Major Cuts Coming in Enterprise Unit

By Mark Evans | Published: September 15, 2009

With the sale of Nortel’s enterprise business to Avaya for $915-million, Avaya appears to be wasting no time in mapping out its initial plans. The company plans to keep only 60% of Nortel’s North American employees, which probably means thousands of jobs will be eliminated.

The restructuring should not be a surprise given the overlap between what Avaya and Nortel do in the enterprise market. As well, Avaya and Nortel also have their own reseller networks, which will be consolidated.

Nortel’s enterprise business had 7,800 employees, according to court documents filed in July. But the business was already being restructured with 1,000 jobs being cut.

According to the Ottawa Citizen, Avaya will not be cutting any Nortel positions in Europe or Washington

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  • Are_We_ChR_Yet

    You are a brilliantly miss-informed jack-ass and a lesser-talented practitioner of generalizations. Please go away.

  • tiredofitall

    Well said. If anything my team has been busier trying to get as much done before the sale as possible. We have commitments to customers and we intend to keep them.

    If someone is just sitting around doing nothing in any company they should be laid off, regardless of Chap11. I just hope when the cuts come this kind of thing is taken into account.

  • S_O_S_This_is_HMS_Nortel

    Not all LTE/CDMA employees will get offer from Ericsson and some will be laid off this week apparently. It's not a sure lifeline even when the new owner said they will keep 60% or 100% of employees in the division. It's just a number until they can look closer at the book and see what they'll find behind the doors.

    In Enterprise case, once Avaya see the “talents” especially management in Ops / Services, watch out for the big axe. Better to remove the Six Sigma, BB designation from their PPT chart…there are still plenty of these morons around pulling metrics.

  • protosphere

    Did Q2 suddenly reflect that customers forgot they are bankrupt and liquidating? Are Q2 numbers reliable given their history and credibility?

    What a convenient coincidence they readied this unit for sale.
    .
    As usual, never mind how much they said they sold in revenues, how much did this earn? Is this unit suddenly profitable too?

    Still a lot of lost ground to make up in revenues alone let alone to streamline into something profitable by simply targeting a larger market.

    What might be the most obvious here given Nortel's history.

    They are still implementing major cuts after endless cuts and still couldn't get it right to the point of bankrupt and liquidating.

    What makes anyone think Avaya can save the day yet again after so many ongoing major cuts.

    Customers are already staying away and will be further lured away by powerhouses like Cisco, Think about it, who would you buy from?

  • protosphere

    What's next? LG, patents, MENs (they already tried selling MENs)

    The simple arithmetic is right there yet everyone remains anxious to see what will be left.

    It is a complex theorem that directly correlates to their recent history of credibility, below zero.

    As even the sold units are still accompanying more cuts and not injections as they decline.

    Even Nortel's largest customer balked at this sale. Will they stick with Avaya transitioning with higher costs or just rip out Nortel gear and just go with someone else? Nortel even put the screws to their largest customer it seems after screwing their shareholders and employees to appease big business creditors who the taxman screwed recently.

    More cuts haven't made it right so far, what makes anyone think they will suddenly work today even if their slight lost ground to a landslide can be relied on. Will Cisco cannibalize any gains in this consolidating market with fewer players (of which Verizon was their largest), after all who would you buy from.

  • protosphere

    “Where are you going to find a job earning 6 digit but doing nothing ? “

    Avaya for the next 12 to 18 months?

    =)

  • nortelex

    Some people are busy…not all. I know at least a few senior managers and directors with a big title and little to do except PPT reports….

    but I agreed Nortel still have a lot of hard working engineers and technical people.

  • protosphere

    A little bit of hard work never killed anyone is false, besides, why risk it =)

    I suspect the letters for termination will be taken from a standard template for everyone. I can't see them tailor making a letter for anyone outside management.

    The stigma Nortel carries is not for efforts but results.

    Everyone had a piece of this fraud dog at some point, accounting for 25% of the TSX. Today, it's hype remains synonymous with a thousand flies just can't be wrong.

  • nortelex

    lol…nortel already has the standard termination paper…they are professional in that respect.

  • protosphere

    Hack is putting the petal to the metal there too. Lovely. Further proof Avaya is screwing up GIGANTICALLY. =)

  • nortelex

    Not sure who is getting laid off in CDMA…most people I know got offers already. and it's pretty damn good to get a 1 yr guaranty in this environment…they are the luckiest people in the company.

  • kennethn2000

    I agree. There is a life after Nortel. I feared for 9 years and survived 16 rounds of layoffs. I finally got it in March. Was out of work for 4 months, but now working in a much better environment. It was actually a blessing. Now in my new job, I am sent to training classes and learning a lot about new technologies. Nortel was poison. Be positive.

  • fabrice002

    GoProto, after replying to your first post in a manner that did not speak contrary to your assertions, you reply with vitriole.

    Then, after suggesting that one corporate culture is not substantially different than another, yet more vitriole.

    Other than your own opinion, which is basically just negative against everything and everyone, what have you contributed that is worthwhile?

  • GoProto

    How does asking if SL needs Liars too affirming my post? Explain.

    I am not negative against everything and everyone. My point is exactly that there is no Corporate culture that can match what the Execs and Bod at Nortel have done to many groups of people. There is no 100% honest company, or probably person, for that matter, but do you know of any other company that has denied the truth in every way possible to the bitter end?
    Your post seems to suggest that SilverLake is no better, but I can't paint broad brush strokes especially with no clear evidence that they have conducted themselves in a similar manner.

  • nothappyanymore

    correct, job offer letter started to be addressed to inscope folks, exactly the same day that the announcement about “mexico cdma teams are out of scope and will move to NBS”, ocurred.

