Loading...
Symbols:
Get Seeking Alpha Free Stock Alerts by Email!
Get Free Stock Alerts by Email!
Transcripts
- American Vanguard Corporation Q3 2008 Earnings Call Transcript
- Oplink Communications, Inc. F1Q09 (Qtr End 09/30/08) Earnings Call Transcript
- Albany Molecular Research, Inc. Q3 2008 Earnings Call Transcript
- Alphatec Spine, Inc. Q3 2008 Earnings Call Transcript
- Avanex Corporation F1Q09 (Qtr End 09/30/08) Earnings Call Transcript
- Alnylam Pharmaceuticals, Inc. Q3 2008 Earnings Call Transcript
- eHealth, Inc. Q3 2008 Earnings Call Transcript
- MIPS Technologies, Inc. F1Q09 (Qtr End 09/30/08) Earnings Call Transcript
- Alexza Pharmaceuticals, Inc. Q3 2008 Earnings Call Transcript
- Alkermes, Inc. F2Q09 (Qtr End 09/30/08) Earnings Call Transcript
-
Editors' Picks
-
Most Popular
- Throwing in the Towel on This Market?
- General Electric: Genuine Risk of Collapse?
- Food: Against Self-Sufficiency
- The Fed: Now the World's Largest Private Bank
- Key to the Global Equity Market: Trend and Cycle Analysis of U.S. Retail
- Can a Global Economy Be Managed One Nation at a Time?
- Full list of Editors' Picks »
- Jim Rogers on China »
- Memo to Warren: AmEx Preferred at 15%, Warrants at $12 »
- Should We Really Bail Out the Big Three Automakers with $73.20 Per Hour Labor? »
- Peak Oil's Bell Is Ringing »
- UltraShort ETFs: At a Tipping Point? »
- The Biggest Problem Detroit's Big Three Face »
- 11 Stocks Selling Below Cash »
- Tech May Be a Wreck, But This Isn't 2001 »
- General Electric: Genuine Risk of Collapse? »
- The Autos and Mentality That Ruined Detroit »
- Iceland: What It's Like to Live in a World Without Money »
Hedge Fund Jobs
Job Seekers: Search jobs by category, get job alerts by email or live feed, apply online See full list of jobs »
Employers: See all recruitment options, get applications online or by email Post a job »
Trading Center
- Free E-Newsletters
- About Seeking Alpha
- About Us
- Contact Us
- What's New
- Readers Feedback
- Advertise With Us
- Contributors
- Contribute an Article
- Feature Your Book
- Our Contributors
- Anonymous Contributions
- Dispute an Article?
- Legal
- Terms of Use
- Privacy
- Copyright
stuck at sprint
16 Comments
Sprint's 'Against the Odds' Turnaround Looks Less and Less Likely
The sad part is that the entire truth still has not been disclosed. You are right on the money in regard to the atmosphere of fear that prevails at Sprint. (Particularly true if you are a legacy Nextel employee.)
As you recall from my previous posts, I forewarned that their bonds would hit junk bond status. That seemed to be almost a prophetic call as that has now occurred.
You may also recall that I inidicated that there are considerable issues with the creative accounting of commissions. If the statement above in regard to suits actually occurs I will tell you right now that it will be the complete unraveling of Sprint. Bankruptcy will be their only alternative.
The amount of money at stake here (in my opinion) may likely reach into the billions of dollars in regard to what the dealers and employees have been cheated out of. I am anxiously awaiting someone to file a class action suit which I will gladly give witness of what I believe is of evidentury value.
As you know I have now left Sprint and gone to a competitor. This after MANY years of devoted work as a Nextel then Sprint employee. THough I have just recently started, I am so far litterally amazed at the cultural difference in the organizations. I knew I was unhappy at Sprint, but in reflection I realize that I was just miserable and what a relief it was to leave that behind.
Sprint is in real trouble Ed. Their simply confusing plan will not be their saviour. Their media blitz (3 times average) of the new iphone clone will not save them either. The changes need to occur from within and that is not likely to happen in my opinion.
Though I try to make my predictions as literal as possible, there is information that I can not disclose even now due to prior confidentiality agreements, however I will make this prognostication for your readers. The nightmare with IPCS is going to hurt Sprint more severely than anything that has thus far occurred. One more prediction for you would be this. The first quarter earnings will be better than forecasted but this will be a temporary blip. Unless the new phone model somehow does wonders in June (which I predict it will not) then the second quarter earnings call will be an unmitigated disaster. Needless to say I will be selling my shares shortly after the Q1 call as I am expecting the stock to take a very brief bump upwards though I do not believe it will last.
