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mgmt memo


Vol. 11, No. 2____________________________________________________________ March 1992

 

"MGMT MEMO" was written by Richard Seltzer in Corporate Employee Communication for the Office of the Presi­dent. It was written for Digital’s managers and supervisors to help them understand and communicate business information to their employees. You can reach Richard at seltzer@seltzerbooks.com

 

CONTENTS

 

Architecture for the 1990s (Ken Olsen)                                                                                      

 

The architectural goal of the 1990s is to win back those industries that we lost in the 1980s. We need to organize to satisfy the customer needs of all industries. Some of these needs may seem mundane or trivial, but yet are very necessary. Some customers require special software, or simply brackets and electrical adapters. This means our Industry Marketing groups must take an intense interest in their customers’ needs, and responsibility to ensure we fulfill those needs.

 

Product Development Based on Customer Needs (Ken Olsen)                                                  

 

In the past, as is true in most computer companies, our Engineering groups chose and developed the products, and Marketing and Sales then had the job of getting them to cus­tomers. We are changing our approach to product development to one that is traditional in other industries and that, due to changes in the computer industry, is now more appropri­ate for us. Marketing and Sales will define the needs of the customer, and Engineering will generate the products to fill those needs.

 

New Organizations Focus on Global Information Systems and Systems for Departments and Medium and Small Businesses (Ken Olsen)         

 

Frank McCabe has been put in charge of our Global Information Systems, which includes "mainframe computing" or "production systems." He will be responsible for planning, organizing and running all our activities in these areas. Meanwhile, Charlie Christ has been put in charge of Digital’s Departmental, Medium and Small Business group. He will be responsible for ensuring we have an integrated set of hardware and software products for small and medium-size companies, and also for departmental and office computing. He will integrate our offerings into a smaller set of hardware and software that will satisfy customer needs in a way that is easier to understand, easier to design and easier to learn.

 

Digital has Re-Entered the Personal Computer Business (Ken Olsen)                                      

 

We have developed an extensive plan for designing and manufacturing our own personal computers. Until recently, this has not been part of our activity; but from now on. it will be a key part of our personal computer business. Our Catalog Sales Group will define the high production machines, and our Engineering groups in several areas of the world will design them. These personal computers are being built from sub-assemblies made in Digital facilities, or purchased from other vendors, and manufactured in the U.S.. Canada. Europe and Asia.

 

Evolving the Organization to Grow Marketshare (Jack Smith)                                                            

 

We’re focusing our energies on those products and services that are needed to do the whole job for the customer. We need to be more market-driven, to allocate our investments based on clearly understood customer needs. We must limit what we do so we can do it with excellence and market it completely. We will optimize our product cost and quality by using a small number of common parts designed to disciplined standards. To grow market- share, we need to be leaders in all the industries identified for us by Industry Market­ing. We’ll provide leadership in our industry by guaranteeing information system solu­tions - products and services for global enterprises, departments, and smaller enter­prises — based on client-server computing.

 

How to Talk about Alpha                                                                                                                      

 

Alpha is the first of a new generation of full 64-bit RISC computing architectures. With the capability for a 1000-fold increase in speed, this architecture has been designed to endure for at least 25 years. It supports multiple operating systems, beginning with DEC OSF/1 and Open VMS. The first Alpha product - the 21064 - is the industry’s fastest microprocessor.

 

Alpha Marketing Strategies (Ed Pastor)                                                                                               

 

The Alpha program embodies all aspects of Digital’s Open Advantage. Alpha is the basis for Digital to be the industry’s technology and solution leader through the 1990s and into the next millennium.

 

DECWORLD Strategy (Deb Nicholls)

DECWORLD ’92, scheduled for April 27 to May 15, will be an international event, held at one location — the World Trade Center in Boston, Massachusetts. We anticipate 25.000 visitors, each staying for an average of two and a half days. This will be a proof point of the Open Advantage campaign.

 

Removing Barriers for People with Disabilities (Jim Cudmore and Jack Rugheimer)

Several years ago, a group of senior managers and other people concerned about the treat­ment of people with disabilities formed a Disability Strategy Committee, with represen­tation from various organizations and disciplines throughout the company. Today, we have the beginnings of an organized approach to dealing with access to computer and communi­cation equipment, access to facilities, revisions to policies and general awareness.

 

Making Profits Selling Components and Manufacturing Capability (Jim Willis)                                

 

Digital’s investments in component-level research and development (R&D) result in an increasing flow of leading-edge base technology — fundamental building blocks necessary for development of world-class systems and solutions. This hardware and software can be profitably sold as separate, volume commodity products, in addition to their use as parts of complete computer systems. And Digital’s expertise in designing and building them can also be sold for a profit.

