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Articles about DEC
Volume 7, #8 December, 1988
What Do We Mean By "Integrating The Enterprise"? And How Are We Doing It? by Peter J. Smith, vice president, Product Marketing
U.S. Team Adopts Long-Range Business Plan
Digital’s Values - Based On Customer Satisfaction And Building A Creative Work Environment by Win Hindle, senior vice president, Corporate Operations
Worms, Viruses And Systems Security
Storage Systems Becomes Storage And Information Management by Grant Saviers, vice president, Storage and Information Management
Digital Expands Its Video Network by Pat Cataldo, vice president, Educational Services
Visas For Temporary Business Visitors To The U.S.
Upcoming Changes In Benefit Programs
Changes In Petty Cash
There has been a lot of discussion lately, within Digital, in the press, and by our customers about the concept of the "integrated enterprise" and the role of information technology in making it a reality. This article deals with Digital’s approach to providing solutions for the "enterprise" customer, and how we are uniquely positioned to be successful.
One can think of an "enterprise" as an organizational entity, bound by a common mission or set of activities. Some examples might be a corporation, an educational institution, or a charitable organization. It is also possible to consider a single department or division an "enterprise" within the context of this definition.
Many enterprises are recognizing three important phenomena today:
o today’s business environment is dynamic, relative to both the nature and methods of accomplishing work;
o the traditional boundaries of the enterprise are becoming less clear as strategically important relationships are formed with customers, suppliers, and partners; and
o that the ability to share information across this expanded concept of the enterprise is critical to success.
Obvious results are that information technologies are key and that integrating these expanding enterprises requires operating in a multi-vendor environment.
The word "enterprise" can also imply that an organization is innovative and forward thinking. Digital has always taken pride in helping customers use computing in enterprising ways - ways which enable the customer to create competitive added value. From the beginning, Digital has said that computing ought to be accessible, usable, and useful, enabling people to solve their problems. We introduced timesharing and distributed computing to get computing power out to where people need it. Then we added networking so people could share ideas and information. "Integrating the enterprise" is a natural next step in this evolution.
Our approach to integrating the enterprise is based on several key, inter-related ingredients:
o Digital’s "single system architecture,"
o a commitment to industry standards efforts,
o creation of a software environment that provides a stable platform for applications and is easy to use,
o a comprehensive set of strategic alliances with selected hardware and software vendors with whom we work closely to ensure a tight integration with Digital’s architectural components, and
o comprehensive service capabilities designed to support the needs of the enterprise.
Digital’s architectural approach is a key element of continuity in how we have provided solutions to our customers. Historically, this architectural approach has meant our VAX/VMS product family which, coupled with DECnet, has established Digital in the forefront of providing distributed computing. Customers are able to write applications once, and implement them anywhere in the network, on whatever size system is appropriate. As their requirements and priorities change, they can reconfigure their network, redefine their application strategies, and upgrade their systems as needed.
It is inappropriate, however, to limit the definition of Digital’s architectural approach to VAX hardware and the VMS operating system. When we designed the VAX family, we had an overall architecture in mind which not only included the hardware and operating system, but networking, data management, application integration, and application services as well. Only when you have designed each of these architectural components together do you truly have a system architecture.
An architectural approach focuses on defining the specific interfaces and relationships between these components so that we can evolve, change, replace, and/or add components without violating the integrity of the architecture. It is this approach which has enabled Digital to add capability such as DECtp, a rich environment for transaction processing, add additional components such as the ULTRIX operating system and the RISC hardware technology, and to evolve DECnet into full compliance with OSI standards.
The capabilities that allow enterprise integration result from a product strategy and product architecture which was established more than a decade ago, and has been under continuous, focused development since then. It is also this disciplined, architectural approach which will enable us in the future to continue to evolve and introduce new components to our system architecture in response to new technologies and changing customer requirements.
As stated previously, the reality of today’s enterprise is a multi-vendor environment, and customers require that our products integrate with those from other vendors. Standards helD facilitate this bv addins stability to the comnutins environment. Some neonle focus on UNIX as the means to achieve this stability, but the Open Software Foundation (OSF), of which Digital is a founding member, recognized that an operating system alone does not provide a complete standard software platform. Thus OSF is defining standards for user access, data interfaces, and more.
