AUDETTE Of course, much of the tremen- ') does progress in service has been due to the incredible sophistica- tion of computerized communi- cations equipment that has become available this decade, but Mr. Kaul can be credited with having kept Bezeq in line with the burgeoning standards of its industry. Although experts only expect- ed Israel's phone system to be- \– come fully digitized in the year • 2005, it has reached this impor- tant milestone this month, way ahead of the United States — where only 60 percent of the tele- phone exchanges are digital — and most of Europe. The replacement of analog phone exchanges with digital equipment means there are no \ mechanical switches prone to get ) stuck, that bills are itemized and generally much more accurate, while cabinets full of silent ma- chines are supervised by a single staffperson and many new ser- vices, such as call-forwarding, op- erator-less reversing of charges, intelligent network and others have become available. Some critics say Mr. Kaul's de- parture may be coming at a per- sonally convenient timing, but a bad one for the company, which is facing accelerated competi- tion. "Bezeq is my first love and the Postal Authority is the second," responds Mr. Kaul, who had cured the ailing Israel postal ser- vice before moving on to Bezeq. "But every job has to be carried \ out for a certain time, and then • the time comes to move on to an- other, taking advantage of one's enriched knowledge and experi- ence. I've always preached the benefits of rotation to my man- agers at Bezeq, and now I'm prac- ticing it." During the last four years, Bezeq has increased its annual income, doubled its net profits w and launched multi-billion-shekel /- investments in improving tele- communications infrastructure. Known as a highly visible manager, Mr. Kaul received nu- merous job offers from both Is- raeli and foreign firms, and even proposals to go into politics. While his management skills are much needed in the highest govern- mental echelons, he says he has \_) no interest in politics or running for office. Only when the Recanati fam- ily — whose Israel Discount Bank has a controlling share of Clal — made him an offer, did he take the bite. Mr. Kaul politely de- clines to confirm or deny that his new salary will be five times his current paycheck. Although Bezeq is the largest company in Israel, Clal too is huge, with extensive interests in real estate (Azorim and Shikun U'Fituah) to financing (Clal In- surance) and from finance (Be- tuha and Clal Manpikim) to tourism (the Disenhaus Group) and marketing (supermarkets, pharmacies, imports). Mr. Kaul admits that after spending most of his life in pub- lic service and communications, the move to Clal is "a bit daunt- ing." "There is no guaranteed suc- cess," he realizes, "and people will be watching me closely to see how I do. But the principles of good management are pretty much the same, whatever the position." "It hasn't been a one-man show. We have developed excel- lent management at all echelons around the country, and our em- ployees have internalized the need to provide good customer service. Obviously, there still are problems and weak corners where Bezeq has yet to improve." His main achievement, Mr. Kaul suggests, is helping to make Bezeq's employees "proud to work here." Now, with de-regulation and privatization well under way — through recently conceded competition in overseas calls, bur- geoning approval of competition in local calls, and the imminent arrival of a third cellular-phone provider — he concedes that the company's 9,000 employees are nervous about the future, which might result in reduced prof- itability for Bezeq. "If you consider the fact that cellular phone services, overseas calls, Bezeqbit and Bezeq Zahav supply 60 percent of the compa- ny's profits, and that all of these are facing competition, employ- ee concern is understandable. But competition will be good for Bezeq, greatly expanding de- mand for these services and new ones to be introduced." The staff also know that down- sizing will continue. Although 1,200 workers have gone on early retirement in the last few years, over the next five the company's manpower is due to be reduced by a further 30 per- cent to about 6,000 workers. "It probably won't go lower than that," adds Mr. Kaul, noting that increased growth in telecom ser- vices will keep the company big. Bezeq's organizational structure will be modified, and technologi- cal changes will render some jobs obsolete. For years, Mr. Kaul has been pushing for total privatization of Bezeq, whereby the government would own no shares in the com- pany; at present, despite various stock issues, the government still has a controlling voice and the communications and finance ministers tell Bezeq what services it may offer and on what terms. The British communications company Cable & Wireless, which already owns 10 percent of Bezeq, is clearly hungry for more. But, as Mr. Kaul points out, the gov- ernment still hasn't decided if it wants a strategic partner. (c) Jerusalem Post 1997 Auto Show Spectacular #1 Luxury Car 1997 Sedan DeVille Leather Loaded No Payments ARF M " r,C "' 8 Stk# D7204 Disclaimer: Lessee responsible for use tax, lyx tax, plates, excess wear and tear. Excess mileage.15c/mile. Leasee must qualify for GM Opt II discount & lease renewal rebate. Lease is a 12 month/12,000 mile Smart Lease plus. 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