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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

1998.0. "DEC After Ken - Where Should Bob Take Us From Here?" by RT128::BATES (NAS-ty Boy) Sun Jul 19 1992 14:53

{reproduced without permission from The Boston Globe, July 19, 1992}

DEC WITHOUT KEN
Just What Can His Successor Do that Olsen Couldn't?
- By Josh Hyatt, Globe Staff

Never mind how it happened. What does it mean?

Thursday's resignation of Kenneth H. Olsen, the founder and president of
Digital Equipment Corp., rocked the business world like a California
earthquake. Like one of those rumblers, the fact that people saw it coming
didn't seem to blunt the blow.

"I literally slipped off my chair," admits Mark Steinkrauss, former director
of investor relations.

Even sources inside Digital said they had no hint earlier last week that
Olsen's 35-year reign was about to come to an abrupt end. But it did.

While Olsen's successor, Robert B. Palmer, has revealed nothing about his
plans for the $14 billion firm, those who know he predict he will introduce
a new decisiveness into company management, imposing a rigid focus and 
reshaping the organization in his super-efficient image. Olsen always leaned
towards a looser and freer company environment.

Because the seven year veteran Palmer is bound to change the company's
essential character, he is respected but - understandably - feared.

"He's not a real insider," says Marc Schulman an analyst at UBS securities
Inc. "If I worked at DEC, this would make me real nervous. The probability
of getting laid off just got higher."

While Digital always refused to give headcount estimates - Olsen even hated
the word layoffs - insiders report that the company has already resigned
itself to cutting at least 15,000 more jobs. Business units must have their
plans approved by Aug. 3, sources say. By the end of that week, those
pink-slippers unable to find new positions in the company will be gone.

Digital insiders believe chaos could descend upon Digital's top ranks and
that Palmer will quickly install his own management team. Pier Carlo Falotti,
president of Digital Europe, already has resigned. Some predict that
old-timers such as Winston R. Hindle, who has served as Olsen's righthand
man for 30 years may also soon depart. And company analysts question whether
John F. Smith - who assumed Falotti's responsibilities on Friday - will find
a comfortable spot.

"What would he do?" asked one source close to the company. "It's hard to
imagine him staying as Palmer's chief of staff."

Whether Palmer is looking for replacements or additions, he's likely to
distinguish himself from Olsen by tapping outside prospects. "I suspect
he will acquire the appropriate talent he needs to turn the company around,"
says John Rose, who in March, resigned as vice president of the personal
computing systems group. "I suspect he'll look outside, as well as inside.
Certainly new blood would be helpful."

There is also talk that the company will soon sell its plant in Greenville
S.C.

Layoffs and plant closings may be Palmer's first, and most obvious, actions.
But he faces daunting challenges on just about every front.

Palmer's mission - and for the sake of 27,000 Massachusetts workers, it had
better not be impossible - is to bring a steady hand to several critical areas.

For one thing, analsysts say, Palmer has to settle on a new management
structure, and stick with it. Digital has been switching its internal structure
with a self-destructive regularity during the last couple of years. This year
alone, the Maynard-based company reshuffled the top DEC charis twice within
four months.

"The has been a constant changing of direction, which causes instability in
the product development area, which causes products to be late to market or
missed opportunities, and an instability in the sales force," explains Rose.
"People aren't focusing on the competition and sales opportunities, but are
more worried about the longevity of their organization or their job."

The restructuring has been so haphazard, sources say, that there are
business units within the company that remain unsure about to whom they
are supposed to report. "Ken's philosophy was that everybody should just do the
right thing. and when you're a small companyeverybody understands what that
is," says Scott Flaigg, who left Digital in 1988 as corporate director of its
artificial intelligence technology center. "It just multiplied to where there
were were a lot of people doing what they thought was the right thing. There
are a lot of right things."

Where Olsen was known for communication through parables that his subordinates
were required to decipher, Palmer "is a very clear thinking who thinks out
loud, and encourages debate," Flaigg says. "He's very direct, and he inspires
people with his decisiveness."

Palmer will find no shortage of uses for his much-vaunted operational talents.
Before being recommended by Olsen to succeed him as president and chief
executive, the 51-year-old served as vice president of manufacturing and
logisitics. Prior to that, he was vice president of semiconductor and inter-
connect technology.

Throughout his tenure at Digital, analysts note, Palmer has an exempalry track
record for bringing products - including high-end chips for Digital's VAX line,
telecommunications chips and Alpha, Digital's new 64-bit chip - on schedule
and within budget.

"He really understands the relationship between engineering and manufacturing,"
says Flaigg. "He'll provide faster delivery of lower cost and higher quality
products than the company has seen in a decade."

Of couse, the highest-profile product introduction that confronts Palmer is
Alpha, the microprocessor on which Digital is betting its future. The company
has already told analysts several Alpha-based computers will be out by
December. Earlier this week, Digital unveiled a new line of so-called "Alpha
ready" systems, offfering customers a clear upgrade path to the new chip.
"Palmer has got to make sure that they can prove successfull in the shift
to Alpha, and regain momentum in a profitable manner," say George Elling, an
analyst with Merrill Lynch & Co.