Sprint's Hesse Continues to Show Leadership but Doubts Remain
You may be correct, or a may be a matter of semantics when you sau "the highest levels". I have personally brought forth a variety of these issues/concerns to two different area vice presidents and one regional vice president. I never had access higher than that, but in my role I had avp / rvp access and made the case. Though assurances were given that these issues would be examined and corrected, they never were.
Sprint's Hesse Continues to Show Leadership but Doubts Remain
If you recall there has been mention of Enron Like fraud at Sprint Nextel. If you read today's report titled: Ex-Sprint Employee Sues For Wrongful Firing, in the Honolulu Advertiser, you will see an example of some of the fraudulant activities that have (and I believe still are) occurring.
In my opinion this is just the beginning of a rash of suits that I believe will eventually be filled. In this particular case the fraud wasn't really perpetuated by Sprint, but I believe that they were certainly culpable (based upon the article) by telling this executive to "live with it" and then firing her 4 months later.
There is an awful lot of game playing going on here and at some point it is all going to come to light.
One of the biggest things that I feel will eventually hit is how the company is intentionally and WITH KNOWLEDGE cheating sales reps out of commissions. Here is how that game works.
As a rep I activate a phone and get credit for it. Now the customer wants to add a data service. In some cases to accomplish that the phone has to be briefly taken out of service and then put back in service. So the customer calls into customer care to have the data service added. Customer service removes the phone from service briefly creating a deact situation for me. Then customer service adds the data service and puts the unit back into service utilizing a HOUSE agent code. My deact means that my commission is charged back against me. The house code activation means that I do not get credit when service is restored. My net is zero, the companies net is one activation.
Doesn't sound like much? It happens thousands of times per week. That may not sound like much but adds up to what I believe is millions of dollars in lost commissions and the company KNOWS that it is happening.
Now the rep may appeal this. However if it occurred in the same month, the transaction (both activation and deactivation) don't even show up in the reps commission report.
If the action occurs in different months, the rep just assumes that the unit was deacted and most of the time does not realize that he/she was just cheated out of commission dollars.
There are so many examples like this. Some cheat customers, some cheat employees and in some cases employees are cheating the company. It's crazy. And worst of all the company is aware of ALL of it and does nothing.
Sprint's Hesse Continues to Show Leadership but Doubts Remain
I think that the part that you are missing is the idea that you are hearing from a small group of disgruntaled current and former employees. You (fairly) indicate that this is not a representative sampling. It is an accurate statement, but it misses the point I believe.
The discontent in this company reaches far beyond the few folks posting here. People loved what they were doing before the merger. People hate the company as it is right now.
The attitudes in the workplace are far worse than this small sampling conveys. We are discouraged, disillusioned and in short we no longer believe that this company has much value. It is a job. Until we can find something better. There is no passion to succeed as things stand today. The passion is about holding on until we can find a better job.
Today I accepted a job offer. It is an 11K cut in pay. It is worth it just to escape the constant depression, anxiety and disaster that this company has become.
The ironic part was that at the interview for this job I ran into TWO of my coworkers who were applying for the same position.
In break rooms and other places out of managements earshot, everyone seems to be talking about how bad they want out of here. There are even some friendly wagers as to who will be next to leave.
The hard part for me is that I have made some very close friends as I have worked here for nearly a decade. It is devastating to leave them behind. But not quite as devastating as watching the company that I loved so very much get gutted like a pig.
In a couple of weeks I will no longer be Stuck At Sprint. But Nextel will always own a piece of my heart. (Sappy I know but in reality it is very very true.)
If a poll were taken and if everyone that responded answered it truthfully, the net result in my opinion would be that in excess of 90% of the employees would indicate that this is not a nice place to work, that they are not cared about or for, that their opportunities to succeed are nearly nonexistant and that they believe that management is being overpaid for underperformance.
This is not a representative sampling. BUt I truly believe that the opinions and frustration that you see posted here is only the very tiniest tip of the ice burg. This company is not only in trouble, it is headed for a HUGE crash and burn.
And in my opinion, based upon what I have see thus far, Dan Heese does not have a clue as to how to save it.
Sprint's Hesse Continues to Show Leadership but Doubts Remain
First let me say it would be an honor to provide you with the requisite two glasses. I may even throw in a third as long as it had no affect upon your ability to objectively report.
