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Conference 7.286::digital

Title:The Digital way of working
Moderator:QUARK::LIONELON
Created:Fri Feb 14 1986
Last Modified:Fri Jun 06 1997
Last Successful Update:Fri Jun 06 1997
Number of topics:5321
Total number of notes:139771

939.0. " WSJ Editorial on Digital" by NISSAN::STIMSON (Thomas) Fri Sep 29 1989 20:26

    
    I'm surprised that no one has yet entered this widely circulated article
    in this conference.    Any comments ????
    
    ========================================================================
    
The Wall Street Journal, Monday, Sept. 25, 1989

                A WINNING PHILOSOPHY BECOMES AN ALBATROSS

By Jack Falvey

The challenge of managing a high-growth, innovative or creative industry has
not been handled well by many of the start-up companies of the 1980s. But even
one of their elders is finding that the techniques that helped get it to the
top are different from those needed to stay there.

Out from the clutter of the computer revolution of the 1970s came Digital
Equipment Corp., which rose to the powerful number two slot by developing a
management system modeled after one often used at research institutions like
the Massachusetts Institute of Technology.

Under the system, which continues to this day, every employee is part of a
group. Each group has a leader, a project and a budget. The group is free to
spend its budget with virtually no upper-management control, provided it stays
within its allotment. Every once in a while, a group produces something
wondrous and its budget is increased. The groups that don't produce anything of
value are left alone for a long while. If they still don't produce, they are
disbanded and their people join other expanding groups. Digital's approach is:
Don't get organized. Don't manage. Don't control. Just let it happen.

This decentralized management system has kept the company far ahead of the pack
in terms of product development, which continues apace. A byproduct, however,
is that Digital employs large numbers of less than essential people. The
personnel costs are considerable, but the returns no longer justify them.
Inevitably, the hands-off management system that produced unparalleled growth
and creativity also has produced a country-club atmosphere. Many employees,
instead of fighting their way through the current tough times, are just putting
in their time until tough times are over (whenever that may be!) The current
challenge is what to do now that Digital's spectacular growth curve is
leveling off. Earnings for the past four quarters were down 19%, 12%, 11% and
16% respectively, from the same periods a year earlier.

Digital is trying hard to cut costs without violating its commitments to its
creative staff. A hiring frost has turned into a deep freeze. But at the height
of the company's ascent, managers over-hired by about 50% (out of a total
world-wide work force of 125,000.) Attrition cannot bring such vast numbers
down to size in any reasonable period.

Last month, management set a goal of reducing administrative jobs by 10,000 in
24 months. The danger of this strategy is that top-notch workers, unwilling to
forgo promotions into administration, will quit. All salaries have been capped,
and there's a hold on upper-level stock options as well. Early-retirement
packages have not yet been offered, but that strategy often weakens an
organization considerably, since management can't make the offer only to those
it wants to leave.

Finally, thousands of manufacturing people have been sent to sales. This tactic
is seldom effective; industrial musical chairs does not cut costs, nor does it
produce new business. Furthermore, this move emphasizes another weak link in
Digital's management philosophy: allowing the hands-off management system to
work its way into the sales organization. What was right for managing creative
growth turned out to be very wrong for sales management, where no innovative
approach was needed. In sales, the Marine Corps model (get the best people and
work 'em by the numbers) -- not the laid-back model -- works best.

While Digital's products have been outstanding, they have not been matched with
a sales team of equal quality. So long as the products stood out so much that
they practically sold themselves, this wasn't much of a problem. But as the
competition edges closer and closer to Digital's level, lack of expertise in
basic sales management is becoming ever more apparent. And that cannot be
remedied overnight.

The prescription is maddeningly simple. The late chairman of Parade Magazine,
Arthur "Red" Motley -- who coined the phrase "Nothing Happens Till Somebody
Sells Something" -- set forth the formula for success in sales in just 15
words: "Know your customer. Know your product. See a lot of people. Ask all to
buy."

Meeting this challenge is well beyond Digital's current sales management group.
Under ideal conditions, it would take a minimum of 18 months and more like 36
months to produce an effective selling team.

At some point, something must give. The deficiency in sales management is just
about an insurmountable obstacle. But there is a greater lesson from Digital's
recent travails: Despite the success of a particular management technique, a
company must always have the flexibility to alter that technique as conditions
change. The proof of Digital's high-growth strategy now awaits the outcome of
its struggle to deal with a major decline.

------------------------------

Mr. Falvey, a writer based in Londonderry, NH, teaches sales management at the
University of Massachusetts, Boston.




T.RTitleUserPersonal
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939.1And after you sell it....NWACES::LINNJust another chalkmark in the rainSat Sep 30 1989 16:2119
    Okay, I've been standing on soapboxes for this one.  I'm game for a
    reply.
    
