Volume 9, #2_______________________________________________________________
February, 1990
"MGMT MEMO" was written by Richard Seltzer
in Corporate Employee Communication for the Office of the
President. It was written for Digital’s managers and
supervisors to help them understand and communicate business
information to their employees. You can reach Richard at seltzer@seltzerbooks.com
The Merger Of
Product And Industry Marketing -- Why & Where Next?
Marketing
Directions by Peter Smith, vice president, Product/Industry
Marketing
Account/Industry
View by Bob Hughes, vice president, National Accounts
Organizational
Changes In Industry And Product Marketing
International
Accounts Marketing Organization Formed
Digital:
The Corporate Citizen by A1 Mullin, vice president,
Corporate Relations
Digital To
Institute Drug & Alcohol Testing Program For Certain
Jobs In The U.S.
‘Headcount
Equivalency’ To Be Used For Fy91 Budget Planning
DECWORLD
’90 Scheduled For Next Summer In Boston
Robert
Everett Receives National Medal Of Technology
Sam Fuller
Elected IEEE Fellow
Rubin
Olsher Appointed To UCAR Foundation Board
At a gathering
of marketing managers in Marlboro, Mass., in November, Peter
Smith and Bob Hughes explained some of the reasons behind
recent organizational changes and talked about future
directions. The following two articles are based on their
comments.
To put into
perspective the recent organizational changes — bringing
together Product and Industry Marketing — we should look at
the conditions that led to their creation. In the early
1980s, the company had two major problems areas: our
interface with customers and our asset management. It was
not unusual for Digital sales specialists from different
product lines to call on the same customer and suggest
different solutions or to offer the same VAX computer with
different delivery dates and terms and conditions. Our asset
management problems were particularly evident in the size of
our inventories and our return on our engineering
investment.
In response to
these problems, we gave increased power to the geographies
and established Product Business Units (PBUs). We gave the
geographies more responsibility for tactical profitability
and for organizing to improve responsiveness to customers.
Meanwhile, on the engineering side, the "PBU" approach made
it easier to measure our return on investment. In support
of those efforts we created Industry Marketing and Product
or Applications Marketing.
During the late 1980s, customer
requirements have changed, and technology has advanced
very quickly. As a result, today we face a new set of
problems. We need to bring the product and technology side
of the company much closer to the customer requirements.
The account management and customer requirements part of
the company has to become more influential in our product
direction. And the main role of marketing now is to act as
a change agent and integrate our marketing plans across
the entire company.
At the same time, we are concerned
about short-term business, especially in the U.S. So much
of our marketing activities must be in support of
immediate opportunities, helping account management to get
business.
The new "business segments" are
playing a key role in tying together the investments of
the company and providing new ways to look at the
company’s plans and returns. We have to understand the
importance of that integrating mechanism while maintaining
our functional expertise. And we also have to understand
and adapt to the new, intensified account management focus
in the Field.
Some specific changes exemplify these
general ones. For instance, the Digital Customer Centers
or DCCs are intended to serve as a conduit to convey all
of the capabilities from inside the company that can serve
the customer — whether from the business segments, the
PBUs, application groups or services — and to support the
account management focus and the Enterprise Integration
focus in the Field. We have already established three DCCs
in the U.S. — in Detroit, New York, and Atlanta - and
several more are planned and are under way.
The company also is putting in place a
set of interrelated strategic plans. For instance, the
business segments, PBUs and application groups have
compiled a sales support matrix that represents where the
company is making strategic investments from a technology
and application point of view and what kind of sales
support specialists are necessary. And, at the same time,
the accounts are putting together account opportunity maps
to represent the requirements of the individual accounts.
Those opportunity maps become part of the "district
synergy" plans that identify sales support requirements.
And those plans become the basis for application solution
plans, which then get fed back into the account
opportunity map process.
The Educational Services people have
cooperated tremendously with the product and applications
people to train these sales support specialists in the
appropriate areas.
Those two areas — the DCCs and sales
support planning — are very important tie-ins between
Digital’s product and applications efforts and the account
plans.
The better we get at communications,
using that feed-back mechanism between the account
opportunity plans and the strategic investment of the
company, the better we’ll be in terms of having the right
support and the right product and solutions capability in
front of the customers.
We’re just beginning to work out the
new relationship between Industry Marketing and Product
Marketing. In my mind, there are at least three key areas
in which this relationship can make a big difference for
the company.
First, the whole computer industry is
guilty of "pouring" technology at our customers. We have
been able to produce technology so fast that, in our
industry, we don’t take the time to explain how they can
use it and what it means to them. Industry marketing
people bring with them the ability to communicate product
capabilities and solutions in ways that customers can
understand. We must add that perspective to the work of
product marketing and the DCCs.
Second, in Product Marketing, we’ve
done a good job in applications and solutions integration
work intended for individual functions and departments
such as engineering or manufacturing. But we sometimes
fall short in those instances where customers need to
integrate across their various functions, instead of just
within them. Industry Marketing is a catalyst to that
cross-departmental work.
Third, the company continually needs
start up work in newer markets. And the industry approach
is a good way to identify opportunities and start up new
activities that can open major markets for the company.
These are a few of the benefits which
Industry Marketing brings. We need to reinforce and
maintain the important role of Industry Marketing, and we
need to continue to work on building synergy between
Product, Industry Marketing and our Sales and support
operations.