In terms of the morale situation I am afraid that the comments are actually an understatement of the true situation as surprising as that may sound to you.
The recent layoffs were a real thorn in the side of long term employees. In my specific market it was actually quite a devastating thing to watch. Employees with many years of experience were cut in favor of others without any real concern as to the value of that employee. Ironically in my market 100% of those (no exaggeration) were legacy Nextel employees that were eliminated. Some of them litterally knew CEO's of top fortune 100 companies on a first name basis. It was illogical and from a long term basis will be harmful to our company.
But your specific question is in regard to how management must respond to garner front line support.
I am afraid that it is a very theoretical question as I must tell you that management (at least at a director and area v.p. level) is NOT walking the walk. Instead they are taking actions that are draconian to put it mildly.
If they really wanted to right this ship then a house cleaning needs to truly occur. From very senior levels all the way down to front line folks.
Sr. Management should publically announce that they are refusing ANY form of bonus plan during this crisis. Instead we get to read that they are being incented to reduce churn that is at least in part their fault to begin with.
They should present in a company wide meeting a strategic plan (obviously not all could be shared) that outlines the steps that this company is going to take to succeed.
They should present an organizational cohesiveness initiative to eliminate the us and them mentality. This however will never be effective until the affiliate situation is resolved.
They should adopt an attitude of success as a motto instead of the current attitude of cover your butt and blame somebody else for our failures as an organization.
I know that Dan has not had time to do all of this. Though your article basically calls for everyone to give him a chance, it misses the point that he is doomed to fail if steps are not taken in regard to his sr. management staff that has contributed so greatly to these problems.
Now you could argue that he has already made sr management changes. But if you look close, those changes include getting rid of Paul Saleh who all of us believed in as the financial guru that took Nextel to free cash flow over a year ahead of analyst predictions and performed exceptionally as the financial brains of Nextel. Changes like that we could do without.
Dan needs to completely END the current sales situation. Raising quotas is foolish during the current mass defections. Lowering our at risk money by ten percent and tieing that 10% to a churn reduction incentive for employees is seen as ludicrous immediately after he announced an anticipated 1.2 million sibscriber loss for the first and second quarter. The front line folks see this as just another way of reducing our income.
Since you are a former employee I am certain that you are familiar with the term PIP. Sales reps aer being put on PIP constantly now without anyone taking any time to evaluate the issue. A lack of sales performance by employees that have constantly overexceeded for the last 8 to 10 years indicates a much larger problem. If it was one or two people I could understand, but when 90% of the reps in our market fail to hit quota month after month, then the problem has got to be evaluated much clearer and it is unlikely to be the reps failure. However the solution to the failure is to raise quota's? This is senseless. If they want to walk the walk, then they must first define what that walk is.
I appreciate your optimism. But things are NOT getting better. They are deteriorating more rapidly than outsiders are aware of. Long term customer relationships are being severed. Our network continues to get worse (from the custoemrs perspective). Management (local and regional) has quit listening to front line at all. Sr. Management is being portrayed as greedy. Lawsuits are piling up. The affiliate has won yet another battle which has caused an incredible amount of fear and uncertainty with the employee and customer base. And what has been managements response?
They have not presented a strategic integrated plan. They have not responded to employees in regard to any of the lawsuits. They have announced new handsets and recently a new rate plan that we privately call simply confusing. They have demonstrated confusion and a lack of congruity. The act as if they were unprepared to respond to the court of appeals decision regarding the affiliate even though they have had 2 years to formulate a plan of action. They have eliminated valuable assets while providing a new incentive plan to senior management. They have raised quotas and lowered compensation. They have taken silly steps like eliminating coffee service etc., with no justifiable reason which makes working conditions just that much more unpleasant. They have created an atmosphere that makes it seem like management and employees are not even working at the same company. But worst of all, they have failed miserably to communicate with the employees in an effective manner which is a real shame for a communications company.
The question here is not how long they have to walk the walk, but rather when are they going to take the first step of that walk.
Sprint's Hesse Continues to Show Leadership but Doubts Remain
First, we are not allowed to use the name Sprint, have Sprint on our business cards, price lists, collateral etc.
Second, we are expected to carry an unmanageable quota with less than one half of a sales bag. And that quota just increased effective today.
Third, we are expected to be competitive with that half of a bag. This is extrodinarilly difficult in that the dealers in the area (indirect channel) are allowed to sell everything to our customers while we can sell IDEN only.