Digital reported a $294 million loss during its last fiscal quarter. Numbers
for its fourth discal quarter, due this Thrusday, are expected to reveal a $200
million operating loss,m as well as accounting and restructuring charges of
$1.5 billion.

To boost sales - which analysts say will remain stuck this fiscal year at
nearly $14 billion - analyst Geoffrey Woolcott believes that Palmer needs to
reverse Olsen long-held aversion to commissions. "He needs to kick every
salesman in the ass," says the president of Pepperell-based Renaissance Group
International Inc. "He should cut their salaries, leverage those boys, and
make them hungry."

While he should be otugh with sales people, analysts believe Palmer should
make nice with analysts. Since the 1970's, Olsen made a habit of not appearing
before them because "he had a habiot of putting his shoe in his mouth," as
Schulman puts it.

The last time he say Olsen, he recalls, it was the fall of 1972. The Digital
founder made reference to a semiconductor shortage, which turned out to
be fairly insignificant. His comment sent the stock tumbling, losing 10 percent
of its value.

"There were a goodly number of people who believed Olsen was incapable of
change, whether he was or not," Schulman adds. "In the regard, his departure
will help."

But the question remains: Just what does Palmer know that Olsen doesn't?

To answer that, its important to remember that the world Digital grew up in
- the one Olsen knew best and some say, clung to - has radically changed.

Instead of proprietary systems, customers want to pick and choose among
compatible manufacturers, buying database software from one vendor and
networking equipment from another. With increasingly fierce competition,
technology has become a low-margin commodity, and computer companies make their
money by selling software applications and systems integration services.

That's a far cry from the days when Olsen used to joke that he could drop one
of the company's VAX computers from a 727 and it would be sold before it hit
the ground. "The company has to understand the customers much better," says
James Johnson, chairman of the Standish Group International, a Hyannis market
research firm. "Palmer has to turn DEC from an engineering-driven company
to a merket-driven company. And it has to happen fast."

Analsyts believe Palmer clearly understands the new reality. Either sell
commodity products based on price - as Digital has begun to do with mail-order
PC's - or offer distinguishing performance features, as Alpha does.

Such is Palmer's imposing mandate, as analysts and other observers see it. And
no-one - not even Olsen, who will apparently continue to server as director
until November 1993 - should deter him.

"This is an opportunity for a whole new era," says Rose. "I don't know what
Olsen's role will be but I would hope he would be supportive of Bob and his
executive team. The change has now occured, so it's time to move forward
toward a new company, and revitilization. Ken started this company 35 years
ago, and I'm sure he thinks that's the thing to do."

    
T.RTitleUserPersonal
Name
DateLines
1998.1Makes ya wanna laugh...TOOK::TBOYLESun Jul 19 1992 19:468
    Kick the salesman in the a**
    Leverage those boys and make em go hungry
    Drop a VAX from an airplane and sell it before it hits the ground.
    
    All these one-liners certainly make ya wanna laugh! (yes, virginia
    	you may quote me)
    
    
1998.2HAAG::HAAGGot to keep on keepin' onSun Jul 19 1992 20:0917
>Geoffrey Woolcott believes that Palmer needs to
>reverse Olsen long-held aversion to commissions. "He needs to kick every
>salesman in the ass," says the president of Pepperell-based Renaissance Group
>International Inc. "He should cut their salaries, leverage those boys, and
>make them hungry."
    
    Who the hell is this idiot? DEC's sales force, IMHO, is already treated
    more  shabbily than any other I have been associated with. And I have
    personnel friends who are salepersons for IBM, NCR, Amdahl, and a host
    of other companies whose name are not important. Yes, we need our sales
    people to be hungry. But kicking them in the butt and cutting salaries
    isn't the cure. 
    
    BTW, I am in sales but I am not a sales representative. Tho everyone
    sells at one level or another.
    
    Gene.
1998.3ODIXIE::RHARRISbowhunters release on timeMon Jul 20 1992 13:404
    amen to reply .2!  
    
    bob
    
1998.4One of the press opinionsLNDRFR::ADOERFERMon Jul 20 1992 13:48124
headline: Palmer Faces Big Challenge   At Digital Equipment

  By John R. Wilke

  David Stone, Digital Equipment Corp.'s top software strategist, has a
private joke he shares with Robert B. Palmer, who ascended suddenly to the
chief executive's job at Digital last week.

  The two men, with Pier Carlo Falotti, president of Digital's big European
unit, had been named in The Wall Street Journal last year as likely candidates
to succeed Digital's president, Kenneth H. Olsen. And they knew that each time
someone emerged as a potential challenger to Olsen's near-total control, they
lost power and were pushed aside.

  "When we saw each other after that, we drew a little bull's eye on our
foreheads, like this," Stone says. He gestured toward his forehead and traced
three concentric circles with his finger.

