Ericsson gives Nilsson pink slip

Ericsson has traveled a rocky road during the first half of this year, stumbling under the shadow of its powerful Nordic neighbor Nokia and falling short of last year's profits. In response, Ericsson's board last week decided to dump Sven-Christer Nilsson as CEO and president. Kurt Hellstrom, who was executive vice president of Asia Pacific for Ericsson, will fill the role of president, and Lars Ramqvist will serve as both CEO and chairman of the board.

The company also has decided to eliminate 14,000 jobs. "The decision made by the board is a clear one," Ramqvist said. "We need to improve the profitability and long-term growth of Ericsson."

Although the board apparently did not enjoy the rapport it had hoped for with Nilsson, it fully supports his restructuring plans and strategies for future growth and intends to continue to implement them. "We need to improve the pace of the plans," Ramqvist said. "Expeditious leadership is really what this is all about."

Last September Nilsson defined a major company re-organization that formed three new segments and four new corporate offices.

Ramqvist still hopes to meet Nilsson's objectives, including the goal of 20% growth next year. Ericsson also will continue to pursue his acquisitions strategy geared toward building a strong data communications and IP business.