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WASHINGTON (AFX) -- Patricia Russo hasn't spoken French in 25 years, but don't expect a language barrier to distract her as she prepares to move to Paris to run the combined operations of Alcatel and Lucent Technologies Inc.
Russo, chief executive of U.S.-based Lucent, has overcome a number of hurdles to become one of the most prominent female executives in the business world. She shattered stereotypes as a top saleswoman at IBM, turned around a money-losing business at the old AT&T and helped Lucent skirt the shoals of bankruptcy just a few years ago.
Besides, Russo has a few months to brush up on her high-school French. The $13.5 billion merger of Alcatel and Lucent -- the French company is effectively acquiring its American rival -- is not expected to close for six to 12 months.
After the deal closes, Russo will face her biggest challenge yet: integrating the far-flung operations of the French and American companies and cutting at least 8,800 jobs from a combined workforce of 88,000. The overhaul could take up to two years.
The job reductions could prove particularly thorny given the social and political difficulty of trimming payrolls in France. Russo will need to rely on Alcatel's French-born executives to navigate that problem.
Some analysts suggest a heavier share of the workforce reductions could occur on the Lucent side, although neither Russo nor Alcatel Chief Executive Serge Tchuruk would elaborate. Tchuruk, however, did point out in a conference call that only 28% of Alcatel's workforce is French.
In any case, Russo is no stranger to corporate makeovers. She cut Lucent's workforce in half to its current level of about 30,000 since taking over the company in January 2002.
Her successful effort to slash costs and concentrate on sales of wireless equipment helped Lucent to return to profitability in fiscal 2004 after three years of red ink.
Road to comeback
As a young executive at AT&T, Russo was given the role in 1992 of reviving the company's corporate-phone business -- what later became known as Avaya. Within four years, Russo turned the unit into a moneymaker and sharply boosted sales. She then became a senior executive at Lucent when the company was spun off in 1996.
With her responsibilities curtailed by former chief Rich McGinn, Russo left Lucent in August 2002. The timing of her departure was fortuitous: McGinn was fired a few months later as the company's performance deteriorated and evidence of questionable accounting practices surfaced.
Russo soon signed up as chief operating officer at Eastman Kodak, another famous American technology firm in need of a major shakeup. She was lured back to Lucent just nine months later, taking the helm on Jan. 7, 2002, shortly after the company posted a $16.2 billion annual loss.
Although some analysts initially viewed Russo as too much of an insider, she didn't hesitate to adopt major changes at her old firm. She cut jobs, divested noncore assets and eliminated certain benefits for retirees, a move that embittered many former employees.
Lucent also benefited from Russo's push to sell more wireless gear. That strategy led the company back from the brink and offset declining sales in Lucent's established wireline business.
"Pat Russo has done a pretty good job getting the company repositioned," said analyst Bill Leisur, director of Technology Business Research.
Yet Russo's big bet on new Internet-based technologies hasn't paid off yet. Phone companies increasingly demand equipment that will make their networks more efficient and cheaper to operate. While many large carriers are testing Lucent products, its developmental efforts haven't translated into significant sales.
Without a fresh source of revenue, Lucent was facing a difficult choice: cut spending and research dollars again or team up with another vendor.
As Lucent and Alcatel move to consummate their merger, Russo is likely to become chief saleswoman in the United States for the cross-Atlantic venture. Industry observers say that's a role at which she excels.
Days at IBM
Indeed, the Trenton, N.J., native got her first big job as a saleswoman at IBM after graduating from Georgetown University. She eventually became one of Big Blue's top sales representatives despite resistance from some potential customers to deal with a woman.
"Early in my career, there were some people who didn't believe a woman belonged in sales," she told BusinessWeek in a 2003 interview.
The Lucent chief is known for more than just her sales acumen, though. The highly competitive Russo -- she was the first woman selected by Golf Digest to its list of top CEO golfers -- is also viewed as a good listener and delegator who's willing to make the tough decisions.
She's taken on a lot of tough choices at Lucent and will have to make more once the merger with Alcatel is completed. This story was supplied by MarketWatch. For further information see
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