All About Nortel - Latest Comments in John Roese Has a Big Fan

Re: John Roese Has a Big Fan

Another Nortel Watcher — Wed, 13 Aug 2008 01:16:20 -0000

many - appreciate the humor but anybody would be a fool to replace MZ without a major BoD refresh. Nortel is a big, big, problem. We need to see board shakeup and cabinet cleansing before things will turn around.

CTO and CSO are both irrelevant, IMHO. Show me ONE thing that came from either group in the last 5 years that is a revenue engine. I think both functions are needed so I'm not advocating that either should be abolished, but current leadership is clearly ineffective when measured by output. Flush.

The CMO function is interesting. The new campaign looks exactly like a clone of Clent Richardson's campaign to me. If there is a major difference then I argue it takes a marketing expert to see it and that means it isn't significant to the market.

Nortel is a sick puppy.

Re: John Roese Has a Big Fan

exnt — Tue, 12 Aug 2008 20:23:10 -0000

ANW, Nortel gets rid of execs who bring new products to market, whether they are succeeding or failing. Look at the parade of execsin WIMAX (new product), IMS/VOIP (new product) and new enterprise products versus the status quo of CDMA (old product), major account VPs selling to old customers, etc. Anyone trying to get a new product or idea to market will be treated like all pioneers: shot full of arrows and their home burned down.

Re: John Roese Has a Big Fan

many — Tue, 12 Aug 2008 19:16:10 -0000

ANW I like it. Perhaps you are the future nortel CEO? :)

BB - I agree. The CMO strategy is too transparent and the CSO/CTO not enough.

Re: John Roese Has a Big Fan

broadbandbill — Tue, 12 Aug 2008 18:16:05 -0000

Many,

Here’s my score card:

CTO – Self-promoting hot air balloon.
CSO – Cold case or missing case; either way, irrelevant!
CMO – No articulation of vision, perhaps due to lack of one.

Re: John Roese Has a Big Fan

Another Nortel Watcher — Tue, 12 Aug 2008 17:35:47 -0000

many - and how about rewarding BU Presidents that take new ideas to market and firing those that don't. Growth is now like air to this company. If Nortel doesn't find growth, it will die. Each President should be measured on how much air they've supplied. Selling more of what they already produce doesn't count - that reward goes to the sales team.

Re: John Roese Has a Big Fan

many — Tue, 12 Aug 2008 14:22:01 -0000

BB & ANW The more I think about it, the more I am left wondering what the value add ideas from CTO/CSO/CMO are?

Here is an idea from many; Begin rewarding innovation and hiring people who actually produce marketable ideas.

Re: John Roese Has a Big Fan

broadbandbill — Mon, 11 Aug 2008 20:50:37 -0000

The disconnect between the CTO and strategy (read: CSO) runs deeper than most people really understand, especially when one considers how the CTO actually ended up at Nortel. John Roese, you’ve been a bad boy and JUDGEMENT DAY is ‘a coming!!! Better eat your Whitties!!! –bb

Re: John Roese Has a Big Fan

Another Nortel Watcher — Mon, 11 Aug 2008 18:19:49 -0000

many... i agree. You reference the chasm between idea and something useful that I've been talking about. You would think that there would be a really tight linkage with the CSO team to try to bridge some of these gaps, but they seem to be operating as parallel universes below cabinet level. Ask any strategic member of either team what the other organization is doing for them and you'll get an awkward blank look.

Re: John Roese Has a Big Fan

many — Mon, 11 Aug 2008 15:10:24 -0000

ANW Project Chainsaw is a prime example of what I am talking about.

What is the practical and marketable application for Avatars in their business? I understand they are licensing this stuff, but is it simply improved voice? Is it the client? Why is this something more that second life with a nortel brand?

Where is it that they see it going? What's the vision/strategy/tactics/logistics?

To me, championing something is only the first step in the CTO responsibilities.

My guess is that they will throw it over the wall without due diligence on the part of CTO.

