Editor’s note: Mark Evans, a veteran Canadian journalist and consultant, writes almost daily about Nortel at his blog.
TORONTO, Canada – The Financial Post ran last week an about Nortel’s decline, which recapped how Canada’s flagship high-tech company has fallen so dramatically over the past few years. There’s little that’s eye-opening but some quotes from Nortel director John Manley are, frankly stunning.
“It is a huge loss for Canada and for our Canadian research and development,” Manley said, adding that he is “personally and deeply saddened by what’s happened. And I am heartsick about the impact on individuals. One of the things that always impressed me about Nortel is the loyalty that employees, and former employees, had toward the company. It is a tragedy.”
With all due respect, shouldn’t Manley and his fellow board members be taking a healthy part of the blame for Nortel’s demise as opposed to lamenting about they are “saddened” that Nortel has decided to concede defeat by selling all of its assets at firesale prices?
Manley has been a Nortel director since 2004 so he’s been representing the best interests of shareholders for the past five years. During that time, the board has been responsible for approving the hiring of Bill Owens as CEO, a puzzling move given his lack of telecom experience.
The board also backed Owens rather than embrace an ambitious and aggressive makeover created by COO Gary Daichendt and chief technology officer Gary Kunis – a plan that may have changed Nortel’s fortunes. Daichendt and Kunis resigned after the board rejected their plans.
The board also hired Mike Zafirovski, who had never been the CEO of a Fortune 500 company.
And during Mike Z.’s three year reign, the board has watched as Mike Z. has suffered from a terrible and fatal case of strategic paralysis. While Mike Z. has fiddled with reducing costs, Nortel has burned. When Nortel needed a strong vision of the future and decisive strategic moves, Mike Z. has been unable to do what needed to be done.
At the end of the day, Manley and his fellow corporate directors will have to take their share of the blame.
If Manley was smart, he’d be wise to stay away from offering his condolences given he’s had a ringside seat to one of Canada’s biggest corporate declines.