Life at Lucent Technologies Inc. has been anything but settled in the past year, with losses, layoffs and talk of a corporate takeover. Even at fabled Bell Labs, which was fairly isolated from its parents' woes, many of the staff broke old ties when spinouts Avaya and Agere were formed.
Despite the turmoil associated with plummeting stock prices and the schisms created when more than 45,000 staff left Lucent for the two spin-outs, researchers, at Bell Labs report little disruption to their own operations and projects. Most of the staffing cuts at Lucent were in marketing and other areas.
"Fortunately, the commitment to research is still very high," said Victor Lubecke, member of the technical staff at Bell Labs' Network Research Department (Murray Hill, N.J). "We're in an environment where there have been no cuts, so it hasn't seemed as scary."
Scary has indeed been the watchword of late for may of the companies in the EETimes Top 100. But despite the problems of the past year, there's very little red ink on the list. Some companies logged strong enough profits during the first half of 2000 to overcome the downturn that started later that year. Many others have fiscal years that go back a few months into 2000, so their revenue and net income don't reflect the layoffs and other woes that were in the headlines a few months ago.
Although the job market has cooled significantly, layoffs have had minimal impact on engineers, most observers say. That was the case at Bell Labs when 10,000 plus Lucent staffers were cut in the wake of corporate losses in the billions.
Lucent's problems spurred analysts to raise the possibility that the company might have to file for bankruptcy. And the reversal of fortunes has made Lucent, which soared during the communications and Internet boom of the late 1990s the object of takeover rumours.
But Bell Labs' engineers claim to be able to maintain their focus on their research, blocking out the corporation's problems. After all, they say, engineers have to be pretty focused to land a job in a research facility that's been one of America's top labs since 1925.
"Certainly people have a higher level of concern, but it hasn't affected morale," said Louis Manzione, director of the Network Hardware Integration Research Department, which is part of the Communications Materials Research Lab. "We have a feeling that what we're doing here is of value. We are working in basic science and research and in engineering research, for products being delivered and everything in between."
But that doesn't mean that the sweeping changes at Lucent haven't affected the staff. Lubecke, who joined the research facility just two years ago, had to decide whether he would move to the microelectronics spin-off or stay with Lucent. He chose the latter.
"About a third of my department was assigned to Agere, My work spans things that are both in Lucent and Agere, so I had a chance to make a choice," Lubecke said. "I had kind of a 50-50 split. [But] I have been happy with the Bell Labs environment, so it seemed like a good idea to stay here."
Now that Avaya staffers have left and Agere staffers have been selected, those who remain at Bell Labs claim a tighter esprit de corps. "I can see more of a spirit of camaraderie now that we're a smaller company," Lubecke said. Of course, in Lucent's case "smaller" is in the eye of the beholder: The operation still has 30,000 employees scattered in 30 countries.
The Agere spin-off won't happen until later this year, so the two groups are still working in the same building right now. But even after the separation is completed and the IC designers move into a new building, Lubecke and his Bell Labs colleagues won't be totally isolated from their former workmates. The relationship "won't necessarily go away; [we'll] just have a different perspective. Perhaps Lucent will be a customer buying from Agere," Lubecke said. "There are a couple of areas where it's clear both companies have an interest, so there will probably be some form of joint agreement."
Testing the corporate winds
Those arrangements will be made at higher levels, and the engineers will do what engineers do once those high-level decisions are made: adapt as best they can. Until then, they'll keep plugging away, occasionally looking up to see which way the corporate winds are blowing.
What they see now are signs that Lucent may have turned the corner. Stock prices are going up; talk of impending bankruptcy has waned. And although the Bell Labs engineers claimed to have been isolated from the turmoil, they took pains to note that their group is growing. "We hired an RF engineer a while ago," Manzione said.
When share prices went from a high near $70 to a low below $10, Manzione displayed the calm that Wall Street financiers preach. He doesn't pay too much attention to what he considers a sound investment, leaving it alone for long-term savings.
"I didn't benefit when it was really up, and I didn't get hurt when it went really down," he said.
He's been equally unflappable about the layoffs and other upheavals that struck when Lucent and others became the poster children for what has been called the tech wreck. "It's been a lot more stable here than at many other places -- definitely more stable than at many start-ups and at a number of our competitors," Manzione said.
He has seen plenty of changes during his 20 years at Bell Labs. Since Arun Netravali took the helm a couple of years ago, there's been a shift away from the long-term development that created such milestones as the transistor.
The long-range work hasn't been abandoned at Bell Labs. But Netravali's decision to focus more on product development proved auspicious when the communications marketplace imploded, rendering time-to-market even more urgent for struggling companies.
"We still have a good fraction of our work on longer-term projects, but we're more aligned now with emerging products," Manzione said. "It helps our personal growth. We're affiliated with a lot of hot technologies," including base station equipment, antenna technology and microelectro-mechanical systems.
The focus on high-level technologies is one reason that few Bell Labs engineers have jumped ship during the downturn. Designers are working in hot areas, and they're able to set aside time to take courses or do whatever else it takes to stay ahead of the pack. That provides many with the feeling that even if Lucent's management can't turn the company around, or if a buyer decides to scuttle much of the research group, the employees will still be in a very good situation.
Keeping staff motivated
"Keeping the level of personal growth high is key to keeping people motivated and attracting bright young minds," Manzione said. "These are very marketable skills. We do lose people; companies want people who have these skills."
Lubecke, during his short tenure, has also seen some pretty substantial changes. He came in around the time that Netravali put more focus on shorter term research. The shift served Lubecke's interests: He prefers to have links to real products and the company that creates them.
"I was working in a more scientific research environment at NASA," Lubecke said. "I was impressed with the opportunity [at Lucent] to do major research but be supported by a company. That really lessened the bureaucracy."
Both men spend a lot of time in the office, but they balance their lives with outside activities. Lubecke and his wife, who spent two years living in Japan, continue to study Japanese. Lubecke is also a scuba diver and takes time to visit local high schools, mentoring students and promoting the importance of a strong background in mathematics and science.
When Manzione isn't working, he enjoys painting. "It's a good way to take a break from the high-tech world," he said. Manzione holds memberships to "almost all the New York art museums. I really enjoy modern art," he said.