On January 29, 1998, the same day as the decision on WCDMA as the 3G standard was made in Paris, it was announced that Ramqvist was to step down as CEO at the next annual general meeting on March 30. It was proposed that he succeed Björn Svedberg as chairman of the board.

There had been a lot of speculation about who was to succeed Ramqvist, but nobody had tipped Sven-Christer Nilsson. Nilsson was head of Ericsson’s operations in America and was therefore working two levels below top management. He had distinct profile as a computer expert and was an advocate of IP technology, which was significant in a company still haunted by AXE-N.

In the spring of 1998, Håkan Eriksson was about to have his annual performance review with his boss, Nilsson, in the US, when, as result of Nilsson’s promotion, his secretary rang and cancelled the meeting. Eriksson was not particularly surprised at the choice of the new CEO. “From an Ericsson perspective, in our unit, which was working with a different standard, we were underdogs in a way, but Sven-Christer had had good results and we considered him to be an excellent leader. He had put together a strong team but that was because he was the kind of boss who attracts competent people.”

One of Nilsson’s first decisions was to arrange a conference on IP. Eriksson was given the job of choosing who to invite. “I was supposed to select the 30 people in Ericsson who had the most interesting expertise, without bothering about what level they were working at. So I didn’t care about that, either,” he says.

The conference on the internet in 1995 had taken place at Södertuna Castle. Now the selected participants met at Plevnagården, a stone’s throw from Södertuna.

"WE HAD MISSED THE IP-BOAT"

Nilsson says: “It was obvious that we had missed the IP boat. But there was a strong tradition of ‘skunk works’ in the group, which has always been one of the factors behind Ericsson’s success. All our major successes have come from individuals who have not been accepted by the management. And it now turned out that we had IP development in 15 or 16 places across Ericsson. The previous management probably knew nothing about most of it.”

He maintains that he does not consider AXE-N a fiasco. “AXE-N had taken 5–10 percent of the development budget for eight years. But using 5–10 percent of the budget for professional development in an organization based on competence gives training that is worth its weight in gold. So although AXE-N could never be mentioned by name, the expertise was still there. It was probably one of the largest continuing professional development projects ever in Sweden.

“The mistake with AXE-N was the belief that the world needed larger exchanges. But a lot of the ideas were pure genius. If they had gone in for small exchanges instead, AXE-N could have been a success,” he says.

Author: Svenolof Karlsson & Anders Lugn

LARS RAMQVIST

Lars Ramqvist has left his post as CEO at Ericsson and now, as chairman, presents good share-value figures for the 1998 annual meeting.

© Telefonaktiebolaget LM Ericsson and Centre for Business History

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