 

Tracking Profit in Systems Integration Programs (Fran Maycock)

We are developing a management tool to collect cost and revenue information from many different organizations to track profits by customer program. This initiative — Customer Program Reporting (CPR) — is designed to meet the business and financial management needs of Digital’s rapid growing Systems Integration business. The information CPR will make available is analogous to what the New Management System (NMS) provides to Business Unit managers.

 

Architecture For The 1990s by Ken Olsen, president

 

In the 1960s and early 1970s, our approach to business was industry-oriented. We had many groups, each of which was driven to supply all the needs of their industry. We also had a core of computers and peripherals, and developed a variety of computer architectures and operating systems. The results were great.

 

In the early 1980s we shaped the company around a simple, elegant systems architecture. We committed to one computer architecture, one operating system, one protocol and one networking system, and a method of tying them together in clusters. The results were great.

 

But with our great success in systems architecture, we let the emphasis on industries and customer needs slide. We invested huge sums of money in systems that were elegant; but because we lost the concentration on the industries and because we did not develop the myriad odds and ends of non-architectural equipment and software each industry needed, we lost our position in those industries where we had excelled a few years earlier.

 

In the 1990s, we can no longer have one architecture because our customers have insisted on having several, and most customers have not yet learned to tie their various systems together. Additionally, computer architecture is a smaller part of our overall effort because the architecture is largely concentrated within the chip.

 

The architectural goal of the 1990s is to win back those industries that we lost in the 1980s. We need to organize to satisfy the customer needs of all industries. Some of these needs may seem mundane or trivial, but yet are very necessary. Some customers require special software, or simply brackets and electrical adapters. This means our Industry Marketing groups must take an intense interest in their customers’ needs, and responsibility to ensure we fulfill those needs.

Product Development Based On The Needs Of Customers by Ken Olsen, president

The press has recently reported many changes at Digital, most of which I do not recognize at all. Indeed, there is a lot going on in the company right now, and people are working very hard — particularly because DECWORLD is just two and half months away. DECWORLD is our opportunity to present all our products in one place and in one consistent array. Everyone aims to have all their products rationalized, organized, and presented in a complete program for that event. This means we quickly fill in any gaps in our offerings, change things that do not look right and sometimes cut products that do not fit or are easy to postpone.

 

Sales people and customers consistently complain that we have too many products. In the past, as is true in most computer companies, our Engineering groups chose and developed the products, and Marketing and Sales then had the job of getting them to customers. We are changing our approach to product development to one that is traditional in other industries and that due to changes in the computer industry is now more appropriate for us. Marketing and Sales will define the needs of the customer, and Engineering will generate the products to fill those needs. This may sound like an uninteresting change, but it means developing fewer products and concentrating attention on products which would not have been developed in the past because, although customers want them, they are in areas which seemed too specialized for Engineering.

 

The goal of having fewer products is to make it easier to sell what we have, to allow us to spend more on the specialized products needed for each particular industry and to allow us to invest more on development of products for the future. It may turn out that we end up spending less on Engineering. However, as we carry out this program, it is also pos­sible that we will find it is wise, in some areas, to spend more as we focus our efforts specifically on the needs of customers.

 

We are sometimes criticized for not making product decisions from the top by edict in a very fast, efficient way. It has been our experience that any one person, particularly at the top, has too narrow a view of the world to lay out product plans. Product plans are a combination of years of experience, observation, and study by those people who are close to the market and close to engineering. Products have to come from these areas — from the many people who have the experience and knowledge - even though it may appear less efficient than deciding on products by edict. That will continue as we shift the emphasis in our product development to the needs of the customer, as defined by Marketing and Sales.

 

New Organizations Focus On Global Information Systems And Systems For Departments And Medium And Small Businesses by Ken Olsen, president

 

Frank McCabe has been put in charge of our Global Information Systems, which includes "mainframe computing" or "production systems." He will be responsible for planning, organizing and running all our activities in these areas.

 

Minicomputers have often approached the capability of mainframes, but most of the time are not used in the environment that had the discipline of mainframe computing. PCs and workstations often have the computation speed of a mainframe but are far from its input/- output capability, and very far from the discipline of mainframe computing.

 

Mainframe computing takes place, by tradition, in a production shop that produces large amounts of computing, on schedule, with great reliability, discipline and security. It is inconceivable that payroll checks not be completed when due, or that critical business data be lost. In many organizations, it is intolerable not to have marketing data gener­ated from the previous day’s sales available the first thing the next morning.

 

We have had great successes with our VAX 9000 mainframe computer, but we also had some problems. Our Service people say only one percent of the problems were hardware related. All others were problems in scheduling, organizing and disciplining the applications put on the machine. We made the mistake of not including in the price of the computer, a full-time consultant systems engineer to help organize the software to ensure it ran efficiently and well.

 

Today, many companies distribute their mainframe computing around the world, which makes the networking and communication disciplines more critical and more challenging. These are areas in which we have a lot of experience, and will probably be one of our big con­tributions to this part of the industry. Because of the importance of the global nature of mainframe computing, we have titled the organization the Global Information Systems Group.