Fourth, we live with the uncertainty day by day as to how long we will be employed. Just a glance at yesterday's headline regarding the appelate court upholding the ruling in favor of IPCS that Sprint can not manage, maintain or sell IDEN products in their territory and absolutely NO formal response of any merit from our management leaves us dangling in the breeze.
Fifth, the competition is having our lunch by telling customers that IDEN is going to go away and presenting these same customers with a print out of the judgement from 2006 which was just confirmed by the appelate court yesterday. Already today I have had 15 calls asking if we are going to be shutting down the customers IDEN units in response to yesterdays announcement. The only response I can give them (approved by management) is that we are currently considering our legal options. Try to make a sale in that environment!!
Lastly, the company has decided to degrade our only differentiator (direct connect) by releasing High Performance Push To Talk on CDMA devices. This very name degrades IDEN as it implies that IDEN is not high performance since they are just introducing it. It also gives us no leverage over the affiliate as they now can compete with us IDEN salesmen without compunction.
One company? Not if you work in the affiliate market. We aren't even allowed to say that we work for Sprint. We have to say Nextel even in our voicemail greeting. The word Sprint is not allowed as it violates the affiliate non compete agreement.
So in answer to your statement ... WE ARE NOT ONE COMPANY. At least not in my area.
Sprint's Hesse Continues to Show Leadership but Doubts Remain
I am damn good at what I do, but if the company would offer me one tenth (100K) a year for the rest of my life to fail at what I do, I would happily take it and never look back!
The part that is really funny to me is that I can remember saying to my spouse (pre merger) that I was having so much fun in this job that I almost felt guilty taking a paycheck! Now I couldn't hate it much more than I do.
At Nextel we were part of a team. At Sprint we have no significant value.
At Nextel we were the underdog that was always finding new ways to win. At Sprint we are an embarrassment to the industry.
At Nextel we were all about growth. At Sprint we are all about retention.
At Nextel we believed that we were winners. At Sprint we believe that we are losers.
At Nextel there was always opportunity for advancement. We are all about improving the company and ourselves. At Sprint there is always room for a voluntary seperation agreement. We are all about covering our butt to retain our job until we find another.
At Nextel we shared in the success of the company with Stock Options and commission multipliers for over achievers. At Sprint the Sr. Management is the only one with options and they keep raising quota and have reduced your monthly at risk commissions by 10% yet they have a nice new bonus plan for the senior executives.
There are so many differences that one could nearly write a novel outlining them. But at the end of the day the primary difference is that at Nextel we believed we were part of the best and at Sprint we believe that we are of little value to the company and are just a tool to be used by management in their quest for their next multi million dollar pay day.
Sprint's Hesse Continues to Show Leadership but Doubts Remain
It sucks to be here becasue the wonderful company that we once worked for has been consumed in the supposed merger of equals.
It sucks to be here because our network. customer service, leadership, employee benefits, handset mix, and strategic vision have all become a laughingstock of the industry.
It sucks to be here because lawsuits are spreading left and right including one that will end up in front of the Supreme Court, the company has been accused of RICO violations, employee discrimination, and now gambling violations as well as failure to meet the FCC rebanding mandates.
It sucks to be here because our slogan went form how business gets done to how customers get screwed!
As far as resumes and job interviews, believe me MANY times MANY of us are looking and looking hard. Hopefully most of us will find one before the next round of cuts from our leadership.
Sprint's Hesse Continues to Show Leadership but Doubts Remain
Here is a prediction for you.
I predict that churn will be significantly less than the 1.2 million net subscriber loss that Heese announced for first quarter. I am betting that it will net out at half of that. The result will be an increase in our stock price and big fat bonuses to the executive committee that is now paid on churn reduction. There will even be a small amount of money given to sales for beating the churn prediction. But at the end of the day if my prediction is right it will still mean a loss of 600K customers but that will be overshadowed by the fact that it wasn't 1.2 million. So Heese scores a victory with Wall Street, the execs get a big payday and our company is still far worse off than it was at the beginning of the quarter.
If that doesn't happen for Q1 it would only be because it is such an obvious manipulation play, but it is bound to happen by end of Q2 which will be just fine with our Sr. Management and their new bonus compensation plan. (Q2 might be more logical so that Heese can get rid of a few thousand more of us after a disasterous Q1.)
In the meantime we get less and less (and not just compensation) and we continue to be undervalued and underappreciated while our company continues to go down hill.