You can
think of organizational change at Digital in terms of the
"molting" of a lobster. Every couple of years, we shed our
organizational shell to make way for new growth. (Cont’d
on page 4)
We "molted" when we were at $500
million in revenue, and we did it at about $1 billion. $2
billion, $5 billion, and $10 billion. Now we’re "molting"
again in an attempt to restructure our body to get ready
for the next period of growth.
I've been through four of these
moltings now. The last time around, we created Industry
Marketing and Applications (or Product) Marketing. Now
we're integrating marketing and creating an account focus.
I don’t think the molting is done yet.
Parts of the shell are organized in a consistent quality
fashion and other parts aren't there yet. After all, the
end purpose of this game is to create a shell that allows
us to grow.
It’s important to realize that we’re
all going through this change, and we’re all at various
stages of recognizing what has happened, and coming to
terms with it emotionally, as well as in a business sense.
The ultimate end point of our
organization is to be able to satisfy any customer’s needs
for any Digital product or service anywhere in the world,
any time the customer wants it, in zero seconds and at
zero cost. That’s an end point that we could never
achieve. It's physically impossible. Yet it’s a goal very
similar to "zero defects" in manufacturing. If you have
the goal in mind, you keep shooting for an organizational
model or product model that will get you there.
As an example of the same kind of
effort, consider what Buick has been doing recently to
reduce its selling cycle. About two years ago, they
offered to send potential customers a floppy disk for
their PC that would let them configure their own Buick at
home. Customers could then take a printout to their
end-user dealer and negotiate price and delivery.
Later, to shorten the selling cycle
even more, Buick provided an 800 number to let customers
dial-in by modem from their PC. Now they let customers
configure and order their cars directly, on-line, and have
the cars drop-shipped to dealers for pick up. This means
there is no negotiation, no intermediary, no channel of
distribution that customers have to go through. You can
order anything you want, anywhere you want, in almost zero
seconds.
What was the result? From Buick’s
point of view, customer satisfaction went up. Profits went
up, too, because customers tend to order more options and
more expensive options and are willing to pay more than
they did going into the dealer, because now they no longer
feel compelled to negotiate price and delivery.
Throughout our industry, there are
examples like that of efforts to focus on effective
channels of distribution to maximize profit and improve
return on investment.
It’s important that we explore in
those directions for a number of reasons. Distribution
costs in the Field last year exceeded Manufacturing costs
for the first time in our history. And it is expected to
stay that way. We must focus on cost elements and look for
alternative ways to do things.
There are 5,500,000 businesses in the
U.S. today, and we make at least 100.000 products. And we
expect that there will be as many products coming along in
the next five years as we have seen in the last 10 years.
So how do we, as a high technology
company, get the technologists close to the customer so
customers can buy anytime, anywhere, anyplace? What
organizational model do we need?
We haven’t got the resources to do
deal directly with 5,500,000 customers. Maybe,
eventually, we can develop the technology to do that, but
we aren't there yet.
So in the Field, we search for ways to
go after the customer. And people in Marketing help us
figure out ways to make the products easier to sell and to
get to the customer. Together we organize to do that.
In the Field, we decided we should
focus on accounts, since they are the people who buy.
Half of our accounts roll up into
similar kinds of buying entities called "industries." Of
the 5,500,000 enterprises in the U.S., roughly 12,000
represent 80% of the purchasing for information systems in
the U.S. Given the fact that you have limited sales and
sales support resources and don’t have the technology to
go after all 5,500,000 companies, it makes management
sense to focus on 12,000, and to organize around that
number.
An account focus made sense from
another point of view as well. For instance, there are
about a thousand finance companies in the U.S. - banking,
investment, insurance, etc. Of that thousand, 10% are in
the New York area and about 10% are in the Western area.
But 35% of our financial services business in the U.S.
comes out of New York and only 1 % comes out of the West.
Why? This happens because of management attention,
organizational direction, and the thrust of our marketing
and sales programs. We put in the effort in one place and
not in the other. So we thought that if we organized those
accounts into a line of business by industry, we could
drive investment in the right directions.
For 30 years we Invested by geography.
The geography that did the best got the resources. That
approach has benefits, but it has its down side as well.
In Vermont, New Hampshire and Maine today, there are 35
sales reps walking around knocking on doors looking for
$100,000-orders. Why? Because for years the region has
done very well and hence has won new resources, who have
been sent out to knock on doors. Meanwhile, in New York
City there are 174 Fortune 500 companies we don’t even
call on. And of the Fortune 1000 companies in the U.S., we
have Digital business agreements with only half. That's a
situation we’ve got to change.
It also makes sense to organize
differently, so that management "adds value" to our sales
effort. A typical district manager, with 80 different
industries in the district, today adds value primarily
from a "personnel" point of view. He doesn't really
understand the business. But a district manager, whose
focus is a class of accounts in an industry, can
understand the business, can add an entirely different
level of value, and can achieve much better performance.
Since all of that made sense, we
organized industry marketing and sales and software
support to go after business by industries and accounts.
But we made one mistake — we confused
the Field. We had nine separate managers with nine
different plans for executing this. It wasn’t clear how we
were going to go from a geography organization to this
account organization. And furthermore, we took the whole
area infrastructure, which we were trying to reduce, and
moved it to the account line of business structure and
created the same overhead over again. Instead of
simplifying things in the Field, we confused our people.
So Ken Olsen suggested that we call an
"audible" at the line of scrimmage. He said, "You had the
right idea — focus on accounts — but you created a
bureaucracy. So redo it. Create yourself a management
structure in the Field that remains the same. Let that be
where your resources reside. Then figure out how you want
to run that management structure — sometimes by accounts,
sometimes by products, sometimes by industries. But leave
the management structure the same." That’s what we did.
