Adtech may have to lay off workers
By John Duchemin
Advertiser Staff Writer
With its president departed and a new leader in place, Adtech is on the verge of a tough period that may include job cuts to cope with a sharp slowdown in the telecommunications industry, according to officials' comments.
Former Adtech President Tareq Hoque, who resigned suddenly Wednesday afternoon, said he left the company because of concern over its management style and future direction — and implied that Adtech's 360 Hawai'i employees would soon hear some grim news.
In an interview yesterday morning, Hoque said he resigned in anticipation of an event that, "when it happens, will be self-evident," hinting that the Kaimuki-based telecommunications testing company would either lay off workers or shift its focus out of Hawai'i.
Adtech's new president, Alan Sguigna, acknowledged yesterday that the company is facing slower revenues and did not rule out layoffs to help maintain profitability. The company this year has enacted a hiring freeze and in June ended negotiations to build a headquarters building in Kaka'ako, blaming the business slowdown.
"I have to continue to build a solid base for the company and make sure we are being effective and competitive in the utilization of our resources," said Sguigna, Adtech's former vice president of marketing.
"I will do whatever I can to minimize the impact of the economic downturn on this company. ... but I have to constantly look at ways to operate more effectively and battle the competition. We are profitable — one of the most profitable divisions in Spirent — and I have to continue that."
But he said the company will not leave Hawai'i.
"Categorically no to that," he said. "There are no plans to move Adtech to the Mainland, or move jobs to the Mainland. Our core competency and the company's infrastructure is here in Hawai'i. You can't just pop that up, transport it 2,500 miles, and plop it down. Adtech is 100 percent committed to staying here."
Sguigna said the company may consider starting new autonomous projects on the Mainland. Adtech's Hawai'i operations have been strained by lack of space; the company is spread over several buildings in Kaimuki and downtown Honolulu.
Adtech, one of Hawai'i's most high-profile technology companies, is a division of British corporation Spirent Communications. Buyers of Adtech's communications network test equipment include Cisco, Lucent and Nortel — all of whom have been hammered by losses and layoffs this year.
Spirent in June reported a slowdown in second-quarter sales of its telecom test division, of which Adtech is a key part. Adtech in May said revenues should exceed the $150 million earned last year. But Sguigna said yesterday he "didn't have visibility far enough ahead to be able to say that."
"Whether we hit the $150 million mark is really up in the air," he said. "We are a large telecommunications company, and for better or worse, we are being hit with the same challenges prevalent in the rest of the industry."
Hoque said he left the company over "irreconcilable differences" with other senior executives at Spirent, the British multinational firm that bought Adtech in 1997.
"It became apparent that we couldn't proceed further without serious compromise on either one of our parts," he said.
He said the company is becoming more top-heavy and risks losing the creativity and nimbleness that led to several years of growth and dominance in the high-speed communications test equipment market.
"I think the individuals at Adtech have really shown they have what it takes to succeed in a very challenging market," Hoque said. "If they're left to themselves, they certainly have the ability to weather the storm. Unfortunately, they aren't being left to themselves."
Sguigna said Adtech's corporate personality has definitely changed, but that it has maintained its innovative spirit.
Hoque, 35, said he plans to start a new company, probably in the data communications area. He says Adtech's success has verified for him that Hawai'i has the capacity to be a high-tech center.
