Given the financial challenges and competitive marketplace in which Nortel swims, the question had to be asked of the troubled telecommunication gear’s new chief executive officer:
Why did you take the job?
Mike Zafirovski didn’t flinch. He said he had two choices in make when deciding to leave Motorola as a senior executive in order to become CEO of a company to build to greatness.
“I could go with a small company and grow it, or I could go to a tarnished icon and rebuild it,” Zafirovski told WRAl Local Tech Wire in an interview on Thursday. “Obviously, Nortel fits the second category.”
One hundred and fifty days into the job, the challenges just seem to mount for Zafirovski. Just hours after “Mike Z” (as he’s known to deal with the difficulty of his Macedonian name) addressed more than 500 business executives at the North Carolina Technology Associations “CEO Conversation” event, Nortel announced it will have to add another $350 million to a restatement of earnings. The new amount pushes Nortel’s latest book revisions to well past $1.1 billion.
Additionally, Nortel said in a statement issued after 9 PM that it is in default on some credit lines since it continues the review of its finances dating back several years.
Zafirovski, a long-time General Electric executive who lived in Raleigh from 1994-6 during one GE assignment, is the man Nortel brought in to clean up its accounting mess and restore the company to profitability. Preceding him, a former CEO and several accounting executives were fired “for cause”, a CEO brought in to make changes after the firings has since moved on, and federal government investigations continue. Zafirovski also had to endure a lawsuit filed by Motorola when he took the Nortel job. The companies eventually settled.
While dealing with the books, Zafirovski is at the same time putting a new management team in place and reorganizing the telecommunications gear provider.
Yet despite the challenges, Zafirovski told LTW that he remained very confident he would turn Nortel around. And he stressed that the 2,500 Nortel employees at its campus in Research Triangle Park are essential to making his plans succeed.
“I Love To Compete”
“Nortel certainly has the opportunity to be a great company, and I am thrilled to be part of it,” Zafirovski, who moved to the United States from Southern Europe at the age of 16, said. “We have a long way to go. It’s not going to be easy, and it’s not going to happen overnight. But we have great customers, great employees, and I am very, very positive.”
That commented reflected a point Zafirovski made about his leadership style during the NCTA speech. Among his favorite leadership traits is what he called “forceful optimism.”
“I love to compete,” Zafirovski, the captain of his university swim and soccer teams, told the crowd. And he said he is determined to “make good things happen” at Nortel.
Zafirovski, who has a son enrolled at Duke and remains a “huge ACC basketball fan”, said Nortel retained many strengths even though the company is about one-third the size it was at the height of the telecommunications and “dot com” boom of 2000.
“It’s a company with great assets,” he said in the interview. Among those assets are the employees at RTP, the CEO added.
A “Huge, Huge” Role for RTP
“Huge, huge,” he replied when asked what role the RTP group would play in his efforts. “All quality assurance programs will be based here,” Zafirovski added. Other key roles include customer service, order management, supply chain and “some research and development, about 200 people.”
A big believer in Six Sigma standards, Zafirovski said RTP would have a key role in implementing those standards.
During his speech for the NCTA audience, Zafirovski pointed out that the RTP campus is the company’s third largest (behind headquarters in Ottawa and a campus in Richardson TX).
“It’s a great place to recruit,” he added about the Triangle. “We’re making significant investments here.”