*NEWS*HARD TIMES AT LEXMARK CORP ! (READ)
*NEWS*HARD TIMES AT LEXMARK CORP ! (READ)
2008-04-07 at 11:42:26 am #19526
HARD TIMES AT LEXMARK CORP
Departures threatening turnaround,INKJET PRINTER BUSINESS BEING RETOOLED
senior and mid-level managers have left Lexmark International in recent
months, leading some to ask whether the struggling company can complete
an ambitious turnaround plan.Gone are vice presidents in marketing and
finance, taking with them decades of experience at one of Lexington’s
largest employers.Those who left and agreed to talk said their
decisions were personal, but industry observers and one who left said
they can see why some might be compelled to move.
inkjet printer division has struggled since the latter half of 2005, as
customers weren’t buying enough of the highly profitable ink
cartridges. The company has decided to tailor its marketing and sales
to countries where customers print the most. To adjust to its shrinking
demand, the company has shuttered two plants and eliminated or shuffled
thousands of employees worldwide.”I’ve always believed in Lexmark, and
they’ve had a lot of challenges,” said Ben Smith, who left Lexmark in
2006 for a job in Washington, D.C., and has since relocated to rival
Kodak’s Atlanta office. “The things they’re doing now … if they had
been doing them say four years ago, they wouldn’t be in the hole
they’re in today.”Those leaving Lexmark haven’t had trouble finding
jobs. Along with Smith at Kodak’s Atlanta offices are more members of
Lexmark’s marketing team. And a recruiter for industry leader
Hewlett-Packard recently posted job openings on an Internet message
board frequented by some Lexmark employees.
those who left were the leaders of an advertising campaign aiming to
resuscitate the company’s inkjet printer division.Jeff Willard helped
orchestrate the campaign promoting the wireless inkjet lineup but left
last October for Helen of Troy, where he now helps pitch products under
the Vidal Sassoon and Dr. Scholl’s brands. He had worked at Lexmark for
Also gone are:
• Jeff Meredith, Willard’s replacement. He could not be reached.
• Vince Young, another marketing employee who left for Kodak.
• Marketing’s Matt Franz, who also went to Kodak.
• Finance executive Scott Lannum, who had worked for Lexmark for 12 years and declined to say where he now works.
• Finance executive Dave Saunders.
who agreed to talk, like Willard, complimented Lexmark and said their
decisions were personal.”At the end of the day, I just needed to do
something different,” Willard said. “If I had been working at HP for
nine years doing printers, I would have been ready to do something
different from there.”Another factor on the minds of some could be the
company’s poor stock performance, said Tom Carpenter, vice president
and senior equity analyst at Hilliard Lyons in Louisville.”The stock
price is roughly the same as it was 10 years ago,” he said. “And
similar hardware companies have seen their stocks rise by 50 or 100
percent or more over that same timeframe.”
Jobs for the taking
looking to leave aren’t finding it hard since expanding rivals are
snatching them up.”There’s some aggressive companies out there like HP
and Samsung, and Kodak’s trying to come on strong,” said Larry Jamieson
of industry tracker Lyra Research.”I think in some cases, people might
want to say, ‘I would like to stay here, but how many times do I get
the possibility of moving to a company that’s expanding?’”HP took its
efforts public when a recruiter posted on a Yahoo Finance message board
earlier this year, inviting Lexmark employees to apply for a variety of
job openings. An HP spokesman declined to discuss the post.And
Lexmark’s shrinking revenue, Carpenter said, might make employees,
particularly those on the struggling inkjet side, “stop and think,
‘Will my job still be here five years from now?’”"And that’s a question
that’s very hard to answer.”Lexmark executives said in a written
statement that they could not comment on any particular employee’s
departure but that “as at all companies, people leave Lexmark for a
variety of reasons.”"Clearly, these are difficult times for the
company,” the statement added. Executives said the company has “the
necessary talent to execute our core strategic objectives.”But industry
observers said the departures will make it tougher to quickly convert
those strategic ideas into practice. After all, the upper-level and
mid-level managers are the ones tasked with carrying the top team’s
message to the rank-and-file, Jamieson said.
And the company’s struggles make it tough to bring in people from outside.
got to convince them that they can come in and help turn it around, and
people have to risk their future on that,” Jamieson said.Carpenter said
Lexmark is more likely to promote from within, “which is good because
you have people who have experience with the company.” Carpenter’s firm
owned at least 1 percent of Lexmark’s stock on behalf of clients at the
end of February.Lexmark noted just that in its statement, writing “each
departure we’ve experienced recently has created opportunities for
internal candidates, which reflects the overall quality of the talent
pool available to us.”But Carpenter warned that internal candidates
might not always be the best to execute a new plan.”Sometimes you might
keep trying a similar strategy over and over again,” he said.