At the same time he told us that he
wants each leg of this lobster to be functionally pure.
The marketing side of MEM was doing engineering, and the
software piece of the Field was doing engineering, and the
sales piece of the Field was doing marketing, and the
engineering piece of MEM was doing sales and that was
leading to confusion. He wanted us to strive for
functional excellence and functional purity. He wanted
marketing responsibility in one place and sales
responsibility in one place; not to try to control
everything; rather to figure out how to get the work done
through the districts (in the case of account sales) and
through other product groups (in the case of marketing).
He wanted sales in one place, but not to try to control
everything; rather, to figure out how to get the work done
through the districts.
As a result, we now have a simple
district organization in the Field where all our people
reside and are managed. In addition, 1 now have the
management responsibility for the top 200 accounts, which
represent at this time about 55-60% of the U.S. business,
and the funding for those accounts. Districts will receive
half their funding from the accounts group in order to
execute the large account focus. And half their funding
will come from plans that they put together locally to
develop accounts that are local to their districts.
In other words, instead of planning
just by zip code, we are in the process of determining how
to develop large account plans across all geographies.
Then we will roll that plan up by unit and district and
have it approved by the account team across geographies.
This is a paradigm shift of the first
magnitude — getting district managers to understand that
their responsibilities extend beyond their district and
that they have a broader plan to execute.
Our intention is to do that now for
the top 200 U.S. accounts and to let the districts
continue to plan by zip code for the others. Once we have
experience in planning this way, we’ll expand; so
districts can plan outside of their zip code for the
accounts that extend outside of their districts.
Eventually every account will be planned on an account
basis rather than a zip code basis. And as time goes on,
that will change the way district managers view their
job.
Bob Hughes and Peter Smith recently
announced the combining of Industry and Product Marketing
in order to position our marketing resources to more
closely link our customers’ needs with Digital’s product
offerings. Bob Hughes has assumed the responsibility for
managing the Corporate and Named Account Sales program
reporting to Dave Grainger, vice president, U.S. Sales
& Services.
The following Industry groups have
been incorporated into this new Industry/Product
Marketing organization and now report to Peter Smith:
o Consultant & Information
Systems Marketing— Jim Higgins is the acting manager
and sits on the Industry/Product Marketing staff.
o Public Sector Industry
Marketing/General Services Industry Marketing -
Peter Robohm is the acting manager for Public Sector,
Education and Health Care Industry, in addition to his
responsibilities as director for General Services Industry
Marketing.
o Electronics Industry
Marketing/Process Industry Marketing — Robert Horne
is the acting manager for the Electronic Industry
Marketing group, in addition to his responsibilities as
Process Industry Marketing vice president, o Financial
Services Industry Marketing — Claude "Sandy" Thomas
continues his role as Financial Services vice president.
o Manufacturing Industry Marketing
— The Discrete Manufacturing Industry Marketing group
continues to be the responsibility of A1 Fink, the acting
manager.
o Media Industry Marketing -
Bob Farquhar, Media Services vice president, manages the
Media Industry Marketing group.
o Telecommunications Industry
Marketing — Dan Latham, vice president, continues to
manage this group.
o U.S.
MARCQM — Ed Kamins continues to manage this group.
Combining these organizations provides
the opportunity to optimize marketing resources across the
company. The new organization also enables Digital to
further integrate customer and market information in the
development of solutions and products to meet the changing
needs of the marketplace. In addition, the marketing
groups will continue to work closely with the sales
organization to develop new market opportunities across
industries.
The following organizational changes
affecting Product Marketing were announced by Peter Smith:
o Sales and Distribution Systems
(SDS) — A new Product Marketing group, Sales and
Distribution Systems (SDS) includes the existing
Distribution, Marketing, Sales, and Service (DMSS)
organization and a new focus on retail industry unique
applications. Eli Lipcon leads this new group as Sales and
Distribution Systems Marketing vice president.
o Software Business Technologies
(SBT) — Linda Moore manages this new group which
will help Bill Strecker’s DSSG organization to develop and
implement a business and marketing strategy for Digital’s
software business technologies and associated services.
o Corporate Partner Group and
Strategic Programs Group — Peter Graham has joined
Product Marketing staff as manager of the Corporate
Partner Group (formerly reporting to Eli Lipcon) and the
Strategic Programs Group (formerly reporting to Linda
Moore).
An International Accounts Marketing
organization has been formed, managed by Jack MacKeen,
vice president, to better enable Digital to address the
needs of customers operating in a global marketplace.
This group will lead and coordinate a
broad range of international activities. It will
facilitate linkages between the U.S., European and GIA
sales and marketing functions. In addition, it will strive
for consistency across all three areas in business
practices, selling programs, and service and support
activities.
The organization consists of two
elements:
o The International Accounts
Management Office, managed by Dan Burkus, will coordinate
the worldwide account planning process and the
international needs of industry groups, and will develop
international account linkages to the product and service
organizations.
o The Internationa! Programs Office,
managed by Joe Arayas, will identify and develop business
practices necessary to operate in an international
environment, coordinate international CSO (Complementary
Solutions Organization) support programs, and apply a
consistent all-channels strategy across the geographies
where appropriate.
These individuals will work closely
with the three area organizations and the corporate
service groups to ensure that sales, service and support
activities focus on maximizing customer satisfaction by
improving ease of doing business on an international
scale.