    Hey, argue about the specifics, I don't care, but to the main premise
    here's an emphatic:
    
    		AMEN.
    
    
    I would add that after you sell "the system," you had better be able
    to deliver/implement "the system."
    
    Otherwise, you won't get that second order.
    
    And if Digital's movers and shakers in management believe we can do
    that by picking up some manual and reading it over a weekend, well,
    then we're all on a sinking ship.
    
    	-- bL
939.2WSJ Doghouse again?ALBANY::MULLERFred MullerSun Oct 01 1989 14:408
    Is KO going into the Wall Street Doghouse again?  It better be a big
    one; he grew considerably in the last one.
    
    I'm hanging on to my share certificates.  Wish I had the dough to buy
    some more.  Noted in the just received Annual Report that there are 5M
    fewer shares out there.  I'll take his advice any day. 
    
    Fred
939.3LESLIE::LESLIESun Oct 01 1989 18:049
939.4something like this had to have happened...DUGGAN::CURRIEveni vidi scriptiMon Oct 02 1989 11:5716
RE: 0

	a) the situation is actually worse since this article points out
	   a situation in the field that exists elsewhere in the company as
	   well.

	B) even if you hadn't seen it you would have had to surmise that
           something was up ... the stock began a downward spiral just
           after the article appeared and hasn't had an appreciably up day
           since.  (some this will argue that this is due to the vortex
           created by I*M's latest earnings announcement ... not
           necessarily since our stock decline, and this WSJ article,
           preceded the I*M announcement by a few days) 

later...
 jim
939.5CVG::THOMPSONMy friends call me AlfredMon Oct 02 1989 12:5117
	I don't understand something. The article says we have too
	many middle management people, I can buy that. It also says
	that if we freeze the middle management ranks we risk losing
	people who only want to move up in management. This sounds
	like what we want to happen but the article says it's bad.

	You don't have to go in to administration to move up at Digital.
	This seems to be lost on a lot of people outside Digital. I
	know my brother, in the insurance business, doesn't understand
	it at all.

	I'll agree with some of what the article says about sales
	though. We still don't work smart enough about selling. That
	was true 10 years ago and I don't see that anything has changed.
	I don't see the latest re-org changing anything either.

			Alfred 
939.6HALF-ASSED MEASURES WON'T WORKMSCSSE::LENNARDMon Oct 02 1989 14:4419
    Me neither......sales is still our weak link, and will remain so until
    we start hiring the right people and truly compensating them properly.
    (this means commissions.....too bad, but it's time).
    
    I also agree we are overburdened with thousands of staffees who could
    go away tomorrow.  I can say this because I'm one of them.  There are
    about 50 people that do what I do, and an incredibly complex system
    of committees that we have to work through.  One half-assed AI system
    could replace us all.
    
    Our fundamental problem is that our marketplace is changing 
    about five times faster than we can change.  Our bloated structure
    puts us permanently behind the power curve.  Look at the workstations
    fiasco....in FY89 we sold 50,000, made 1.1B in NOR, and lost money.
    The situation is even getting worse now as workstation prices are
    dropping at a 20% a year rate.
    
    I too feel that we will end up a strong #2 player, but Digital will be
    a dramatically different and much smaller company.
939.7But what is the author truly saying?LCDR::REITERI'm the NRAMon Oct 02 1989 17:1052
Re  basenote essay

Digital, like anyone or anything else, can always benefit from constructive
criticism, but I'm not sure that that's what the article is. 
I offer:

>> Digital's approach is:
>> Don't get organized. Don't manage. Don't control. Just let it happen.

I missed this.  Is this in the Orangebook?  No, this is the faulty premise 
upon which the remainder of the essay is predicated.

>> Early-retirement packages have not yet been offered, but that strategy
   often weakens an organization considerably, since management can't make the
   offer only to those it wants to leave. <<

Who says it can't?  At least in the case of attractive severance packages, 
various groups can be targeted.  (I realize that severance is not the same as 
early retirement, but the net effect in headcount is the same.)

>> Finally, thousands of manufacturing people have been sent to sales. This
   tactic is seldom effective; industrial musical chairs does not cut costs,
   nor does it produce new business. <<

May I differ?  Mazda (Toyo Kogyo) was on the verge of bankruptcy after it had
bet its business on the rotary engine and the energy crisis of 1973 hit.  It
struggled back by 1980 to be the 3rd largest automaker in Japan and the 10th
largest worldwide by doing just what our dear professor says can't be done. 
Without a penny of subsidy money and no layoffs... amazing!

