Shortly after he moved to the United States, Mike Zafirovski was asked by a high-school teacher to describe his home country of Macedonia. The 16-year-old and his family had just arrived in Cleveland, and the youth knew only a few dozen words of English. Nervous about his language limitations and realizing he was in a jam, he instead asked for three weeks to prepare a report. The classroom response was overwhelming. "It was the first time in my life that I received a standing ovation," he said years later. "I worked it to my advantage."
That kind of determination and focus has defined Mr. Zafirovski's life. Over the past three decades he has climbed to the top ranks at General Electric Co., Motorola Inc. and now Nortel Networks Corp.
But he will need those qualities more than ever now that he faces the toughest job of his life as chief executive officer of Nortel. Mr. Zafirovski, now 52, is the latest executive charged with getting the troubled telecommunications equipment maker back on track. The list of hurdles is long: Nortel's rivals are merging, the company is still cleaning up after a three-year-old accounting mess, it faces intense competition from Asian rivals and big customers are demanding lower prices.
But through the years, Mr. Zafirovski has developed a reputation as a corporate repair man. At the beginning of the decade, he steered Motorola's cellphone unit through the technology market crash and returned it to profitability. Before that, he had already turned around several GE businesses, according to a former boss.
More Report on Business Stories
"He's a great guy to be in a foxhole with," said Boeing Co. chairman and CEO Jim McNerney, who worked with Mr. Zafirovski at GE Capital and GE Lighting and now sits with him on the Boeing board. "He's one of those guys who is pretty fearless. People look at these big challenges and see the glass is half-empty. He's one of these people who sees the glass half-full and is stimulated by it."
While his successes at Motorola and GE inspire confidence, a 30-per-cent drop in the share price since he took the helm in November suggests investors still have plenty of worries about Nortel's future. Shareholders will get their first glimpse of the high-energy CEO, who has 20 half-marathons under his belt, at the company's annual general meeting on Thursday.
During his 25 years at GE, and nearly five years at Motorola, Mr. Zafirovski developed a reputation as an executive who can chart a new course for a company by building strong teams and making hard decisions.
"When I joined [Motorola's] handset business, it certainly provided a number of very practical opportunities, which I'm trying to reflect on," Mr. Zafirovski said in a brief telephone interview this month after the Brampton, Ont., company reported a first-quarter loss that had widened from the previous year.
Among the lessons he learned at Motorola was the importance of quality products, Mr. Zafirovski said. In addition, he believes Nortel has to make "strong" commitments to its customers and be frank with them about its problems. He declined a sit-down interview for this article, citing scheduling difficulties.
Even before he joined Nortel he had made a favourable impression on some customers. Bell Canada president George Cope said that when he headed Telus Corp.'s wireless business and was a customer of Mr. Zafirovski, then with Motorola, he found him direct and very attentive to his clients. That hasn't changed since Mr. Zafirovski moved to Nortel, he said. As a result, customers don't have to fear that there are unpleasant surprises lurking.
"I think Mike's made sure that we certainly are always aware what the issues are at Nortel," Mr. Cope said.
Nortel's many woes are well known. A slump in telecom equipment spending caused the shares to dive at the start of the decade, sparking one round of cost cutting after another. Just when things began to look brighter in 2003, Nortel was hit by a bookkeeping scandal that led to the firing of 10 executives, shareholder lawsuits and criminal and regulatory probes.
Mr. Zafirovski had some problems of is own during his start at Nortel. Shortly after his appointment, Motorola filed a lawsuit alleging the new job would put him in violation of non-compete agreements. The suit was settled with an $11.5-million (U.S.) payment, for which Nortel reimbursed Mr. Zafirovski. And his recovery plan suffered a big setback in March when Nortel revealed it would have to restate financial results again for the third time in as many years. By the end of April, Nortel had once again sorted out its bookkeeping.
