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Lucent chief tries to sell workers on Alcatel deal

"I don't think that anybody's been reassured that's worked for Lucent since about 1999. It's just been one disaster after another."

Bruce Fabian, a Lucent employee

After helping to broker an acquisition by Alcatel SA to create a global telecommunications gear powerhouse, Lucent Technologies Inc chief executive Patricia Russo is trying to win over her employees, thousands of whom will eventually get pink slips.

Russo, who will be CEO of the combined, Paris-based corporation after the deal closes, is emphasizing to workers her belief that "this is a defining moment in the history of our industry and of our company," she said in an interview.

Russo said she doesn't expect corporate culture clashes between employees of the uniting US and French companies and was surprised at how well the two groups worked together in ironing out details of the US$13.4 billion merger announced on Sunday. Negotiations had begun last fall.

Different cultures

Business executives outside the company have said differences between French and American business cultures -- and even Lucent's and Alcatel's -- could cause problems, but Russo, 53, said both companies already have multiple cultures, given their global operations.

"When we put our people in the room to talk about what we could create together, you would be amazed at how easily we understood each other and our ability to work through issues," she said.

Russo, who became Lucent's chief executive in January 2002, said she planned to stress that the merger is needed to create long-term growth, recognizing that doing so will subject employees to yet another restructuring.

Amid plummeting sales and other problems, Lucent's global work force was cut from about 120,000 in 2000 to 30,200 now, and 10 percent of the combined company's 88,000 employees will lose their jobs after the merger is completed over the next six to 12 months.

Russo addressed more than 9,500 workers on the deal on Tuesday morning -- in an auditorium at company headquarters in Murray Hill and elsewhere via a teleconference and a Web cast.

Job cuts

"People hammered her about where the job cuts are going to be," said Bruce Fabian, a Lucent employee and the president of Communications Workers of America Local 1061, which represents clerical, building maintenance, machine shop and other workers at a Lucent facility in northern New Jersey.

Some employees, he said, expressed fears that French workers will be spared most of the cuts. About 17,900 of Lucent's employees work in North America, including about 5,200 in New Jersey. Russo told workers staffing decisions would be based on the skills the company needs, Fabian said.

Addressing questions from the audience, Russo told workers that existing union contracts with both CWA and the International Brotherhood of Electrical Workers would stay in place, according to Fabian, and that maintaining Lucent's US$34 billion pension fund, which covers about 235,000 retirees and spouses, should not be a problem.

A company spokesman confirmed Fabian's account of Russo's talk.

The union local president said he and co-workers listening in with him still have qualms.

"I don't think that anybody's been reassured that's worked for Lucent since about 1999," Fabian said. "It's just been one disaster after another."
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