 

Frank McCabe will be responsible to make sure we have an organized, disciplined approach to this most organized and disciplined market. We have exciting products for our main­frame customers, and Frank will balance these with the discipline they need.

 

Meanwhile, Charlie Christ has been put in charge of Digital’s Departmental, Medium and Small Business group. Because of our expertise in products and networking, we have been a leader in the integrated office. Charlie will be responsible for ensuring we have an integrated set of hardware and software products for small and medium-size companies, and also for departmental and office computing. Charlie will integrate our offerings into a smaller set of hardware and software that will satisfy customer needs in a way that is easier to understand, easier to design and easier to learn.

 

Digital probably has, by far, the largest private computer network in the world. We tie

 

all 120,000 thousand people together. We have over 80,000 computers on our multi-vendor, multi-protocol, internal network, and people from terminals and other desktop devices can instantly share data, mail, drawings, documents and images. Above all, our network allows Digital to form teams — some ad hoc and short-term, and some permanent — that work together in spite of the fact that the members might be spread around the world. This networking has been a key part of Digital’s growth and success through the years.

 

Charlie’s job will be to show how small and large organizations can use this communication and networking to build teams within an office and across a company. In addition, he is responsible for providing all the computing capabilities normally used within a department or a small company.

 

 

 

Digital Has Re-Entered The Personal Computer Business by Ken Olsen, president

 

Since we re-entered the personal computer business a few years ago, we have done quite well. Our PC Group under John Rose explored ways of marketing and selling, and developed effective strategies. We started by buying PCs from other manufacturers with the advan­tage of offering our customers the best of what was available. To serve our customers better, we also tried different ways of selling and marketing to find the most effective and efficient and settled on catalog sales as the best tool. Catalog sales give us the opportunity to provide information to our customers in a concise, simple format, and allows them to design, choose and learn.

 

Our catalog people organize the family of computers they want and order them either from in-house Engineering and Manufacturing, or sometimes from other vendors. They also de­velop marketing plans, literature, pricing and sales strategy.

 

Our PC Group successfully defined the market in which we are interested, identified our approaches to computers, and helped to develop catalog sales. The results look very promising and we are enthusiastic about them.

 

Now we are ready to move on to the next stage in this business. The success of developing an effective marketing tool means we will now concentrate on that tool. We are, there­fore, combining our PC Group and our Catalog Group into one organization which will be called the "Catalog Sales Group."

 

Meanwhile, we have developed an extensive plan for designing and manufacturing our own personal computers. Until recently, this has not been part of our activity; but from now on, it will be a key part of our personal computer business. Our Catalog Sales Group will define the high production machines, and our Engineering groups in several areas of the world will design them. These personal computers are being built from sub-assemblies made

 

in Digital facilities, or purchased from other vendors, and manufactured in the U.S., Canada, Europe and Asia.

 

The personal computer business is exciting and ever-changing. While the technology con­tinues to improve, the price of the product keeps going down, and the cost of doing busi­ness must also go down.

 

Selling PCs is a classic business problem. Unlike most of the computer business, every cost detail and activity is critical to its success. The capital investment is low, but so is the profit level. Even the most minute cost is critical. We need to look at every detail of logistics and distribution problems. We can’t tolerate extra charges for handl­ing, shipping or warehousing.

 

Personal computing is a natural business for Digital, and we have been consulting with customers on these activities for years. While the rest of the world sees the PC market slowing down, we are looking forward to significant continued growth in the PC business.

 

 

 

Evolving the Organization to Grow Marketshare by Jack Smith, Senior Vice President, Operations

 

in our effort to do a much better job of delivering complete solutions to customers, we're continuing to evolve our organization and the new Management System. We’ve assigned a few senior people to new responsibilities and have made some other organization changes with the aim of simplifying our operations to better meet the needs of important sets of cus­tomers. The most significant organization changes are in Marketing, where Bill Johnson now heads Industry Marketing, Frank McCabe has Global Information Systems Marketing, and Charlie Christ leads Departmental and Small-to-Medium-Enterprise (SME) Marketing.

 

The Global and Departmental Marketing roles are new, and we’re still refining them. Basically, our intention is to deliver more complete solutions for targeted sets of cus­tomers. That will require the new marketing groups to do technical work in the area of systems engineering and integration of software, hardware and third-party applications. At the same time, they must also work with Engineering to sharpen our product direction.

 

We intend to take full advantage of our technological leadership and experience in being able to solve very complex customer problems. We have a strong headstart over everyone else in the industry in our approach to multivendor systems integration with Network Application Support (NAS). Today, all the complex and interesting customer problems are multivendor ones. Many are even multi-customer, involving information transfer between a company and its suppliers and customers.

