Conference 7.286::digital

    What you're dealing with here, I believe, is just another manifestation
    of the attitude of a new generation of managers who have been taught
    to treat the workforce as just another resource or asset.  Feeding
    this attitude is an obsession with the bottom line and increased
    profitability at all costs.
    
    I think earlier generations of managers, lacking the "advantages" of
    MBA's and driving more off their real life experiences, many as
    workers, were much more sensitive to all aspects of creating and
    maintaining loyalties in both directions.

    
    Try hiring a "temporary" Software Engineer.
    
    /prc

re: .2

>    Try hiring a "temporary" Software Engineer.

They are called 'contractors'.  We have 2 of them in our 4-man cube.

Bob

    I would question the validity of their data in lieu of recent events. A
    great deal of temporary employees, especially clerical, have been
    released. 

    I didn't see the TIME article, but TIME is not exactly one of the more
    sophisticated business publications. I wonder if the readership understands
    the business reasons for temporary help. It is not merely a means of
    "getting away" with not paying benefits. There are legitimate needs for
    short term help, one of the reasons might be the ability to release
    these employees during a slow period. This is our slow period (however
    you choose to define slow), we have released these employees. Companies
    that do not employee great numbers of temps would simply have layoffs.
     
    Gail

    re .4  > ... I wonder if the readership understands the business
    reasons...
    
    The odds are Joe/Jane average reader will either not understand
    or will not apply the understanding to the situation mentioned.
    The answer to the question is, in fact, irrelevant, as the negative
    impression will have been made.
    
    Such articles do not do us any good at any level.
    
    Being perceived as a "user" of people rather than an "employer"
    of people does no easily measurable damage this quarter, so our
    current trend towards the "user" role may not be arrested before
    it does real long-term damage.
    
    

Time magazine is, for reasons that I don't know and which might not be an
appropriate topic for this conference, notoriously anti-DEC.

/john

    Re: .6

    Hmmmmm.  I've worked for DEC for many years.  And read Time for many
    years.  Somehow I've missed noticing that Time is "notoriously"
    anti-DEC.  What are others seeing that I'm not, that is so frequent and
    so exaggerated, and so negative that the word "notorious" applies?

re .4:  I  haven't conducted a study, but based on observation, both SCO and
AI seem to be hiring contractors - this seemed especially common last April
& May.  I figured this wasn't so much an effort to avoid paying benefits
as to avoid the hiring freeze.

re .6:  I haven't noticed Time's bias towards anyone except themselves.

    I remember a Time article about a totally automated factory in Japan. 
    There was a photo of a night watchman walking around with a flashlight
    while all these machines chunked away.  At the very end of the article,
    it mentioned that, Oh ...by the way, the computers that drive this
    factory are manufactured by Digital Equipment Corp of Maynard Mass....
    

    Why aren't young, MBA-type managers "people oriented"?  Simple - they
    all fancy themselves to be on the "fast track" and therefore only
    anticipate holding down their current position for 18 months to 2 years
    before a promotion or job change.  With that sort of short term view of
    the manager's role, it's go for the bottome line and who gives a $%^&
    what sort of organization you pass on to your successor.
    
    Those "old-fashioned" manager-types generally expected to be around for
    a considerably longer period, and therefore saw building an
    organization as a supremely important activity.
    
    Question - do you blame the MBA?  Or the senior managers who encourqage
    (by rewarding) this sort of behavior?
    
    (By the way, I have NOTHING against MBA's per se.  It's just a
    convenient shorthand.)
    
    
    -dave

    having worked for the military, two large life insurance companies
    and three other vendors, I can say without a doubt that digital
    uses people, it does not employ them.

.11> ...I can say without a doubt that digital uses people, it does 
    not employ them.

    I'm not sure of your point. The word employ means to engage or use
    the services of, to use. 

    All employees use their people. 

    Digital happens to do an acceptable job treating it's workforce as 
    people. If Digital didn't care about the *people* that make up it's
    workforce you wouldn't see the notes in here about possible layoffs,
    possible early retirement, you'd have seen the pink slips a long time
    ago. That is the difference between a company that watches out for its
    people and one that doesn't care.  