I wonder if maybe they are beginning to realize how dumb it was to be the only major carrier that did not get approved on the big federal contract last year for instance. Or how rediculous it is to go to market without a strategic plan to win. But I feel like they really don't care as long as the execs pull in their big paydays. I hope that someone buys us at Sprint Speed (whatever that is supposed to be.)
Sprint's Hesse Continues to Show Leadership but Doubts Remain
Why would they authorize a 40 million dollar golden parachute for a CEO that has led this company into a disasterous situation?
Why would they condine a statement from Hesse indicating that the company is slated to lose 1.2 million net subscribers in the first quarter alone and an additional 1.2 million in the second quarter? Where is the urgency to correct that now instead of eventually?
Why did they condone the Xohm adventure before assuring that their current operations were first taken care of?
Why isn't the board demanding blood and the rolling of heads after the disasterous J.D. Powers report today over the atrocious state of our network? This report echos the previous disparaging reports by others that point out the obvious failures in customer service, network, customer satisfaction etc.
Why hasn't the board directed the CEO to finish the procurement of the remaining affiliates before throwing away billions on a Wimax shot in the dark that many anaylsts claim is due to fail before it even gets off the ground?
Why isn't the board demanding action in regard to the gaming of the system by Sprint employees who are deactivating IDEN units by porting them over to CDMA and receiving full commissionable credit even though they have actually sold nothing?
Why with the supposed increased focus on IDEN did the engineering budget for the enhancement of the IDEN network get cut by an enormous percentage in late 2007?
Why did the board back the decision of the previous CEO to eliminate an IDEN full QWERTY BlackBerry therefore eliminating the possibility of selling this device to clients (such as police) that require full qwerty functionality? (A very irritating problem in the affiliate territory.)
There is a lot wrong here. The need to fix it is now. Urgency should be paramount. However you have got to love the way they are handling things like churn. Let's throw more money in terms of bonuses to the fat cat executives that are so rediculously overpaid allready to reduce churn. Like anything they are going to do is going to make a significant difference. This should already be a significant part of their job. How dare the board condone this foolishness. The churn is where it is in part due to their previous failures. To incent them to fix it now is an insult to those of us in the field.
Since the merger, Sprint has removed our car allowances though gas costs are the highest it has been in U.S. history. It has removed the legacy Nextel Stock Option plans precluding us from sharing in the success of the company. It has eliminated merit increases for this year. It has reduced out monthly commisionable at risk money by 10% by moving that portion over to a churn factor for sales that it knows we can not hit based upon Hesse's own predictions of a 1.2 million net subscriber loss in Q1 and again in Q2. And to add insult to injury raised sales quota's beginning in April when the vast majority of the sales reps are not achieving them currently due to the mass exodus of our subscribers to the competitors. With all of this they also managed to terminate over 4000 staff. I wonder what percentage of that 4000 are at the executive level. I have not seen any of their positions eliminated that has not been backfilled.
As an employee I am ashamed to work for such a screwed up company currently. As a stockholder I am outraged at the decisions being made by Sr. Management and approved by the Board of Directors.
At This Price, Sprint Is a Steal for the Right Suitor
At This Price, Sprint Is a Steal for the Right Suitor
Undoing the Sprint Nextel Merger
Is it possible that the gaming goes up the food chain a lot higher than just local sales managers or market directors?
Why are the employees so afraid to talk? Why are so many of them googleing the "Whistle Blower Act"?
This company is in trouble and I believe that it will unravel completely. When it does, I beleive that people will privately refer to it as Enron II the sequal!
One Scenario for Sprint's Long Term Future
One Scenario for Sprint's Long Term Future
Now everyone sees all of the IDEN defectors and thinks that the demise of Sprint is the fault of Nextel. Let's write off all of the Nextel goodwill, let's spin off that company etc. The fact is that the number one cause of the massive defections is Sprint sale staff gaming the system to inflate their own commission checks. It's provable. If the company would investigate it properly their would be massive terminations for fraud. But that won't happen.
When we were Nextel, we believed that we were the best in the industry and consistantly went out and proved it. Our customer service was consistantly rated number one by industry anaylsts. Sprint's customer service is rated the worst.
If Motorola would have licensed the IDEN technology out to Nokia and Samsung and the others, then I believe none of this disaster would have occurred. But we should have seen this coming. Our advertising was basically prophetic in regard to it. When the slogan went from Nextel How Business Gets Done to simply Nextel Done it should have sent off warning signs to us employees. Unfortunately we were blinded by the fact that we worked for the best company in the industry and had given it 100% of our loyalty. If only they would have given back the same to us.