Conference 7.286::digital

	... if you ever find some of them in THIS conference, it was the last note
ever written, and you probably were its last reader! :>)

	Possibly the SEC's 10K report might contain enough pieces to get what
you ask, but I'm not sure.  Some of those things look pretty confidential to me.

	You could always call Investor Services.

    There's a public strategy and it's discussed in the Annual Report and
    in interviews with Olsen, Smith, Osterhoff, etc.  that appear in the
    business press.
    
    There's a private strategy and it doesn't appear in a VAX Notes
    conference.  I don't know it and I don't want to know it.
    
    My summary:
    
    Digital expects slow growth and low profits from operations due to the
    US and world economic environment.
    
    Digital continues to invest in new technologies and products because
    bad times don't last forever.
    
    Digital acknowledges that it has to improve profitability and that part
    of that includes reducing the employee population.

>>>>	Ref.0 
>>>>
>>>>    I'm looking for the latest, financial goals of Digital for FY90 &
>>>>    FY91. 

	Call the office of Jim Osterhoff (VP Finance).  

	But be prepared with a real good explanation
	of why you want to know.  BTW, why?

	Jim

    I would expect that the following are the corporate goals:
    
    1)  Make a profit!
    
    

    This comes up so often...
    
    The core goal of any company is to attract and retain customers.
    
    Products, profit, employees are a consequence of doing this.
    
    If profit was the only motivator, then the shareholders would invest in
    risk-free default-proof securities that have a one year yield of 7.66.

    umm, re .5 I've got twice as much invested in a money-market fund
    as I do in DEC stock

those who have profit as a goal, do not do as well as those who do
not have profit as a goal.  this surprising result has been confirmed 
by a survey of chief executives.  the results were published, i think
in harvard business review, in the mid 50s.  i believe the experiment has
been repeated at least twice, with similar results, but i do not
recall where the later results were published.

the effective goals were phrases such as "to make the best widgets"
or "to have people prefer our milk/airline/clothing/car/etc".

i do not recall if the article tried to give a reason for the difference.
one possibility is that profit calculations for now treat investments
in the future as costs/expenses now.  short sighted.

>              <<< Note 1249.7 by TOOK::CBRADLEY "Chuck Bradley" >>>

> those who have profit as a goal, do not do as well as those who do
> not have profit as a goal......
> ...
> the effective goals were phrases such as "to make the best widgets"
> or "to have people prefer our milk/airline/clothing/car/etc".

It's naive to think that these longer term, no-mention-of-profit goals
are more altruistic than profit-motivated.
In simple fact, keeping your business a going concern is the best way
to ensure long term profitability.  One keeps one's business a going
concern by serving customers and keeping them satisfied.
Quality ("making the best..." or "people prefer our...") is one known,
relaiable road to such success, but it is not without its costs in short
term profitability.

- tom]

Some years ago European HQ put together a Mission Statement which was to be
dessiminated throughout all Area organizations and subsidiaries.

The first of some fourteen or fifteen objectives was (and I paraphrase):
"To provide quality information systems..." When some questioned why profits 
were not the first objective, the very simple explanation was put that profits
were the  derivative of the first objective.

In fact, nowhere in the numerous objectives is profit explicitly stated as an
objective - the underlying thought being, I believe, that if the other 
objectives are achieved, then profits will derive as a natural consequence.

Where they being naive?  Well, Digital Europe has been, for some time now,
 one of the most profitable of the Areas.

Let's not make a fixation of the word "profit" in and of itself - it is the 
effect, not the cause of proper business managment.

    Where is there official financial data that discloses the profitability
    of the subsidiaries?
    
    I am, of course, familiar with the annecdotes to the effect that the
    United States is the least profitable area of Digital, but asking
    again, if this information has been released internally without
    distribution controls.

European Subsidiary "Contribution Margins" (since individual subsidiaries do
not report "profit" except for local tax purposes) are rolled up into FANDA
(Financial ANalysis DAta, or somesort). This data, located within the European 
Finance Department, is company confidential and, to my knowledge, 
not for public consumption.

    re: .7 those who have profit as a goal, do not do as well as those who  do 
           not have profit as a goal.  this surprising result has been confirmed
           by a survey of chief executives.  the results were published, i think
           in harvard business review, in the mid 50s. 
    
    Any chance of a better reference? 
    DEC did seem to do better when the goal had something to do with
    computers rather a goal of ROI/ROE = X