It is Digital’s goal to ultimately provide a smooth, seamless computing environment where users need not know what operating system they are using. A good example of this software transparency is our Network Application Support (NAS) strategy, a key element in providing enterprise integration. Through NAS capabilities, we are able to bring consistency to applications access (DECwindows and ALL-IN-1), information sharing (Compound Document Architecture, SQL, Postscript), and business communications (mail, conferencing, and videotex) for the many different desktop devices customers have today and will invest in tomorrow. NAS enables users of video terminals, industry standard PCs, Macintoshes, as well as users of powerful workstations running VMS or ULTRIX, to use applications that have a consistent look and feel, as well as the ability to exchange information.
While constantly improving the software environment which we provide to our customers, another critical element of enterprise integration entails a close technical, as well as business, partnership with other software as well as hardware vendors. Our cooperative marketing programs have evolved to ensure that our CMPs are provided with the tools and support to make it easy for them to write applications that take full advantage of the capabilities of our computing environment.
In addition, we are expanding these relationships with programs like the Distributed CMP, where we will distribute, and as importantly, support the CMP’s software. This is a critical customer requirement in many large enterprise integration projects.
Through strategic alliances, with companies such as Allen-Bradley, we are jointly developing solutions to complex integration problems, in this case, tightly integrating programmable controllers on the shop floor with material planning and scheduling systems in the plants. Customers are able to tailor their support from Allen-Bradley and Digital to best suit their specific needs and working relationships.
The last major element mentioned was a comprehensive support capability to complement the technology Digital provides. As highlighted at the Enterprise Services announcement at DECworld ’88, Digital is committed to work with our customers to understand their requirements and to assist in the design and implementation of the optimal solution supporting their business objectives. Furthermore, Digital can do this on a worldwide basis, providing the sophisticated, on-going support so critical to our customer’s success.
In conclusion, Digital has clearly stated its mission to help our customers build and sustain competitive advantage by managing information technology the way they choose to work. More importantly, Digital has a design to accomplish this, which entails a coordinated implementation of our product strategy, our business strategy, and our service strategy. It is the powerful combination of these strategies, the "integration of our enterprise", which uniquely positions Digital in the industry today.
The U.S. Country Team has adopted a unified long range business plan that sets objectives and strategies for the next five years and beyond. This is the first time that the U.S. functions, working together as a management team, have tried to craft a common set of goals. It represents an important step toward greater coordination and cooperation among the various U.S. Field and Manufacturing organizations in providing customers with "seamless service."
The Country Team includes: Chick Shue, vice president, U.S. Sales; Don Zereski, vice president, U.S. Field Service; Bill Ferry, vice president, U.S. Software Services; Lou Gaviglia, vice president, U.S. Manufacturing; Joe Fabrizio, manager, U.S. Educational Services; Mike Kalagher, manager, U.S. Administration; Donna Blaney, manager, U.S. Field Personnel; Steve Behrens, manager, U.S. Field Finance; and Tom Grilk, acting manager, U.S. Law.
The objectives are:
o to double U.S. revenues over the next five years, while meeting or exceeding corporate margin goals;
o to achieve 51% or greater share in selected accounts;
o to achieve preferred vendor reputation in selected industries and applications;
o to be the number one place to work;
o to establish the U.S. as an integrated business entity; and
o to be positioned for future success.
"Growth for the sake of growth is not our goal," explains Chick Shue. "We are striving for customer satisfaction and investment return, as opposed to just revenue growth. This is the premise that drives our business model and our organizational structure.
"We intend to achieve that growth by targeting our resources to increase our marketshare in selected accounts," says Chick. "IBM may be five times bigger than us, but we can be ten times more focused in selected accounts. With the help of Industry Marketing, we have identified accounts that are growing rapidly. These are companies that are likely to be winners in their respective industries. We will position ourselves by building full service, fully integrated, business relationships with these customers. We have to step beyond the supplier relationships we have had in the past to become a true business partner.
"We will strive to become number one in those accounts. This doesn’t mean that we will necessarily have more Digital computers on site than IBM, but rather that we will get the larger share of new purchases."
"The groundwork for this approach was laid with the Corporate Account Program, which began modestly with 25 accounts," explains Bill Ferry. "An account management team which included Sales, Software Services and Field Service account managers, was measured on the
common goal of increasing customer satisfaction and penetration in the account. In these accounts, customers wanted more from us, and we enjoyed more business and grew as they succeeded.