 

Basically, we’re focusing our energies on those products and services that are needed to do the whole job for the customer. We need to be more market-driven, to allocate our investments based on clearly understood customer needs. We must limit what we do so we can do it with excellence and market it completely. We will optimize our product cost and quality by using a small number of common parts designed to disciplined standards. To grow marketshare, we need to be leaders in all the industries identified for us by Indus­try Marketing. We’ll provide leadership in our industry by guaranteeing information system solutions — products and services for global enterprises, departments, and smaller enterprises — based on client-server computing.

 

We recognize the importance of professional disciplines that are central to our business. We’ve developed a framework around "key competencies" to focus our long-term investments and develop our people in such areas as Marketing, Engineering, Manufacturing, Services and Sales. At the same time we need to institutionalize education and development to support our strategies and competencies. We’ll retrain people as program managers, sys­tems engineers and software specialists to sustain our future business growth in systems integration and consulting and services.

 

We have developed a unique style of working in this company. We emphasize both teamwork and leadership. Our products and services mirror that style — enabling different pro­ducts from different vendors to work together, as well as enabling the people who work for our customers to work as teams. That’s the essence of the Open Advantage.

 

We can’t help but be optimistic when we see the enthusiastic reactions of analysts and customers to our strategy. Years of effort and many millions of dollars of investment are coming to fruition in a new generation of computer products that could revolutionize the industry. This is happening at a time when we are faced with the hardest challenges in our company’s history. We need to fully appreciate both the difficulties we face and the enormous return that is at stake. Strategies and organizational change mean little unless plans are executed in a timely and professional manner. Hard work is very important, but not enough on its own. To operate as a team on a global scale, we need to follow through on our commitments. We need to be able to count on one another, predictably, to seize the opportunities that are within our grasp.

 

 

 

How To Talk About Alpha

 

(The following article is intended to help mangers better understand this important new direction for the company so they can explain it to their employees.)

 

Alpha is the first of a new generation of full 64-bit RISC computing architectures. With the capability for a 1000-fold increase in speed, this architecture has been designed to endure for at least 25 years. It supports multiple operating systems, beginning with DEC

 

OSF/1 and Open VMS. The first Alpha product - the 21064 - is the industry's fastest microprocessor.

 

Alpha offers open business practices (licensing the architecture; sale of chips, boards, and systems; and licensing of Digital software for all Alpha systems,) It also means open services (partner services and customer services). Digital is establishing partnership with semiconductor companies, other computer vendors, OEMs and software application pro­viders to build volume and firmly establish the leadership of this new architecture.

 

Alpha both enhances Digital’s current products/services and opens new business opportuni­ties. Digital will provide clearly defined upgrade paths to Alpha from current products, and will provide services for integration of new technologies. Alpha systems will extend and complement today’s VAX and DECsystem products by plugging into the same networks and clusters and sharing the same software, data and applications. At the same time, Alpha will generate new opportunities, in areas such as mainframes, high-performance UNIX ap­plications, OEM markets, and new services.

 

 

 

Alpha Marketing Strategies by Ed Pastor, Alpha Market Development manager

 

On February 25, at press events in Hudson, Mass., South Queensferry, Scotland, and Tokyo, Japan, Digital announced Alpha — the industry’s first 64-bit RISC computing architecture designed for the twenty-first century, and the first Alpha product—Digital’s 21064 micro­processor, the industry’s fastest.

 

We also announced new open business practices and open services for Alpha. Alpha open business practices include licensing of the Alpha architecture and software to other vendors, and the sale of Alpha products at all levels of integration - chips, boards and systems. Open services for Alpha encompass services to help end users integrate Alpha into their existing computing environments, and services to help other vendors design Alpha into their products.

 

The Alpha program embodies all aspects of Digital’s Open Advantage. Alpha is the basis for Digital to be the industry’s technology and solution leader through the 1990s and into the next millennium.

 

The Alpha 21064 microprocessor will form the basis of a family of Digital systems with capabilities that span from the desktop to the data center. Alpha systems will run Open VMS or DEC OSF/1 software. In fact, the Alpha architecture will allow us to add support for other popular operating systems, such as Microsoft's Windows/NT. This flexibility, together with the capability to support a thousand-fold increase in speed over its life­time, and an addressing capacity that is four billion times greater than that of the VAX

 

architecture, promise that the Alpha architecture should have a long life, even in the rapidly changing and highly competitive computer industry.

 

Not only does Alpha provide a leadership vision for the future, but it also offers a solid bridge from the present. Customers can confidently purchase today’s industry-leading VAX and DECsystem products because their investments in software, applications, data, user training and many peripherals are protected by tomorrow’s Alpha systems. Today’s VAX and DECsystem products will continue to be aggressively promoted and sold to customers. Today’s products provide industry-leading solutions to customers’ needs.

