We held our November board meeting yesterday. It was shorter than usual because although there were two more serious than usual items to be considered the uncertainties in the current market places meant that we couldn't really consider anything operationally until we resolved those issues at some future time. We did approve the most expensive capital expenditure program for next year - required to move to the next phase of upgrading the Australian network and we also approved the expenditure required in Sri Lanka to fit out new offices to accommodate another 60 people for the proposed growth in small and medium business sales and support. So, in one way, it was the most 'expansionist, board meeting we have ever held......which was very strange given the other circumstances that we will need to address over the coming months.
The build out of the Australian network, apart from being the largest expenditure we have ever contemplated will also involve, almost certainly, a pretty comprehensive change to our IP and back haul providers....in itself a seriously major change and one not undertaken lightly....I always dread network changes of any sort. Over the years of developing corporate and business sales we have added a considerable number of circuits to our network - something approaching 2,000 additional links - 'on top' of dozens of links required for the residential customer network. While this has, of course, been done gradually over time it has totally changed our network topology and, looking at the likely future growth, will require massive increasing changes in the not too distant future. While we have signed the appropriate supply agreements with Cisco to acquire the new equipment at sensible commercial prices the costs are still quite considerable.
Similarly, the costs of adding 60% more space and personnel to our Sri Lankan operation are not inconsiderable and all of that expenditure has to be incurred before we can generate a single dollar of revenue - let alone profit. While office space and fit out costs are lower in Colombo's CBD than they are in North Sydney they are still considerable though they pale into insignificance when compared to the massive costs of hiring and training the additional personnel....and that continues to be the major problem we continue to confront as we look in to the future - just how well can we select, employ and train the large number of people we will need to make our 'planning' a reality? I am probably more troubled than I used to be on this issue - because I don't see the personnel management skills that the planned growth needs developing as quickly as I had expected.
So the caution displayed at the board meeting, apart from a major decision not being capable of being made, was generated by a hesitation caused by this lack of personnel management skills - perhaps even desires. I do understand that no company, of any size, can grow easily when there is doubt about its personnel management skills. I just don't know how to ensure all the obvious problems are addressed let alone all the problems I just don't see. It will be necessary to make a judgement on which of our current employees can rapidly develop to make this planned growth 'happen'. I have been trying to do that over the past few months without success. Perhaps I am looking at the issues wrongly? I never seemed to have had this problem in the past - perhaps I just never noticed?