Mitel CEO Rich McBee Outlines Key Changes to Company Strategy and Organization

  • Mitel Hospitality
  • 05.04.11
Mitel (Nasdaq:MITL), a leading provider of unified communications and collaboration software solutions, announced key changes to its business strategy.


 Mitel will simplify its organizational structure, focus R&D investment for the mid market, and realign sales and channel in the U.S. Rich McBee, Mitel's CEO, made the following statement regarding these changes:

"In evaluating the market opportunity for Mitel, I've spent the last three months speaking with, customers, channel partners, industry analysts, shareholders and our internal team. As a result, I am implementing a strategy anchored by three initiatives in a multi-step approach to grow Mitel's business as a unified communications and collaboration provider.

"First, we will simplify our business. This means creating a flatter organization comprised of two geographical sales organizations and three key business units. This new, more agile organizational structure will enable Mitel to better serve its customers and innovate more quickly, all with the goal of increasing shareholder value."

Mitel sales will consist of Americas and International organizations. Philip Keenan is promoted to executive vice president of Americas sales with responsibility for the U.S. and Canada while Graham Bevington is promoted to executive vice president of international sales with responsibility for Mitel's operations in Europe, Middle East and Africa (EMEA), Asia Pacific, and Caribbean and Latin America (CALA).

Mitel communications solutions: responsible for delivering unified communications and collaboration products and services to businesses. Ron Wellard is promoted to the role of General Manager and Executive Vice President.

Mitel NetSolutions: responsible for network and hosted services, mobile services, and broadband connectivity. Jon Brinton will continue to lead this business unit as the general manager.
Mitel DataNet: responsible for the distribution of third-party products to partners and customers. Ryan Donovan is promoted to the role of general manager.

Mitel is also announcing the departure of Paul Butcher, Mitel's president and chief operating officer effective April 30, 2011. In addition to his existing role as CEO, Rich McBee has assumed the role of president and the chief operating officer role has been eliminated.

McBee said, "The second initiative will see a re-direction of our R&D investment to products serving the high-growth market of 100 to 2,500 user organizations. We are committed to our Freedom architecture which is being well received by customers around the world looking to capitalize on existing infrastructure investments and create a best-in-class communications solution. We will continue to innovate in this area to provide flexibility to both IT and the end user and to take advantage of the opportunity in the mid market segment.

"Third, we will reorganize our U.S. sales organization to more effectively deliver our products through partners by increasing our investment in our indirect channel, facilitating growth and expansion at local, regional, and national levels. We will also focus our direct sales team on a select group of customers.

"Additionally, we intend to exploit our significant market leadership in voice virtualization. This means continuing to partner with virtualization leader VMware to jointly innovate in this area. This has been a differentiator for Mitel in acquiring new customers and providing a migration path for existing Mitel 3300 IP communications platform customers to virtual Mitel communications director. Our customers have made it clear to us that virtualization is a priority for them and, as a result, it is a strong priority for us as well.

"In conclusion, we have excellent products and technology. By implementing this strategy, we are aiming to better serve Mitel's customers, improve Mitel's performance, and grow operating results for Mitel."

Financial Update

Mitel reiterated its revenue and non-GAAP financial guidance for the fourth quarter as provided in its prior quarterly earnings press release dated March 1, 2011. In connection with the changes in its business strategy and organizational structure announced today, the Company will incur a non-recurring charge in the fourth quarter of fiscal 2011. The charge will not impact non-GAAP operating expenses or any of the other non-GAAP outlook provided in its previous press release. The Company will provide details of these charges and information about its fourth quarter and full-year results on its regularly scheduled fourth quarter conference call on Thursday, June 30, 2011.

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