"We increased the number of corporate accounts, and later we provided the same kind of focused attention to a broader base of Digital Named Accounts (DNA). Using the accountteam approach enabled us to more easily provide ’seamless’ service -- coordinating the efforts of Software Services, Field Service, Sales and Manufacturing for the benefit of the customer."
"Basically, we target our resources not only to maximize our return on investment," adds Chick, "but also to achieve a higher level of customer satisfaction, higher managementlevel contact with the account, and a higher degree of interdependence between our two companies. We become more than just a supplier of hardware, software and service. From that relationship comes not only increased growth, but also increased profit. At the same time, we are setting the stage for the future, building relationships that will be important for a long time to come.
"Now we are developing application and industry plans that tie together not only our sales and product strengths, but also our application strengths, the needs of the account and the industry, and a strategic view of the competitive position of the account in its industry. We are considering not just the market today, but where the market is going to be. As opposed to pursuing every large opportunity, we want to pursue the large opportunities that are going to increase our position not only in the account, but in the marketplace."
"We aren’t just saying to the sales force, ’Go prospect in this account.’ Our effort is more focused than that," says Bill Ferry. "What matters is not just winning in the account, but rather winning the right thing at the right place because that’s where our strength is. We are relying on our growing expertise in specific applications, and we are relying on industry marketing leadership to help us achieve our goals.
"For instance, we select global trading in the banking industry not because a particular bank wants to spend $50 million with us today, but because we believe this is a strategic application in the rest of the industry and we will be able to sell this application to ten other banks and become a world leader in providing this kind of expertise."
"For partner relationships, cross-functional teamwork is paramount," emphasizes Don Ze- reski. "Whether the installation is a single site in a remote geography, an international node in a worldwide network or a centralized hub of a customer’s business-critical application, Digital’s Sales and Services functions must refuse to compromise on customer satisfaction.
"Increased focus and more detailed planning should result in tighter links between Sales and Manufacturing plans," notes Lou Gaviglia. "By planning more discretely what we sell, we can also plan more accurately what we should build, resulting in lower inventories, faster shipments to customers, shorter receivable periods and overall increases in customer satisfaction."
"Our people are extremely important to us as we try to achieve the customer relationships we need to maintain our position as the number two computer vendor," says Don Zereski. "Sales and services involve lots of customer interaction, and so by nature are very people-intensive. Our people are our number one asset.
"Looking ahead, we have to determine the kind of organizational structure we need to make it easier for customers to do business with us. If a customer in Des Moines, Iowa, has a problem, we have to have someone close by who has the skills, the motivation and the authority to solve that problem quickly, in a manner that reflects the company’s goals and is right for the customer."
"We’re going to have to focus a lot more attention on developing our present people for both present and future roles, so we’ll have the right people in the right places at the right times," adds Donna Blaney. "The Long Range Plan gives us a clear idea of what needs to be done."
"We want to inspire all employees to focus on the needs of the customer," adds Mike Kala- gher. "As a complement to that, we want to recognize employees for their excellent work and reward them in meaningful ways for the outstanding contributions they make."
"We will continue to move operational controls to the Field — as close to our customers as possible," notes Chick. "This should mean opportunities for individual development and advancement. It should mean that more people will be given greater responsibility and have the chance to take more risks.
"As we undertake larger and more complex, critical business solutions for our customers, we will be expected to deliver increasing levels of value-added service that will be priced with the total solution," adds Bill Ferry. "Our recent movement into the systems integration business is an example of bringing more focused service to our customers while increasing operational responsibilities in the Areas."
"The creation of a single integrated business entity for the U.S. is essential for us to deliver high-quality, seamless service to customers, especially for the large enterprisewide customers where we are targeting our efforts," says Bill. "These customers don’t want to have to deal separately with our Sales, Software Services, Educational Services and Field Service organizations. Basically, we have to operate as a single entity so we can build enterprise-to-enterprise relationships with these key customers.
"As we simplify and integrate our own business practices in the U.S., we are gaining valuable experience in using what we sell," notes Mike Kalagher. "That experience will then create more opportunities for us to sell what we use."
"Today we face economic uncertainty, an industry in transition, increased competition, advancing technology, and a changing market with more diverse and disparate customer expectations," adds Steve Behrens. "The need to understand the business, provide financial leadership, control costs, improve productivity and manage change is greater than ever."