>> In sales, the Marine Corps model (get the best people and work 'em by the
   numbers) -- not the laid-back model -- works best. <<

And this guy _teaches_ sales management?

>> "Know your customer. Know your product. See a lot of people. Ask all to
   buy." <<

Nearly 100% of the Digital sales folk that I have had the pleasure of being 
associated with here in the field do just that.  Every day.  

If his premise is that it takes different skills to run a mature industry-
leading firm than a fast-growing smaller one, few will disagree.  It seems 
that he has taken a fairly obvious point, tried to use DEC as an example, and 
tried to "shoehorn" his philosophy onto DEC via inductive reasoning.  Yes, we 
could be doing things better, but he's way off base in his basic assumptions 
about us.  Haven't people in here been complaining about the "New DEC" with 
its beancounter mentality?  I think the change in management style that he 
advocates took place five years ago.  

Someone asked for my opinion...
\Gary
939.8Well....maybeLESCOM::CLOSEMon Oct 02 1989 18:4126
    I agree with Falvey that there's trouble right here in (Assabet)
    River City, but I differ with him on several points.
    
    Don't manage...don't organize....etc? I think we're way too organized
    and way too managed. There are committees monitoring committees.
    We're strangling on bureaucracy and we're way overmanaged. The result
    is chaos -- which the WSJ piece attributes to lack of management
    -- but the cause is what the writer prescribes as the cure.
    
    "Country club atmosphere" ????? Where? I want to work there! In
    low-end systems we're been working like maniacs for three or four
    years. We're in permanent announcement mode, short-staffed, and
    we can't hire anyone. Sure doesn't feel like any country club I've
    heard of, and I'll bet most people feel the same way. Where is this
    cushy place?
    
    Sales management? I'm not qualified to comment, but I agree that
    it's time for commissions.
    
    If we've been on an over-hiring binge, and thousands will lose their
    jobs because of it, then I hope the people who made the decisions
    and approved the hiring lose theirs.
    
    The Mazda example is a good one. Companies can come back from deep,
    deep trouble. Chrysler, Ford, Nissan, Apple, the list goes on. I
    think we can do it, too.
939.9HKFINN::STANLEYWhat a long, strange trip its beenMon Oct 02 1989 19:3418
    We do have too much overhead, too much "middle management" to carry.

    I've seen statistics recently showing substantially greater increases 
    in salary in recent years for management than for individual contributors.  
    Such policy (deliberate or not) creates unbalanced overhead that
    the individual contributor has to carry.  In a down market (and
    the industry is in a down market) that inbalance can become an
    unbearable burden.   Because salary increase is contained in cost
    containment policy, managers tend to reward achievers by promotion
    to middle management.  Bad idea.  It would be cheaper in the long
    run and better for the corporation to simply pay the individual
    contributor what he is worth and discourage so much middle management.
    
    IBM announced this morning that it is extending its early retirement 
    program to cut headcount again.   Tough times ahead, no time to
    be building little kingdoms with layers of unnecessary managers.
    
    Mary
939.10NEWVAX::TURROHi Ho Hi Ho I'm off to ODOTue Oct 03 1989 04:5516
    re.7
    
    	Where have you been ? Here in the MAA we are on reorganization
    20 ver5 revA. And this has been goin' on for years. And as for
    managment (HUH?) HAAA I have a DM that I may see once a month in
    our office. He manages 2 branch offices but he lives in VA and thats
    where he spends 95% of his time. And the UMs who are in the office
    don't want to have anything to do with customers or engineers and
    there main worry is "Is this call covered ?" . Granted this is one
    of there duties but anything above that you can forget. Our UM told
    us he was tired of hearing us cryin' abou' this and that and said
    manage it ourselves. Thats the way its been in the field since I
    came here. ANd I don't think its goin to change.
    
    Mike Who agrees with everything author says 150%
    
939.11MPO::GILBERTThe Wild Rover - Portfolio Mgmt ServicesTue Oct 03 1989 14:0735
    
    >> Know your customer
    
    	We know our installed base. We don't know our enough customers.
    
    >> Know your products
    
    	We don't. Our salesforce complained long and hard about this.
    	We set up training programs to get this done. Salesforce complains
    	about having to go to training.
    
    >> (Sorry, I forgot the exact wording of the third one) Make lots
    	of calls?
    
    	We don't. We target large accounts where we can sell 100 Vaxen
    	or more. IBM salespeople scour small companies looking to sell
    	one machine. They advertise their name all over the place. If
    	you're a small company that needs it's first computer who do
    	call. The name you're familiar with. IBM also targets small
    	accounts that they figure 40% of the time will grow into larger
    	ones. Here's a perfect example I have first hand knowledge of.
    
