Layoffs?

There will layoffs but not accross the board and gradual over 12 months targeting job functions. The long awaited R&D reduction will come in the form of outsourcing Product Verification and System Engineering. Product Verification which consumes about ~400 Million of the R&D budget will be gone to IBM. Nortel may save good 250 Million with this transaction and many talented people who helped building Nortel qality brand will be shown the door. Same thing already started to happen to the System engineering teams.

The new GE management have no clue what carrier grade is and they are willing to sacrifise the very thing which made Nortel different just to fix the balance sheet and get their bonus.

Cost cutting is good for share holders. But these short term moves will only cuase Nortel brand to go down the drain over the next few years. Best cost cutting will be to fire few useless GE people and let these hunders of people who will be layed off do their magic in building good products and sell it.

Sad to see that GE brightest have nothing new other than, cut R&D quality! Cut the heart of what Nortel is!

According to the Q1 , 2008 SEC report Nortel had completed 57% of the year 2007 restructuring plan which targeted the layoffs of 2900 people in total therefore leaving appr. 1250 left to go to date. They also announced a 2008 restructuring plan at the year end of 2007 of 2100 people of which 250 were terminated in Q1 leaving 1850 to go. This does not include the transfers of positions to low cost opperational countries of which is ongoing and now taking place. So….It would appear that there are apprx. 3100 people slated to be layed off over the next 2 years in order to complete the 2007 and 2008 restructuring plan. Also the Calgary facilities is slated to close by the end of 2009 and i am sure there will be other adjustments made to other facilities before this is all complete but in order to reach the goals set by the company….. this all needs to be done.

It has merits, speaking as a layoffee (one of 8 in my area)

Layoffs would not surprise many of the severely mistreated Nortel employees. How many layoffs could be avoided if executive compensation was realistic? If the loss of sales due to outsourcing of support never happened?

The management (in Support, anyway) still have not realized the destruction they are causing. How long until the salesforce realizes that the support contracts they sell are worth a lot less than even a year ago, simply because so many of the second level engineers have left and cases sit in the “FIFO” queue unworked for so long? How many of those cases have been worked by the so-called COE's? How many managers from Support have resigned this month alone? It's sad when you can't even hold on to the managers…

Boy that was a huge miss..

AP
Nortel posts bigger 2Q loss on charges
Friday August 1, 6:45 am ET
Nortel posts larger 2nd-quarter loss as restructuring charges outpace sales growth

NEW YORK (AP) — Canadian telecommunications equipment maker Nortel Networks Corp. on Friday said it posted a bigger second-quarter loss on higher restructuring charges and expenses that outpaced sales growth.
Nortel posted a loss of $113 million, or 23 cents per share, compared with a loss of 37 million, or a loss of 7 cents per share, a year ago.

Nortel's quarter was impacted by a number of charges and expenses, including charges of $67 million for a restructuring, a loss of $21 million mostly from mark-to-market losses on interest rate swaps and a gain of $34 million for changes in foreign exchange rates.

A year ago, results included $36 million in restructuring charges, a regulatory investigation expense of $35 million, a gain of $69 million for changes in foreign exchange rates.

Total sales rose 2 percent to $2.62 billion from $2.56 billion.

Revenue in the company's carrier networks unit declined 2 percent from a year ago, while sales rose 9 percent in its global services segment.

Looking ahead, Nortel warned that the business environment is challenging because of a weak economy, higher competition and lower spending by certain customers, but reiterated sales growth in the low single digits for 2008.

“In the second half, faced with a challenging business environment, we will continue our focus on execution and on delivering accelerated growth in key segments in order to achieve our financial objectives for the year,” Chief Executive Mike Zafirovski said in a statement.

http://biz.yahoo.com/ap/080801/earns_nortel.htm…

Look – the sector sucks and all vendors in carrier space are hurting. It's unfortunate that NN is worse than most – chalk it up to a bad starting position. The result however, will likely be that those at the bottom will fall off, those in the middle will be happy to survive, and those at the top (when it started, anyway) will end up seeking a new way, or improved way, to salvage what ever can be saved, in a ruthless environment. The opportunities for the vendors would appear to be outside of traditional customer/scope…..

A lot of the layoffs will happen in the Product Verfication and system engineering area where Nortel is going to outsource to IBM. This will save the company ~250Million out of the 400Million they spend today on Verification. The sad things is that these GE leaders have no clue about what Carrier grade quality is hence opting out to the east answer, kill product verfication

Top

Non-salaried = overpaid, underqualified; a bad investment, as per Lean Six Sigma.

less.
Is that in Canada or the U.S

Layoffs?!

http://www.youtube.com/watch?v=p3-eavMSBnk&feat…

Nortel Layoffs have nothing to do with the performance of employees being laidoff. Basically the leadership started trying to manipulate the stock price around the year 1999. By selling off their assets and profitiable divisions. They run the business as if they were day traders. Looking for the quick score. If they had continued building quality products the market would have taken care of its self. But we see where they are now!