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A Sad Tale from Mexico
When Ericsson purchased Nortel’s CDMA business last month, Nortel employees in Mexico were excited about a new owner arriving on the scene to provide some much-needed stability and direction. Unfortunately, the future of the Mexican operations and its 130 employees is still uncertain. Below is a guest post from Mexican employee about the situation:
On September 3, Nortel’s CDMA employees had the opportunity to breathe a little bit easier. This was the day that offer letters from Ericsson were scheduled to appear on employees’ inboxes. It was finally the time to get out of Nortel and its entire sad story. It was an opportunity to get out of the salary freeze, hiring freeze, training freeze among other cost-saving measures. It was also an opportunity to allow Nortel’s technology and innovation to move forward on a company that could make use of it. Indeed it was an overall happy day in all the sad days through the stream of announcements, at least, happy for US, Canada and China employees.
It all started when an email came out from Richard Lowe that mentioned only NA and China. This was puzzling and alarming to all Mexico employees since in all NSN communications the wording was “North America, Mexico and China”. Equally puzzling was the fact that Lowe clarified that two Ericsson/Nortel communication emails had been sent to potentially in-scope employees only, since it was sent to a distribution list created for offer distribution under the NSN deal.
Immediately after this, emails, phone calls and requests for clarification were made. Was it just an oversight that around 130 Mexico employees were not in scope? Was it safe to assume Mexico was included as part of NA since it handles a vast amount of NA operations? Several days later, the worst was confirmed. The entirety of Mexico was not included, essentially leaving out a huge cost-effective and successful project called “Mexico Center of Excellence”.
However, this was not the end of the story, but far from it. The information around this decision was not communicated to Mexico employees until a few hours before the offers went out for distribution. Late on the day, September 2, there was a conference call hosted by Ron Centis (CDMA Leader). After the news was given, moments of shock, awe, anger and frustration were present on the room. A few moments later, questions started to pour in. When asked about the business rationale behind the decision, Centis was quick to state it was his, and his leadership team’s decision, and that Ericsson had nothing to do with the final decision to leave Mexico out.
As expected, morale went down to the floor. And it will continue like that for a long time. High levels of attrition would not be surprising. It is hard to imagine how a cost-effective and successful project with continuous improvement and higher-than-expected metrics were to be left out.
But wait, that is still not the end of the story.
Being left out of the deal, the worst was expected and assumed: massive layoffs. However, this is not the case. As the CoE is a critical part of the CDMA operations (as well as for several other business units), the CoE will be re-incorporated into NBS to continue servicing Ericsson now as an external outsourced supplier. Translation: Mexico employees will stay with Nortel until Ericsson decides to stop buying services or until work has been transitioned over to another location.
Still, Mexico Nortel employees must keep their metrics at expected levels in order to keep Ericsson happy enough to continue the deal. With no incentives other than the quarterly AIP (whose variable factor is decreasing each time), work must be done to the same or better levels.
A sad tale, one of many to come out of the poorly managed Nortel, whose potential to become a key player on the telecoms field was eliminated by the few people who make key decisions. And still, Mexico employees will come out of this incredibly incompetent communication effort and impossibly business-wise incorrect decision (at least with the tidbits of information available to general population) performing the job as they have always been, and supporting the original decision to move work to Mexico and create the CoE.
With a lot more weight on their backs, and with a lot more people moving on, but getting the job done and demonstrating the potential of an organization that started out with a few engineers and turned out to be one of the most profitable and successful projects Nortel has come up with.