Lucent realigns top management and cuts 240 jobs

Lucent Technologies Inc. said it is restructuring management in a push to integrate its sales and service organization. As part of that restructuring, the company plans to cut 240 jobs.

The announcement Tuesday came amid rumors of layoffs and as the telecommunications equipment maker began a search for someone to replace chairman and CEO Richard McGinn, who was ousted on Oct. 23. McGinn was let go after the company posted lower-than-expected results for its fourth quarter.

In the new structure, the company said, said Ben Verwaayen, 48, vice-chairman of the corporation, will be responsible for marketing, sales and service worldwide.

Bob Holder, 54, who previously was executive of corporate operations, will head up manufacturing, supply chain and the company’s product groups.

In addition, executive vice-president and chief financial officer Deborah Hopkins, 45, will lead development of a new information systems infrastructure.

“Linking our finance organization and our CIO organization will better enable us to uniformly redesign our key processes and systems to increase our efficiency and simplify the way we do business,” said CEO and chairman Henry Schacht.

Lucent spokeswoman Mary Lou Ambrus said late this afternoon that “as a result of consolidation of the Lucent infrastructure to better focus on the service provider market, we would expect approximately 240 employees to be affected.” Ambrus also noted that rumors earlier in the day of thousands of employees being layed off weren’t true.

Larry Hettick, vice-president and an analyst at Tulsa, Okla.-based TeleChoice Inc., said that after speaking with “people in the trenches and senior staff [at Lucent],” he believed major layoffs at Lucent were unlikely.

Hettick added that while there have already been cutbacks of a couple hundred people in administrative positions, Lucent is still aggressively recruiting engineering talent at job fairs. The company recently boosted its employee benefits, by paying quarterly rather than yearly bonuses and granting additional stock options.

Schacht, 66, was Lucent’s CEO from 1995 to 1997 and then continued as its chairman into early 1998. In March, he was named chairman of Avaya Inc., a spin-off of Lucent’s enterprise networking equipment business. He was again appointed to take over as chairman and CEO until the company finds a permanent replacement for McGinn. Hettick said Lucent needs some very strong leadership.

“They need a CEO with the leadership abilities of a Jack Welch [chairman and CEO at General Electric Co.] and the industry knowledge of a John Chambers [president and CEO of Cisco Systems Inc].”