Wayne Williams

The Williams family knows a little bit about recessions. After all, they founded Telect in 1982 in the middle of an economic downturn.

But Bill Williams Jr., his wife Judi and son Wayne saw opportunity in the midst of a deregulating telecom market. So Telect began as a manufacturer of custom cable assemblies and expanded its offerings to include digital cross-connects.

Now 19 years later, Wayne Williams has assumed the role of president and CEO of the company — and again the economy is in a slump. “Like everybody else, we're weathering it. It's been difficult. I don't think we've seen an all-market downturn… for this part of the telecom sector since about 1991,” he says.

Although Telect has grown in those 10 years, Williams says the impact on the company has been greater because so many more people are affected. Although Williams couldn't give specific numbers, he said that Telect has cut 15% to 20% of its 1400-person work force, which he says has been par for the course in the industry.

“We have been very aggressive in reducing our costs for travel and entertainment as well as for our capital expenditures. We just unfortunately haven't been able to support the current level of business,” Williams says.

However, Williams does see light at the end of the tunnel.

“The market itself is still a good market,” he says. “The customers are out there buying. It's just that you have to bring your business back. It's like going from 120 miles per hour to 20 miles per hour, and it feels like you're standing still.”

Therefore, changes in strategy are necessary, he says.

“It wasn't until probably January that a lot of companies could start having visibility of what their customers were doing, even though December was soft,” he says. “We had to revise our budget and forecasts seven times since November.”

Still, the thing that Telect and most other companies still lack is visibility into what the customer can spend. Things have changed since the halcyon spending days of 1999 and 2000.

As an antidote, Telect is relying on its established main themes. Williams says Telect has expanded on its ideals of keeping close to the customer to ensure that perceptions of the company remain positive and customers don't run scared. “The retention of customers kind of goes along with our philosophy from day one. Be in the face of the customers, treat them really well, treat them with respect, be honest with them and maintain integrity.”

Ultimately, Williams sees this climate as an opportunity. “I think Cisco started right after our 1987 crash. So there's going to be investment coming into this marketplace with technologies that could be disruptive,” he says. “Anybody out there not paying attention to new technology at lower cost is in jeopardy.”