Re: John Roese Has a Big Fan

less — Mon, 11 Aug 2008 14:21:53 -0000

Age doesn't matter, savvy does. Period.

Re: John Roese Has a Big Fan

Another Nortel Watcher — Mon, 11 Aug 2008 11:29:05 -0000

many - one example would be the virtual world conferencing concept. Certainly not a Nortel-originated idea, but I see evidence that somebody in Nortel is thinking about how to add value to it. As we've agreed, the problem is that Nortel doesn't have the right people to figure out how to monetize or sell whatever they might come up with because it's out of the comfort zone.

I know longer know what the output of the CTO group is or how success is measured. Same goes for the CSO team.

Re: John Roese Has a Big Fan

many — Mon, 11 Aug 2008 08:56:08 -0000

ANW, can you enlighten me as to what these "ideas" might be? Exactly what value add has the Nortel CTO office provided? What exactly is their work product? Are there standards body submissions? Patents? Architectures? White papers? Publications?

There sure are a lot of buzzwords and powerpoint, I will say that, but there seems to be very few (if any) ideas.

It seems to me that as it has been throughout the Nortel history, the CTO's office is disconnected from the development, and does not influence technical direction. It has been gutted of any talent (such as what had been a rich human factors and software architecture groups) and is content to be a puppy to a sales group that has no use for it and does not know how to take care of it.

I agree that even if these ideas existed within CTO, they would lack a solid business plan and a way to implement it. I also agree that they have missed and continue to miss the revenue boat on a lot of upper layer technologies and applications. This is not just due to an over emphasis on six sigma style manufacturing, but a fundamental lack of understanding as to how their customers are reacting to changes in their own businesses.

Re: John Roese Has a Big Fan

Observer — Sat, 09 Aug 2008 20:56:12 -0000

By the way, look at the age of the board members. If they believed Nortel had a future, they would replace themselves with younger advisors who are more savvy about understanding hardware & software technology, applications and business. It would appear the board has been constructed to ask the Canadian government for a bailout as opposed to grow the company for the long term benefit of the shareholders.

Re: John Roese Has a Big Fan

Observer — Sat, 09 Aug 2008 20:46:21 -0000

Things won't get better until the board acts.

Fat chance of this happening since the Chairman is Harry Pearce. You have to ask yourself why a technology company has the former head of GM at its chairman of the BoD. If you look across the industry you wouldn't find this at Google, Cisco, Sun or Microsoft. If you look at the rest of the board, none of them have any tangible leadership roles at advising or running major technology companies. The board should be fired by the shareholders.

http://www.nortel.com/corporate/exec/board.html

Re: John Roese Has a Big Fan

Another Nortel Watcher — Sat, 09 Aug 2008 16:42:21 -0000

bb - nicely stated. I agree completely. The GE-style is fine, but it isn't appropriate for Nortel. GE acquires businesses that are established and running well with solid executive teams. GE sticks a guy like choker Hackney at the top of each business to manage efficiencies (six sigma style) and monitor performance. If/when the business starts to underperform relative to other investment opportunities, the business is sold off and investment funds are moved to a new opportunity that is already on a growth curve. It's actually a decent system for a big holding company and MZ and his GEniuses are probably perfectly appropriate leaders for that kind of business.

If Nortel's issue was purely one of operational efficiency, this model would be beneficial for Nortel too, for a short period of time. But Nortel's troubles go way beyond operational efficiency. The business units aren't already being led by industry names and the core revenue engines are eroding with no new replacement on the near-term horizon. The GE model would dictate selling off at least the Carrier business and moving the money to something else. Ooops...that doesn't work with a company like Nortel. It doesn't have the right kind of brand.

So what to do? Mike Z recognized that his leaders knew a little bit about the business but were underperforming on execution. So he replaced them with people who have an execution track-record but who know nothing about the business. He turns a problem into a bigger problem. I think Mike Z was extremely lucky at Moto. He arrived at the early stage of the RAZR growth curve and added some operational efficiency. His biggest contribution was not getting in the way of the RAZR program. wow.

