Nortel chief is happy to come home but then has to cut jobs

 

After 13 years with Nortel, one top job after the other, plus a series of international postings from Brazil to China, there is little doubt that Mr Chris Conway was more than qualified to be the next vice-president of operations at the group's Northern Ireland campus.

But six weeks into the job and in the middle of the worst industry downturn the Canadian group has faced, Mr Conway admits there was nothing in his previous career that could have prepared him for this experience.

The Northern Ireland-born, University of Ulster graduate first joined the company as a junior engineer at the beginning of the development of the optical networks business.

He moved from design to manufacturing to get general management experience and enjoyed a couple of years on the shop floor, working on the production side at Nortel's Monkstown plant on the outskirts of Belfast.

Many of the faces were still familiar to him when he returned to the plant earlier this year after a five-year absence working first on business development projects in Brazil and China and most recently in Europe where he set up a pan-European sales support team.

But the business environment in which Monkstown operates has changed dramatically since Mr Conway first joined as a junior engineer. The industry is no longer in expansive growth mode, Nortel Networks plans to lay off 30,000 staff across the globe and Monkstown is in the process of negotiating redundancies that will see its employment numbers drop to 1,300 over the coming months.

"In terms of getting to break even and a return to profitability we have had to lay off people in their hundreds, and that is difficult. It is difficult for people here, for the morale of our employees - it is very difficult for the people who have been laid off and we are still living through that," Mr Conway said.

But he added that in the context of Nortel's worldwide redundancy programme, Monkstown is in a strong position because it has taken the right action at the right time. In one sense the decision to make redundancies at the plant has been more difficult for him than it might have been for someone who does not have the same history as he does with Monkstown. He is more than aware that some of the people now facing redundancy have worked at the plant for a lifetime, one man who is leaving has spent 27 years at the site - first in its previous guise as Northern Telecom and in its latter years as Nortel.

"I joined Nortel as a junior engineer, which is the lowest engineer you can come in at. Although I have been off site for five years I still see a lot of faces that I remember. It can be a difficult situation when there are people you have known for a long time who are now being made redundant."

He admits that few in the industry saw the current high-tech downturn coming.

"I don't think anyone expected the downturn we have seen this year. It has caught everyone across the globe by surprise. I have heard it described as the 100 year flood and it's that sort of disaster type thing which it has caused in its wake."

"There are five main products which have been identified by Nortel as being long-term growth areas even with this downturn," he said.

Two of these - the optical internet linking cities and the metro internet connecting businesses and campuses within urban areas - are important to the Monkstown plant.

Mr Conway said Monkstown was the only facility in Europe which has research and development and operations co-located on one site with a key focus on optical and metro internet.

"Monkstown has to be efficient when it comes to its own processes but it also has to be efficient in how it delivers into a European logistics and international supply chain. The same is true for research and development, we must make sure it delivers what customers need in a global market place," he said.

"Even going forward we are going to be a product of that marketplace and how well that plays out. I would hope it plays out against our current forecast. We haven't been over-ambitious with our forecast but we are still a product of that and it is still very unclear.

"We have been helped here in Monkstown because we do support Europe, Asia and South America. Europe lagged North America although it has been impacted just as badly now and there is still a lot of debate about Asia. Currently China is doing extremely well. But I have no doubt the next six to nine months are going to be difficult," he added.

Mr Conway believes the fact that Nortel has invested heavily in terms of facilities, people and training makes the Northern Ireland operation a key asset in the group's global family.

"Where else can Nortel access 500 engineers who have the experience and the reputation for delivering world class products? Our people are a brilliant asset, but at the end of the day we have to be profitable and we have to deliver on costs and product development and that is going to be our focus going forward," he said.