"Although we happen to be hosted by
the U.S., our efforts in international accounts marketing
are meant to address the needs of customers on a global
basis", explains Jack. "Our task will be to improve
Digital’s image as an international supplier, with the
ultimate goal of positioning Digital as the computer
industry leader in meeting the needs of international
accounts.
"Through account management offices in
each area, international account planning processes are
being developed using a pilot group of Corporate Accounts.
The goal is to have one quality plan worldwide for
accounts that do business with Digital internationally.
The geographies then fund and manage the approved account
plan.
"In support of this goal, some of the
issues we are working on include common templates across
the world for account planning; integrated planning
calendars; international business practices and support
programs; and training content for international account
managers.
"Our overall thrust is to meet the
expectations of our international customers for
consistent, seamless management of their business with
Digital anywhere in the world. In a sense, this means
manage the customer and CSO relationships the way we
manage ourselves; i.e., use technology to leverage
distributed operations toward achievement of corporate
goals and standards."
In the Corporate Operations Committee,
people managing Digital’s business segments, geographies,
and other key operations come together to establish
priorities and make decisions. Each business segment
consists of a number of separate businesses. And each
geography consists of thousands of accounts. In other
words, there are thousands of people responsible for
subsets of Digital’s business.
This approach allows for diversity,
which is veiy important for the future of the company. We
want many people to feel that they are running a piece of
the business, because so many projects need focus and a
feeling of ownership by those involved. Some ideas will
fail, but enough of them will succeed so the company will
succeed. That’s why we have divided the company into so
many parts and don’t concentrate all our investments in
one area.
Our Operations Committee provides an
immediate opportunity to stimulate the flow of
information in all directions throughout the company. In
this committee, engineering groups, services, geographies
and functions have an opportunity to integrate our product
strategies for the customer to an extent that we’ve never
done before. This committee has started the integration
and serves as a symbol of the fact that we now operate as
one, integrated company.
The "one-company" effort that we see
at the Operations Committee level is a manifestation of
what we want to occur at all levels of the company - a
unification of our goals and management so that we can
integrate all of our resources in front of the customer.
We need diversity internally because
it provides us with the ideas we need to succeed. But to
customers we must appear as one company. We have to unify
all of our efforts and integrate them as we strive to
solve our customers’ problems. That’s our challenge: How
do we foster the diversity inside the company — keep
people feeling open and free and keep the ideas flowing
freely — and yet integrate our efforts to bring solutions
to customers?
The network helps make this possible,
but you can override the network. If we don’t have
enlightened managers and supervisors, all the benefits of
the network could go away, because they could come down
hard on people’s ideas, not listen to ideas and discourage
people.
A management style that discourages
ideas can stifle a company. I believe our Employee
Involvement Program is intended to send a clear message
throughout the company that we want ideas from everyone,
everywhere — including from people who aren’t yet
connected to the network — and we will recognize the
people who provide good ones.
Basically, the nature of work is
changing. Technology is allowing a global enterprise to
work together. And companies that are not global will soon
fall behind because other more future-oriented companies
are going to overwhelm them.
Due in large part to networking and
information systems, organizations in the future are going
to be very different. Companies that get themselves ready
and use these new capabilities are going to be leaders in
their industries. But to use the systems well, they will
have to use management styles that complement the network
capabilities — delegating authority and encouraging
independent thought and initiative in order to take
advantage of distributed computing.
While this is all new, it’s also very
familiar to us. One might say that our company values have
been built into our network. The free interchange of
ideas, giving people responsibility, trusting people —
those values are necessary if a company is to get full
benefit from this technology. Management and technology
are intertwined.
Our management style isn’t without
faults, but it is the wave of the future. I believe we’re
on the leading edge organizationally as well as
technically. That’s what makes this business so exciting.
More and more frequently, customers are asking us to help
them reexamine their organizations to enable them to take
full advantage of networking and information management
technology.
Increasingly, when we deal with
customers, we don’t just tell them what we make. We talk
about who we are. Our people, our values and our
management style are becoming an important part of what
we "sell." Our experience in managing our diverse and
complex global enterprise helps us help customers facing
similar challenges.
(This article is based on a speech
delivered at Digital’s Worldwide Public Relations Meeting
in November.)
Digital is committed to the concept
that it is good business to be a thoughtful neighbor and a
responsible corporate citizen and, from the very first,
has taken an active interest in the communities in which
our employees and their families live and work.
"Digital, The Corporate Citizen," may
be loosely defined as, "More than 125,000 employees
worldwide acting collectively, with allegiance to Digital
constituents: investors, employees, customers, vendors
and the communities and countries in which Digital
operates."
As a publicly-owned corporation, we
must work hard to make our shareholders’ investments grow.
Profit is one important measure of our progress in meeting
this goal. Bui we realize that the ability of a company to
grow and prosper is directly related to the well-being of
its employees and their communities.
Our public involvement, therefore, is
designed to meet both our business and social goals. We
believe these goals are inseparable.
Our far-flung operations demand
consistency in the way we present Digital to our customers
and the other constituents of the company. 1 call it "One
Face to the World." This is an outgrowth of a
long-standing corporate philosophy of simplicity. We want
all aspects of Digital to be clear and simple. We want
simple products, proposals, organization, literature that
is easy to read and understand, and advertisements that
have a simple, obvious message. We have thousands of
employees and many thousands of customers. We have to keep
things simple to be sure we all work together. Our
decisions and communications must always consider the
impact on the people who will be affected by them.