    	A year ago I sat on a review of bids for a local school system.
    	Digital didn't bid. A third party bid an 11/83. IBM bid an AS/400.
    	The system decided to hold off. One of the topics of discussion
    	and reasons for the hold was to look at future needs for the
    	whole town. The school system has gone out to bid again. Again,
    	DEC chose not to bid directly. This time I've got a Microvax
    	3300 against the AS/400 b10 from IBM and a b20 from a different
    	third party. Whatever the review board chooses the town wants
    	to network a number of systems over time. The board feels obligated
    	to stick to one hardware supplier where possible. There will
    	probably be at 3 or 4 added systems in the next few years. Again
    	IBM goes looking for these directly. We don't.
    
939.12Fully agree with -1ARCHER::LAWRENCEWed Oct 04 1989 15:2119
 Re -1

You've hit a spark!  I've run into the same kind of thing.  Twice my daughter
and I tried to get sales involved in prospective clients and both times the
response was 'tell them to go to the computer store'.

The first was an antique dealer who was also president of some Massachusetts
antique society.  He wanted to get a computer.  His eventual goal was to
connect all the antique dealers within his group.  There was NO WAY he was
going to go to any computer store.

The second was a book dealer in Worcester.  When the manager had to go looking
for a book title I'd requested, I started talking to him about automating his
stock/payroll/whatever.  He was enthusiastic.  But we couldn't get sales
interested.  That store, plus all his other stores in the chain now have
computers.  Not ours.

Betty
939.13Bingo!MPO::GILBERTThe Wild Rover - Portfolio Mgmt ServicesWed Oct 04 1989 16:5312
    I'm not surprised. If sales had acted on half the stories I've heard
    over the last 6 - 12 months I doubt we'ld be having the problems
    we're having today. Our "salesmen" think they only need to sell our
    systems to big corporations like our own. And I know I'm going to
    get heat for this but most of them don't know how to sell. They're
    nothing more than glorified order takers. We send the marketers
    to sell the big accounts then they get a sales rep to take new orders
    from the customer. We need to start knocking on small and medium
    size doors and start selling one or two systems instead of trying
    to sell 500 to one big guy. There just aren't that many big guys
    left.
     
939.14I only want the pretty brown onesSMOOT::ROTHAll you can do is all you can do!Wed Oct 04 1989 17:179
    DEC is in a bind. We don't want to fool with the little fish; we
    only want the big ones. (We are not even prepared for small
    fish!) And some big fish take a while to land... and if your
    vision is only as long as the next quarter then you may be
    forced to skip fishing for the really big fish.

    A real quandary. I'm glad I'm not in sales.
    
    Lee
939.15POCUS::KOZAKIEWICZShoes for industryWed Oct 04 1989 18:2017
    re: .11,.12,.13
    
    Targeting small businesses is OK, just remember that the direct
    expense for a Sales Staff Week (a term I just made up - any combo
    of sales and sales support that adds up to 40 hours) is on the order
    of $3,000.00.  A week is about the minimum amount of effort required
    to close a small system sale. Two things to consider - 1. you won't be 
    successful selling $30K systems if most of the gross margin is consumed
    by the cost of the sale; 2. If I am a sales unit manager and have limited
    resources to invest, I'm going to put them where the payback will
    be the greatest.
    
    Look for changes to this scenario starting next year once Sales
    UM's have an expense budget...
    
    Al
    
939.16universe of 1, but a symptom??COOKIE::SIMONWed Oct 04 1989 19:2015
    This is only one example, but...
    
    Before working at Digital, I was with a small consulting firm in Denver
    that specializes in Government contracts.  Several months ago, I was
    having lunch with a couple of the guys with whom I used to work, and
    they mentioned to me that several months prior to that, they had been
    trying for over 2 months to get some price quotes and configurations from 
    Digital sales (don't know what group specifically) for a systems 
    integration contract they were pursuing, but were unable to get any 
    information at all; most phone calls they made were unreturned.  They
    eventually, due to the deadline, bid some UNIX boxes from one of
    Digital's competitors.  True, they only wanted to bid a couple of
    workstations and I think one mid-range system for this contract, but
    they also go after some major hardware sales efforts that would be a
    boon to Digital if we were the vendor.
939.17Can we track the calls we don't return?KYOA::KOCHMy brother did not lose the electionWed Oct 04 1989 20:125
	I don't think .-1 is a universe of 1. IMHO we should put in
	place some kind of tracking system for these kinds of calls.
	If we don't return the call, at least we would get an idea
	of how much business we are turning away. This might cause
	someone to think about it.
939.18Lets do lunchHOCUS::RICCIARDIMark Ricciardi New York FinancialThu Oct 05 1989 00:2218
    Re .13
    
    The voice of experience?     You'd be very wrong to spend
    your time chasing 10-20K deals. These rightfully belong to other
    channels, you'd be getting paid to much to be spending alot of your
    time on them.  You should assume responsibility for involving an
    OEM or Distributer and check up, but not manage the sale.
    