 

Customers will be able to add Alpha systems seamlessly to their existing computing envi­ronments. Customers can add Alpha when and if they need to. Alpha enhances the value of customers’ investments in today’s systems and helps us sell today’s products.

 

But Alpha is not just a product for our current base of customers. Alpha opens the door for profitable growth in many areas. With Alpha, we can revitalize our Technical OEM business, selling chips, boards and complete systems to other computer vendors. On February 25, Cray Research and Kubota Pacific announced their commitment to Alpha. Other vendors will follow shortly.

 

There are tremendous opportunities to sell Alpha into embedded applications in a number of industries, such as telecommunications, industrial automation, medical imaging, and mili­tary/aerospace. We expect to announce successful sales to this class of customers soon. Alpha product sales open important opportunities for the sale of Digital software and services.

 

Alpha puts us in the position of being industry leaders. It puts us in the headlines as the standard of performance and capability against which competitors’ new product offer­ings are compared. It puts our name in front of the customer whenever there are discus­sions of such topics as open systems, client/server computing, RISC, and advanced tech­nology. It adds a strategic, future dimension, with a twenty-year-plus path of evolution, to every Digital purchase a customer makes today.

 

People will ask how Digital was able to jump so far ahead of the RISC competition. The basis of our success is the core competencies we have built over our history. We have the ability to design effective architectures that endure for many years, proven by our suc­cess with the VAX and PDP-11 families. We can design high-performance CMOS microproces­sors based on the Alpha architecture. We have world-class semiconductor fabrication technology, focused on producing high-speed microprocessors. (The microprocessors in today’s VAX systems are the fastest CISC [complex instruction set] microprocessors in the industry.)

 

In addition, we have experience designing balanced systems of all sizes, from the desktop)

 

to the data center. We have the software engineering ability to build optimizing compi­lers that are necessary to take full advantage of the hardware capabilities of RISC sys­tems. We can build all of the "middleware" — the languages, networks, and other software needed to produce the rich distributed environment that customers need. And we have global sales and services presence, as well as financial strength and staying power.

 

In other words, while Alpha represents a major advance for Digital and the computer indu­stry, it is based on a firm foundation of experience and proven technology.

 

The structure of the computer industry is changing, and Digital has the core competencies to emerge as an industry leader as this shakeout occurs. Few of our competitors possess the breadth of capabilities needed to prosper into the 1990s and beyond. Many may disap­pear, or change their business model to become assemblers of key technology components supplied by a few leaders. Digital is committed to being a technology leader in the in­dustry.

 

Many customers utilize software from independent developers, and Digital has a massive program under way to work with them to get their software migrated onto Alpha. Our goal is to have a thousand key existing applications converted to Alpha by the time systems are shipping.

 

Alpha will also facilitate development of a new generation of "high-impact" applications that use power-consuming advanced technologies, such as imaging, multi-media, voice rec­ognition, artificial intelligence and virtual reality. We will see software developers increasingly choose Alpha as their platform of choice for new and existing applications.

 

The price/performance of Alpha will allow users to economically deploy existing supercom­puter applications — such as seismic data analysis, computational chemistry, econometric forecasting and molecular modeling — to a wider range of users than was previously af­fordable.

 

The computer industry is changing rapidly, and Alpha helps us position Digital as a leader in the forefront of this change. Alpha presents many opportunities for profitable growth — not just in our systems businesses, but also in our software, services, application, and embedded hardware businesses. As the Alpha program roll-out continues over the coming months, I hope employees across the company will continue to be excited about making the Alpha vision a reality for Digital and our customers.

 

Decworld Strategy by Deb Nicholls, Decworld manager

 

DECWORLD ’92, an international event, will be held April 27 to May 15 at the World Trade Center in Boston, Massachusetts. It is anticipated that 25,000 visitors — customers, prospects, press, and sales people — will attend DECWORLD ’92 during those three weeks.

 

For the past year we have been delivering messages about Digital’s Open Advantage, and introducing new products, services, and business practices to support our claims. DECWORLD ’92 provides the proof points of the Open Advantage — bringing everything you’ve heard about it under one roof, and adding a glimpse of the future. Customers will encounter real examples of openness: products built on standards working in multivendor environments, success stories of systems integration and global support, and Digital's progressive software licensing strategy.

 

In addition to "Open", the program has been designed to focus on the benefits, or "Advan­tages", that Digital brings to the customer. The best technology and services, a wealth of partners, and the flexible practices that Digital offers are of no value unless they help to the customer some way. That means listening to our customers, demonstrating our under­standing of their issues, and showing the willingness and flexibility to work with them to solve their problems so that they can succeed.

 

In today’s recessionary economy, companies are interested in their business revival and how we can be their partner. We’ll highlight our management consulting capabilities as part of this. Sales people and their customers will have the opportunity and space through the World Trade Center to confer with experts, senior management, or consultants. These can be scheduled in advance through the Account Visit program, or happen ad hoc as the occasion warrants.

