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The Alcatel-Lucent I joined in 2013 was a company with great potential but facing urgent and dangerous challenges. Despite a highly talented and dedicated workforce, an impressive customer list and an envied history of innovation, the company was sliding towards bankruptcy. We created The Shift Plan to reverse direction and build a strong industrial project for Alcatel-Lucent.

Our transformation plan

The Shift Plan was divided into three chapters:

1

Our first efforts were to stabilize our financial position and restore customer confidence

2

Our second chapter is about strengthening our innovation and growth strategy to reposition Alcatel-Lucent as a specialist in the networks of the future by focusing on Ultra-Broadband access, IP networking and cloud technology

3

The third chapter is to realize our long-term vision dedicated to customer success and network transformation that can be implemented sustainably

Fixing the short-term financial issues

We moved quickly to accomplish the first chapter. Alcatel-Lucent returned to profitability in late 2013. Excluding restructuring costs, Alcatel-Lucent posted a positive cashflow (€43 million) for 2014, a first since the merger of Alcatel and Lucent in 2006. Restructuration/new operating model dedicated to competitiveness in a company which was losing money since its birth.

Building our future

The second chapter of our plan on innovation, transformation and growth is more ambitious, but also more rewarding. With the company’s specialist focus on next-generation IP networking, cloud and Ultra-Broadband access technologies now representing two-thirds of the revenue mix, a refocused R&D program and open strategy of partnerships, we are very quickly gaining traction in the marketplace. Industrial vision which needed new resources to compete efficiently in the new technical revolution opened by 5G and the move to Network 2020.

Unleashing value for all our stakeholders

This Annual Review is an overview of our 2014 achievements with The Shift Plan, and how we invent and deliver trusted networks to help our customers – service providers, governments, extra large enterprises – unleash their value through our products and solutions.

Closing thoughts

In closing, I must express how deeply proud I am of the employees that collectively worked to assure the future of our company for our customers and shareholders.

I became CEO to revive a great company, an ambitious charter that was not possible without the dedication and expertise of the team supporting me. We entered 2015 as a stronger, more focused company. We are financially healthy, we have exciting opportunities to drive growth and we are inventing the future by solving the tough technology challenges. When Alcatel-Lucent joins with Nokia next year, an innovation leader in next-generation technology and services will take the global stage. That is a very exciting outcome and an appropriate conclusion to The Shift Plan.

I will spend the remainder of my time at Alcatel-Lucent to ensure The Shift Plan is brought to completion and Alcatel-Lucent is successfully positioned for the future. Every success has its network.
Every success has its network.
Michel Combes
Chief Executive Officer of Alcatel-Lucent