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Severance, Restructuring, and Acquisition Integration Activities | 12 Months Ended
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Dec. 31, 2016
Restructuring and Related Activities [Abstract] |
Severance, Restructuring, and Acquisition Integration Activities | Severance, Restructuring, and Acquisition Integration Activities Industrial and Network Solutions Restructuring Program: 2015-2016 Both our Industrial Solutions and Network Solutions segments have been negatively impacted by a decline in sales volume. Global demand for industrial products has been negatively impacted by the strengthened U.S. dollar and lower energy prices. Our customers have reduced capital spending in response to these conditions, and we expect these conditions to continue to negatively impact sales volume for these segments. In response to these industrial market conditions, we began to execute a restructuring program in the fourth fiscal quarter of 2015 to reduce our cost structure. We recognized approximately $9.7 million and $3.3 million of severance and other restructuring costs for this program during 2016 and 2015, respectively. We do not expect to incur any additional severance and other restructuring costs for this program. We expect the restructuring program to generate approximately $18 million of savings on an annualized basis, which we began to realize in the first fiscal quarter of 2016. Industrial Manufacturing Footprint Program: 2016 In further response to the industrial market conditions described above, in the first quarter of 2016 we began a program to consolidate our manufacturing footprint. The manufacturing consolidation is expected to be completed by the end of 2017. We recognized $17.8 million of severance and other restructuring costs for this program during 2016. The costs were incurred by the Enterprise Solutions and Industrial Solutions segments, as the manufacturing locations involved in the program serve both platforms. We expect to incur approximately $15 million of additional severance and other restructuring costs for this program in 2017. We expect the program to generate approximately $10 million of savings on an annualized basis, beginning in the second half of 2017. Grass Valley Restructuring Program: 2015-2016 Our Broadcast Solutions segment’s Grass Valley brand was negatively impacted by a decline in global demand of broadcast technology infrastructure products beginning in 2015. Outside of the U.S., demand for these products was impacted by the relative price increase of products due to the strengthened U.S. dollar as well as the impact of weaker economic conditions which have resulted in lower capital spending. Within the U.S., demand for these products was impacted by deferred capital spending. We believe broadcast customers have deferred their capital spending as they navigate through a number of important industry transitions and a changing media landscape. In response to these broadcast market conditions, we began to execute a restructuring program beginning in the third fiscal quarter of 2015 to reduce our cost structure. We recognized approximately $8.7 million and $25.4 million of severance and other restructuring costs for this program during 2016 and 2015, respectively. We do not expect to incur any additional severance and other restructuring costs for this program. We expect the restructuring program to generate approximately $30 million of savings on an annualized basis, which we began to realize in the fourth fiscal quarter of 2015. Productivity Improvement Program and Acquisition Integration: 2014-2016 In 2014, we began a productivity improvement program and the integration of our acquisition of Grass Valley. The productivity improvement program focused on improving the productivity of our sales, marketing, finance, and human resources functions relative to our peers. The majority of the costs for the productivity improvement program related to the Industrial Solutions, Enterprise Solutions, and Network Solutions segments. We expected the productivity improvement program to reduce our operating expenses by approximately $18 million on an annualized basis, and we are substantially realizing such benefits. The restructuring and integration activities related to our acquisition of Grass Valley focused on achieving desired cost savings by consolidating existing and acquired operating facilities and other support functions. The Grass Valley costs related to our Broadcast Solutions segment. In 2014, we recorded $70.8 million of severance, restructuring, and integration costs. In 2015, we recorded $18.5 million of such costs related to these two significant programs, as well as other cost reduction actions and the integration of our acquisitions of ProSoft, Coast, and Tripwire. In 2016, we recognized $2.6 million of costs, primarily related to our 2016 acquisition of M2FX. We do not expect to incur any significant, additional costs for this program. The following tables summarize the costs by segment of the various programs described above:
Year Ended December 31, 2016 | Severance |  | Other Restructuring and Integration Costs |  | Total Costs
|  |  | (In thousands) |  |
Broadcast Solutions | $ | (116 | ) |  | $ | 10,530 |  |  | $ | 10,414 |
Enterprise Solutions | 636 |  |  | 11,326 |  |  | 11,962 |