 

Of course, DECWORLD ’92 will also provide us with an opportunity to showcase Digital’s latest technology, which customers always want to see. We have developed the floor with industries and technologies logically adjacent to one another, to make it easier for the customer to connect with the right people.

 

The forerunner to DECWORLD, known as "DECtown," was done for sales people to educate them on our products. The sales people loved it so much they said they wanted to bring their customers. The first DECWORLD was open to anyone who wanted to come. Then, over the years, we’ve targeted this event more and more toward senior-level people. This DEC­WORLD, like the last two, will be admission by invitation only, to make sure that we have qualified customers or prospects, and to make sure it’s the audience for which we’ve targeted the program. As much as possible, sales people escort their customers.

 

The success of past DECWORLDs has been due to the hard work of many good people operating as a team. Nearly 5,000 Digital employees will have some responsibility in shaping and staging DECWORLD. This time, we have been able to get Sales involved earlier, which helps both in the planning and the implementation.

 

We’re making it easier for sales people to find out what’s going to be at DECWORLD, to assist them in both the invitation and visit planning processes. First we have a VTX application that anyone in Digital can access. VTX DECWORLD includes information about the invitation and registration process, the speaker series, special events, sales tools, and a complete set of abstracts of demonstrations and session planned for DECWORLD. This information will help the Sales force to encourage customers to pre-register, which ena­bles us to balance the volume of visitors over the three weeks, for everyone’s comfort and convenience. Europe and GIA are balancing their customers over all three weeks. The U.S. is focusing on the first two weeks, which will leave space for spill-over and late regi­strants in the third week.

 

Preparing this complete information early forced many people involved in the event to make decisions and get their piece of work done sooner, rather than wait until the last minute. Doing this also gives us more time to improve the quality.

 

To make it easier for customers to find their way around, we’re using the metaphor of a "global village." Store fronts will represent the various industries. In addition, a Corporate Headquarters area will be set up to address the business problems and planning needs of an Information Technology (IT) vice president, including overall services, and worldwide messages. An area known as Technology Park will have the products themselves and experts who can explain how to use them to solve business problems.

 

We’ll also have a "distinguished speaker series." These speakers - including Casper Weinberger, Henry Kissinger and C. Everett Koop — will talk about matters of general concern, such as economic, geopolitical, environmental and health issues.

 

While preparing for this event, we are also repackaging the content so we can deliver it to the Field afterward for reuse. For example, a customer may be particularly impressed by a seminar or a demo and want to share it with others. The sales rep can then re-create some of that experience back at that customer’s site, for more people.

 

 

 

Removing Barriers For People With Disabilities by Jim Cudmore, vice president, Operations Staff, and Jack Rugheimer, Senior Attorney

 

Several years ago, a group of senior managers and other people concerned about the treat­ment of people with disabilities formed a Disability Strategy Committee, with representa­tion from various organizations and disciplines throughout the company. Some of the participants are themselves disabled or have parents or children, spouses or relatives with some form of disability.

 

We approach these problems with the understanding that comes from experience and with the

 

enthusiasm of personal commitment. We also approach them from the viewpoint that many of us, as we get older, will need many of the same kinds of accommodations and devices that are important for today’s disabled population.

 

Digital had already made many efforts to help and accommodate people with disabilities — including wheelchair access, availability of translators in meetings, and access to spe­cial computer terminal or telephone equipment. But these efforts were mostly local, independent, fragmented and uncoordinated. We wanted to get more organized in how we deal with major areas of concern for the disabled. We wanted to determine what we could do differently as a company to overcome limitations that we unintentionally impose on these people and so we could better tap into the contributions these people can make. Today, we have the beginnings of an organized approach to dealing with access to computer and com­munication equipment, access to facilities, revisions to policies and general awareness. There’s a lot more work to be done, but we’ve made a start.

 

A facilities task force has completed an extensive survey of the major facilities in the U.S., screening them in terms of physical access criteria, such as doors, ramps, parking, elevators and access to rest rooms. As a followup, they created guidelines for local facilities managers. These include relatively simple changes, such as raising a desk so a wheelchair can fit under it, or permitting a blind person to bring a dog into the build­ing. They also include more complicated solutions, requiring structural changes, such as providing toilet booths that are wide enough to accommodate wheel chairs, and adding ramps or elevators. The guidelines create a framework to help facilities people as they make local decisions about the right approach and timetable for their particular circumstances.

 

Another task force, headed by Dave Brown, focuses on computer access for people with disabilities. For the last three years, he has been responsible for an engineering pro­gram that deals with these questions.

 

Digital has an Assistive Technology Access Center in Northboro, Mass., where employees can try out recently developed devices. These include products based on our DECtalk capabi­lity (which turns ASCII text into normal voice), as well as third-party devices such as alternative keyboards, terminals that show large text on the screen, and voice input.

