Lucent Technologies underwent an HR restructuring in 1999-2001 due to failures to evolve with changing market dynamics and integrate acquired companies. The restructuring involved centralizing HR functions, standardizing global policies, simplifying operations into four key businesses, and implementing a new organizational structure and service delivery model to enable faster decision-making and develop a global culture. Resistance to change was addressed by communicating changes and encouraging online training. The new structure aimed to streamline processes, reduce workforce costs, and better align HR with business strategy.

1. HR RESTRUCTURING AT
LUCENT TECHNOLOGIES
-SHOUMIK ROY
- RISHABH KHANNA
- NIKET MOHAN
- HARSHPREET SINGH
- ANIMA BAJPAI

2. BACKGROUND
• 1996 – Spun off from AT&T
• 1997 – Lucent major Telecom equipment maker
• Focus on Telecom equipment and voice-based
technologies
• Failure to evolve towards convergence of data, voice
and internet
• 1999 – Decision to restructure operations

3. • Restructuring into four key businesses –
a. Service provider networks
b. NetCare Professional Services
c. Enterprise Networks
d. Communications Technologies
• Late 1999 – Unable to integrate operations of
acquired companies
• 2000 – Severe financial crunch
• 2001 – Seven-point restructuring plan

4. MAJOR ISSUES
• Mismatch between Lucent’s organizational culture
and the culture of companies it had acquired
• Standardization of HR policies and processes difficult
due to autonomy in business units
• Failure to evolve with changing market
• Major exodus of talent from acquired companies

5. Modern Organization Designs
1. Project design
2. Matrix design
3. Horizontal organizations
4. Network design
5. Virtual organizations

6. President
Engineering Marketing Design Purchasing
Project
Manager 1
Project
Manager 2
Project
Manager 3

7. MATRIX DESIGN
Advantages –
• High degree of specialization
• Functional departmentation helps gather specialized
resourses
• Facilitates coordination among various specialists
•On-time completion of tasks

8. Disadvantages -
•Employees report to two or more bosses
• Role-conflict and ambiguity among employees
• High stress
• Weak superior-subordinate relationships
• Duplication of activities
• Increase in costs

9. Lucent’s “GROWS” Initiative – 1997
•GLOBAL – Strengthen Lucent’s International operations and to ensure
70% of the company’s future growth comes from outside U.S.
•RESULTS – Improve flexibility and productivity and to meet the rapidly
challenging preferences and diversified needs of customers.
•OBSESSED – Put excessive, matched focus on customers and new
competitors.
•WORKPLACE – Create and promote an open, supportive and diverse
workplace.
•SPEED – Replace existing culture with a new corporate culture driven by
technology and innovations.

10. GOALS FOR RESTRUCTURING
• Develop global culture
• Enable speedy decision-making
• Simplify and standardize global HR policies
• Evolve with changing market dynamics
• Effective downsizing of workforce
• Reduce employee dissatisfaction and unrest

11. HR
ORGANIZATION
HR OPERATION
CENTRES
HR CENTRES
OF
EXCELLENCE
HR BUSINESS
PARTNER
ORGANIZATION
SERVICE DELIVERY MODEL

12. RESISTANCE TO CHANGE
A. Individual Resistance to Change
B. Organizational Resistance to Change
• Structural inertia
• Limited focus of change
• Group inertia
• Threat to expertise
• Threat to established power relationships
• Threat to established resource allocation

13. Benefits of New Organizational Structure
• In accordance with diverse regional operations
• Implemented after communicating changes to
workforce
• Easy and quick decision-making
• Global IT platform reduced workforce costs
• Efficient management of HR functions with reduced
workforce
• Streamlined processing via self-service

14. • Drastic reduction in manual interfaces
• Employees encouraged to take online training
programmes
•Work closely aligned with senior managers
• Focus on investing in ongoing development of
talent

15. CONTINGENCIES OF ORGANIZATIONAL DESIGN
• Organizational Size
•Organizational Strategy

16. BENEFITS OF HR CENTRALIZATION
• The HR function must not only be focused on the
workplace but also the marketplace and linked directly
to the core business strategy.
• If HR is becoming a profit center, costs need to be
reduced and processes optimized - this can only be
achieved by having all key players work at the same
centralized location.
• Operating centrally is necessary for all parties to be
fully aware of the overall strategy and to pull into the
same direction.

17. ROLE OF INFORMATION TECHNOLOGY
• To Save cost and time consumed in transactional and
repetitive HR activities
• Reduced administrative & training cost effectively
• Promoted self service and web enabling to employees
and managers
• Helped in quick and effective decision making

18. THANK YOU