Whoever is doing Nortel’s PR should be getting a huge year-end bonus. First, a glowing story in Forbes; then, another one in Barron’s; and now, a “Has Nortel Turned Around?” story in Forbes. This media bonanza featuring CEO Mike Zafirovski is a far cry from his predecessors, Frank Dunn and Bill Owens. Dunn had an open disdain for the media, and rarely provided interviews, while Owens was talked the talk but couldn’t walk the walk. In terms of what Zafirovski told Forbes, the most intriguing was a question about Nortel’s shopping list. His leading priority is enterprise, particularly data – although there was no insight into how big of a deal Nortel is prepared to make.
Archive for the ‘Executive Suite’ Category
Nortel received an early holiday gift after Ron Alepian agreed to come over from BCE to become the telecom equipment maker’s v.p. of global communications. He replaces Bill Durling, who replaced, Marian MacKenzie, who replaced…Well, you get the picture. Alepian will be responsible for the “strategy and execution for global public relations, employee and executive communications, and industry analyst relations”. Before taking on the Nortel assignment, he was senior director, corporate communications with Bell Canada/BCE Inc. I hope you know what you’re getting yourself in to, Mr. Alepian…:)
So let’s have some holiday fun and put together a 2007 wish list for Nortel CEO Mike Zafirovski. Let’s me start things off by suggesting Mike Z. could like to see the small and medium size business market really embrace the BCM 50 so it becomes a $1-billion a year business. Anyone else want to step up?
Network World’s Jim Duffy sat down for an interview with Nortel CEO MIke Zafirovski. Duffy wasted no time putting Zafirovski on the spot by asking him why Cisco should worry about Nortel. Here’s the answer:
“Cisco is a great company; I have lots of respect for them. Most people would say they are a very powerful sales and marketing machine, not necessarily an innovator. [But Nortel] is a very passionate company that really wants to make a difference, to be a great alternative. A company that has led in most communications, including the evolutions on IP. We are very committed to lead again and we believe we are bringing our innovation back to a core competency [with] smarter commercialization of that technology. And most important, a company that’s going to make business simple and more flexible than any other company out there.”
Technorati Tags: Nortel
Now that I’m no longer a business journalist, I wonder whether there’s any chance of begin the first blogger to formally interview Nortel CEO Mike Zafirovski? After all, I write the only blog (as far as i can tell) specifically devoted to all things Nortel so you figure they could treat me like a quasi-journalist, right? I’ve already put in a request for an interview so let’s see if Mike Z. bites.
For those of you who don’t have a WSJ subscription, here’s the story on Nortel that appeared in yesterday’s newspaper.
TORONTO — As Nortel Networks Corp. reported its seventh loss in the past nine quarters, Chief Executive Mike Zafirovski mapped out a plan to get the company’s bottom line back in the black.
Mr. Zafirovski says the telecommunications-equipment vendor will slash spending on materials, cut research-and-development spending to around 15% of revenue from about 18%, and halve key administrative costs. The company moved into a scaled-down Toronto headquarters in late September. Nortel says cost-cutting will save some $1.5 billion a year by 2008.
The company also expects new product offerings to boost profit margins. Mr. Zafirovski last week told reporters that Nortel is on a “path to improved profitability.”
But it remains a rocky road. Earlier this month Nortel reported a third-quarter loss of $99 million, even though revenue climbed 17% to $2.96 billion. The results triggered an 11% drop in the company’s long-slumping stock price.
The telecom-equipment market suffers from “too many vendors and too little business,” says Ping Zhao, a senior analyst with research firm CreditSights. “The pricing environment is not getting better,” she says, because telecom carriers expect revenue-hungry vendors to reduce prices to secure business.
Nortel’s “recovery” has caught the attention of the Wall St. Journal, which published a story today (subscription needed). In the story, CEO Mike Zafirovski said the company’s financial rebound will come from reducing costs by $1.5-billion by 2008 and a boost in profit margins from new product offerings.
The mystery – at least to me – about why Nortel CEO Mike Zafirovski sold some shares earlier this month has been solved. According to the company, Mike Z. was given 2.265 million restricted stock units on Nov. 15, 2005 in accordance to the Nortel 2005 Stock Incentive Plan. The RSUs vest in five equal annual installments beginning on Nov. 15, 2006, and are settled in Nortel common shares upon vesting. The shares that Mike Z. sold are required by Nortel under the plan in order to pay withholding taxes at the time of the vesting of the RSUs. Of course, some of you already knew that but now it’s official.