    Gail

    Re .11......Amen, brother.
    
    Re MBA's and the "fast track".  It's partly their own distorted idea of
    what constitutes success, and partly the fault of an awfully sick
    system of business schools.  Bottom line is still that they're masters 
    (pardon the pun) at using people to further their own goals.  What's
    really sick is that as long as they make the short-term numbers look
    good, they get full backing from so-call "management".
    

    First off, to those of you who have "doubts" about the article in Time,
    I welcome you to read it.  It is not about Digital per se, it is about
    the idea of corporations ignoring the psychological impact of their
    actions on their workforce.  The issue has nothing to do with whether
    or not a company's management is humane for humanity's sake.  It is
    that companies which use short-term "fragging" tactics to deal with
    their headcount issues can cause the productivity level of their whole
    workforce to go down.  The benefits of employee loyalty and morale may
    not be measurable on a numeric scale, but few top managers would argue
    that these things can be ignored with impunity.
    
    I hate to use the cliche'd examples of Japanese industry, since there
    are many cultural differences that set them and us apart, but the fact
    is that most Japanese professionals regard their company more as a type
    of family than most Americans do.  The culture does not lend itself to
    "job-hopping", so employees are more willing to put in the extra effort
    needed to help the company compete in the long term, because they can't
    bail out if things get rough ...
    
    So I guess the moral of the article was that the "use and abuse"
    attitude once attributed to sweatshops and defense contractors is
    now making its way into even the most conservative corporations,
    and it's just another symptom of the short-sightedness disease that's
    making the U.S. into the second greatest industrial power in the world.
    Whether you call it "downsizing", "rightsizing", or whatever, if you
    take the attitude that employees can be treated as replaceable units
    and not as integral parts of the corporation, then you can expect to
    pay for that attitude dearly, both in hard dollars (constant turnover)
    and in lost productivity and innovation.
    
    Ask some employees of General Motors, Lockheed, or National Semiconductor
    how much loyalty they feel towards the company, and how many interviews
    they go to on the side, and you will get a grim answer.  These are just
    examples, but I would hate to see the name Digital added to the list.
    I would love to see Digital on the list of companies that put employee
    development goals on each manager's goalsheets, and made it a priority.
    
    Most managers (in the Field at least) have goalsheets that denote what
    the corporation can expect from them in terms of "contribution" to the
    corporation.  For Sales and revenue-generating organizations, that is
    most often measured in hard-dollar amounts, bookings or revenue.  For
    engineering units, it's measured in products to market.  I would like
    to see managers also measured on their "contribution" in terms of
    employee loyalty and committment, because they are valuable assets
    to the corporation, and should be treated as such.  In theory, these
    things would be reflected in the performance of the unit as a whole.
    But in practice, it's all to easy for a manager (or anyone else,
    to be fair) in this company to "walk away" from a marginally-performing
    unit and let someone else take the heat later on.  That's got to change.
    
    Geoff
    

      reply .12
    
    
    Although I didn't write .11 one of the meanings of the word use
    is, exploit. I think that thats what .11 meant. And that is exactly
    how I feel I am being used. 
    
    
    
    Brian

    Hi
    
    Why are we suddenly blaming everything on MBA's? This seems rather
    silly -- there are plenty of non-MBA's who are ambitious within
    DEC.  
    
    Secondly why not check some of the MBA courses before fragging them
    -- alot of them emphasize the importance of people in organisations.
    
    Finally to wave the red flag it might be useful if some people took
    some basic business skill courses.
    
    Mike
    
    
    
    
    

>    Why are we suddenly blaming everything on MBA's? This seems rather
>    silly -- there are plenty of non-MBA's who are ambitious within
>    DEC.

Because when the world is fine then the grass is always greener on
the other side of the fence, but when it hits the fan then everyone
points out the leeching field underneath "their" lawn.

