Chief Executive Officer of Alcatel-Lucent
B orn Patricia Fiorello, June 12, 1952, in Trenton, NJ; daughter of a doctor and a homemaker; married Frank Russo, 1983; children: two stepchildren. Education: Georgetown University, B.A., 1973; Harvard University, completed Advanced Management Program, 1989.
Addresses: Office—Alcatel-Lucent Executive Offices, 54 rue de la Boétie, 75008 Paris, France.
S ales and marketing management, IBM Corporation, 1973-81; management and executive positions in strategic planning, marketing, human resources, and operations, AT&T, 1981-92, president of Business Communications Systems, 1992-96; executive vice president of corporate operations, Lu-cent Technologies, 1997-99; executive vice president and chief executive officer of Service Provider Networks Group, 1999-2000; president and chief operations officer, Eastman Kodak, 2001; chairwoman and chief executive officer, Lucent Technologies, 2002-06; chief executive officer, Alcatel-Lucent, 2006—.
Awards: 50 Most Powerful Women in American Business, Fortune, 1998, 1999, 2001; tenth most powerful woman in the world, Forbes, 2007.
P atricia Russo successfully moved up the corporate ladder from her positions in sales and marketing at IBM to become the CEO of international corporation Alcatel-Lucent. Listed three times as one of the 50 Most Powerful Women in Business by Fortune magazine, Forbes magazine declared her the tenth most powerful woman in the world in 2007. When she joined AT&T in 1981, she was responsible for turning around a telecommunication department, and that beginning of her career with the company allowed her to help launch and lead spinoff corporation Lucent Technologies. When Lucent suffered in the market of the late 1990s, Russo took a job with Eastman Kodak, becoming number two in that company, only to return to Lucent a year later as CEO. She has been responsible for guiding Lucent through its merger with French telecommunications company Alcatel since 2006.
On her success as a woman in business, Russo told Institutional Investor, “The landscape certainly looks a lot different today from when I started out. We have made a lot of progress. But if you just look at the raw numbers, it’s hard to argue that there’s full representation of women in senior jobs. We’ve always been a pretty diverse company. So quite frankly, it’s not as much on my radar screen as it is in some other companies. I have women running my wireless and wireline businesses. I believe that the more views you have attacking a problem, the better the answer.”
Born on June 12, 1952, Russo grew up as the second oldest in a family of seven children. The daughter of a doctor and a homemaker, she was a natural athlete, and in high school she was the co-captain of her basketball team and captain of the cheerlead-ing squad. Two of her siblings, however, grew up physically challenged, which shaped Russo’s understanding of family. In 1983, she married Frank Russo and became the stepmother of two children.
A graduate of Georgetown University with a degree in political science and history, Russo spent eight years in the sales and marketing department at IBM. She was one of the few woman in her department, as the attitude at the time was that women were not cut out for careers in sales. In 1981, she was hired by AT&T, where she moved up in the company’s sales and marketing departments. In 1992, Russo was moved into the Global Business Communications Systems area, which was floundering and required an overhaul. Russo turned the division around, cutting costs and expanding overseas, focusing efforts on their core products. The division transformed from a failing arm of the company to a profitable unit.
In 1996, Russo moved into AT&T’s equipment spinoff, Lucent Technologies. In 1999, Russo became the vice president and chairwoman of the Service Provider Networks Group, a division worth $24 billion that employed 80,000 workers. But as Russo’s career reached this height, the telecommunications industry suffered a blow. Many companies began failing, and Lucent was among them, its sales and stock dropping drastically. Russo’s division was reduced, and Russo soon left the company for a position at Eastman Kodak.
Hired for the number-two position at Eastman Kodak, she focused on helping to modernize Kodak from film to digital imaging. They also knew of her track record for reorganizing and divesting businesses. She helped the company with a plan to spinoff a new company called Appairent in order to reduce their losses. “Russo’s reputation is for skill in motivating people,” Gale Morrison wrote in Electronic News.
