Conference 7.286::digital

>  "The complete success of Digital hinges on the following:  unity of 
>  purpose, will to deliver, and uncompromising ability to produce the 
>  expected results," Bob said.

    About as concise a statement as I've seen in a while. Of course the
    obvious questions are:

    What is the purpose we are to unite on? Service to customers?
    What is it will want to deliver? The n S's?
    What are the expected results? Profit? Satisfied customers? Both?

    The rest of the memo answers those questions to some degree. I suspect
    that more clarification is to come. Especially, one hopes, from
    peoples direct management.

>  "We have been saying Digital will return to profitable growth and preserve 
>  85,000 to 90,000 jobs," Bob continued.  

    Sounds like a pretty official goal to me. The rest of it sounds like
    Bob Palmer wants to get to that level as soon as possible so we can get
    on with things. A lot of Noters have been asking for that for a long
    time.

>  While noting that the realities of the marketplace "don't allow us to make 
>  guarantees," Bob said he is looking forward to FY 94, "when we hope to 
>  have the greatest part of our workforce reductions behind us.

    After the bad news (official target head count) we get some hope. This
    leads one to believe that the plan is to be done with layoffs after the
    end of this FY. Or at least that the plan is to do this last round
    right so that more rounds aren't needed.

>  "During the remainder of FY93, we will need to focus on serving our 
>  customers, clarifying our messages and setting our priorities for FY94," 
>  Bob concluded.

    Quite a change. We haven't had clear messages and priorities for a while.
    Not since "One architecture, one strategy, one egg, one basket."

    We've had lip service about serving our customers before though. If
    we're serious about it this time I believe we can get back on track. I
    hope we're serious about it.
    
    		Alfred

re: .0

>>> "...CEO Bob Palmer outlined the steps Digital will be taking
>>>  to achieve Q3/Q4 revenue and expense reduction goals..."

  I hope we haven't cut so many revenue producing people that we're
now of the mindset to reduce those revenues at all costs!!  :-)
                                  ----------

    I'm surprised there isn't more reaction to this: he's talking about
    ~10,000-15,000 more layoffs in the next *three* months (depending on
    the number let go in March that is) ... that's more in such a short
    time than any other quarter ...  ???  :-(
    
    Jim

	I am glad that the base noter copied Bob's message since it has now 
been removed from  Live Wire. Does anyone know why the original message was 
pulled?

Walt

It's still there (or it is back) as of 3/17/93 16:20

    re .3
    
    I guess after nearly 4 years of layoffs and speculation about final
    numbers, we're not too surprised to see them in print - a case of 
    rumors finally confirmed?
    
    re .4
    
    I'd speculate that it's just a matter of disk failure and restore from
    a week-old backup...?
    
    mtcw,
    
    /dlw

re: 2418.5

	It was removed from and has since been put back into Live Wire. I 
promise you that I am not halucinating (although I am starting to become
somewhat paranoid). Several other people in my group also saw it and then 
could not find it.
	I agree that a 10,000 - 15,000 person headcount reduction before
July, 1993 is a substantial reduction in such a short period of time. It is
definitely a much faster pace than we have seen before.
	I am glad that Bob is trying to bring closure the TFSO's that we 
have all lived with for the past three years. Perhaps those that survive 
the next phase will feel at least somewhat secure and be able to get on 
with the process of rebuilding DEC.

Walt

    I'm the infobase provider for LIVE WIRE News.  We had some technical
    difficulties this afternoon and temporarily lost the most current news
    menu.  The problem has been fixed, so the Bob Palmer article is back
    in the menu.  Our apologies for the confusion.
    
    Leslie Johnson

    
    If Bob Palmer did say a reduction in headcount of 10-15k, I would 
    speculate that he won't get this from the usual TFSO "all share the
    pain" way of losing headcount.
    
    I would speculate he is thinking of spinning off a whole division of
    the company, now I wonder which part? Perhaps Europe?
    
    Simon

re: .9

>    I would speculate he is thinking of spinning off a whole division of
>    the company, now I wonder which part? Perhaps Europe?
    