- greg

    
    I have to agree with most of the views expressed here -
    and this is not to slam MBA's. I think in general
    the attitude of college graduates/MBA's in the last
    10 years when approaching ANY TYPE of job, be it 
    management or something else is "money is the bottom 
    line". I think the Reagan years ingrained this thinking into 
    the 80's generation. When I hear many of my husbands' buddies from
    Holy Cross (no offense to those graduates, they are my friends too)
     talk about their jobs, businesses or personal politics,
    etc. it always centers around their MONEY. They vote, work, breathe
    MONEY.  People are last on the list of priorities. 
    
    
    I feel Digital is a good copany, but must go back
    to the basic things that once attracted all of us
    to make our careers here - this place used to feel like
    a family and now it feels like Divorce court. 
     
    
    
    
    

    
    	If you feel you can be treated better in another company, please
    	go for it, and may your life be prosperous.
    
    	/prc

    > If you feel you can be treated better in another company, please	
    > go for it, and may your life be prosperous.
    
    Your comment wasn't directed at me, but I feel compelled to answer.  I
    don't believe for one minute I'd be treated better at another company. 
    If I did I wouldn't be at Digital.  But that does *not* mean there
    isn't any room for improvement at Digital, and it does *not* mean that
    loyal employees shouldn't keep trying to make it better.
    
    							Pat

    Digital -- love it or leave it!

    My country, may it always be right.
    When wrong, may it be put right,
    But my country, right or wrong.

    "... my country..." - right on, I like your comparison.
    
    Can't help adding something about the source of all of the discontent,
    grumping, etc (recognizing I do my share too):  Anyone remember the
    rash of best sellers about 10 or 15 years ago with titles something
    like "#1"?  I can't remember the authors, but there were more than a
    few, and I recall that I could not bring myself to read much of them.
    They were so discouraging to my way of thinking.  Many of our younger
    folks must have read and acted on their principles. I can think of at
    least two examples of good "ex-"friends that did. 

    Fred

"Looking Out For #1"
and other titles
author:
Robert Ringer

very popular in the '70s

    Re: .23 & .24:
    
    A sense of humor might come in handy if you read Robert Ringer. I read
    his book cited in .24 while working for a company that had some the
    worst management examples. I and a colleague used to recite key passages
    to each other and have a good laugh. Not too long afterward, I was laid
    off. :-(

    I agree with .18 that attitudes have changed, especially for folks in
    school. When I was in Graduate Business School 5 years ago, I was
    struck by how much more focussed the undergrads were on money than
    either myself or many of my peers. And I lived in an undergrad dorm, so
    there were a lot of data points. Too many.  
    
    As far as DEC goes, it was never known as the place to make the big
    bucks, at least for MBA's. And my expectations have been met. Am I
    sorry I joined DEC, hell no. It's been a great place to work - even for
    us cut throat types.  :^)  The question is, will this second go round
    of hard times - remember the Oct '83 order processing disaster? -
    permanently hurt the DIGITAL culture?  The jury is out.
    
    Bill     

� Note 910.19 by VCSESU::COOK:
�     
�     	If you feel you can be treated better in another company, please
�     	go for it, and may your life be prosperous.

	After reading this reply, I began thinking of the situation I and 
	some other SWS-types are currently involved in.  In our residency 
	we are working with AC and they are basically running the proj* 
	(I can't write the word, because its not really one), and running
	roughshod over us.  The DEC folks have been trying to assist the 
	company by saying things like "You realize that is going to be an 
	enormous performance problem", or "The baud rate of the network 
	line has a greater impact on throughput than the size of the
	message", or "It may be very difficult to randomly select a 
	suspended 'conversation' (an ACMS task), and especially after the 
	machine has crashed."

	Those may not make a lot of sense to you, but its hard to 
	describe the situation unless you've been living it for a month 
	or two.  Anyway, we've been telling "middle management" that the 
	situation is not good, and is getting worse.  We give the "bad 
	news" (listed above) to the customer, and we get pushed down to 
	writing "environment definitions" and LSE templates.  We go into 
	the office to say that the work we're doing could be done by a 
	SWS-1 and it is compromising or future opportunities, and 
	management says

		"If it hurts that much, maybe you should look
		 for employment opportunities elsewhere."