"With this long range plan, we are beginning to act more as a single company here in the U.S.," concludes Bill. "The management team approach helps us look more at what is good for the customers and good for the company, rather than what is good for one particular function."
Implementing Digital’s values gets harder as we get bigger. It’s more of a challenge to us to create an environment that feels as open and free and enticing as it was when we were smaller.
It’s just as important today as it was 20 years ago for employees to feel the freedom to create ideas, communicate them, and test them with their peers. It’s just as important that we hire the most competent people and that we communicate clearly with all of them.
The fundamental goal of the company is to do well for our customers. We can only thrive as a company when our customers think highly of our products and services and enjoy doing business with us.
Each individual in the company must understand how his or her job impacts our customers. The relationship is easier to understand in functions that deal directly with customers, such as Sales and Service. It is also clear in Manufacturing, where the product is used directly by customers. But people in departments that are more remote from customers also need to make the appropriate connection. For example, when Personnel helps to create an environment for people to be innovative and productive and feel motivated, then those employees will increase customer satisfaction. In Finance and Administration, those who prepare information to send to customers can have an enormous, positive impact on customers by the quality of the information they produce.
We always have been in the business of building relationships with customers. In the past, it wasn’t as formal. In the 1960s, we were successful because we understood the markets we were dealing with. Those customers were engineers and manufacturers, just as we were. So we built products that we liked to use. It was intuitively obvious what products would be successful.
Now we have entered new markets where customers have other expectations and require other things of us. So we have to put more explicit emphasis on understanding customer needs.
Back in the early 1960s, we would sell hardware for the customer to add other hardware, software, service and applications. As time has gone on, we have provided more of those other components; until today we’re in the position of providing the customer with complete integrated solutions. To integrate all of the components properly, we’ve got to be experts in the customer’s business as well as our own.
Many customers want computer systems to be an integral part of their business. In this environment, customer satisfaction means trust and confidence. It requires that these customers believe we are a very trustworthy, ethical, competent supplier and partner.
I like to think of these people as our "clients" rather than customers. The word "customer" implies a buyer-seller relationship, whereas "client" implies a professional relationship in which two people come together because one of them has an expertise that the other needs. In our case, that expertise is how to provide networked information systems that will meet the customer’s business needs.
A few years ago, Ken came up with the theme of "one company, one strategy, one message." It helped us develop a strategy that enabled us to go to the customer with an integrated approach. Back then, we criticized our customers for having little islands of automation, but we had islands of our own. Customers often had to deal with four or five separate individual organizations inside Digital. So we have been striving to make ourselves relate to the customer as one coordinated team.
We also have to remain technically excellent in every one of our disciplines. This means that within the company, there has to be an environment where creative risk taking and initiative can thrive. Otherwise we don't get better, and people don’t improve. To achieve that excellence, we often generate internal competition. That is healthy in any organization. In a sense, we’re all competing for the company’s investment dollars. Not
every product we begin to develop can go into final production. There are always twice as many ideas and programs proposed as we have funds to invest. We simply have to say no to a lot of good ideas.
Sometimes people proposing new programs get confused and frustrated trying to get their programs accepted. We’ve gotten large and need to simplify the processes by which we decide our annual investments.
We want to hear all of the good ideas from our people. We always have to consider how the proposed product or service will interact with other departments that also have relationships with the customer. Each product and program has to connect with the core Digital strategy and with the architecture and the standards that have been accepted, because that’s what holds us together as a company. Customers should see one united Digital focused on serving their interests.
It is a challenge for the management of the company to keep our values strong as the company grows. We all know that there are times when these values appear to have been forgotten. We have to keep chiseling away at and resisting the unnecessary steps which any bureaucracy tends to create. Most of all, we have to be sure that all of our people know the company values and can help to preserve them no matter how large we grow.
Beginning on November 2, a computer program quickly copied itself to over 6,000 computers on the Arpanet, an open network that researchers and scientists use to freely exchange information. This deliberately written software included instructions to distribute itself by electronic mail to any computer it could reach over a communications network. Once inside the individual computers, this program repeatedly copied itself, causing the computers to overload their memory, slow down or even stop working. Within a few days, the problem was under control. Fortunately, no lasting harm was done; files were not destroyed. But it took considerable, costly efforts to find and eradicate this "worm."