    I don't see that many order takers and I've been looking for 5 years.
    I see people in sales working very hard.  The ones that "don't know
    how to sell" don't and as a result, last only 2 to 3 quarters before
    they are inspired to work somewhere else.  Budgets in sales grow
    at such rapid rates that "taking orders" will not cut for long.
    
    I'm glad to see lots of people have such wonderful ideas on how
    to sell.  I hope you all have an opportunity to try them out :)
    
    Mark
939.19We think bigger than BlueLEAF::JONGSteve Jong/NaC PubsThu Oct 05 1989 03:1218
    I used to hear the same stories at Honeywell.  They allegedly weren't
    interested in onsies and twosies; if you didn't want to buy a million
    dollars' worth of product, they didn't know you existed.
    
    Of course, Honeywell isn't in the computer business any more...
    
    I fully believe the anecdotes told in this topic, based on my previous
    experience (not in sales).  It's deplorable!  IBM is grubbing after
    every one-seat sale and we're not?  Since when are we too big to go
    after that kind of business?  (Especially in view of the how these
    stories always end up with IBM winning the business.  I guess we're
    bigger than IBM now...)
    
    It reminds me of the joke about the rich man telling his driver how to
    save a toll by taking a shortcut.  "If you don't mind my asking, sir,"
    the driver says, "How come a man in your position is worried about
    saving fifty cents?"  The millionaire replies, "How do you think a man
    in my position gets that way?"
939.20Blue cuts through Red (tape)AUSTIN::UNLANDSic Biscuitus DisintegratumThu Oct 05 1989 10:2929
939.21almost.....MAMIE::DCOXThu Oct 05 1989 11:0233
Not quite!

>    The trick to high-margin sales is to have good products, convince the
>    customer that he *needs* those products, and offer him a clear and
>    concise solution with no hidden costs.  We do great on the first point,
>    we need to work on the second, and we fall down miserably on the last.

One and  three,  no  question.    

However,  if  you  feel  you need to convince the customer that he  NEEDS  your
products, you are wasting your time on a short term investment.  You might just
be working real hard to force that proverbial square peg into the round hole  -
it only works once with each customer.  Spend the same amount of effort working
WITH the  customer  finding  out  what it is he really needs.  Surprisingly so,
many customers know  more  about  their business than we do.  They may not know
our products (then again,  most  of  US  don't know them all), but they sure do
know what problems they are wrestling with each day.

If you do your job well, the customer will see the answer soon enough.  Perhaps
Digital does not offer  the products and/or services to solve his problem, more
likely that we do.   In either case, the customer knows of at least one account
manager (generic term, here) in at  least  one  company  who is thinking of the
customer's  long  term  interests  and not the  account  manager's  short  term
bookings.  That is a valuable investment.

Now then, the hard part  is  to  structure  the goals of those folks who are in
active contact with customers (the WHOLE "account team") to permit them to work
this way.  Would be rewarding, no?    But  then,  that  has  been  discussed ad
nauseum in another note.

just my opinion.....
Dave

939.22DNA600 still lives, right?DLOACT::RESENDEWe never criticize the competition directly.Thu Oct 05 1989 20:009
Re:  last several on selling to 'small' accounts

Unless things have changed, the field is still responsible for focusing on the
'DNA600' accounts -- the 600 largest accounts.  With the focus there, until
some change is declared by management, I doubt you'll see any effort being
expended on so-called 'mom-and-pop' operations.  Boy, it's tough to walk away
from a custome with money ......

Steve
939.23Smaller Accounts May Pay Off!CTD016::J_BUTLERLeave it better than you found it...Thu Oct 05 1989 20:4040
    Just some 'small sales' thoughts here...
    
    An earlier reply said that it takes a minimum of one week to close
    a small order, at a $3K direct expense. But the sales force needn't
    dedicate a salesperson to only that one contract. It seems to me
    that a moderately aggressive salesperson would be closing some,
    working others, and seeking more during that same week for the same
    $3K expense. 
    
    Aggressive sales to smaller businesses have some hidden benefits:
    
    1. Small organizations frequently employ a high percentage of 
       entry-level workers. If they learn DEC equipment, they will
       (hopefully) try to seek out higher positions with larger firms
       also o DEC equipment. That makes them more competitive in the
       job market (good for salaries, etc) and more capable performers
       (good for productivity).
    
