, Uber was down, and major banks’ call centres were out. The local cafe couldn’t take payments - bad for you not getting caffeine but worse for them missing out on revenue.
Are people getting compensation? 200GB has been offered by Optus to impacted customers. An inquiry will delve further into if that's enough. ACMA has also told customers impacted to file a formal complaint, according to rights guaranteed under Australian consumer law.
With NCA Newswire
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