Until recently SimpleTel had a star performer in the telecommunications industry, and the CEO was a favorite of analysts community. Several years back, SimpleTel even in a situation where customers to smaller, local telecom provider of migration were found SimpleTel to avoid the congestion on the network. At this point SimpleTel leadership had decided to invest heavily in the expansion of network capacity. But now, the company was left with a huge amount of unused capacity. That, along with deb … Read more »

Until recently SimpleTel had a star performer in the telecommunications industry, and the CEO was a favorite of analysts community. Several years back, SimpleTel even in a situation where customers to smaller, local telecom provider of migration were found SimpleTel to avoid the congestion on the network. At this point SimpleTel leadership had decided to invest heavily in the expansion of network capacity. But now, the company was left with a huge amount of unused capacity. This, together with debt securities in connection with the massive investments in capacity and a lack of demand threatened SimpleTel to the brink of bankruptcy to push. The previously acclaimed CEO had fallen into disgrace and shareholders were baying for his blood. He was forced to make an unceremonious departure, and had begun the search for a savior. Today, the Compensation Committee based on the compensation for Chief Executive SimpleTel was advised.
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from
S. Venkataraman
Rajesh Narayanan,
Prasad Nair
Source: Darden School of Business
11 pages.
Release Date: 31, December 2008. Prod #: UV1035-PDF-ENG
The dilemma SimpleTel HBR case solution

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