Lucent's guiding light, 4/20/98

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Lucent's guiding light
McGinn

Richard McGinn stays close to customers to keep on top.

By Paul Desmond
Network World,

Lucent has a presence in lots of different areas, from the consumer market to business customers to carriers to pure research and development. Given all these markets, how do you keep people focused?
Last fall, we segmented the company according to customer sets to make in essence 10 smaller companies, each of them focused on the hottest growth areas we've got.
In doing that, we aligned people with specific targeted markets. So there's a great deal of line of sight and people know the pulse of their customers, their competitors and their markets every day.

With the pace of change in this industry, there's a lot of talk about the need to make decisions quickly. What would you say are the keys to making quick but effective decisions?
Be connected to the business in an intimate fashion so you have enough information to make informed decisions, and then just do it.
There's a great line from the movie "Wag the Dog'' that says, "A good plan today is better than a perfect plan tomorrow.'' That's exactly it. You're never going to have perfect information and things are always going to change, so you've got to get out there and do it now.
It's amazing when you take that attitude and constantly reinforce it, how many good decisions people can make quickly.
But you just have to keep doing it, because you can get seduced into thinking that you've got more time, and you simply don't, given customer expectations going up and competitors who want to take away your children's college education money.

You've budgeted over $3 billion for research and development this year. What are the key areas you're spending on?
We are focused in the following areas:

Communications and applications for semiconductors

Wireless . . . for service providers and for business or enterprises

Optical electronic systems primarily for service providers

And communications software. We have a very large software business focused primarily on network management that serves service providers around the world.
By the way, the latency period between invention and product in the marketplace has been dramatically reduced.

How did you reduce that latency period? A whole host of ways.
But it goes back to integrating the Bell Labs people with the business [units], tying their compensation directly to the business performance, having a closeness with the customers and really driving ourselves to meet unrealistic expectations - and knowing that that's never going to change.
I even moved some of the research folks into the development teams to give them a better sense of the issues that those engineers and developers face.
[As a result], I've found an amazing excitement in people that spurs them on to really want to get out there and be the leaders.

When you're dealing with enterprise business customers, as opposed to your carrier customers, what are the top network issues they're concerned about?
No. 1, they are trying to address systems that enable or facilitate integrated messaging for data and voice.
They have a need to improve customer service and figure out how their communications networks are going to help them do that.
And they need to find a cost-effective way to deal with the proliferation of data products, systems and networks that they're finding very costly to maintain and to deal with explosive growth [in network traffic].

What, if anything, do you think business customers would most like to see change at Lucent?
They would probably like to see us bring the reliability of our voice networks to the data world to reduce their cost of ownership and to work with carriers to offload some of the burden of management of WANs and campus-wide [nets].

Aren't you working on all that already?
Absolutely, but all those things are not there today, so that's what the customers would like to see.

How important is the Internet in terms of driving your strategy vs. the goal of simply solving communications problems? Can you distinguish between the two anymore?
I think we're going to see an overhaul of [the Internet] in the next couple of years, probably some fundamental changes to IP [and added] intelligence to make [the 'Net] more facile and easier to grow.
At that point in time, I think the Internet will be indistinguishable from [corporate] communications networks. It will be an integral part as opposed to something that is adjunctive.

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