According to Ed Maguire, program manager, Network Security, the worm never penetrated the gateway computers which link Digital’s internal Easynet network with external networks such as Arpanet. He also noted that the computers affected by the worm all used certain variants of the Unix Berkeley Software Distribution (BSD) operating system. ULTRIX versions 2.2 and 2.3, which Digital ships to customers and uses internally, do not have the weaknesses the worm needed to propagate itself.
Government systems running classified information were not affected by the Arpanet worm because they are not on that network. There is no connectivity between those government systems and the systems that were infected.
Interviewed in a taped segment on the ABC show "Nightline" with Ted Koppel, Ken Olsen, president, expressed concern that this incident could lead to restrictions on the use of open academic networks like Arpanet. "The worst thing that could happen is that they clamp down on free flow of academic information. That should be preserved at all costs," he emphasized.
"A runaway program of this kind, that reproduces itself automatically and proliferates through a network, is a rarity," notes Steve Lipner, manager, Secure Systems Development. "But there are people who would like to break into our networks to sabotage our efforts, steal our information or both."
The exotic and rare kinds of computer break-in and sabotage that catch the attention of the press are known as: worm, trapdoor, logic bomb, Trojan horse and virus. Steve describes them as follows:
o A worm copies itself across a network to another workstation or system, intrudes itself in the target and then replicates across. Often it’s a prank or experiment that goes out of control. Once started, this normally doesn’t involve human intervention.
o A trapdoor is a piece of code left in the core of a piece of software by someone who was involved in writing or modifying it. This code will allow anyone who knows about it to by-pass the system controls and do something for that person, unbeknownst to the authorized users. For example, in the movie "War Games," a programmer modified the log-in program so he could always get in with the password JOSHUA.
o A logic bomb is a piece of code buried in a program or command procedure that, when triggered by some time or sequence of events, will do something to erase or damage software or data on the same system.
o A Trojan horse is a program deliberately hidden within another apparently useful or amusing program. Somebody sends you this program; you file it in your user space and run it. Once it’s run, unbeknownst to you, the program embedded in it can take control of your user space, with access to any information that you have access to. It could, for instance, take all your proprietary files and mail them out the Arpanet gateway to the perpetrator. Or, similarly, it could automatically forward all your incoming or outgoing mail to that person.
o A virus could be thought of as a composite of a Trojan horse and a worm. It finds other computer programs to which its host has access and modifies them by including the key elements of the virus. It changes other programs, rather than just spreading copies of itself over the network. Then each affected program could pose the same kind of insidious threat as a Trojan horse.
"The discipline and quality of Digital’s software development provide a high level of protection against these exotic kinds of problems," notes Steve. "Digital also offers customers and internal users a variety of software products, such as encryption packages, which can significantly enhance system security. But overall systems security depends largely on people, not just products — on systems managers and individual users.
"Employees who use our Easynet network must exercise responsibility in managing passwords, protecting files and staying alert to notice signals of unusual activity. Those employees who have contact with customers have an additional obligation to help the customers use our systems effectively and securely.
"People also should be very careful about using software they get anonymously off public computer bulletin boards or from outside networks," he advises. "If you don’t understand everything that’s in the code, don’t risk putting it on a system connected to our network.
"The biggest systems security problem today is password abuse," adds Steve. "Those who wish to break in might run programs that systematically try all common words in the dictionary. On a VMS system that the system manager has set it up properly, after a certain number of unsuccessful tries to log into an account, even the correct password will fail. But as an extra measure of security on any system, passwords ought to be either non-words (like ESQUIB) or nonsense combinations of words or words and digits (like DOOR8HILL). Users should also change passwords regularly and not use the same password on multiple systems.
"VMS users should pay attention to the protection of files that contain proprietary information to make sure they can’t be read, copied or changed by unauthorized individuals. Programs and command procedures should also be protected to ensure that they can’t be altered. Protections for individual files can be set to allow access to everyone on the network (World), the local work group (Group), the system manager (System), or the user (Owner). If you have sensitive information, you should find out what protections you have in effect and make sure that they are appropriate. Don’t just assume that the default setting chosen by your system manager is the right setting for all the information you use and store."
Digital’s most visible computer link to outside networks is the Arpanet gateway at the Western Research Laboratory in California. That connection is very carefully and cautiously structured. It only permits mail.
