Excerpt on layoffs:
"Of Nortel's four business units -- wireline, wireless, optical and enterprise -- where is the lion's share of the 3,500 layoffs coming from?
Enterprise is not as affected as the carrier side. You'd find that future R&D -- R&D associated with a converged network -- is far less affected than legacy R&D. Less R&D is going into upgrading our legacy systems, but we will continue to support them. More of the job cuts are coming out of management by a significant amount as a percentage than out of the general workforce. Less of the cuts are coming out of the sales and marketing force than they are out of all other areas. You would find strong R&D being added in the area of Internet security, which I believe is a critical marketplace for us going forward.
We have generated a list of the names of about half of the people who would make up that 3,500 and are continuing on a daily basis to generate that list, and that will be available in about two weeks. We'll try to get that out to the press as soon as we know precisely the number of jobs that will be taken from given areas but the intention is to have it implemented substantially by the end of 2004.
You mentioned that enterprise was spared the brunt of the reductions, and I've seen reports that state wireless was relatively untouched. That would leave wireline and optical…
That's a little bit too general. One of the critical areas where we found a lot of synergies is when you take those three business areas -- wireline, wireless and optical -- and merge them into a common carrier business. Each of those business areas before had its own HR staff, its own finance staff, its own IT staff and several other functional staffs. When you put the three together you find the synergies among them. That is a substantial amount of the savings that we've announced in SG&A (sales, general and administrative) and in some cases even in R&D because each of those entities had its own R&D functions. So the synergies of putting those three together resulted in considerable cost savings and that of course means that if you were an HR person working for wireless you might be asked to leave. But that doesn't mean we focused on wireless, if you know what I mean. So some of these are SG&A kinds of reductions that are functional staffs and not meaning that we're taking that support away from any one of the entities. Wireless has been relatively spared as compared to the other two disciplines, wireline and optical."
Link:http://www.nwfusion.com/edge/news/2004/0820ntqa.html |