  But it is Palmer who will remain, not Olsen, ending a spellbinding corporate
drama with a troubled passing of the torch to a new generation of leadership
at the company. Although Olsen, 66 years old, won't retire until Oct. 1, the
precise and methodical Palmer, 51, is expected to take the reins almost
immediately. He's likely to move quickly to make sweeping work-force cuts that
Olsen resisted and break a logjam of indecision that has nearly paralyzed
Digital's senior ranks for months, the Journal reported.

  "Bob Palmer is a strong technologist and pragmatic businessman who isn't
afraid to take the tough actions that are going to be necessary," says James
M. Osterhoff, Digital's former chief finance officer. Osterhoff left last year
after a run-in with Olsen, part of an exodus of talented executives who
tangled with the iron-willed founder.

  Palmer will have Stone's help reshaping the company, but not Falotti's,
whose resignation was made public last Friday. In fact, he resigned June 30,
and his decision to leave had a key role in the events leading to Olsen's
exit, insiders said. Digital's board was already alarmed by the company's
freefall and aware that other top managers could be expected to resign unless
Olsen stepped aside. But the imminent loss of Falotti, who had been
responsible for Digital's success in Europe, "was the last straw," said one
executive familiar with the events. "They had to act."

  Falotti, whose frustration with Olsen was well known, had decided to accept
the chief executive's job at ASK Cos. But Digital mounted a last-ditch effort
to get him to reconsider. But Falotti had made up his mind. Falotti, in a
telephone interview, said he was already focusing on the job ahead, at ASK.
"In this moment of turmoil and emotion I cannot be quoted on this," he said
from Portugal. "I am a man who looks forward, I do not engage in recrimination
about the past."

  With pressure from the board intensifying, insiders said, and a looming net
loss of $1.5 billion or more to be reported on Wednesday for the quarter ended
June 27, Olsen apparently decided the time had come. By some accounts, he had
no other choice. But neither Olsen nor any of the nine-member board would
discuss what happened.

  "In the end, it doesn't matter," said Harvey Weiss, a former vice president
who ran Digital's $2 billion federal sales division. "Ken's legacy remains.
His vision and his values endure." But Weiss added that Olsen could be
maddeningly stubborn. Even as the company began to come apart, "he just
refused to take help from anyone."

  Digital is likely to become a very different company under Palmer. Analysts
say that while Olsen's organizational model was that of the research
university, with often-fractious cliques and independent departments fighting
for resources, Palmer is likely to build a more top-down management to impose
new discipline and a more traditional hierarchy onto Digital's freewheeling
structure.


  As a result, investors and even some Digital executives welcomed Olsen's
exit, even as they hailed his historic contribution to the industry. Digital's
shares gained $2.25 on heavy volume Friday, to close at $43.25, in late New
York Stock Exchange trading. Analysts also applauded. Steven Milunovich of
Morgan Stanley called the change at the top "a significant, long-term positive
for Digital."

  For now, though, Milunovich remains deeply skeptical. Dean Witter's Jay
Stevens, on the other hand, immediately raised his recommendation to a "buy"
on Digital stock, betting on a comeback in 1993. But he doesn't think the
changes at the top are complete and predicts that the board will bring in new
marketing talent at a senior level and replace the company's new chief
financial officer.

  Palmer takes the helm with Digital in dire straits. Many employees have been
demoralized by the layoffs and by seemingly relentless infighting among
management, while executive ranks have been thinned by an early-retirement
program that claimed many of the company's most experienced managers. Of the
37 men and women listed as corporate officers in the annual report, only 23
remain.

  Palmer must also preside over sweeping work-force reductions, which the
company has already said could reach 15,000 in the fiscal year that began June
28, out of a total work force of about 112,000. Many analysts expect Palmer to
push to exceed that number in an effort to return more quickly to
profitability. One consultant to Digital familiar with internal estimates says
that layoffs will range from 17,000 to 22,000 and will commence in two waves,
with the first coming late this month. A Digital spokesman would not discuss
the cuts and said that Palmer wouldn't be available for comment.

  Perhaps Palmer's most basic challenge is to deliver on time a new line of
products on which the company's future depends. The products are based around
a powerful new microprocessor chip, dubbed Alpha, that was developed by
Digital's state-of-the-art chip making operation. That unit, considered in the
computer industry to be Digital's crown jewel, has been overseen by Palmer
since 1985.

  Palmer's tasks will be made even more difficult by the long shadow of the
founder, whose personality has shaped the company for 35 years. And while it
isn't clear how much influence Olsen will still wield as a director -- his
term expires in November next year -- people who have followed his remarkable
career find it hard to believe he will be able to resist meddling with company
management.

  But in an interview in May, Olsen seemed to understand the problem. As he
had said many times before, he repeated that he had no plans to retire and
wanted to stay at least long enough to get his beloved company back on course.
But he added, "the real measure of my success will be how well we fare after I
am gone.

  "And once I'm gone," he said, "I'm gone. I'm going fishing."