The numerous X.25 links into the company (packet switched networks like Tymnet, including our TSN connections) are more problematic. Many Sales and Service offices use those because that is the only way they can connect from a particular location or because they are more cost effective than a dedicated line. Those links have sometimes allowed additional interconnections to the world without the tight controls present at the Arpanet gateway. "It is very important that business and svstem managers at sites where X.25 gateways are installed follow the security guidance available from Digital Telecommunications for setting up the gateway software," says Steve.
"Digital encourages open networks because that free flow of information is so important for business," he continues. "But, at the same time, we quietly, unobtrusively, in the background, take appropriate steps to guard our information and computer system assets. You wouldn’t protect a bank the same way you would protect your home or vice versa. Likewise, we match our security measures to the risks involved.
"Just as alert citizens and neighbors can help local police prevent break-ins to houses and businesses, alert and security-conscious employees are important to our efforts," he observes. "When you log in, the system displays if there have been failed attempts to log into your account and when you last logged in. It can also display when a file was last altered or observed. Those kinds of clues can let you know that something strange has been going on. If that is the case, talk to your system manager or people in Information Systems Security."
"Digital products can provide a very high level of security. However, it is our job to make sure that the proper security features are enabled and used correctly," adds Ed Maguire. "VMS has evasion detection features that can frustrate would-be intruders. But evasion detection and other VMS security features must be installed properly. Security is more effective if layers of security are provided to safeguard Digital Proprietary Information. For example, the terminal server password feature can provide an additional layer of security for dial-in or other forms of remote access.
"Our security programs use our technology to protect our technology. We provide up to date information security policies and standards on VTX. We conduct security tests on our internal networks to detect and to correct security weaknesses before they can be exploited by a would be intruder. Technical security solutions, no matter how cleverly contrived, depend upon people to be effective. We need the support of every Digital employee to secure our networks and our proprietary information."
To signal the change of our business from just peripherals to products that are closely integrated to the company’s overall computing strategy, we’ve changed the name of our organization from Storage Systems to Storage and Information Management.
We have brought the Database Management Group into our organization. And even our traditional storage hardware organizations — which design and build tape, disk and memory devices, controllers and boards - now strive to provide complete solutions to customers with both hardware and software. This emphasis on delivering storage and information management solutions is aligned with the company’s efforts to be the leader in enter- prise-wide solutions, distributed computing, distributed databases and information management. The mission of our group is to help make information readily available to everybody in the customer's organization.
Information management will be at the center of the systems battles of the 1990s. Our storage and information management products should give us a unique opportunity to optimize the performance costs and availability of information to our customers, locally on any system and distributed across networks. Also, being able to effectively store and retrieve customers’ data will be important in our efforts to integrate applications, through our Application Integration Architecture (AlA).
There are a broad range of applications that will benefit from significantly enhanced storage performance. Many of these are commercial applications, but we also see increasingly large requirements for data storage in scientific applications with heavy computation needs.
Transaction processing, in particular, stresses the database software and the communications capability, and also the ability to operate at high rates. These are all areas in which our product architecture excels.
In July, together with DECtp products, we announced a number of advances in our storage capabilities, including the SA600 disk array, which offers two times the gigabytes per square foot as IBM, and performance levels equivalent to their largest systems.
Our objective was to make a storage subsystem that was state-of-the art in terms of data reliability, integrity and availability. We spent a lot of energy insuring that the bus system was robust and could be extended to handle the large storage configurations that we think customers will need.
In October, we announced a new family of storage elements with the MicroVAX 3300 and 3400 computers. Using advanced (VLSI) semiconductor technology, we have included all the controller functions in the storage device itself. This increase in the "intelligence" of these storage devices greatly improves the input/output (I/O) performance of the total system. In fact, the MicroVAX 3300 and 3400 systems offer I/O capabilities that are about three times the performance of our competitiors.
Basically, we extended technology that previously only operated in our larger systems to our MicroVAX line. This extension of our Digital Storage Architecture gives us the capa
bility to improve overall computer system performance when multiple storage devices are operating. It was a major step forward in small systems I/O technology.
Use of our storage and information management products and our distributed computing capablities internally will allow our manufacturing organizations at different sites around the world to share product and process information. This sharing is key to integration of the work in engineering with manufacturing. We are looking at a common database that extends through our suppliers. Electronic document interchange is a start in this direction. But ultimately, we want to add access to one another’s databases regarding products and forecasts and our business relationships. This experience is important in helping our customers who are asking us for such capabilities today.