I conclude that Nortel is an unfixable problem for the current leadership team. Not because they're bad people (well, I guess at least one of them is) but because they're the wrong people in the wrong roles. This is a BoD problem now. Things won't get better until the board acts.

many - I actually do think there are a number of ideas floating around in the CTO group...not necessarily original Nortel concepts...but ideas on the kinds of things Nortel could get involved with technically. The problem is that there is no skill set that knows how to turn the ideas into a product/portfolio plan with a credible monetization strategy that would be appropriate for Nortel. The business leaders in Nortel are manufacturing oriented. They're going to be no help to the CTO team in trying to figure out how to monetize Internet-based opportunities. In fact, I'm sure the business guys feel threatened, which ensures the disconnects between functions will stay in place. This issue predates MZ and Roese, but they've done nothing to fix it, IMHO.

Sigh.

Re: John Roese Has a Big Fan

broadbandbill — Sat, 09 Aug 2008 14:28:43 -0000

Observer’s comment “Using manufacturing thinking and techniques simply doesn't work for technology companies” is almost spot on to the words I used to hammer (and I mean HAMMER!) my point with key (and top) Nortel executives. I also offered the numerous (and very) insightful posts on this blog over the past year or so as a means of leveraging objective wisdom to make my case.

Their response has been nothing short of total disregard for collective industry wisdom; I have even offered the services of the industry’s top analysts and consultants in an effort to help few friends. Sadly, what I see is a continued denial that there is a problem and, even more tragically, a continued insistence that the ship is actually holding up well. What they have really failed to see is the perception the industry has of Nortel and its ability to continue to provide sustainable value to its customer base. “The need for a second source” (read: an alternative to Cisco) should be coupled with a broad and comprehensive strategy that includes tactical (technology) acquisitions, mutually beneficial strategic partnerships (MSFT/NT has done more for MSFT than NT), a comprehensive next-gen software architecture and a will to ‘eat your young ones’ (CDMA). What we got was acronyms that mean nothing (WiMAX, IMS, IPTV), and even less as it relates to revenue growth. As a top telecom industry analyst once told me – ‘Nortel has displaced 3Com as the industry’s most underperforming company that is managed by a highly- pedigreed team that knows how to manage a business but not growth.’

To be fair, the management team is indeed a highly- qualified one if it was running a private equity firm but has ZERO qualifications running a creativity and innovation based business. We see this in LALA land almost every day; no shortage of liquor salesman, oil barons and bandwidth peddlers trying to run Hollywood and failing each and every time. Right team, wrong company or vice versa, take your pick. Well, we tried…

bb

Re: John Roese Has a Big Fan

Observer — Sat, 09 Aug 2008 14:22:49 -0000

By the way, Canada is following the US into recession. Unemployment ticked up appreciably this week. The commodity boom will take a breather as the dollar recovers. The world is following the united states into recession.

Re: John Roese Has a Big Fan

Observer — Sat, 09 Aug 2008 14:19:24 -0000

Thanks. Nothing Nortel is doing is really revolutionary. They are just trying to survive. It's going to get very ugly now that europe is slowing. Asia will slow further after the olympics end.

Re: John Roese Has a Big Fan

Mark Evans — Sat, 09 Aug 2008 14:06:18 -0000

Yeah, you're probably right that I should have done something on Jha's appointment but it was a busy post-vacation week. Expect to see some more industry perspective posts going forward.

Mark

Re: John Roese Has a Big Fan

commentor — Sat, 09 Aug 2008 07:47:39 -0000

great posts.
for those who challenge the value of this blog, I urge them to reflect on the past 10 comments. I consider it as a free adive service Nortel management can use.

