The new business plan of the company reports a cost savings of EUR2.1 billion, an increase from its planned cost savings of EUR1.7 billion.

Other players in the communications industry, such as Nortel Networks and Motorola, have also recently announced plans to reduce their workforce. Nortel Networks will reduce its workforce by 2,900 people, roughly 8%, by the end of 2008 as part of a restructuring effort announced in 2006. Motorola had reduced its staff by 3,500 by June 2007 and plans to cut 4,000 more jobs by end of 2008 to save $600 million.

The company has also made several management changes by replacing its chief financial officer, Jean-Pascal Beau fret with Hubert De Pesquidoux, who was previously the head of the Enterprise division. Christian Reinaudo, head of the Northern European region, will also leave the company. He was previously the president of Alcatel’s optical activities and its submarine unit. In August 2007, Mike Quigley, president and chief operating officer and Frank D’Amelio, chief administrative officer left the company.

To streamline the company’s regional operations two structures will be created, one for Americas and the other one for EMEA and Asia Pacific. Frederic Rose, who currently heads the Asia-Pacific Region, will assume additional responsibilities for the company’s current Europe & North and Europe & South regions. Cindy Christy, will lead the Americas Region. Frederic Rose and Cindy Christy will continue to report directly to the company’s CEO, Patricia Russo. Olivier Picard, head of the Europe and South region will continue to oversee the Europe and South region, reporting to and serving as deputy to Frederic Rose. Christian Reinaudo, head of the Europe and North region, will be leaving the company.

To simplify Alcatel-Lucent’s management structure and to improve the company’s decision-making process, a seven-member management committee has been formed, which would report directly to Patricia Russo. The seven member committee comprises of Hubert de Pesquidoux, chief financial officer, Etienne Fouques, chief technology officer, strategy, and corporate marketing, Cindy Christy, head of Americas region, Frederic Rose, head of EMEA and Asia/Pacific region, Michel Rahier, head of the Carrier Business Group, John Meyer, head of the Services Group, and Claire Pedini, head of corporate human resources and communications. In addition, Janet Davidson, company’s chief compliance officer and head of Integration and IT, will serve as secretary for the committee.

Alcatel-Lucent posted a net loss of EUR258 million for the three months ended September 2007. Revenues declined by 11% to EUR4.35 billion. The company made a loss of 11 cents per share, compared with earnings of 23 cents a year ago. Alcatel-Lucent’s market value has declined by more than EUR 12 billion since January 2007.

Source: ComputerWire daily updates