Meanwhile the Service organizations will be able to use our database capabilities to access product specific information, so they can take appropriate corrective actions. In fact, many of the strides we have made in improving the quality and reliability of our products has come from the ability to share this information.
Satellite-distributed business television networks are a relatively new concept, and effective application of them is an increasingly important strategic challenge.
Our Digital Video Network (DVN) started in 1985 with 20 downlink sites (facilities that can receive the signals). It now includes over 70 sites in the U.S. and additional sites have been approved for installation in the next year. With additional sites, 98% of Field employees in the U.S. will be within one hour’s drive from a DVN site. Programming has grown steadily from 17 programs with 3,674 viewers in FY86 to 48 programs with 23,675 viewers in FY88.
This network allows large numbers of geographically separated employees to hear and see their company leaders, fellow-employees and outside experts train, inform and discuss key issues. It can also allow the audience to participate in televised training presentations via two-way audio connections. And the programming can be encrypted for privacy so only designated sites can decode the scrambled signal.
News conferences and product announcements distributed over satellite TV allow media representatives, customers, employees and other key audiences across the continent to see the event as it is happening and actually participate in the discussion. The network can also be expanded to include international sites by using ad hoc installations.
Although costs are greater outside North America, technology advances and scheduled new satellite launches will likely spur installation of additional world-wide business TV networks in the near future. There are a few in existence now, but they are used sparingly because of international transmission costs.
The DVN is now used primarily for product training and updates, saving the company the cost of travel, lodging and food expenses. As the network expands to reach more employees it will be increasingly used for key management messages, company/industry news and messages deemed strategically important for immediate and widespread distribution. Managers who learn how to effectively use this new communications resource will be able to stay in closer touch with their employees, while reducing their travel schedules and time spent away from the office.
Since Digital has a number of foreign nationals coming to the U.S. on a special visa intended for business or on-the-job training (B-l), it is important to keep in mind that this visa is issued for short periods — no more than six months at a time. To qualify for a B-l visa, a foreign national must:
o enter the U.S. for a limited duration,
o intend to depart the U.S. at the expiration of the stay,
o maintain a foreign residence while in the U.S., which he or she has no intention of abandoning,
o have adequate financial arrangements to travel to, stay in and depart from the U.S.
o engage solely in legitimate activities relating to the business or on-the-job training (in other words, no separate, gainful employment in the U.S.), and
o remain on the home country payroll.
Foreign nationals coming to the U.S. on business must come on a B-l visa and not on a tourist visa (B-2). They can be denied entry to the U.S. if they have the wrong visa. B-l visas are issued to foreign nationals at U.S. Consulates abroad.
Foreign employees who come to the U.S. on B-l visas should keep in mind that the white card which is attached to their passport when entering the U.S. (form 1-94) governs the length of time they are allowed to say in the U.S. If the 1-94 expires and the foreign national is still in the U.S., He or she cannot obtain an extension of the visa.
Foreign nationals seeking B-l entry can be challenged and/or denied entry for reasons of questionable "intent." Therefore, one should not assume that previous uneventful entries are a reliable basis for presuming that future B-l entries will be problem-free.
Family members accompanying the foreign national should enter on a tourist (B-2) visa, which also is obtained at a U.S. Consulate.
In addition, many foreign nationals do not have medical coverage while outside their home country. Therefore, it is important for them to speak to their incoming U.S. Personnel Deparment to secure medical coverage. Section 4.25 of the Benefit Administrative Procedures in the U.S. lists the coverage that is available to them. Other procedures must be put in place to allow for the business expense payments due to the foreign national.
For more information regarding B-l visas and related matters, contact Corporate Immigration at DTN 251-1483 or 251-1286.
Fran Barton has been named European Area controller, reporting to Earl Mason, European Finance manager. In this position, he is responsible for all area controllership functions, area financial planning and analysis functions. Fran joined Digital in 1974 and has worked in Manufacturing, the Field and corporate, most recently as manager of Corporate Financial Planning and Analysis.