Yes, John Roese should never been hired as a CTO, but MZ did not know better, sadely. John Roese failed to execute internally and externally -just like his boss-. Who cares if you have a CTO who is great in yapping when your company is hyper-lost.

there are lots of R&D managers who are suffering from how JR is driving -or trying to- drive them. Nortel is lucky they still produce releases given the JR impact and the 6 segma impact. If it was not for few good managers standinging R&D you would see no product S/W or H/W coming out of this company.

Re: John Roese Has a Big Fan

Observer — Fri, 08 Aug 2008 23:20:11 -0000

Mark - Why no mention of the hiring of Sanjay Jha by Motorola for their phone division President and CO-CEO ? Wasn''t Mike Z the head of this business during his stint at Motorola ? What does it say about the business unit that Mike Z left behind ? He wanted to be promoted to CEO of Motorola but the board didn't go for it. Several years later Motorola's business is floundering and has fallen behind in the handset business again to Nokia, RIM and Apple. In my opinion, this proves that focus on six sigma and the GE way at Motorola simply failed them because they fell so far behind in studying the market and technology. Sound familiar ? When will the board of Nortel wake up and look what the GE way has left in its wake ? Using manufacturing thinking and techniques simply doesn't work for technology companies. Mark - you are much too much the Nortel cheerleader and not good at reading or interpreting the industry :)

Re: John Roese Has a Big Fan

many — Fri, 08 Aug 2008 20:32:18 -0000

ANW I dispute the notion that the CTO office has a lot of ideas. I honestly think they do not. The postings I have seen have been all over the place, from OLPC to "mashups", "being green - ala Kermit" and seomthing called UC, which is really UA.

Anyway. I do agree there is serious disconnect between the product and the CTO organization, and that is in fact one of the (many) problems with the leadership.

I also agree that sales and marketing is lost, which is another of the (many) problems with the leadership. What exactly is the boondogle with the BBC an 100Gige? Who is the target market?

Re: John Roese Has a Big Fan

Another Nortel Watcher — Fri, 08 Aug 2008 20:02:42 -0000

After reading this post and the latest on the Nortel Buzzboard, a simple way of explaining Nortel's dilemma occured to me.

The CTO office has lots of ideas, but no clue how to execute. They never talk in the context of Nortel execution or deliverables.

The Carrier and Enterprise business units know how to execute but have no ideas. They never talk about what's going on in the market and with only a couple of exceptions they're invisible at industry fora.

The sales teams don't have a clue what's in the pipeline - or what might be cut from the pipeline next quarter - so they're cautious instead of aggressive.

The large accounts are frightened by their dependency on such a long running train wreck. They throw a bone every now and then to ensure the customer support teams don't disappear.

Investors just look past all the hype to the bottom line. Is the business growing? No. Do we know where growth is going to come from? Maybe. Is it enough to replace declining businesses? Unlikely.

And who is accountable for all of the disconnect? Mike Z. And who is accountable for the Mike Z trainwreck? The board.

Re: John Roese Has a Big Fan

broadbandbill — Fri, 08 Aug 2008 10:26:20 -0000

Correction EXNT,

The CTO of Broadcom was Dr. Henry Samueli; John Roese was a CTO of the networking group. Broadcom is a phy-layer (L1) company -- just like hyper-connectivity (a phy-layer concept). Sadly, his boss does not know just how dumb JR makes Nortel look (and sound) with a phy-layer concept that is over a decade old... -- bb

PS -- your post is very funny, just like the cartoon...

Re: John Roese Has a Big Fan

exnt — Fri, 08 Aug 2008 08:35:23 -0000

Its hyperconnectivity boy, hyperconnectivity! You listenin to me? Why when I was a boy and CTO of Broadcomm, I invented hyperconnectivity, after I invented the Internet, IP, and the transistor! Boy, you listenin? Anyway, I invented hyperconnectivity, everyone connected to everyone, all the time, electronically, you know?! Its marvelous, stupendous, any fool can see that! Why they will probably give me the Order of Canada for it, maybe the Queen will knight me, who knows!! ................