Lucent will reduce its workforce by an unprecedented 120 percent by the end of 2001, believed to be the first time a major corporation has laid off more employees than it actually has. Lucent stock soared more than 12 points on the news. The reduction decision, announced Wednesday, came after a year-long internal review of cost-cutting procedures. The initial report concluded the company would save $1.2 billion by eliminating 20 percent of its 108,000 employees. From there, "it didn't take a genius to figure out that if we cut 40 percent of our workforce, we'd save $2.4 billion, and if we cut 100 percent of our workforce, we'd save $6 billion. But then we thought, why stop there? Let's cut another 20 percent and save $7 billion. "We believe in increasing shareholder value, and we believe that by decreasing expenditures, we enhance our competitive cost position and our bottom line." Lucent plans to achieve the 100 percent internal reduction through layoffs, attrition and early retirement packages. To achieve the 20 percent in external reductions, the company plans to involuntarily downsize 22,000 non-Lucent employees who presently work for other companies. "We pretty much picked them out of a hat." Among firms Lucent has picked as "External Reduction Targets," or ERTs, are Quaker Oats, AMR Corporation, parent of American Airlines, Callaway Golf, and Charles Schwab & Co. Lucent's plan presents a "win-win" for the company and ERTs, said Schacht, as any savings by ERTs would be passed on to Lucent, while the ERTs themselves would benefit by the increase in stock price that usually accompanies personnel cutback announcements. "We're also hoping that since, over the years, we've been really helpful to a lot of companies, they'll do this for us kind of as a favor." Legally, pink slips sent out by Lucent would have no standing at ERTs unless those companies agreed. While executives at ERTs declined to comment, employees at those companies said they were not inclined to cooperate. "This is ridiculous. I don't work for Lucent. They can't fire me," said Kaili Blackburn, a flight attendant with American Airlines. Reactions like that, replied Schacht, "are not very sporting." Inspiration for Lucent's plan came from previous cutback initiatives, said company officials. In January of 1998, for instance, the company announced it would trim 18,000 jobs over two years. However, just a year later, Lucent said it had already reached its quota. "We were quite surprised at the number of employees willing to leave Lucent in such a hurry, and we decided to build on that," Schacht said. Analysts credited the short-term vision, noting that the announcement had the desired effect of immediately increasing Lucent's share value. However, the long-term ramifications could be detrimental, said Bear Stearns analyst Beldon McInty. "It's a little early to tell, but by eliminating all its employees, Lucent may jeopardize its market position and could, at least theoretically, cease to exist," said McInty. The company, however, urged patience: "To my knowledge, this hasn't been done before, so let's just wait and see what happens." Please see below temporary cost cutting exercises that all employees must adhere to! ACCOMMODATION All employees are encouraged to stay with relatives and friends while on business travel. If weather permits, public areas such as parks should be used as temporary lodging sites. Bus terminals, train stations and office lobbies may provide shelter in periods of inclement weather. Employees attending Global meetings are encouraged to sleep in the conference rooms but should not interfere with the cleaning staff. TRANSPORTATION Hitch-hiking is the preferred mode of travel in lieu of commercial transport. Luminescent safety vests and destination signs will be issued to all employees prior to their departure on business trips. Bus transportation will be used only when work schedules require such travel. Airline tickets will be authorized only in extreme circumstances and only the lowest fares will be used. The company intends to reach agreement with the cheaper airlines to have employees sent as baggage, thus greatly reducing unnecessary costs. MEALS Expenditure for meals will be limited to an absolute minimum. It should be noted that certain grocery and specially chains, such as Shoprite, Pathmark, A&P, Ali's corner shop etc. often provide free samples of promotional items. Entire meals can be obtained in this manner. Many churches provide excellent meals for free. Other patrons at these meals are an excellent source of local lodging recommendations. Travelers should also be familiar with indigenous roots, berries and other protein sources available at their destinations. Employees are encouraged to bring an implement such as a small hammer stick with which to stun pigeons for cooking on a travel iron (not provided). Recipes will be provided but spices should be brought from home. If restaurants must be utilized, travelers should use "all you can eat" salad bars. This is especially effective for employees traveling together as one plate can be used to feed the entire group. Employees are also encouraged to bring their own food on business travel. Cans of tuna fish, Spam, and baked beans can be consumed at your leisure without the necessary bother of heating or costly preparation. MISCELLANEOUS All employees are encouraged to devise innovative techniques in an effort to save costs and these will be taken into account at the next pay review. One enterprising individual has already suggested that money could be raised during airport waiting periods which could be used to defray travel expenses. In support of this idea, red caps will be issued to all employees prior to their departure so that they may earn tips by helping others with their luggage. Small plastic company logo badges and ball point pens will also be available to employees so that sales may be made as time permits. Basking or crowd entertainment at airports is also encouraged as large amounts of foreign currency can be obtained in this way.