In addition, we must remember that
size and success in business beget power, and with power
comes immense responsibility. As a corporate citizen, we
have responsibility for our acts and their impact on the
community at large. What we say, how we say it and when we
say it has inordinate impact. A good example of this is
the construction, content and timing of our quarterly
financial press releases to our investors and the
financial community. We are acutely aware of the impact
of good news, bad news or, worst of all, surprises on our
customer attitudes, stock value, and the confidence of
shareowners.
Size and success also create high
expectations on the part of employees, customers,
investors, communities and governments. We have to manage
these expectations and seize the opportunities these
expectations create. Our stakeholders have a variety of
expectations. For instance:
o investors expect to share in our
success;
o businesses and communities expect
support and advocacy of shared interests;
o
governments look for jobs, technology transfer, tax
revenues, and consideration for community health and
safety;
o employees,
in part, want stable employment, opportunities for
personal growth, and a competitive recognition and reward
system;
o customers
expect solutions to their business problems, vendor
commitment, quality products, service and support.
We do not have unlimited resources.
Therefore, in managing some of these expectations we
should attempt to leverage the opportunities we have for
demonstrating our corporate citizenship. For example, AIDS
is a worldwide health concern affecting our employees and
their families, as well as the community at large. Digital
is supporting efforts to educate, conduct research, and
demonstrate human support through donations of cash,
equipmerit and human resources.
We have given equipment to the World
Health Organization in Geneva and to two major Australian
health organizations doing significant AIDS programming.
Cash and equipment grants have also been made to leading
AIDS organizations in the United States.
The "Monet in the 90s Exhibition" is
an example of citizenship in the cultural dimension. Here,
Digital identified a one-time, high-quality opportunity,
which is international in scope and supports three
world-class museums. Sponsorship of this exhibition
positions Digital as a leader in the arts and enables us
to leverage our employee, customer and community
relations.
Our citizenship displays itself in a
variety of other ways. For instance, Digital creates jobs
and, therefore, wealth. Last year, we supported our
governments through $348.1 million in taxes. Last year,
Digital also donated more than $35 million in cash and
equipment to educational, health care, civic, cultural and
environmental programs, and matched $5.5 million in
employee contributions to non-profit organizations. By our
presence in communities and in dealing with our vendors,
we create additional jobs and services through a ripple
effect.
Because we place pressure on the
community infrastructure, in terms of roads, water,
electricity, schools, etc., we have the duty of a citizen
to support and help the community. We do this not only
through taxes, but through direct efforts, particularly in
education. Digital supports educational activities with
large cash and equipment investments. Through Corporate
Contributions we invested close to $13 million last year
in: o educational support programs for kindergarten
through graduate school;
o local community and employee
scholarships;
o
T.E.R.C.(The Technical Educational Research Center) an
international program focused on interactive technology at
the elementary through high school levels; and
o the
Digital Faculty Program, a U.S. program to develop and
retain valuable computer science and engineering faculty.
We want our employees, their families
and neighbors to be proud of Digital and enjoy and share
in the fruits of our corporate success. Cultural, civic
and educational opportunities abound. For instance, child
safety is a major community and family concern. A
child-safety program entitled, Kids & Company,
presented Digital with an outstanding opportunity. Through
it, Digital managed a three-year development phase of a
curriculum program for kindergarten through grade 6. This
program was created not only to promote child safety, but
to enhance a child’s self-esteem. We worked with
communities and parent groups to implement the program in
Digital communities. Once launched, the plans are to
translate the program into other languages for use
overseas.
Another topic which relates to
Digital's role in society is concern for the environment.
As a good citizen, we believe we have
a responsibility to keep our environment free of pollution
and to set an example. A number of activities are under
way to demonstrate this commitment. We have worked to
develop innovative legislation here in Massachusetts and
are working on opportunities in Europe to highlight
Digital’s capabilities in this area.
Projects
already under way include:
o Regione
Lombardia (Italy), where we are managing two pilot
projects to control pollution and to provide recovery and
civil protection;
o The World
Meteorological Organization (Switzerland), where one of
the major programs is weather forecasting and global
change studies;
o
Weatherschool (U.S.), a television series geared to
elementary and middle schools, preparing students for
today’s high-tech world; and
o The Norway
Project, a four-prong approach to worldwide environmental
issues (academic conference, industry trade show, youth
conference, and museum exhibition).
Digital’s involvement in these
projects includes cash, equipment, human resource and
technical assistance from our marketing, environmental and
corporate groups.
We encourage all employees to take
responsibility in community, social and government
activities. We are always open for proposals as to what
the company or an individual on company time may want to
do in these areas.
A company of Digital’s prominence and
success cannot operate in a vacuum. External forces
directly affect the Company’s ability to do business. The
principal question in a civic sense is: What are you
giving back beyond compliance with business laws and
regulations? You can be a corporate citizen and get by.
But, what does it take to be a good corporate citizen?
On balance, I’d like to believe
Digital has demonstrated it is a good corporate citizen.
And many opportunities await us in the future to
demonstrate our philosophy and, hopefully, encourage
others to emulate us.
Digital’s network of computers
connects all of our employees and our managers. It not
only gives them an easy way of passing information and
requests back and forth, it can also help stimulate ideas
and allow the best ones to surface.
I believe the best model for
establishing priorities, and identifying and acting on the
best ideas is found in our Engineering organization. It’s
magnificent. Ideas are suggested throughout the
organization, by whoever has the idea.
Engineering ideas rattle around inside
the network all of the time. If an idea lasts in the
system and the person backing it is persistent, the idea
becomes a proposal, asking for funding or other decisions.