    
1998.5UK Engineers viewIOSG::WDAVIESThere can only be one ALL-IN-1 MailTue Jul 21 1992 09:1334
    A quick view from S/W Engineering with what *appears* to be the problem
    from our perspective:                                 
                                                          
    1.  Lack of focus on what the company is to produce, and specifically
        what software markets (if any) are we aiming at. Alpha seems to be
        well in hand as our hardware product, yet I have yet to see a
        vision of what software we expect to run on it. Given the current
        craze to see PCs taking over the world, what are we doing about 
        making the most of our engineering expertise ? Should we compete
        with MS in GUIs or concentrate on our Networking ? 
                 
    2.  Lack of strategical vision in the software we are producing - what
        will CASE or OA be in 5 years time for example ?                
                                                          
    3.  Lack of direct interface to customer needs - we engineers can
        remedy this, given support. Example - I have produced several small
        prototypes for new facilities to ALL-IN-1 - yet I've found it next
        to impossible to get solid YES or NO from customers via Marketing.
        For requirements, I lean entirely on a few CSC specialists and a
        DECUS wishlist.                                   
                                                          
    4.  I won't and can't comment on Sales, as we don't know how they work
        - but one would at least expect them to act as a channel back for
        customer wishlists
    
    
    Finally  a snipe at the logic of headcount cutting - only effective if
    the people being laidoff are 100% non-productive. Sure you can temporarily
    jack up the profitability, by cutting all but the biggest margin
    products - but as mentioned, people don't just buy the big ones, they
    want allround. Secondly you lose the critical mass of engineering
    expertise, finally where do new products get developed.
                                     
     Winton
1998.6POCUS::OHARAVote for Ren and Stimpy!Tue Jul 21 1992 12:0015
>>    4.  I won't and can't comment on Sales, as we don't know how they work
>>        - but one would at least expect them to act as a channel back for
>>        customer wishlists
  
A few thoughts:

Customers express their wishes by their purchase patterns.  There has been
little or no efforts on the part of Digital to elicit feedback from sales
as to what the customers actually want (at least in my experience).  Nor has 
there been a focal point for sales to channel these wishes back to 
engineers/developers.  Actually, this is what Marketing is supposed to do.

The formation of the Industry Business Units should fix this, if the right
people manage the IBU's.
 
1998.7If they'd only tell it like it is...ASDG::SBILLTue Jul 21 1992 12:0210
    
    About editing out the good parts of the "State of the Company
    meeting"... It sounds to me that the propaganda ministry is at it
    again. You know the people that think that we can't handle the clouds
    so they only show us the sunshine. Everything is just so watered down
    with sugar coating that the real message is lost. They'd like us to
    believe that we're doing a great job and everything is just fine, just
    don't pay any attention to that man behind the curtain...
    
    Steve B.
1998.8my paranoia comes to the foreSGOUTL::BELDIN_RAll's well that endsTue Jul 21 1992 12:2110
    re .7
    
    I think you are too generous with the "propaganda ministry".  I no
    longer believe that they were doing "innocent mischief".  I believe
    that they were involved in a deliberate conspiracy to sabotage KO and
    the company for their own personal benefits.  It's time to start a
    crusade against "political correctness" and "pollyanna thinking".  Too
    bad I won't be around after March to help.
    
    Dick
1998.9WHO301::BOWERSDave Bowers @WHOTue Jul 21 1992 14:0611
Regarding feedback from the field, one area we miss entirely is analyzing 
situations where we lost.  Very little thought is given as to WHY the prospect
bought from the other guy.  What was it about us or our products that he really
didn't like?  What was the competition's winning card?  We kind of shrug our
shoulders, whistle a few bars of "Que sera, sera" and go on to the next
opportunity.

If you exclude the feedback from the non-customer, all you end up with is 
nit-picking of minor features, not a critique of your overall offering.

\dave
1998.10IOSG::WDAVIESThere can only be one ALL-IN-1 MailTue Jul 21 1992 14:334
    Neat point - does this happen anywhere ? Is there a central notes file
    that SALES people read regularly ?
    
    Winton
1998.11a wild prediction: "portables"LGP30::FLEISCHERwithout vision the people perish (381-0899 ZKO3-2/T63)Tue Jul 21 1992 15:2923
re Note 1998.5 by IOSG::WDAVIES:

>         Given the current
>         craze to see PCs taking over the world, what are we doing about 

        I suspect that the PCs have already taken over the world.

        The next computing device to take over the world will be the
        various flavors of portable devices -- things that people
        won't even think of as "computers".  There will be 50-100
        million of them in the next decade.  They will have some
        tie-ins to digitally-delivered TV and other information
        services.

        So what are we doing?  We are working to bring Alpha all the
        way down to the PC market.  That's not low enough.  In the
        late 80s-early 90s you have to be in the PC market to really
        be in computers.  Towards the turn of the century, if you're
        not in portables, you're in a niche market.

        I think we will stay behind -- by choice as we did before.