	I'd say I'm getting "used", not used.  I have heard of situations 
	where a resident has been doing the work specified by the work 
	statement, and the job performed in spite of some of the customer's
	employees (NOT management), and being told they are unpromotable 
	because of the work performed on the residency.

	I'd say that's being "used", not used.

	If your original statement was meant in jest, believe that it 
	wasn't taken that way by everyone.  If that's the attitude that's 
	currently running in Digital, then maybe it would be better to 
	work elsewhere, because this company is going to drop like a 
	rock.

	As one of my "middle-managers" is wont to say, "If we have no 
	customers that will pay for our services, then we don't need to 
	many employees."  I say "If you have employees who only care 
	about picking up a paycheck, you'll never have to worry about 
	having customers."

    
    re .27
    
    It was certainly made in jest.
    
    /prc

RE:        <<< Note 910.27 by OKBYUS::SEABERG "Just one of the samurai!" >>

Ask Oscar Hammerstein II put it:
"Happy talk keep talking happy talk"

GET WITH THE PROGRAM...

You have to learn that in the SS managers only want to hear good things.
If you want to get ahead tell your managers that everything is going
perfectly.  Don't bother them with trivial things like the system we
just sold won't work.  If we can get someone to buy something then we're
going to sell it.  The fact that the system won't work is next week's
problem so it's not really a problem.

On a project I worked on last year the Phase 1 part of system we
delivered was a total disaster.  I was tearing my hair out and begging
the management to get qualified help on the thing.  I'm telling the
management the thing isn't working but each level in the chain paints a
rosier and rosier picture of the situation.  The Sales District manager
(I assume that he thought the thing was running beautifully) visited a
VP to ask the customer to write a glowing review of the project in their
newsletter to help us get more business.  The VP exploded.  I found
about the tirade when I was presented with a chart produced from an
investigation that was done that showed I had told customer A who had told
person B who had told person C who had told the VP that the "System was
a piece of S#$T".  It never occured to us that maybe the VP found out
about how bad it was because the VP was getting 50 calls A DAY from his
users on how bad the system was.  The lesson is that if you are the only
person tell DEC about how bad a system is and the customer finds out
then DEC is going to assume the you told them.  Customers are not smart
enough to tell when a system doesn't work.  Even though the second phase
of the project replaced the first phase very well, the customer canceled
the third phase of the project. 

Get with the program.  Don't complain.  If you do then you're a trouble
maker.  Help insulate your management from reallity.  That's the way
things are supposed to work.  DAMN IT, IF SOMEONE IS WILLING TO PAY FOR
IT THEN WE'RE GOING TO SELL IT.  Managers make their numbers by SELLING
solutions, not by delivering solutions.

See what you folks that the MGMT wants to move into the field have to
look forward to.  It's the same almost everywhere.

Re .29:
I have been doing projects on customer site and in the office, in
SWS, in the field, for the past 4 years.  I violently disagree with the
premise and conclusion in .-1.
I think the blow-up you saw was a result of a tendancy to make the picture
rosier as it goes up.  Getting chewed out bu the DM was a result of the
DM getting blindsided by the customer.  You NEVER want your management to
be surprised.  If they have an incorrect view of the situation, correct
it.  NEVER gloss over problems.  I assume you kept copies of your status
reports documenting what the problems were and what would be required to
fix them, along with the response (or lack of) to your needs.  If my DM
were blindsided like that, then presented with such reports, it would not
be my head on the block, but whoever in the management chain falsified (rosied
up if you want a euphamism) my reports.  

It is probably not a good idea to tell your customer that you are doing
a bad job (as in the system that I'm building is a piece of sh%t). That
is probably a CLM.  