 

A battery-powered version of DECtalk is used in Boston’s Children’s Hospital. There, speech-impaired children, many of whom have poor muscle control, use a stick held in the mouth to activate a giant keyboard and the machine "speaks" out loud for them.

 

Also, some people at Digital, on their own, have been working on a Braille output terminal with a Braille keyboard. Three women in the Atlanta Customer Support Center who are visually impaired now use this device to access information from the network to answer customer questions.

 

Some of the devices being developed for people with disabilities — such as voice input — could prove very useful for a broader population — such as people who never learned to type or find traditional keyboard techniques awkward.

 

In focusing on the needs of the disabled, we also become aware of some not-so-obvious issues. For instance, Digital posts most of its software documentation on the network. In the past, that was done in simple ASCII form, which is readable by machines using DECtalk and which can readily be printed in Braille. Now we’ve begun posting such docu­mentation in Postscript and other formats, which, while they print out beautifully, are totally inaccessible by people who are blind. Videotex also poses problems.

 

Meanwhile, the U.S. government has been addressing similar issues with the Americans with Disabilities Act (ADA) and the regulations emanating from that. The ADA is a comprehen­sive law that creates new rights and extends current rights for the estimated 43 million people in the U.S. with a "disability." It was enacted on July 26, 1990, with the employ­ment provisions becoming effective on July 26, 1992.

 

This Act uses a broad definition of "disability," including anything that substantially interferes with one or more major life activities. This includes blindness, deafness, and being in a wheelchair. It also includes drug addiction, alcoholism, and having the HIV (AIDS) virus. The law also protects people who are perceived as having such a disability or who have a history of having such a disability.

 

Under the law, people must voluntarily identify themselves as "disabled" to be known as such. In most cases, it’s illegal for a company to ask its employees about disabilities or to keep statistics on people who have not come forward. This means that we do not and cannot know how many people in Digital are hearing impaired or vision impaired, etc., anymore than we can know the number of people with HIV virus.

 

The current use of illegal drugs is not protected. A person who has a history of being a drug addict and is not currently an active drug user is protected. If somebody comes in drunk to work, even though they may be under treatment, they can still be fired for being drunk. But the law says that if someone has a history of being an alcoholic, we can’t base our employment decisions on that history.

 

The major provisions of the ADA are consistent with what Digital is already doing. The company must make reasonable accommodations that do not create undue hardship, so that any qualified person with a disability can perform the essential functions of his or her job. These might include readers for the blind, interpreters for the deaf, part-time work, modified work schedules and other forms of job restructuring to permit employees with disabilities to perform the essential parts of jobs. Also, new facilities must be de­signed to be accessible to persons with disabilities, including employees, customers and suppliers.

 

There are some differences from prior law, particularly relating to the use of medical exams. These changes mean that we must train our employment and management people care­fully regarding the types of questions they may ask and the use of the information they obtain.

 

Basically, the Act is one more incentive for Digital to get on with the business of making the workplace more accessible for employees, customers, and vendors, and to permit dis­abled individuals to participate more fully in the business.

 

Making Profits Selling Components And Manufacturing Capability by Jim Willis, vice president, Components Business Group

 

Digital’s investments in component-level research and development (R&D) result in an increasing flow of leading-edge products. Much of this is base technology — hardware and software that are fundamental building blocks necessary for development of world-class systems and solutions. These basic elements — software, networks, components, and com­puter peripherals, such as terminals and disk drives- can be profitably sold as separate, volume commodity products, in addition to their use as parts of complete computer systems. And Digital’s expertise in designing and building them can also be sold for a profit.

 

Worldwide competition and the high cost of research and development are leading to in­creased interdependence among the major manufacturers in the computer industry. Just as Digital buys some of its components and makes others, so do many other companies. In fact, many companies that compete with Digital for systems business are potential cus­tomers for base products, components and even manufacturing services. Also, systems customers of Digital who are also manufacturers now buy piece parts and components as well as systems, and even ask us to do some of their manufacturing for them.

 

What we are doing now in the components area resembles what we did in our earliest days when we focused on building modules. We’re focusing on our core competency as an engi- neering/manufacturing company, both in hardware and software. We’re building on our manu­facturing strengths.

 

We can "private label" some of our products for customers. For example, we took the base design of our VT420 terminal and modified it to meet Olivetti’s specifications, and now Olivetti is selling that under their own label.

 

At the component level, Digital’s thin-film heads are in very high demand right now. This is an extremely high precision component for storage devices. Digital uses these in making its own disk drives, and sells them to other manufacturers, some of whom supply

 

disk drives to us and to others. Currently, about 50% of our thin film head volume goes to other disk drive manufacturers. In addition to the margin that generates directly, the higher volume significantly lowers the costs of these components used in our own products.