Peter Brown has been named manager of the newly created Strategic Technologies Group in Digital Information Systems (DIS). He reports to Bel Cross, corporate manager, DIS. The new group will provide worldwide business solutions to the corporation through the development. integration, and application of information and telecommunications technologies. Peter joined Digital in 1977. Most recently, as Telecommunications manager, he developed the company’s telecommunications architecture and strategy, and was responsible for providing Digital’s voice, data, and video communications technologies. He also has worked in Storage Systems and Distributed Systems Manufacturing.
Tom Colatosti has joined Corporate Finance as assistant corporate controller, reporting to Bruce J. Ryan, vice president, corporate controller. In this role, he is responsible for managing the Corporate Financial Planning and Analysis organization. Tom joined Digital in 1973 and has held financial management positions in the product lines, at corporate and as Finance and Administration manager in Canada. For the past five years, he has been manager of U.S. Area Finance.
Leo Quinn has been named DIS Controller, reporting to Bel Cross, manager, Digital Information Systems, and Harry McKnight, manager, Corporate Operations Finance. In his new role, Leo will assume financial responsibility for all of Corporate DIS in the areas of accounting, budgeting, forecasting, management reporting and internal Controls. He joined Digital in 1977. Since then he has held senior financial management positions in the U.S. Field and in Manufacturing. Most recently, he was the Group Audit manager for European Subsidiaries, Manufacturing and Engineering.
Jim Schweitzer has joined Digital as corporate manager, Information Security, reporting to Ray Humphrey, manager, Corporate Security. He comes from Xerox where he had held the senior corporate information protection position since 1977. In that capacity, he was responsible for worldwide policy development and program implementation. An authority in the field of imformation protection, he is the current or past chairman of several industry committees charged with computer security issues and has written five books on the subject.
In response to increasing health care costs and to provide employees with more choices for access to quality care, Digital is making a number of changes to the medical plans offered to employees. Employees will now have three choices: Health Maintenance Organizations (HMOs) and two Digital Medical Plans.
Digital Medical Plan 1, with weekly premiums of zero for a person with single coverage and $7 for dependent coverage, pays 80% of reasonable and customary in-hospital and surgical expenses and 80% for outpatient services.
Digital Medical Plan 2, with weekly premiums of $3 for single coverage and $16 for family coverage (including the employee), pays 100% of in-hospital and surgical expenses and 80% for outpatient services.
Plans 1 and 2 both require the employee to pay a deductible before the Plan begins to pay.
Under both Plans, the deductible will be increased from $125 to $150 per person per year for single coverage and from $375 to $450 for family coverage.
The various HMOs have not yet determined what benefit or rate changes they may wish to make to their individual plans. Details on all these changes will be mailed to all employees in the U.S. in February so they can make their choices before April 1, 1989.
At the same time, Digital is enabling employees to benefit from U.S. tax laws. Medical and dental insurance premiums will automatically be deducted from employees’ paychecks before federal and most state and local taxes are calculated. Depending on income, the tax savings could range from about $200 to $500 per year.
Digital will also offer another program allowed by U.S. tax law that enables employees with dependent care expenses (such as child care and elder care) to set aside a portion of their income (pre-tax) in an account earmarked for payment of such expenses. A number of government restrictions apply to this program; so carefully read all the plan details when they are published.
Information on the medical changes and dependent care programs will be available soon through many channels, including newsletters and group meetings. The level of detail will range from a short video to a complete enrollment kit containing detailed plan provisions as well as an individualized comparison of the HMOs that are available to each employee.
The name "Petty Cash" has been changed to "Employee Expense," to describe more accurately the service being provided. Several procedural changes in this operation will take effect Jan. 3, 1989:
o Cost center managers/approvers are accountable and responsible for the content, accuracy and appropriateness of approved Employee Expense vouchers.
o Internal Audit will continue to put more emphasis on auditing the business groups/- approvers for adherence to Petty Cash Policy.
o New policies and procedures will be implemented whereby Employee Expense will verify at the window arithmetic and appropriate approvals only.
o Employee Expense will perform after-the-fact audits, reporting the results back to the Controller/Finance organization and/or the cost center manager/approver.
These changes reaffirm that the accountability and responsibility for adhering to policy lies with the cost center manager or approver. The Petty Cash Manual is the focal point for Corporate Petty Cash policy and procedures issues.
For further clarification, please consult your local Finance Support Group, and/or Controller, your local Disbursements manager, your local Employee Expense office, or the Corporate Accounting Policy manager, Ted Bitensky, AKO1-3/Q3, DTN 244-6294.