Andy

Maybe you know this rumor...maybe you don't. It was fairly rumored that Andy made it part of the terms of his offer that if Bob was going to suceed the CEO position, that Andy was guarranteed the spot. I also originally heard that it took 2 extra months to come to this agreement..otherwise Andy would have been their earlier. But... what maybe you didn't hear was that Bob is intending to step down a lot sooner than later...potentially by the end of this calendar year.

Today's PLCM 8K

Short and sweet:

"On August 14, 2009, Polycom, Inc. (the “Company”) committed to a restructuring plan to realign and reinvest resources in the strategic growth areas of the business. The Company is eliminating those positions that are not aligned with the go-to-market structure under our new sales leadership and reallocating resources to growth areas. The plan includes elimination of approximately three percent of the Company’s global workforce, with most of these reductions taking effect immediately. The Company currently expects to record restructuring charges resulting from these actions totaling between approximately $5 million and $6 million in the third quarter of 2009, which amounts will be paid in cash through the second quarter of 2010. These charges and payments primarily relate to severance and other employee termination benefits."

So, maybe 60 people or so were let go. I did hear that severance in this round was pretty good...a year of pay. Of course..some that were let go were there for years and years. Of the 9 I heard of in the US, at least three of them had been at the company for over 10 years each.

Polycom Sales Reorg

As predicted (I cant claim too much credit, i think it was painfully obvious), Polycom as reorged their sales group. Reorgs are painful, at the people level, and I know at least seven who were let go within the US. But, at a company level, this is potentially good news. First, because Polycom is uniting multiple sales groups into a unified group and I've heard that one salesperson will work an account, whether its a voice opportunity or a video opportunity. Second, at least for the US, they are getting a solid VP, Jack Shemavon who successfully turned Canada around. The Canada story is a good one as Polycom had almost lost the entire country, and at one point, there were zero employees. It started out with just Jack and one SE for the entire country. They were systematic and fully focused and they kicked TAAs butt. Jack will bring that single minded focus to the US.

I have not heard yet what happened in AsiaPac or EMEA yet..but I would expect tweaks to their organizations.

Here's the key to all of this. Polycom has to execute this and stick with the plan. They're not good at keeping with plans..and tire of them quickly.

Also, Polycom has to keep working on its portfolio. I think they have to do two things. Keep the focus on strengthening their enterprise platform. They have a good start..but it needs to improve. One desperate area that needs to improve is out their telepresence systems integrate with the rest of the portfolio. It is honestly, horrible. Sorry, but using Crestron code to create a telepresence system is not the right answer. Also, Polycom needs to immediately hire engineers that are good at reducing COGS on their products. This will increase margin...but, it will also allow them to compete at the lower end..the value end of the market. That is the end of the market that is growing quickly. If I was them..I would also immediately eliminate all non-HD products.

It could be a good time for Polycom. I personally think it would be interesting working there..and quite exciting as there is renewed focus... most importantly.. an aggressively managed sales team.

Cash for Video?

Barack,
Cash for Clunkers... interesting program. Many think its a great program. I'd have to say, the way its structured is totally debatable.

But..really...whats your agenda? Is it to spur the economy? is it to yet again help the auto makers? or is it to help the environment?

I say, lets take $1B (heck, to government types $1B is chump change) and lets to a Cash for Video program. $4500 per video conferencing room as an immediate refund right from the US government. I tell you Barack, it would be enormous ROI for everyone involved.

Let me throw some math your way. If I have a car that gets 18mpg and I upgrade to one that gets 36mpg and lets say I drive 10K miles per year and lets assume gas at $3 per gallon. At 18mpg, its 555 gallons or $1666 per year. Double the gas mileage and I'm at 277 gallons per year or $833 per year. Its a savings of $833 per year.

But, give me $4500 to build a video conferencing room and if I just use it one day per week for one meeting with 8 people. Lets say its a regional busines and we drive to meetings. If its 8 people and say 100 miles each, its 800 miles a week. Do that meeting 50x a year and we're at 40,000 miles. Say we're still drivig 18mpg cars..thats $6666 of gas. Even if we have 36mpg cars...that $3333 of gas per year. That makes my savings 400% greater than the cash for clunkers program. And thats all from just one meeting held weekly.

Imagine if we were uniting people cross country? What if we were having multiple meetings per week? The ROI just increases. The decrease in the amount of energy use. And not to mention the amount of CO2 produced.

Barack, you're certainly the most hip and trendy President I've seen..and you're certainly the most technological. This should be a no brainer. Or..I know you like to play basketball...that makes it an easy lay up.

Lets spend tax dollars wisely.

jeff

Andy Miller

I've only heard a few things so far about Andy. Mostly that he's been spending time figuring out the company. I know that down in the trenches... there have been a lot of what ifs. There are some that are just tired of the every two year sales team shakeups. But..I did talk to a mid level sales manager that so far wasn't concerned at all.

Whatever the sentiment of everyone is, if Andy is going to deliver for the board and the stockholders, he's going to have to formulate a plan and start to execute. I'm sure that part of that plan is going to changing out of mid to high level sales management. It might even mean re-organization

I suspect it will happen pretty soon. The last sales SVP kept his first major changes to 1 year in..and then the second set at 2 years in. I honestly believe that the best course is to make your changes immediately as you then have the most amount of time to execute.

But..the problem also comes with the fact that most Polycom customers feel that Polycom is a revolving door. They either have not seen their sales rep in years... or their sales rep changes every six months.