    2. A wider customer base at small levels makes for more purchases
       when the company expands (not all do, but those willing to spend
       a good amount of cash on a system (even a small one) probably
       are doing OK already. We make outstanding equipment. The more
       that use it, the more likely to like it and get their buyers
       to purchase upgrades, new equipment, etc.
    
    3. Before I came to Digital, the people I worked with spoke of
       Digital 'snobbery.' DECies had an 'attitude of superiority'
       about them. 'It's a GREAT company...*IF* you can get in.
       By placing our great systems and networking solutions out where
       the smaller folks get to see them and come in contact with the
       'real people' who ARE Digital we can overcome such stereotyping.
       Ignoring the 'little guy' just reinforces bad feelings, and
       when our stock falls the 'little guy' we ignored says 'GREAT!
       It serves them right!"
    
    Maybe we OUGHT to be more aggressive towards selling to the smaller
    potential customers. ?? Should I be in sales??
    
    
       
939.24We don't make it simpleRIPPLE::KOTTERRIRich KotterThu Oct 05 1989 22:00102
    I've been with DEC in sales for six years, and eleven years selling in
    the industry. In my experience, I think it is a true statement that
    many smaller customers feel very ignored by DEC sales. Even some of our
    larger customers feel this way, from time to time. 
    
    In my experience, I do not think it is because we don't have good sales
    people, or that they are lazy. I also don't think that it is mostly
    because our sales force is not adequately trained. Here's what I have
    experienced as some of the causes of the problems: 
    
    1- Sales reps are just like everybody else. We have 24 hours a day and
    no more, which we have to allocate. Most sales reps that I know
    allocate more than 40 hours each week to DEC. There are are only so
    many things that you can get done in 40+ hours. After that, the rest
    gets undone. 
    
    2- Sales reps, though not on commission, are under extreme pressure to
    make the budget (quota). It's a major career limiting move to
    consistently miss the numbers. Many jobs in DEC can't be measured in
    such a readily visible way. The sales rep will and must focus on making
    the number, as a matter of survival. He also wants customer
    satisfaction, but that is not as easy to determine, and usually is a
    secondary priority to making the numbers. 
    
    3- In my view, the sales cycle is MUCH more complicated than it should
    be. We have made it so difficult to get it right the first time, and we
    have NOT kept it simple. For example, life got much more frustrating a
    year ago, when we decided that there would be four different prices for
    every system, depending on the level of warranty the customer wants.
    There are about ten different classes of warranty, depending on the
    product. Then there's the services. Did the customer want integrated
    hardware and software support, hardware only, right to copy updates,
    Basic, DECservice, Carry-in, telephone support, media updates, on and
    on ad nauseum. 
    
    To configure systems is not simple. Sure we have lots of VAXes that are
    compatible, but which one should we propose? Should it be one larger
    system or a cluster of smaller ones? How much memory is needed, how
    much disk space, what are the software licence codes? Did you forget
    the H-kits, a cable, or the keyboard that needed to be specified
    separately? Did you use the automated expert configuration tool, and
    find that it rejects a valid configuration or adds parts that are
    already included? 
    
    Getting answers to customers questions takes too many phone call
    cycles, only to get conflicting answers from within DEC. You're put on
    hold for long periods of time, to only then get someone on the other
    end of the support line that knows less than you do, and looks in the
    same books that didn't have the answer. Then they refer you back to
    your local sales support resources to get an answer, but they are all
    out for the rest of the week at training or customer visits or what
    not. 

    If it is a competitive situation, you have to work with several
    different people to try to get an allowance in order to offer a better
    price, so we can win. Is it low enough? Is it too low? Why is it
    justified? Will it set a bad precedent? 
    
    If the customer has gone out to bid, it can take an ENORMOUS amount of
    time to respond to all of the points in the bid, to get DEC to agree to
    some off-the-wall terms and conditions, to round up copies of hardware
    and software documentation, and to really put together a good response
    that has a chance of winning.
    
    Then we must mention the fun that goes on after the sale. We get to
    help work the issues when the product goes on engineering hold and
    delivery slips, or we shipped the wrong thing, or the invoice is wrong,
    or the customer is slow to pay, or we didn't quite get the
    configuration right (see above) and have to try to fix the problem in a
    big hurry, or the product arrives Dead-on-arrival, or field service
    can't get out to install it soon enough, etc. 
                            
    4- Continuous re-(dis)-organizations, re-budgeting, forecast reports,
    expense reports, monthly reports, war games reports, sales effort
    tracking reports, (that change format on a regular basis) eats up too
    big of a chunk of valuable sales time. 
    
    5- Sales support is woefully lacking, given the complexity of our sales
    cycle. 
    
    6- The pace of product and technology change, as well as the breadth of
    our offerings and markets that we are trying to address, makes it very
    hard to keep up. 
    
