Telstra's Great Leap Forward

NEW YORK (TheStreet) -- Throughout 2010, American telecommunications companies have been touting next-generation mobile networks they say represent leaps and bounds forward in speed and reliability. Sprint's(S) new system, for example, which is being rolled out in selected markets, allows voice, video and data information to reach mobile phones and other digital devices at speeds peaking at 12 mbps (megabits per second), with average speeds of 3-6 mbps -- about 10 times faster than previous commercial networks in the United States.

Impressive as that sounds, consider that a year earlier (an eternity in technology time), Australia's Telstra launched a wireless Internet with peak speeds of up to 21 Mbps across a nation about the size of the U.S. lower 48. Each extra megabit makes it that much easier and faster to transmit video, text or even vital medical scans wherever they're needed. Telstra already has 42 Mbps peak speeds operating in the five largest cities, with more to come.

Telstra's great leap forward in the mobile Internet is sobering for those who assume a U.S. lead in technological markets, especially for a company never considered cutting-edge. Indeed, for much of its history, Telstra was a large and plodding government-owned utility. The rapid transformation of Telstra -- encompassing not only technology innovation, but also radical changes in the company's culture, marketing and financial performance -- is a leadership tale with fundamental lessons for business worldwide.

Telstra's business transformation -- from caution, conformity and status quo to flexibility, innovation and change -- coincides with the 2005-2009 tenure of Sol Trujillo as chief executive. Trujillo, an American with a long track record leading high-cap telecom companies in the U.S. and Europe, was invited to Australia by Telstra's board specifically to shake things up. Though privatization began during the mid-1990s, when Trujillo arrived, Telstra was still majority government-owned, bureaucratic and hidebound even as it steadily lost market share to competitors in a deregulated market.

Trujillo moved fast to identify and execute necessary changes. For example, Telstra needed to shed around 20 percent of its workforce - no easy task in a culture accustomed to lifetime employment. "We imposed performance benchmarks. Low performers were given time to improve. Many did. If they didn't, they were removed from the business," recalls Trujillo.