Industrial Solutions | 2,828 |  |  | 7,095 |  |  | 9,923 |
Network Solutions | 3,734 |  |  | 2,737 |  |  | 6,471 |
Total | $ | 7,082 |  |  | $ | 31,688 |  |  | $ | 38,770 |
Year Ended December 31, 2015 |  |  |  |  |
Broadcast Solutions | $ | 16,694 |  |  | $ | 22,384 |  |  | $ | 39,078 |
Enterprise Solutions | (186 | ) |  | 909 |  |  | 723 |
Industrial Solutions | 3,309 |  |  | 2,919 |  |  | 6,228 |
Network Solutions | (716 | ) |  | 1,857 |  |  | 1,141 |
Total | $ | 19,101 |  |  | $ | 28,069 |  |  | $ | 47,170 |
Year Ended December 31, 2014 |  |  |  |  |
Broadcast Solutions | $ | 20,025 |  |  | $ | 28,532 |  |  | $ | 48,557 |
Enterprise Solutions | 2,183 |  |  | 1,135 |  |  | 3,318 |
Industrial Solutions | 9,732 |  |  | 2,221 |  |  | 11,953 |
Network Solutions | 5,314 |  |  | 1,685 |  |  | 6,999 |
Total | $ | 37,254 |  |  | $ | 33,573 |  |  | $ | 70,827 |
The other restructuring and integration costs in 2016 primarily consisted of non-cash pension settlement charges due in part to our restructuring activities as well as equipment transfer, costs to consolidate operating and support facilities, retention bonuses, relocation, travel, legal, and other costs. The other restructuring and integration costs in 2015 and 2014 primarily consisted of costs of integrating manufacturing operations, such as relocating inventory on a global basis, retention bonuses, relocation, travel, reserves for inventory obsolescence as a result of product line integration, costs to consolidate operating and support facilities, and other costs. The majority of the other restructuring and integration costs related to these actions were paid as incurred or are payable within the next 60 days. Of the total severance, restructuring, and acquisition integration costs recognized during 2016, $12.3 million, $25.7 million, and $0.8 million were included in cost of sales; selling, general and administrative expenses; and research and development, respectively. Of the total severance, restructuring, and acquisition integration costs recognized during 2015, $9.4 million, $31.7 million, and $6.1 million were included in cost of sales; selling, general and administrative expenses; and research and development, respectively. Of the total severance and other restructuring costs recognized during 2014, $20.7 million, $46.5 million, and $3.6 million were included in cost of sales; selling, general and administrative expenses; and research and development, respectively. Accrued Severance The table below sets forth the activity that occurred for the programs described above with significant severance costs. The balances are included in accrued liabilities.
|  | Grass Valley Restructuring |  | Industrial and Network Solutions Restructuring
|  | (In thousands)
Balance at December 31, 2015 |  | $ | 12,076 |  |  | $ | 2,947 |
New charges |  | 886 |  |  | 2,919 |
Cash payments |  | (4,404 | ) |  | (1,967 | )
Foreign currency translation |  | 167 |  |  | 94 |
Other adjustments |  | (1,528 | ) |  | — |
Balance at April 3, 2016 |  | $ | 7,197 |  |  | $ | 3,993 |
New charges |  | 251 |  |  | 1,489 |
Cash payments |  | (3,356 | ) |  | (1,685 | )
Foreign currency translation |  | (13 | ) |  | (42 | )
Other adjustments |  | (360 | ) |  | — |
Balance at July 3, 2016 |  | $ | 3,719 |  |  | $ | 3,755 |
New charges |  | 148 |  |  | 1,287 |
Cash payments |  | (1,945 | ) |  | (743 | )
Foreign currency translation |  | 32 |  |  | 51 |
Other adjustments |  | (262 | ) |  | — |
Balance at October 2, 2016 |  | $ | 1,692 |  |  | $ | 4,350 |
New charges |  | 749 |  |  | 885 |
Cash payments |  | (829 | ) |  | (645 | )
Foreign currency translation |  | (90 | ) |  | (259 | )
Balance at December 31, 2016 |  | $ | 1,522 |  |  | $ | 4,331 |
The other adjustments in the three months ended April 3, 2016 and July 3, 2016 were the result of changes in estimates. We experienced higher than expected voluntary turnover, and as a result, certain approved severance actions were not taken. We expect the remaining amounts of these liabilities to be paid during 2017.

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- Definition The entire disclosure for restructuring and related activities. Description of restructuring activities such as exit and disposal activities, include facts and circumstances leading to the plan, the expected plan completion date, the major types of costs associated with the plan activities, total expected costs, the accrual balance at the end of the period, and the periods over which the remaining accrual will be settled. + References Reference 1: http://www.xbrl.org/2003/role/presentationRef -Publisher FASB -Name Accounting Standards Codification -Topic 420 -SubTopic 10 -Section S99 -Paragraph 2 -Subparagraph (SAB Topic 5.P.4) -URI http://asc.fasb.org/extlink&oid=27011515&loc=d3e140904-122747 Reference 2: http://www.xbrl.org/2003/role/presentationRef -Publisher FASB -Name Accounting Standards Codification -Topic 420 -SubTopic 10 -Section S99 -Paragraph 1 -Subparagraph (SAB Topic 5.P.3) -URI http://asc.fasb.org/extlink&oid=27011515&loc=d3e140864-122747 Reference 3: http://www.xbrl.org/2003/role/presentationRef -Publisher FASB -Name Accounting Standards Codification -Topic 420 -SubTopic 10 -Section 50 -Paragraph 1 -URI http://asc.fasb.org/extlink&oid=6394359&loc=d3e17939-110869 + Details
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