Then the idea is taken more seriously and gets bombarded
even more by opinions from throughout Engineering.
Finally, it gets approved or not approved.
Over time, that process has resulted
in Digital having a set of standards, products and
practices which are the best in the industry.
How did we get the best product line
in the industry from such a seemingly chaotic process?
It’s the free flow of ideas. Good ideas move ahead based
on their merit, and they rise to the top of the pile. Top
level engineering managers did not impose these ideas.
The ideas can come from anywhere, even
from outside the groups that normally deal with such
products and technology. But, out of that intense
interaction, and with the advantage of our internal
network, comes a strategy and a set of standards and an
implementation that are the best in the industry.
We need to replicate these interactive
processes and transfer them to the rest of the company.
Of course, the system isn’t perfect.
There are a lot of frustrated people in Engineering. Every
engineer does not feel that his or her idea has gotten the
attention it deserves. And probably, for one reason or
another, some ideas have been shot down that shouldn’t
have been. But, on balance, we have come out with an
excellent strategy.
To me, this interaction is one of the
most exciting parts of our company. Out of this very
tumultuous engineering effort, we created the most
disciplined product line in the industry.
Now, the use of network communications
is spreading throughout the company, in particular to the
Field. This is necessary as we try to reduce costs and
make closer links between customers and the people who
design and build our products. Our network and information
management products allow direct communicaton and enable
us to do away with much of the filtering we have depended
on in the past. It will take us awhile to get used to this
new working environment, but the results should be
exciting and valuable.
As we extend these capabilities and
this working style, we will be putting account managers
in closer touch with product developers. The ideas of
people in the Field and of customers will be added to this
free-flowing process that helps generate our products and
strategies.
The development organization is
familiar with the networked environment. To the Field it
is still new and they aren’t using it as as much as they
could. The change will take time, but it will happen, and
it will be very important for our future. Connecting
customers’ ideas directly into our development
organization should have a profound effect on our
strategy.
Background
Drug and alcohol abuse have been
elevated to a major public problem in the U.S. today. As a
result, there is a growing expectation that large
companies with employees in the U.S. should lead in the
overall effort to deal with this problem.
Digital has been wrestling with this
issue for many months, working to develop policies and
practices that remain consistent with the company’s basic
values, while meeting new and complex legal, customer and
business requirements. At the same time, Digital believes
employees should be responsible for their own behavior,
and expects employees to conduct themselves in a safe and
healthy way.
Abuse of drugs or alcohol can show up
at the workplace in the form of performance problems such
as absenteeism, tardiness and inability to do quality
work. It can lead to waste or safety hazards in a
manufacturing environment, or poor decision making or
engineering errors. It can affect customer relations
because of behavior that endangers customers’ workplaces
and profitability. Consequently, Digital does not condone
abuse of drugs or alcohol either inside or outside of the
workplace.
Digital has strong substance abuse and
employee conduct policies to deal with problems that show
up in performance on the job. For instance, the use,
possession or distribution of illegal substances on
Digital property, or on a customer site, could be cause
for termination from the company.
Since alcohol and chemical
dependencies are treatable diseases, Digital, through its
Employee Assistance Program (EAP). makes various resources
available to employees who may have a drug or alcohol
problem. Employees who have a problem are strongly
encouraged to
take advantage of the opportunity to
seek treatment, and are able to do so with
confidentiality. For those who seek treatment, the
chances of recovery are great, but it is up to the
employee to take the first step toward treatment.
The
Testing Program
The U.S. government and customers have
been putting increasing emphasis on testing as the most
visible means for combating drug abuse. In response to an
ever-increasing number of requirements and obligations
from government agencies and customers, Digital’s
Executive Committee has decided to test employees in
impacted jobs to determine whether they have used illegal
or controlled substances, or are under the influence of
alcohol.
At first, this program will affect
certain truck drivers in the U.S. (in accordance with
regulations from the U.S. Department of Transportation),
some employees in the Government Systems Group in jobs
requiring security clearances, and those who provide
service to a few customers that are particularly sensitive
about this issue because of health, safety or security
considerations. But everyone should bear in mind that, in
the current climate of public opinion regarding drugs and
drug testing, the number of people affected probably will
expand in response to further government regulations,
customer requirements and other business needs.
Digital is
setting up a program that has five goals:
o to educate
employees about the effects of drug and alcohol abuse,
o to make
sure the testing is done consistently, fairly and
accurately,
o to make
sure people are treated with respect,
o to make sure employees know that
treatment and other assistance is available to those who
seek it, and
o to make sure information about test
results is distributed only to those with a clear need to
know.
The people affected will be notified
in advance. Each will be given detailed information and
opportunities to ask whatever questions they may have in
order to help them understand their responsibilities under
the program, if they should become subject to it. Digital
is aware of the complex legal restrictions and employee
relations issues surrounding testing, and will be
instituting quality training for affected managers.
For FY91, beginning with the budgeting
process, Digital worldwide will change its management
measurement for employee population — the way it counts
people — to "headcount equivalency." An individual will be
counted for the number of hours scheduled to work,
expressed as a percentage of the standard work period. For
example, a Digital employee who is scheduled to work 20
hours of a standard 40-hour work week will be counted as
.50. Current reporting systems will be enhanced to report
numbers of employees in total (gross) and by
"equivalency."
The program, which gives managers
greater flexibility in meeting their needs for people, has
been approved by the Finance Committee and the Personnel
Management Committee. For more information, contact Cris
Day, SSM1 Finance, DTN 276-8294; Ragi Mehta. SRCOF
Finance, DTN 244-6160; or Mhairi Paget, MEM Finance, DTN
223-5663.