 

We will do custom manufacturing for other companies, including making printed wiring boards and modules to customer specifications. In some cases, the customer provides the materials, but we prefer to do the material acquisition. We’re selling our manufacturing capability -- taking advantage of the fact that Digital is a world-class manufacturer and basically becoming the manufacturing arm for these customers.

 

This kind of activity benefits Digital in four ways:

 

o The sale itself is profitable.

 

o We reduce our manufacturing costs by increasing volumes.

 

o We make full use of existing plants and people.

 

o We get early feedback on our products and their competitiveness.

 

This kind of business forces us to be competitive in our basic operations. It's also useful as a benchmarking activity, helping establish internal pricing for the New Manage­ment System (NMS), since the price charged to a business unit should equal what we would charge a high-volume customer.

 

Digital’s experience with OEM (Original Equipment Manufacturer) relationships is an enor­mous advantage in this market. The association with an OEM is different in style from the more familiar end-user model. Planning on both a sales and a technical level require a closer level of collaboration. Reliable material supplies and smooth long-term scheduling are very important. Also, rapidly changing technology requires very close collaboration between design engineers from supplier and customer. In other words, close working links among sales, engineering and manufacturing organizations are essential to success in this style of relationship with customers.

 

We are working with the three area managers to establish dedicated sales teams. The Sales Managers are: Joe Kelly, US; Werner Burckhardt, Europe; and Tom Coleman, GIA. In most cases, these sales teams will be the account managers. For some of the larger accounts that do a mix of business with Digital, the dedicated sales person will manage this piece on behalf of the overall account manager.

 

These sales people need different kinds of business plans and measurements and training because their customers are so different from computer system customers. In particular, we need to keep cost of sales and administration very low — less than 10% and. prefer­ably, close to 6% — so we can meet the Business Model for this type of business.

 

This activity is an important element for the future success of the company as a whole.

 

We need to be able to sell profitably at all levels - from individual components to systems to global networks.

 

This is a perfect time to be launching this activity. Many companies are rationalizing their business strategies, trying to optimize their efforts by judiciously deciding which parts of their business activity they need to do themselves and which they should buy outside. We’re finding excellent receptivity to our overtures. At the same time, Digi­tal’s reputation for excellence in manufacturing and engineering is very important to this class of customers, many of whom know us very well.

 

The Components Business Group is an Integration Business Unit (IBU). We’ve been in opera­tion for about six months now, and at this point we’re going after over 110 different opportunities in 60 different companies.

 

Tracking Profit In Systems Integration Programs by Fran Maycock, program manager, Customer Program Reporting

 

In Systems Integration (SI), we are developing a management tool to collect cost and revenue information from many different organizations to track profits by customer pro­gram. This initiative is called Customer Program Reporting (CPR) and is designed to meet the business and financial management needs of Digital's rapid growing Systems Integration business. The information CPR will make available is analogous to what the New Management System (NMS) provides to Business Unit managers.

 

Over the last few years, Digital has vaulted to the forefront in Systems Integration, one of the strongest areas of growth in the computer industry. Digital is now consistently ranked as one of the top five vendors in this area. This accomplishment has been the result of significant changes in how we manage customer programs. To achieve our goal of industry leadership, we must continue to change, basing our decisions on better and more timely information about the effort, expenses and revenue related to individual programs.

 

Systems Integration programs present unique management problems because they regularly involve multiple Digital organizations and can span several years. To meet these chal­lenges, new business practices and procedures are being developed, based on our experi­ences in winning and delivering SI business. Perhaps the most significant new practices are those requiring everyone working on SI programs to account for their time by program. This is more difficult than it may sound because people may work on multiple projects simultaneously. Tracking the various pieces of work and accounting for them by program requires behavior modification — calling for new levels of commitment from everyone involved in SI programs.

 

To track this information, CPR will collect and compile program transactions from all U.S. business systems. Program information can be collected as soon as an opportunity is identified and then on through its bid, win, delivery, and close. Information available via CPR will be related to a program’s Work-Break-Down Structure (WBS), Line of Business (LOB) and account portfolio. This information will be used by program managers, senior management and Finance to plan and manage the Systems Integration business.

 

Initially, CPR will focus on large programs managed through the program management of­fices. Functionality will then be introduced in stages, beginning with the collection and reporting of effort, expense, and revenue on a per program basis. Subsequent stages will support forecasting, budgeting, portfolio summaries and variance analysis. As the solu­tion matures, it will be extended to support smaller projects and activities.

 

Planned for implementation in the first quarter of FY93, this solution is designed to support the continued growth of the SI business on many fronts. Program managers will have timely information on which to make management decisions during delivery, and senior management will have a clearer view of the dynamics of their portfolios. Historical program information will be available for use as a reference to improve decision making on which business opportunities to pursue and how to price and position them for the cust­omer. This information should also make it easier Digital to deliver SI solutions to our customers.

 


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