Lucent Technologies in France Best in France Case Study April July 2004 By: Ms Cheong, Mr Coulom, Mr Girma, Mr Moreno, Mr Remmele

Executive Overview What's your business? Company products and clients Do company values fit the French culture? Constraints in France Adaptation to France Key Constraint Costs Key Benefit Numbers Essential Advice

Lucent Technologies Acquisition of TRT (France) from Philips in 1996 Telco equipment Supplier World Sales 8.5 B$ European Market 500 M$

Company products No Production in France Production Outsourcing: Factory sold to Flextronics 2004 trend to outsource R&D

Company's clients “Top 50 operators” Local Support Sensitivity to technical local support: example of the DSL expertise center with France Telecom

Why it came to France France, Alcatel Germany, Siemens Local Confrontation in their home market with direct competitors

Company values Creative Force/Produce growth Awesome execution Unmatched customer value Winning environment/Winning Team

Constraints in France No constraints Existing Structure Social habits different from the US Adaptation for international teams lead by non-French managers Lower Adaptability/Flexibility, projects moved to Germany/Netherlands

Adaptation to France What kinds of adaptations did/is the company making to its people management systems? –Recruitment/Selection –Compensation –Management Development –Performance Appraisal –Motivation –Job Design, Job Assignment –Communication Policies –International Transfers, Use of Expatriates –Training –etc.

Key Constraint Costs What are the key costs to coming to France that are more or less than operating in other locations? –Any or all HR type costs (hiring, paying, training, dismissing, etc.) –Other organisation structure costs (real estate, travel, taxes, "cultural consultants," etc.) –Communication constraints (language) –Integration of French managers into global organization

Key Benefit Numbers What are the key benefits of being in France? –Revenue/profit (revenue/profit per French employee) –Location benefits (transport, time zone, quality of life, employee satisfaction with France) –Government assistance –Market Potential (product penetration or growth potential, customer demands for cultural adaptation of product(s), launch platform for other European countries, etc.)

Essential Advice What advice do you offer to other companies in this sector concerning use of France as a location? –Real International Culture –Local Partners –Hiring the right Person –Flexibility with the local legal constraints

We Thank Manager 1: Virgine Robichon, HR Account Manager Manager 2: Marc Thivet, France Telecom General Account Manager Manager 3: Michel Muzy, CFO, Customer Group Central

Our Team Sze-Pei Cheong Vincent Coulom Eric Girma Christiano Moreno Claus Remmele