DECWORLD ’90
is scheduled for July 8 - August 1, 1990, in Boston,
Mass., at the World Trade Center. The DECWORLD program,
Digitarsworld wide information system symposium and
exhibition, originated in Boston in 1983 and has been held
here and in Cannes, France, several times since. The North
American-focused DECWORLD ’90 event will be followed by a
comparable, European-focused event, DECV1LLE, in Cannes,
France, in September.
DECWORLD ’90 will be a selling event
within an educational setting. Expanding on the Brown
University program, it will focus its seminars and
demonstrations on Digital’s application solutions and
technology that customers need in a rapidly changing,
competitive global environment. It will be designed as
both a customer and a sales and sales support education
program. Over 10,000 customers and their account teams are
expected to attend.
Pat Zilvitis will serve as the
DECWORLD ’90 Chairman; Peter Zottowill be the DECWORLD ’90
sponsor and provide management support for Pat and the
DECWORLD ’90 program. Pat joined Digital in 1987 as Group
Marketing manger for IS Marketing. Prior to joining
Digital, Pat was president of Martin Marietta Data Systems
and vice president of Sales for the Perkin- Elmer Computer
Group. Pat also spent 17 years with IBM in various Field
and Headquarters positions.
Robert Everett, a member of Digital’s
Board of Directors, has been awarded the National Medal of
Technology, the nation’s highest honor in technology.
President George Bush presented Bob with the medal in a
ceremony at the White House.
Bob received the award for his work
with Jay W. Forrester of MIT on Project Whirlwind. Project
Whirlwind began in 1944 as an idea for a universal flight
trainer and aircraft simulator for Navy aviators. It
quickly became much more — the first general-purpose,
high-speed, real-time parallel synchronous electronic
digital computer. Its speed and reliability are now
commonplace in the minicomputers and microcomputers that
are its direct descendants.
Bob created Project Whirlwind’s basic
design, made numerous technical contributions and
instructed and guided the Whirlwind team for more than 10
years. Digital President Ken Olsen also worked on the
project.
Bob joined MITRE Corp, in 1958 and was
named its president in 1969. He retired as president and
chief executive officer in July 1986, and became a member
of Digital's Board of Directors that same year.
He is presently chair of the Defense
Science Board and a senior scientist on the Air Force
Scientific Advisory Board. He is a member of the Strategic
Defense Initiative Advisory Committee and a member of the
Commission on Engineering and Technical Systems of the
National Research Council.
The National Medal of Technology was
established by U.S. Congress in 1980 to recognize
individuals or companies that have made "exceptional
contributions to the well-being of the nation through the
development or application of technology."
Sam Fuller, vice president, Research,
has been elected a Fellow of the Institute of Electrical
and Electronics Engineers (IEEE). Sam was honored for his
leadership and contributions to computer architecture
design.
The grade of Fellow recognizes
"unusual distinction" in the electrical and electronics
engineering profession. It is conferred only by invitation
of the IEEE Board of Directors.
Sam joins four other IEEE Fellows in
Digital — Ken Olsen, president; Bob Glorioso. vice
president, High Performance Systems; and Mike Riggle.
senior corporate consultant.
Sam's leadership contributed to the
high performance input/output architecture (CI) which was
used in high-performance VAX systems following the
VAX-11/750 system; local area networks and the adoption of
Ethernet at Digital; and the XCON expert system for
configuring VAX systems.
Sam is responsible for the company’s
corporate research programs which include groups in
Maynard and Cambridge, Mass.; Palo Alto, Calif.; and
Paris, France; joint research with universities, and
Digital participation in the Microelectronics and Computer
Technology Corp., a research consortium of several
companies.
He joined Digital in 1978 as
Engineering manager for the VAX System Architecture Group
and was appointed group manager, Corporate Research and
Architecture, in 1981. Prior to joining Digital, Sam was
an associate professor of computer science and electrical
engineering at Carnegie-Mellon University in Pittsburgh,
Penna.
While at Carnegie-Mellon, he was
involved in the performance evaluation and design of
several experimental multiprocessor computer systems. One
widely referenced example of this work culminated in an
operational 50-microprocessor system, a forerunner of
today’s commercial multiprocessors.
Rubin Olsher has been appointed to the
Board of Directors of the University Corporation for
Atmospheric Research (UCAR) Foundation, headquartered in
Boulder, Colorado. Founded in 1986, the UCAR Foundation is
chartered to accelerate the pace at which science serves
society. A private non-profit corporation, it develops
innovative and productive new relationships among the
atmospheric and related sciences, government, and private
industry.
Rubin manages and coordinates
Digital’s corporate business relationships between the
Federal Advanced Research Agencies (FARA), and Digital’s
Engineering, Marketing and Field management. He founded
the FARA Corporate Task Forces, comprised of key advanced
engineering, marketing, and field groups, including
Digital’s Federal Systems Group, Corporate Research
Engineering, LDP/Science Products, Engineering Systems
Products, and Education Industries Group. These task
forces selectively participate in joint funding and
collaboration with individual university researchers, and
targeted scientific research centers, whose fields of
expertise focus on computer-related scientific and
engineering research.
Don Busiek, vice president, has assumed a new
role reporting to Jack Smith, senior vice president,
Engineering, Manufacturing and Marketing. In his new
position, he will propose the methods and organizational
structures for helping Digital focus on software as a
mainstream business. He will also address the need for a
mechanism for new, innovative, strategic ideas to be
proposed, tested, measured and implemented through the
Field organization. Most recently, Don served as vice
president, Enterprise Integration Services.