    7- We are told to use distributors to help sell to small customers, but
    the distributors, for the most part, are not good at selling solutions.
    They can quote price and delivery on a requested item, but most can't
    put together, say, an accounting solution for Mom and Pop, Inc. They
    have most of the same challenges that the DEC sales rep has, and they
    are outside of DEC, to boot. 

    Now, you ask, what is the DEC sales rep doing with his time that not
    all of the calls get returned when they should or quotes don't get sent
    when the customer asks? He's dealing with the above garbage until the
    end of his day comes, and then he goes home, just like you do, and
    tries to find time the next day to do all of those things that he knows
    needs to happen, but can't seem to find enough time to get done. 
    
    If we want this to change, we have to put into practice the axiom: KEEP
    IT SWEET AND SIMPLE, which it is not. 
    
    Rich
939.25POCUS::KOZAKIEWICZShoes for industryThu Oct 05 1989 22:0115
    re: .23
    
    I was the one who quoted the 1 week figure.  I was referring to
    direct effort, not the sales cycle (which is usually longer).  If
    you use 1 week as the median effort to close a small system sale
    (and it's just my own opinion that it is a reasonable figure),
    that translates to about a $3K cost of sale.  That comes right off 
    our gross margin.
    
    The Digital sales force is not designed to handle direct small systems
    sales; that is why we have DECdirect and relationships with OEMs
    and distributors.
    
    Al
    
939.26MicroVAX? Call me when you want a 6000!....ClickHOCUS::RICCIARDIMark Ricciardi New York FinancialFri Oct 06 1989 01:5619
    
                                            or paid
    >The Digital sales force is not designed to handle direct small systems
                                            ^
    >sales; that is why we have DECdirect and relationships with OEMs
    
    >and distributors.
    
    Please, all you folks who keep saying we don't pay attention to
    MOM and POP.  WE DO!!
    
    It makes sense to a lot of people to address their needs through
    channels and it proves quite effective normally.
    
    Re .24
    
    And thats the short list.
                                                   
    
939.27LCDR::REITERI'm the NRA^Partnership 4 a Free AmericaFri Oct 06 1989 11:5720
Basically, Rich Kotter said everything I was going to say (but in 102 lines).

To the people who blame the individual sales rep for our problems:

1. Do something about the complexity of doing business WITH and AT Digital.

2. There are other channels for the florist shops and bookstores.  If we are
not reaching them, it's our Distributor/OEM's fault --- not our sales reps'.

3. Individual sales reps do not make the decisions that lead to (1) and (2).
Other people --- people not in the field --- make those decisions.

I seriously call into question the business judgment of everyone with the
"one that got away" horror stories, and who blames that on Digital's sales
force.  Yes, they should have purchased DEC-manufactured equipment, but not
directly from us.

\Gary (in the field, but not in sales... the salespeople don't have time
       to constantly defend themselves in Notes, they're too busy earning
       our paychecks)
939.28Can we get back on the subject?DIXIE1::BONEYour humble servantSat Oct 07 1989 03:416
    Oooooooowwweeeee!!!!  I love this.  Sales-bashing stories.  This is
    REALLY accomplishing something.
    
    Bo
    
    (sales representative)
939.29KO's advice?ALBANY::MULLERFred MullerSat Oct 07 1989 14:1213
    Not once in 939.* has anyone mentioned KO's famous sayings that "We do
    not pay commissions so that we will pay attention to all our customers
    equally, large or small".  I think that is a close paraphrase.
    
    I am not in sales, never understood how it could work, but somehow
    liked the sentiment.  Maybe because I chuckle over paradoxes and find
    the world full of contradictions. I am continually amazed how many get
    "worked out" some way or other. 
    
    Fred
    
    Hmmm, I do not think I have heard him say this recently.  Missed the
    last stockholder's meeting; gotta go this year.
939.30LESLIE::LESLIESat Oct 07 1989 17:003
939.31What Distributor/OEM? TOHOKU::TAYLORSun Oct 08 1989 18:0313
  Note 939.27 by LCDR::REITER 
    
2. There are other channels for the florist shops and bookstores.  If we are
not reaching them, it's our Distributor/OEM's fault --- not our sales reps'.

    I have been to trade shows for both bookstores and video stores. In the
    hundreds of booths selling computer related stuff, only 1 was even
    remotely interested in DEC equipment. I agree this is not a problem for
    the sales rep. But there is no visible Distributor/OEM. Small business
    buys at the local corner computer store. If it is not on the shelf at
    PCs 'R US, it is not on the desk of the small business.
    
    mike
939.32Where the WSJ laid the blameSDSVAX::SWEENEYI was focused when focus wasnt coolMon Oct 09 1989 13:0610
    Let's be frank about the Wall Street Journal piece on what's wrong with
    Digital:
    
    It laid the blame at the door of "sales management", and for crying out
    loud, isn't that where it belongs?
    