  • watching…

    Just sharing. http://ow.ly/ptSw

  • zeroman

    I wanted out last year. Got it and moved on. Never been happier. Once outside talent was recognized better than the BS within Nortel to keep you tied up and not let you flourish..

  • zeroman

    you would want that. anybody would who is focused on the business. but not at Nortel. I have seen director level guys come down to a few levels down and not do anything but just talk hot air.doing hard work was not in their job description so all they did was reviews, presentations and other paper value work.

  • zeroman

    what can you expect from a cut and paste company. at least one thing right. ha ha

  • GoProto

    Have you heard any news yet?

  • GoProto

    Just saw this :
    “A Delaware bankruptcy judge on Wednesday rejected an objection by Verizon Communications Inc. to Nortel Networks' $900 million sale of a unit that makes communications systems for businesses.”

    http://www.google.com/hostednews/ap/article/ALe…

  • fabrice002

    ->How does asking if SL needs Liars too affirm my post? Explain

    By essentially agreeing with your assertion, not widely accepted, that Nortel management has been consistently lying, rather than simply being inept. And wondering, perhaps skeptically, whether Avaya should be expected to be different. The essence of some of Nortel managment is constant self-promotion from salesmen. I've seen no reason to think that such type are less successful in other environments.

    I completely agree with your assessment of Hackney, in particular, and partially with that of MikeZ. I can be faulted for giving him the benefit of the doubt.

    I, too, hope SilverLake is better. The point of my second reply is that, through your vitriolic filter you were blind to the essential agreement. When one espouses difficult and controversial positions, it's self-defeating to isolate your supporters.

  • zeroman

    Avaya is almost there. Courts threw out Verizon complaint. Wedding bells ringing.

  • GoProto

    Thank you for your explanation. I am not proud or happy about the extent to which this mess has , well, messed with my mind at times.Sometimes I need to calm down and as you say,take the blinders off.
    A struggle at times but I am perservering to not let it affect me permanently.

  • GoProto

    Yup, and:
    “Judges in Delaware and Ontario have approved the sale of a Nortel Networks unit that makes communications systems for businesses.'

    Call the clergy..

  • brett5

    Can anyone confirm a possible rumor that this Friday will be a big day of cuts….20-30% this week?

  • skrowtenletron

    Latest I heard….

    MAJOR lay-off Sept 24th
    Offer letter from Avaya Oct15-Oct 30

    So I guess if you are in Documentation, R&D, Sales, and Management you are VERY scared now.

    Tech support looks good.

  • GoProto

    What's your source? if you can say..

  • fabrice002

    No problem, Go.. today was a particularly hard day on many of us. We lost quite a number of quality colleagues this day.

  • GoProto

    I am looking for things to get better somehow soon..
    BTW, i do really like that tune…=)
    I hope that i can sleep. Good night to you.

  • skrowtenletron

    Legit….three very good sources.

    One, I will call “Deepthroat”, was a JCI 4 laid off last week. One his way out he mentioned that the layoff was coming by the 24th. “Deepthroat” was in implementation and was a manager.

    The second, I will call “Pussy Galore”, was laid off yesterday…she, too, confirmed the 24th and she was in sales and was a manager/JCI 4.

    The third, I will call, “El Toro” was laid off today and was from documentation/ JCI 4 – Manager and confirmed the same.

    Sorry to hear they left on one hand but, on the other hand, good to see management finally getting hit for a change.

    So let's see what happens on the 24th/25th…paid day. If we can make it through Nortel's cuts AND get an offer letter from Avaya in mid Oct…”we” should be save!

  • GoProto

    Thanks..
    You writing a book? Interesting names..to say the least.

  • tonyryb

    Mark,
    The cuts remind us that this is not a merger but an acquisition under Chapter 11. So while industry consolidation is taking place, your blog highlights the fact that this will be a sub-optimal industry consolidation at best.

    See
    http://blog.tmcnet.com/the-hyperconnected-enter…

  • The_Closinator

    I saw this on eBay. It says it all.

    Item 190335501244.

  • MichelangeloF536

    Here's a brief post at No Jitter that gives some detail about the auction. According to the most recent monitor report, bidding went six rounds and concluded late Sunday/early Monday. The only bidders were Avaya and Siemens–however, there was a third entity (unnamed in the report) that “gained status as a qualified bidder but was ultimately unable to submit a bid and withdrew before the auction began…”

    http://www.nojitter.com/blog/archives/2009/09/t…

    The monitor's report is docket number 1508 at this site: http://chapter11.epiqsystems.com/docket/docketl…

  • FormerBayGuy

    I can confirm this. I'm still at NT but not after 9/24. My group alone will take a 50% hit. We just took a 50% hit a few weeks ago too.

    They are trying to wrap up this round before the end of the quarter as to not delay the Avaya transition. This is according to the HR person herself.

  • netwatcher

    Given that the deal hasn't closed yet, it seems like these cuts would be part of the ongoing Nortel restructuring. Avaya can't cut what they don't own yet.

  • The_Closinator

    Yes. The plans seem a prequel to the ongoing HR sacrifices offered at the Shrine of Our Lady of Perpetual Reorganization, erected by Mike Z

  • FormerBayGuy

    I can confirm this. I'm still at NT but not after 9/24. My group alone will take a 50% hit. We just took a 50% hit a few weeks ago too.

    They are trying to wrap up this round before the end of the quarter as to not delay the Avaya transition. This is according to the HR person herself.

  • netwatcher

    Given that the deal hasn't closed yet, it seems like these cuts would be part of the ongoing Nortel restructuring. Avaya can't cut what they don't own yet.

  • The_Closinator

    Yes. The plans seem a prequel to the ongoing HR sacrifices offered at the Shrine of Our Lady of Perpetual Reorganization, erected by Mike Z

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