While Russo worked at Kodak, Lucent continued to falter. At the end of 2000, CEO Richard McGinn was let go, and in January of 2002, Russo was invited back to Lucent, this time in the head position. When she accepted the job, which came with a healthy compensation package, she became one of six female CEOs running Fortune 500 companies. The return was like a homecoming for Russo despite the work that stretched ahead of her. Lucent was drowning in debt, and demand for Lucent’s services was very low. Russo announced her goal to turn a profit by early 2003. “The strategy and the product plan are right,” she said in BusinessWeek. “And I can accelerate them.”
Although many of Lucent’s employees had been let go before Russo came back on board, the company was still employing more staff than could be afforded. Russo laid off thousands of workers, and focused on reducing operating expenses, working capital, and vendor-financing commitments. She developed a tighter focus for the company, changing Lucent’s goal from providing equipment to offering customer services, then sold off businesses that did not support this new direction. Russo also enhanced the sales department, which had always been one of Lucent’s strengths. But by the end of 2002, things still looked bleak. Russo was named chairwoman of Lucent in 2003, and shortly thereafter, her changes began to show in their profit margin. In 2004, Lu-cent showed its first profit since 2000. “Nobody likes to make decisions that affect people in the business,” Russo said in Institutional Investor. “But it’s my responsibility. I and the senior leadership team had to be proactive and aggressive about taking action so that this company would weather that storm. And we did. But it was not a fun time, for sure.”
The new profitability of Lucent made it an appealing acquisition, and in 2006, Alcatel in France bought the company, merging the two into Alcatel-Lucent and keeping Russo as the CEO. The deal was one of the largest in the industry, and Russo was shown in pictures of the Paris press conference looking ecstatic. But the merger was a challenge, and integration took time—which cost money, leading Russo to suggest further lay offs. By October of 2007, the company had missed its financial forecasts three times since the initial acquisition. These difficulties led some critics, particularly in Parisian businesses, to suspect that Russo’s stay with the company would not last. Other industry commentators suggested that the merger itself was a mistake. “It’s easy to sit on the sidelines and make strategic judgments,” Russo commented in BusinessWeek Online. But she defended her strategy and said that the troubles came from “problems that we’re going to work our way out of.” She continued to push Alcatel-Lucent into service and support, and under her, it ranked second, behind Ericsson, in that field. While the changes continued, Russo gave the press little reason to increase their faith in the company, acknowledging that the outlook for the next year was uncertain. In other interviews, however, she has kept a positive attitude. “We’re not done. We will execute on what we’ve started,” she was quoted as having said on the Wall Street Journal Blog. “We believe in what we can create.”
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TelecomWeb News Digest, April 30, 2008, “Rumor Du Jour: CEO Endangered asAlcatel-Lucent Fumbles Again.”
“Alcatel Rules Change Threatens Russo,” Business-Week Online, http://www.businessweek.com/globalbiz/content/may2008/gb20080516.tif_848053.htm (May 19, 2008).
Biography Resource Center Online, Gale Group, 2002. “Is the Worst Over at Alcatel-Lucent?,” Business-Week Online, http://www.businessweek.com/globalbiz/content/nov2007/gb20071128.tif_204292.htm (May 10, 2008).
“Lucent Technologies CEO Patricia Russo,” Public Radio Marketplace Online, http://marketplace.publicradio.org/segments/corneroffice/corner_russo_bio.html (May 18, 2008).
“Mean Street: What Alcatel-Lucent’s Pat Russo Can Learn from Spock,” Wall Street Journal Blog, http://blogs.wsj.com/deals/2008/050/05/mean-street-what-alcatel-lucents-pat-russo-can-learn-from-spock/?mod=WSJBlogprint/ (May 5, 2008).
“The 100 Most Powerful Women: Number 10: Patricia Russo,” Forbes Online,http://www.forbes.com/lists/2007/11/biz-07women_Patricia-Russo_ZE1Y.html (May 18, 2007).
“Patricia Russo,” InfoPlease, http://www.infoplease.com/spot/womenceo1.html (May 18, 2008).
“Patricia Russo, Chief Executive Officer,” Alcatel-Lucent, http://www.alcatel-lucent.com/ (May 18, 2008).
—Alana Joli Abbott