        Bob
1998.12IOSG::WDAVIESThere can only be one ALL-IN-1 MailTue Jul 21 1992 15:586
    What are the REAL figures of MS-DOS PCs versus timeshare terminals &
    workstations.                                                     
    
          
    
    Winton
1998.13BIG numbersBOOKS::HAMILTONAll models are false; some are useful - Dr. G. BoxTue Jul 21 1992 16:4011
    Re: real (?) numbers
    
    Last figures I heard were 90M+ installed base of MS-DOS class
    machines worldwide.
    
    MS-WINDOWS is shipping at, I believe, 1M copies per month, or
    thereabouts.
    
    Don't know about WS or terminals
    
    Glenn 
1998.14Wait until WINDOW-NT, then countRT95::HUOlympic GameTue Jul 21 1992 18:5214
    
Re: .13
        
>    MS-WINDOWS is shipping at, I believe, 1M copies per month, or
>    thereabouts.
 
This is absolutely true, and 1M copies is equivalent to the total
VMS licenses you have in this universe as I heard before. This doesn't
count early version of WINDOWS yet. Never mind when WINDOW-NT hit the market.

By now, anyone won't have 2nd thought about the stock price of MicroSoft.
    

Michael... (happy user of 486 + WINDOW 3.1)
1998.15POCUS::OHARAVote for Ren and Stimpy!Tue Jul 21 1992 18:528
   <<< Note 1998.10 by IOSG::WDAVIES "There can only be one ALL-IN-1 Mail" >>>

    Neat point - does this happen anywhere ? Is there a central notes file
    that SALES people read regularly ?


Well, there is a "Sales" conference, but there's only a few active contributors.
In my (limited) experience very few sales reps read NOTES.
1998.16Reaching SalesSTOHUB::DSCGLF::SOCHASales - the original Virtual RealityTue Jul 21 1992 20:0726
	The successful Sales Rep doesn't spend their time reading Notes!  He/she
spends their time:

	- talking to customers
	- learning the product of the day
	- figuring out our confused product strategies
	- configuring systems
	- fixing order/billing problems
	- fixing support problems
	- fixing measurement problems
	- fixing ...

I you want to drive ANY behavior by Sales Reps AND their Management, then you
need to measure them on it.  Right now, Sales is measured by what they sell
this week - with particular focus on hardware sales (because they are
tracked better).

	As for lost sales, this is a major hole which noone is attempting
to fix, and noone seems interested in fixing. (Noone wants to decrease this
weeks sales for the opportunity to improve next quarters sales).

	I have not experienced much transfer of information between sales
and marketing.  I am often amazed at the products and features that we come
up with...

Kevin
1998.17We are suffering from MIS informationRIPPLE::NORDLAND_GEWaiting for Perot :^)Tue Jul 21 1992 23:3541
    
    	I just talked to a sales rep who just took over an account 3 months
    ago.  This was a long time DEC customer but generally an 'IBM house'.
    His predecessor took SERP and essentially left him no info on the
    account.  He bravely spoke of his challenge to 'create demand.'  I wish
    him well.
    
    	But if I was in charge, I'd fire the sales manager who allowed his
    predecessor's knowledge to escape the company!  The sad thing is that 
    this is pretty standard.  Has been for years - since I was a customer
    and a new guy showed up and asked us who we were; since I was in
    marketing and could find no one who knew how many VAXen had been sold
    to each division of GE, one of our biggest customers; etc.
    
    	If we're going to change the company, we better do it from the
    viewpoint of satisfying the few customers we still have.  The problem
    we have is - we don't know near as much about our customers as the
    competition does.  We should start to collect this information into a
    corporate database so that everyone who has to deal with any customer
    can find it quickly and act accordingly.
    
    	The second thing we need to do is some serious self-assessment.  We
    have no workable system that allows anyone to ask, say, 'How many
    people do we have with IBM Cobol experience that could help do ___?  I
    think our entire Personnel function is totally broken.  Everything gets
    done via networking - either you know someone who knows someone or
    you're lost.  Personnel _just_ files req's and waits to hear whether
    they're filled or closed.  We need the same information about our
    people as we do about our customers and the same ability to access it.
    
    	Only then can the company start to set direction.  Right now we're
    like Sears - a little of everything from applicances to lawn mowers to
    underwear.  And we have lost our reputation as being good at anything. 
    Everything you can buy at Sears you can get cheaper/better somewhere
    else.  Why would you go there?  Why would a customer come to DEC?  Once
    we know what the customers want and know what talent we have, we can
    find the common ground and move forward. 
    
    	Let's just hope that 'Rapid Robert' holds off any amputation until
    he looks at the X-rays.
                                                                         
1998.18Post-mortems and GERBIL::US_SALES_SERVICENEWVAX::SGRIFFINDTN 339-5391Tue Jul 21 1992 23:3927
re: .9

> Regarding feedback from the field, one area we miss entirely is analyzing 

I know that many major programs have post-mortems, whether we win or lose.  We 
can learn our mistakes and strengths in both instances.  We also regularly 
take customers to meet with engineering, one-on-one, to discuss needs versus 
current product offerings.  Field tests provide another method of feedback.

re: .10

>    Neat point - does this happen anywhere ? Is there a central notes file
>    that SALES people read regularly ?
    