Pat Cataldo, Educational Services vice president,
now reports to Peter Smith, vice president, Industry and
Product Marketing, and Russ Gullotti, Enterprise
Integration Services vice president. Inclusion of
Educational services on the EIS Management team reinforces
the important role training plays in providing total
solutions for customers. Membership in the Industry and
Product Marketing organization recognizes the importance
of Educational Services as a Marketing tool for Digital.
Cary Gherman has been named Corporate Waste
Management consultant engineer, reporting to David
Barrett, corporate manager, Environmental Health &
Safety (EHS), and John Caulfield, corporate manager, Waste
Management. In this newly created position, Cary will be
responsible for providing full-time environmental support
for the worldwide waste minimization initiative. He joined
Digital in 1981 as an Environmental, Health & Safety
Engineer in the Greenville printed wire board
manufacturing facility. From 1986 to the present, he has
been a Corporate Industrial Hygienist/Safety Engineer in
the Corporate Department of Industrial Hygiene and Safety.
Ron Glover has been appointed Corporate
Personnel Policy manager, reporting to Erline Belton,
manager, Corporate Employee Relations. Ron has been at
Digital over six years as a Personnel attorney in the Law
Department. In his new role as Corporate Personnel Policy
manager, he will be responsible for providing leadership
and strategic direction for policy development in the
company.
Russ Gullotti is expanding his current
responsibilites to assume the position of overall
Enterprise Integration Services vice president. In this
role, he will be a member of the Operations Committee.
Russ served as CSS vice president and, in 1989, began, to
integrate CSS, Educational Services and Software Services
functions into Enterprise Integration Services.
Peter Hatfield has been named Defense Agencies Group
Market manager, reporting to Harvey Weiss, vice president,
Government Systems Group. Peter is currently Defense
District Sales manager and will continue in that role
through the end of January. Four of the units that report
to him in that role will continue to report to him in his
new position.
Pan Infante has been appointed vice president.
Digital Information Technology, reporting to John Sims,
vice president, Strategic Resources. Dan joined Digital in
1973 after a 17-year career with RCA. He has held a series
of key financing positions, his most recent being group
controller for Manufacturing. He became a vice president
in 1985.
Bud Keating has been named GIA Customer Service
vice president, reporting to Dick Poulsen, vice president,
GIA, and Don Zereski, vice president Customer Serivces.
Bud joined Digital in 1981 and has held a number of key
management positions within Customer Services. He was
appointed Business Ventures Group manager in 1986 and been
responsible for GIA Customer Services since last April.
Prior to joining Digital, Bud was the vice president of
customer services for a Digital OEM.
Joe Lombardi has been named Direct Marketing
Organization (DMO) End-User Sales manager, reporting to
John Alexanderson, vice president. U.S. Direct Marketing.
Joe has worked for Installed Systems Marketing for the
past six years, most recently as the Field Development
Group Marketing manager. He has also been the acting
manager for U.S. Installed Base Sales.
Susan Moloney has been named Manager of
ESD&P/MCG (Educational Services Development and
Publishing/Media Communications Group) in the United
Kingdom, reporting to Paul Gillot, UK Educational Services
Manager. In her new position, she has program
responsibility for establishing the Digital Video Network
(DVN) and Digital Graphics Network (DGN) in Europe. She
joined Digital in 1981 as a Marketing Communications
Specialist for Digital’s Manufacturing Product Group. In
1983, she joined the Media Communications Group in
Merrimack, NH, and has been the MCG Design and Development
manager since 1986.
Mark Roberts has assumed a new role as MEM/MarCom
manager for Product and Applications Marketing, reporting
to Peter Zotto. In his new role, Mark will provide the
functional leadership for Digital’s Product and
Application MarCom strategies including Advertising,
Promotional Literature, Customer Events and Trade Shows,
Direct Marketing and Sales Tools. Mark has been with
Digital for 19 years. He was most recently Product
Operations Manager and Announcement Strategy Committee
chairman. He was the first DECworld Manager for DECworld
'84.
Barry Rubinson, senior consulting engineer, has
accepted the position of technical director, Enterprise
Information Management and Transaction Processing,
reporting jointly to Hans Gyllstrom, Database Systems
Group and PBU manager, and Dennis Roberson, Transaction
Processing Systems Group manager. In this position, Barry
will be responsible for the integration of the Technical
Strategies and Architectures for all the groups comprising
Transaction Processing and Enterprise Information
Management. In addition, he will be responsible for the
development of an overall "enterprise architecture." Barry
began his career with Digital in 1974. He helped architect
the Storage Controller (HSC-50), which is the basis of
VAXclusters and started the Database Advanced Development
Group.
Brian Wade has been named Security Marketing
Group manager, reporting to Harvey Weiss, vice president,
Government Systems/Marketing, in Harvey’s role as manager,
Security Strategic Business Unit (SSBU). The SSBU was
created last spring to pull together various parts of
Digital that are responsible for electronic information
security products, capabilities and services. Brian will
be responsible for developing and driving Digital’s
overall Security architecture, products and service
strategies across all markets worldwide. The group will
work closely with the Secure Program Office and Secure
Systems Development in Engineering, and with the newly
formed European Security Office in the United Kingdom. At
Digital, Brian has served as a sales representative and
sales manager in upstate New York and Corporate Account
manager for GTE Corp. Most recently, he was the Business
Development Programs manager for the LDP/Science
Application Group.
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