Björn Svedberg - 1977-1990
A three-minute phone call. That was all it took for Björn Svedberg to accept the offer to become president of Ericsson when retiring president Björn Lundvall offered him the job. Just 40 years old at the time, Björn Svedberg became president on July 1, 1977.
"If age is the only problem, then it will solve itself" said Hans Werthén, when he was asked about my qualifications, relates Björn Svedberg.
Like most of his predecessors, Björn Svedberg was an engineer who had graduated from Stockholm's Royal Institute of Technology and received his training within the company, which he joined directly after completing his studies in 1962. Svedberg started at the research department with computer memory circuits that would control telephone switches.
- Because the marketing people of that time were not skilled in the new computer technology, those of us who were recent graduates had to help sell the new switches. Combining technology and marketing was exciting, recalls Björn Svedberg.
He was subsequently appointed as manager for electromechanical system development, and in 1976, he was appointed as Ericsson?s technical director at the corporate level.
While Björn Svedberg's impressive technical ability could not be disputed, he was primarily interested in people. During his 13 years as president, the focus remained on the technical competence possessed by the company's employees.
Under Svedberg's leadership, personnel policies and skills development for employees at various levels was given greater importance. Svedberg also contributed to management training within the company and was himself a mentor for many management candidates. In addition, he developed an incentive system for employees that included warrants.
Within Ericsson, Björn Svedberg was generally regarded as very democratic. He was known for his ability to find consensus solutions for issues under debate. Work at the executive management level was characterized by a greater degree of team work than previously.
When the situation demanded it, however, Svedberg was also able to make quick decisions on his own, even if they were unpopular. In the early 1980s, after Svedberg had been involved in leading the extremely successful development and launch of the AXE system which was sold to such countries as Saudi Arabia and Australia, management decided to invest in computers, terminals and complete information systems for offices.
Investments in computers under the name Ericsson Information Systems were a huge failure, however. Ericsson products, such as minicomputers, were not technically perfected when they were introduced in the market, and the pace of expansion, with acquisitions of Datasaab and Facit, was too rapid.
"The engineers in these companies were highly skilled, but they were used to a different market and not accustomed to our way of working. That was one reason for the problems" explains Björn Svedberg.
Ericsson was losing billions, and by the mid-1980s, management stopped investing in computers. Björn Svedberg was now forced to initiate a tough re-structuring and rationalization program that included many unpopular decisions and personnel reductions.
From 1985 to 1988, the mess at Ericsson was cleaned up. Parts of the company were divested, including the sale of Ericsson Information Systems to Nokia. Svedberg was roundly criticized during these difficult years, not least by the press.
Björn Svedberg recalls how he remarked to his chairman Hans Werthén after the crisis was over that "this was an absolutely incredible management training program" whereupon Werthén answered: "Yes, but expensive! So don't do it again!"
After the clean-up, Ericsson once more focused on its strengths - telecommunications and the continued development of the AXE system. Björn Svedberg traveled extensively to strengthen customer relations and win new customers. He was well known internationally and very respected for his knowledge and experience by both customers and telecom organizations.
Ericsson now succeeded in creating growing markets in Europe in such countries as Great Britain and France.
By 1989, Björn Svedberg had definitely transformed Ericsson's crisis into success. Increasingly intensive investments in mobile telephony were beginning to produce results.
Ericsson was still on its way up when Björn Svedberg resigned as president in 1990 to become chairman of the board. The position of president was turned over to Lars Ramquist, one of the managers who, in accordance with Svedberg's personnel policies, had been "raised" within Ericsson.
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