GERBIL::US_SALES_SERVICE

Sales people read and contribute.  Until his departure, Bob Hughes was a 
participant.

re: .16

>	The successful Sales Rep doesn't spend their time reading Notes!  He/she

I would imagine some of the participants of the above mentioned conference
_ARE_ successful sales reps.  Perhaps they feel it is important to provide
that feedback to senior management, or simply to share their experience, what
works, what doesn't, with others, both sales and service. 
1998.19MILKWY::TATISTCHEFFwell, lah-di-dahTue Jul 21 1992 23:4253
    what should bob do in hardware land?
    
    refocus our efforts on INTELLIGENT engineering.
    
    we engineer our products like nuts (witness six sigma).  but what are
    the product failures we actually look at?  reliability test failures. 
    do we have any idea what ACTUALLY fails?  what is a REAL infant
    mortality failure?
    
    no.  i can count on my hands the number of chips and boards that fail
    at customer sites and are sent back for failure analysis.  those that
    do fall into two categories: big bucks customer who's witholding
    payment (or the next purchase), and the enormous disaster.  enormous
    disaster like our unpleasant experience with electrochemical migration
    (dendrites), or the one when IBM discovered the phenomenon of
    electromigration.
    
    we engineer out features we THINK will cause poor lifetimes, but we
    have very little REAL data (free of projections) indicating dominant
    lifetime killers.  if an airplane crashes, it's analyzed and
    corrections are implemented.  when a bridge falls down or even just
    cracks a lot, it's analyzed and those results are shared.  if a chip
    breaks, it's tossed out (until a zillion chips with the same part
    number also fail).
    
    people ooh-aah about electromigration, supposedly a real killer.  huh. 
    the last electromigration failure in our lab was about 5 years ago. 
    the one before that was in FY83 or 84.  neither was a field return. 
    plenty of folks have predicted (with data to back them up) that this or
    that component would croak from electromigration in 500 hours of real
    use, but none of those croakers have made their way back to this lab. 
    and, to my knowledge, none of our suppliers have diagnosed
    electromigration as cause of failure in our returns to them.  some
    killer.  think we're overdoing electromigration a bit?  how's about we
    go back to corrosion, a DOCUMENTED, CURRENT zinger?
    
    i've seen plenty of efforts to get parts back from the field so we can
    discover the real lifetimes, the controlling failure mechanisms, and
    feed that info back to the designers and the folks who generate the
    specs.  there's another push on now; i certainly hope it works, but i'm
    not terribly optimistic.
    
    i think we are overengineering most of our product, at great expense. 
    there's no reason to make a worstation where every component has a
    real lifetime of 20+ years.  and since components fail, we obviously
    are NOT reaching that 20+ years despite the fact that our
    projections say we DO.  what are we overengineering?  what are we
    underengineering?
    
    we'll never know if we don't get the real data into our hands, analyze
    it, and disseminate those results.
    
    lt
1998.20TOKLAS::feldmanLarix decidua, var. decifyWed Jul 22 1992 00:336
re: .19

You seem to be suggesting that Six Sigma is overengineering.  Yet the
sort of defect analysis you propose is very much a part of Six Sigma.  

  Gary
1998.21Actually get real data to make decisions?DYPSS1::COGHILLSteve Coghill, Luke 14:28Wed Jul 22 1992 15:1738
1998.22MILKWY::TATISTCHEFFwell, lah-di-dahWed Jul 22 1992 16:1623
    re .20  good!  does that mean we'll start seeing some field returns
    come in for failure analysis?  will those results be disseminated to
    lab folks, spec folks, component engineers, designers?  when will that
    happen?  i'm not getting my hopes up; six sigma has been here for a
    while and we still don't have any such data.  
    
    what we've got are loooong projections of data with questionable
    relevance to real lifetimes in order to come up with a magic fit
    number.  kinda like getting an A+ in a class without understanding the
    course content; not hard to do, but of dubious value.
    
    projections are a necessary evil, based on good methodology, but i
    think there are too many assumptions and simplifications as well as too
    few "reality checks".  hypotheses must be checked, and it is best to be
    extremely critical of them so we are very aware of their limitations. 
    if all our projections are based on failure modes a,b,c,d, but failure
    mode e is the real lifetime limiter, then why have we worked so hard on
    a,b,c,d without addressing e?
    
    i think the adoption of "six sigma" (i.e. the buzzwordy, "official"
    meaning, not the philopophy) is the result of willy-nilly engineering. 
    
    lt
1998.23BOD Confirms PalmerSWAM2::MCCARTHY_LALie to exit pollersWed Jul 22 1992 21:3968
[E-mail of Press Release]
    
	  DIGITAL ELECTS ROBERT B. PALMER PRESIDENT
                   AND CHIEF EXECUTIVE OFFICER,
             AND A MEMBER OF THE BOARD OF DIRECTORS



MAYNARD, MASS. -- July 22, 1992 -- Digital Equipment Corporation 
announced today, as expected, that its Board of Directors has 
elected Robert B. Palmer President, Chief Executive Officer, and 
a member of Digital's Board of Directors.  Palmer's membership on 
the Board of Directors is effective immediately.  He will assume 
the positions of President and Chief Executive Officer effective 
October 1, 1992, when Kenneth H. Olsen retires.
    