John Roese, Nortel’s chief technology officer, must have passed his media training with flying colors because he’s everywhere these days. His latest gig is a Q&A with ITBusiness.ca where he explains the reason he joined Nortel after only eight months at his previous job was its scale in six businesses: wireless, wireline, carrier, enterprise, applications and infrastructure. “Those are the characteristics of a next-generation communication provider,” he says. “If you don’t have all six of those, you better find a way to get ‘em, because without them, you are going have a disadvantage in solving problems such as making the extended enterprise work.” It’s an interesting statement because some analysts have criticized Nortel recently for trying to be all things to all people (even after the sale of its UMTS and blade-server units).
Not sure what to make of Mike Zafirovski’s
“purchase” earlier this week of 2.26 million Nortel shares (the filing says $0 per share) and sale of 180,706 shares at $2.07 each for proceeds of $374.061. Who knows, maybe he’s got a tax bill or doing some renovations. Zafirovski still owns 2.08 million shares. Some other corporate officers to sell shares recently include Steve Slattery (37,414 shares in September) and Dian Joannou (28,508 shares in August). Note: This post has been amended to correct a mistake. Zafirovski purchased the 2.26 million shares in Nov., 2005.
Nortel CEO Mike Zafirovski kicked off the company’s annual investor day with his typical mixuture of enthusiasm, bullishness and optimism. While conceding there had been some challenges along the way as Nortel re-invents as its operates, and the telecom equipment market is extremely competitive, he said sales should growth by at least 7% in 2007, while gross margins have stablizied at 38% to 39%. Tags: Nortel
Nortel is holding its annual investor conference on Nov. 15. with an audio Webcast available. Here’s the schedule:
Terry Glofcheskie, Vice President, Investor Relations – introduction
Mike Zafirovski, President and Chief Executive Officer – opening remarks and macro view of Nortel
Peter Currie, Executive Vice President and Chief Financial Officer – financial overview
George Riedel, Chief Strategy Officer – strategy overview
John Roese, Chief Technology Officer – tech focus areas
Dennis Carey, Executive Vice President, Corporate Operations – driving operational efficiency
Joel Hackney, Sr. Vice President, Global Operations and Quality – driving operational efficiency and customer service
Steve Slattery, President Enterprise Solutions
Dion Joannou, President North America Regions
Richard Lowe, President Mobility and Converged Core Networks
Peter MacKinnon, General Manager, WiMAX and Chairman, LG-Nortel Joint Venture
Phillipe Morin, President Metro Ethernet Networks
Sorin Lupu, Leader Eastern Europe Markets
Dietmar Wendt, President Global Services
Martha Bejar, President Caribbean and Latin America Region
Lauren Flaherty, Chief Marketing Officer
According to an Angel TeleManagement Group newsletter, Nortel’s chief ethics and compliance officer, Susan Shepard, has resigned to “pursue other interests”. There is no news about it online, and Shepard’s bio is live on Nortel’s Web site. Shephard was among the many executives hired by ex-CEO Bill Owens. Update: According to an 8-K filed with the SEC, Shepard tendered her resignation on Nov. 6., and will stop working for Nortel on Dec. 1. Tags: Nortel Networks, Susan Shephard
BusinessWeek has a Q&A with Norte CEO Mike Zafirovski. Question number one is interesting:What are the strongest indicators that you are making progress in the turnaround of Nortel?
A: Two indicators are customer and employee satisfaction. Both are up dramatically in the second half of the year vs. the first half. The surveys we do indicate satisfaction was 20% higher in October than in April. So customers are getting much more satisfaction from Nortel products and service.
What about sales momentum? What are growing demand from carriers and cablecos for specific kinds of technology? Is there a strategy beyond Wi-Max right now? Those would be interesting answers.
Are Nortel’s senior executives spending any time in the office these days? It’s difficult not to get the impression they’re hanging out outside newsrooms or “accidently” bumping into journalists at the local watering hole. The latest Nortel executive to chat up the media is Dion Joannou, who heads up the company’s North American operations. He sat down for a Q&A with Investor’s Business Daily. There’s nothing terribly enlightening but Joannou does offer up a frank quote about Nortel’s troubles before CEO Mike Zafirovski arrived on the scene. “We have a great history and heritage of innovation, but we were starting to lose some relevance in technology”. To be honest, it’s refreshing to see an executive own up to what went down in the past rather than simply reading off the script.