    There's a consenus on this.  Would Shue and Shields have resigned if
    "sales management" had succeeded in meeting their commitments to the
    corporation?  There's not a ex-sales manager or ex-sales rep in the
    bunch until you get into the "areas".
939.33CASEE::LACROIXObject oriented dog food? No, sorryMon Oct 09 1989 14:3112
    Re .32:

    Take it easy... Once again, if Sales Management hasn't succeeded in
    meeting their commitments to the corporation, that doesn't mean that
    this is " what's wrong with Digital ". It only means that we haven't
    sold as much stuff as we thought we would; blaming it on Sales
    Management is the easy way out, but is a pretty good way of missing the
    real problems. What if after a Sales Reorg, things still don't look
    right? Maybe we'll then hear that folks are starting to try to find out
    what the problems really are... and maybe they'll miss the mark again.

    Denis.
939.34There's enough blame to go around ...AUSTIN::UNLANDSic Biscuitus DisintegratumMon Oct 09 1989 14:3931
    re:  .32
    
    >It laid the blame at the door of "sales management", and for crying out
    >loud, isn't that where it belongs?
    
    I would have to agree with this, except that, from the Corporate
    viewpoint, Engineering was the focus, not Sales and Marketing.
    The customer was expected to know and love Digital for its products,
    not because Digital was easy to do business with.  Sales was mostly
    considered to be a "necessary evil".
    
    If Jack Shields is the one to take credit for things like DECworld,
    then I have to applaud him, because those events did more to raise
    us up in the eyes of my customers than anything else DEC has done.
    But if Jack was also the one who fostered the current Sales problems
    with "certs-by-second" metrics and poor compensation for performance,
    then maybe it was indeed time for him to step down.
    
    As a SWS Sales Support Specialist, I am in the classic "love/hate"
    relationship with Sales reps.  On the one hand, I hate the way we
    are understaffed and overworked by Sales, but on the other, I see
    lots of Sales reps who put in even longer hours and who are truly
    committed to seeing that the customer is satisfied.  Many of them
    get very little support from management in the field, and are always
    hindered by the complex and outdated administration and licensing
    policies.  I used to wonder how much more abuse SWS people could
    take, but now I'm even more concerned about how much more the Sales
    reps can take before even the most committed ones look elsewhere.
    
    Geoff
    
939.35we're all to blame....MPO::GILBERTThe Wild Rover - Portfolio Mgmt ServicesTue Oct 10 1989 19:5224
    Ok, since I'm the one who started all this I have some misconceptions
    to clear up. 
    
    I am not blaming any Sales Rep. It's not their responsibility to
    make the rules. I am blaming Sales and Marketing Management. 
    
    I am sure that we make some single system sales through distributors.
    I am sure we make more than a few through OEMS and Marketing Partners.
    So does IBM. But IBM goes one step further. My story about the school
    system? The IBM salesperson is calling once a week to answer questions.
    I feed the questions to the business manager from the evaluation
    team.
    
    Small sales that don't have any potential? who makes that decision?
    The scenario I painted looks at 4-5 more in town. Most towns going
    to bid on even a small system want a proven product. Sell one and
    you've got a reference site. If most towns work the way mine does
    that could sell alot of machines. 
    
    We have a tendancy, over the years, to target "markets". When we
    do that and concentrate on it for a while we do well. I think the
    restructure will take advantage of this and hopefully we'll do better
    in the follow up.
    
939.36FYI - there is a conference on selling to schoolsCVG::THOMPSONMy friends call me AlfredWed Oct 11 1989 13:1621
    Perhaps we can take the selling to education rathole elsewhere.
    
         <<< TURRIS::NOTE$:[NOTES$LIBRARY]EASYNET_CONFERENCES.NOTE;1 >>>
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================================================================================
Note 2514.0*                     SELLING_TO_EDU                       No replies
ABACUS::BEELER "Beeler for President"                12 lines   9-OCT-1989 10:06
--------------------------------------------------------------------------------
    ABACUS::SELLING_TO_EDU is a conference which is dedicated
    to discussion of any and all issues which relate to *selling*
    to the educational arena.  It includes, but is not limited to,
    discussions surrounding K-12, Community and Junior Colleges, 4 year
    and comprehensive universities, EDU marketing, training issues,
    programs, products, etc... 
    
    Participation by cross functional team members (Field Service,
    Financial Services, Software Services, etc...), in addition to
    field sales, is HIGHLY ENCOURAGED.
    
    Jerry Beeler