     In connection with Ken Olsen's plan to retire, Digital's 
Board of Directors released the following statement:
    
     	    Ken Olsen is a computing pioneer and has 
          made unprecedented contributions to the 
          industry.  Throughout his long and 
          distinguished career he has won the respect 
          and admiration of employees, customers, and 
          business partners.
    
      	    When he started Digital, he took on the 
          enormous challenge of converting the world to 
          a revolutionary style of interactive 
          computing.  His creativity and success in 
          doing this and building Digital are 
          unparalleled achievements.  Ken's leadership 
          has made computing approachable and affordable.  
          This vision is the foundation of Digital.  
                         - more - 


Digital Elects Robert B. Palmer President
and Chief Executive Officer and A Member of 
the Board of Directors
 Page 2

       	    Ken's vision attracted and challenged some 
          of the most talented people in the industry. 
     	  One of them, Bob Palmer, will succeed Ken.  
          We have observed Bob for many years.  We are 
          confident that he and his management team 
          will build aggressively and creatively on the 
          Ken Olsen legacy.
    
     Olsen founded Digital in 1957, and has been its only chief 
executive officer.  He is a member of the Boards of Directors of 
Polaroid Corporation and Ford Motor Company; the Corporation of 
MIT, Cambridge, Mass.; board of trustees, Gordon College, Wenham, 
Mass.; the Corporation of Wentworth Institute, Boston; and a 
Deacon of Boston's Park Street Church. 
    
     Digital Equipment Corporation, headquartered in Maynard, 
Massachusetts, is the leading worldwide supplier of networked 
computer systems, software and services.  Digital pioneered and 
leads the industry in interactive, distributed and multivendor 
computing.  Digital and its partners deliver the power to use the 
best integrated solutions - from desktop to data center - in open 
information environments.


                               ###

1998.24Unclear press releaseSMAUG::GARRODFloating on a wooden DECk chairThu Jul 23 1992 00:1017
    
    Re:
    
    
>     Olsen founded Digital in 1957, and has been its only chief 
>executive officer.  He is a member of the Boards of Directors of 
>Polaroid Corporation and Ford Motor Company; the Corporation of 
>MIT, Cambridge, Mass.; board of trustees, Gordon College, Wenham, 
>Mass.; the Corporation of Wentworth Institute, Boston; and a 
>Deacon of Boston's Park Street Church. 
    
    Does anybody know whether the omission of the company "Digital
    Equipment Corporation" from the above list is just simply a
    clerical error or whether it has greater significance?
    
    Dave
    
1998.25Press release languageMR4DEC::HARRISThu Jul 23 1992 16:196
    Re .24:
    
    It is neither an error nor significant.  That is simply a list of
    *other* organizations upon whose boards Ken sits.
    
    Mac.
1998.26Maybe Bob will tell us his plan tomorrowSWAM2::MCCARTHY_LALie to exit pollersThu Jul 23 1992 18:3121
U.S. News                         LIVE WIRE                    23-Jul-1992

      Address to employees by Bob Palmer on DVN - July 24, 28 and 29

  The Digital Video Network (DVN) will broadcast an address to employees by 
  Bob Palmer on Friday, July 24 at 9 a.m. and at 1 p.m (EST).  It will be 
  re-broadcast Tuesday, July 28 at 4 p.m. and Wednesday, July 29 at 1 p.m.  
  The broadcast is expected to run between 10 and 15 minutes.

  Bob shares his thoughts on a range of issues, including Ken Olsen's legacy; 
  Digital's culture; Bob's expectations of managers and employees; his 
  philosophy regarding leadership, management and accountability; the context 
  for future decisions concerning downsizing; and new directions employees 
  can expect.

  The address was videotaped Thursday morning.  Bob was named president and 
  CEO on Wednesday by the board of directors.  He will also hold a board 
  position, effective immediately.  Bob assumes his other duties on Oct. 1 
  when Ken Olsen retires.

  For a list of DVN sites, access option 99 in LIVE WIRE's U.S. menu.
1998.27Another broadcast to watchDYPSS1::COGHILLSteve Coghill, Luke 14:28Thu Jul 23 1992 20:1443
                  I N T E R O F F I C E   M E M O R A N D U M

                                        Date:     22-Jul-1992 04:16pm EDT
                                        From:     US_TEAM
                                                  US_TEAM@NEST@MRGATE@NROMTS@NRO
                                        Dept:      
                                        Tel No:    

TO: See Below

Subject: FY93 U.S. KICKOFF PRESENTATION                                         


    
     
    The U.S. Team is sponsoring an FY93 U.S. Kickoff Presentation via the 
    Digital Video Network on Tuesday August 11, 1992.
    
    We are asking all employees of the U.S. Organization to plan to 
    attend this presentation.
        