To form a viable spin-off, wouldn't you basically have to take a CBU and
dump the engineering and sales/services resources it needed of into a
separate company with it?  Wouldn't surprise me if this happened with
some of our businesses (storage, PCs, etc.) in 15-24 months, but now seems
a little soon.  Wait til we have a buyer for what's left of the company
(which will probably be the "silicon" side).

								paul

    
    	The Boston Globe article of March 15 about Mitsubishi
	also had a paragraph about a statement from a Digital 
    	spokesperson (name given -- I've forgotten) which said
    	layoffs for the rest of the year would be half of what 
    	they were for Q3, which were in the 6000 range....
    
    	FWIW
    
    

>    I'm surprised there isn't more reaction to this: he's talking about
>    ~10,000-15,000 more layoffs in the next *three* months 

    Anyone have any data on the current effective population?  What
    he said is that he wants the company down to the 85-90K range.
    It was down to about 100K last quarter, and I thought that
    still included all the previous quarter's TFSOs.  We've announced
    plant closings since then....We may be pretty close to the target
    already.
    bob

    	I thought I understood that the employee population was still over
    100k. This would translate to layoffs of AT LEAST 5k people in Q3 and
    another 5k in Q4...to meet the minimum numbers. Now, I don't see any
    evidence of such widespread layoff activity. However, I'm in
    engineering and we've *heard* that engineering isn't being hit in Q3.
    So I'm wondering how it looks elsewhere in the company, if it looks
    like there's a concerted effort to achieve these numbers.

102,100 was the official count at the end of last quarter.  See note 2329.

Note the careful wording in .0:
  "We have been saying Digital will return to profitable growth and preserve 
  85,000 to 90,000 jobs," Bob continued.  "In my message to the Senior 
  Leadership Team I directed that we make the decisions required to reach 
  the level of employment we need to serve our customers profitably by the 
  end of FY93 on June 30."

It sounds like 85K to 90K is now a worst-case scenario, not an eventual goal;
he didn't say that was the "level of employment we need to serve our customers
profitably".  We can hope this is the case, anyway.

<><><><><><><><>  T h e   V O G O N   N e w s   S e r v i c e  <><><><><><><><>
 Edition : 2789             Thursday 18-Mar-1993            Circulation :  7094 
VNS COMPUTER NEWS:                            [Tracy Talcott, VNS Computer Desk]
==================                            [Littleton, MA, USA              ]
 Digital - Layoff expectations
	{The Boston Globe, 16-Mar-93, p. 42}
   Spokeswoman Nikki Richardson said Digital expected to lay off about half as
 many workers as it did last quarter.  The company, which employs about 102,000
 workers, cut some 6,500 jobs in the quarter that ended Dec. 26.

re: 2418.8

	Leslie,

		Thanks for the explanation on the disappearance/re-appearance of 
Bob's message on profitability. I knew that I wasn't seeing things.


	Walt

    Walt,
    
    Just because you are paranoid, doesn't mean that they AREN'T out to get
    you!!!

    I heard but have yet to confirm it anywhere that we are below 95K. 
    Is that possible with some non-US cuts, perhaps?
    
    billk

    For the last five years, I have been analyzing DEC's P&L amazed at the
    amount of Selling, General and Administrative spending that we have
    quarter in and quarter out.   Recently, to my amazement, Bob Plamer
    published the following:
    
    	"Selling, General and Administrative Expenses are our of control in
         DEC, we are 30% to 34% of revenue versus 20% to 25% for the
         industry".
    
    Now my only hope is that Mr. Palmer, gets into action and the remainder
    10K to 15K TFSO comes from where the ONLY fat in this company lies.....
    Selling, General and Administrative Expenses.   

	re .9:

>>    I would speculate he is thinking of spinning off a whole division of
>>    the company, now I wonder which part? Perhaps Europe?

	More likely the USA. It does less business than Europe. Sure,
	most of Engineering is in the States, but then this company
	isn't Engineering-led any more, so that wouldn't be so important.

	One good idea would be to spin off the software business. Digital
	has become one of those companies which has become so confused
	that it is impossible to figure out the true costs or profitability
	of any one element. Like many of those struggling to get our
	software business where it should be, I am frustrated by people
	who tell me that software isn't important, or we can't sell it,
	and challenge me to prove that we should.

	If software were spun off, it would have its own profit and loss
	all the way from Engineering to Sales. We would then see what we
	would see.

	/Tom

    Or, some other (large) software company may decide to buy our software
    unit...

	re .20:

>    Or, some other (large) software company may decide to buy our software
>    unit...

	As well they might - we don't seem to want it...

	/Tom