    Schedule of events:
    
    12:00 - 2:00  Formal Presentation from the U.S. Team
    
    2:20  - 4:00  Questions and Answers
    
    
    The format of this presentation will be similar to the "State of the 
    Company" meetings where senior managers deliver the messages the 
    company will operate under for the next fiscal year. 
    
    Please mark you calendars now.
        
        
        
        
    
    
    

Distribution:
    (deleted)
1998.28ALIEN::MCCULLEYDEC ProFri Jul 24 1992 01:0636
    Yesterday or the day before I happened to catch an interview with 
    John Sculley, the CEO of Apple, on CNN.  He was asked, as one who had
    followed a charismatic founder as CEO of a successful computer
    manufacturer, what advice he would have for Bob Palmer.  Sculley
    answered something like "focus on your technology, and your customers."
    
    Thinking about it, I was tempted to believe that there was a point that
    Sculley missed, because he had not taken over an organization as
    seriously dysfunctional as Digital seems.  On reflection though I think
    he's right, focus on the product (technology) and the customers and the
    rest of the organization will follow that vision.  From all accounts
    Palmer has the strength to assert his will in taking care of business,
    so the organization will follow if the leadership shows a vision of how
    our technology answers customers needs.
    
    What can that vision be?  Perhaps there's a hint in another topic:
    
1985.22>  While many of you are drooling over this leadership processor 
1985.22>  technology between yourselves, there are a fair few customers 
1985.22>  with some magic words stamped on their foreheads:
1985.22>  			"What's in it for me".
1985.22>  You won't catch any wave if you don't answer that one first, IMHO.

    I recently received a much-forwarded mail message containing "notes
    from a presentation by Bob Palmer at the Process Analysis Symposium for
    Competitiveness on April 1, 1992" (but won't repost it because I haven't 
    gotten permission to propogate it from the author) that identifies 
    "semiconductors and software" as key core competencies for Digital.
    
    I see this as hinting at a vision of our business strategy to be providing
    base platforms using Alpha as a foundation for our software expertise. 
    
    My reservations are about whether there is much prospect for success
    with W/NT and Novell and Intel platforms already crowding the
    marketplace.  I think we need some better definition, but this may be a
    good starting point.
1998.29Change to spareSDSVAX::SWEENEYRum, Romanism, RebellionFri Jul 24 1992 11:423
    The biggest "change" would be to stop all the internally generated
    change, uncertainty, and chaos so that we can get on with serving
    customers and respond to external change in the market.
1998.30AmenSGOUTL::RUSSELL_DWed Jul 29 1992 17:0551
    re: .19 & .18
    
    AAAAAmen, AAAAAmen, AAmen, Amen, Amen!
    
    Six sigma isn't a waste of time or effort; HOWEVER, when you fix a
    non-problem you're not devoting time to six sigma you are wasting time,
    money, and resources.  I've seen it all too frequently that saying a
    problem is resolved by this afternoon is infinitely preferable to
    getting the right answer tomorrow and resolving the problem.  Trying to
    look good costs a lot more in the long run than actually being good. 
    It is sickening to see what some of the manufacturing fixes that have
    come into place because some people (self-proclamed experts) have,
    without data, jumped to some conclusion or another and instituted a
    process change.  It adds to the process cost and does not eliminate the
    problem but very likely results in another, yet to be discovered,
    failure mode.  Oh, by the way, most of these "heads" will probably
    still be here after the "down-sizing," "rightsizing," and will probably
    use their expertise to continue to shoot from the hip and shoot others
    in the foot.
    
    As far as using real data.  I've tried to do that with two facilities,
    GSO and SGO.  The best I could do was a VAXmate with a couple of
    hundred dollars worth of software.  Talked with people until I was blue
    in the face about getting a little more sophisticated so that more
    engineers could have access to analyzing production/scrap/rework data
    to improve processes.  Never happened.  I was told by one of the
    computer nerds that is supposed to "facilitate" the eighty-five reasons
    why a PC could not be purchased.  (He had three in his office!)  He
    thought that it might be possible to set up another department's PC so
    that it could be multiuser, for $2500, the cost of a da** good PC!
    
    Folks, we're beating the buggy, not the horse; and we're wondering why
    we don't make headway.  The DEC solution--buy a bigger buggy whip!
    
    What is distressing, is that these people who are deciding on the next
    generation of buggy whips actually believe they are adding value to the
    corporation.  They're everywhere, squirrelled away in "special
    projects" like determining what toilet paper the corporation should
    buy.  Some who couldn't run a Koolaid stand tried to run a business,
    failed, got put into a closet or are getting a company paid master's
    degree.  Yes, these mighty minds are still with DEC, as a matter of
    fact some are the ones who came up with the list of "heads to chop." 
    
    What should Mr. P do?  Get back to makin' and sellin' it.  (Of course
    define what IT is first)  then clean the closets, and see if we haven't
    come up with 20K heads.  If you got rid of all those who were an
    impediment to makin' and sellin', you would be surprised at how
    productive the rest of the corporation would be.  In my not so humble
    opinion.
    
    DAR