Selling systems that won't work and trying to hide that fact is a losing
strategy for ALL involved.  The customer loses by not getting what they
need.  Digital loses a customer.  Your manager loses the revenue he would
have gotten in the future from the customer, and you get caught in the middle
(usually with the blame.  You know the saying about sh%t flowing downhill)

If the situation is not right, FIX IT.  If your manager does not understand
this, educate him(her).

Kevin

Just to clarify...

>It is probably not a good idea to tell your customer that you are doing
>a bad job (as in the system that I'm building is a piece of sh%t). That
>is probably a CLM.  

This was not done.  The customer managaged to figured it out all by
themselves because the we delivered system would crash their VAXcluster
every twenty minutes. On a 24*7 system and 100 screaming users it
becomes pretty obvious. 

John

    re: .30
    
    I agree with much of what you say in principle, but reality and human
    nature just make some of these things impractical.
    
    >If my DM were blindsided like that, then presented with such reports,
    >it would not be my head on the block, but whoever in the management
    >chain falsified (rosied up if you want a euphamism) my reports.  

    This is what is supposed to happen, but more often I've found that
    once you've been accused, even if you've been able to prove you are
    doing the right thing, you will still get the short end of the stick.
    
    First off, the person you're trying to point the blame at is either
    your direct manager or *their* manager, neither of whom will appreciate
    your actions.  Second, since it is unlikely that any action will result
    in removing this person from your chain of command, this person will
    have the opportunity to have the last laugh.  Third, many *other*
    managers will become wary of you, and you will gain a reputation as a
    whistle-blower, rather than as a "team player" who is willing to cover
    (up) for his boss.
    
    This can be one of those cases where "doing right" can be directly
    harmful to your salary and career.  If you are lucky enough to have a
    manager who understand that loyalty and support work both ways, then
    you may escape unscathed, but that is rare these days ...
    
    >Digital loses a customer.  Your manager loses the revenue he would
    >have gotten in the future from the customer, and you get caught in 
    
    I would agree on this too, except for one thing:  Lots of managers
    (and individual contributors, too, to be fair) tend to hop around from
    one assignment to another within the company, and are able to "jump
    ship" before the day of reckoning comes.  I'm not saying that everyone
    does it, but it has happened enough times within my own area that I
    can't believe that they are isolated incidents.
    
    As long as people are able to create terrible situations and then just
    transfer out of it, with no accountability after the fact, and leaving
    others to clean up the mess, then the short-term mentality will rule.
    
    Geoff

    Digital is a *glowing* negative example, not by virtue(?) of being
    bad and evil, but because we have gone from the "builders" stage to
    the "bottom-liners" stage in thirty short years.  Generally it takes
    a lot longer.
    
    A Company ("the state of being along with; fellowship; an assemblage
    of *persons*" - Webster) starts out with a few builders who wish to either
    a) get rich quick; or b) creating a product which is then sold,
    hopefully for a profit.  The 'a' companies do their thing and disappear
    within a short time.  The 'b' companies tend to hang around longer.
      The people they attract as they expand are those oriented toward
    the company's line(s) of business.  We will ignore the 'a's for
    the purposes of this note.
    
    While everyone else is 'doing business',
    developing/building/selling/delivering/servicing product, a company
    needs a bag-man.  He is sort of a housekeeper who makes sure the
    bills are paid (both ways) and things are in order.  A good bag
    man is hard to find and worth his weight in junk bonds, but...
    
    It seems inevitable that a bag-man will come along who is also a
    dynamic presence.  When this happens, the 'company' becomes a bank.
     That is, the focus moves from whatever it had been to money.  Now
    money is an immediate sort of commodity with an real shaky long-term
    future.  A "You can't take it with you", and a "You can't do what you
    wanted it for if you wait too long." kind of thing.  The result
    then becomes attention to accounting cycles.  
    
    Now, bag-men aren't the bespectacled pencil-pushers they once were.
    This is part of the problem.   They go the Harvard, now, alongside
    the lawyers, and they learn the fundamentals of marketing and such.
    And they see markets as companions to money as the basis for all
    things.  There are but two elements in the periodic table of the
    bag-man.  
    
    Anyway, when the dynamic bag-man arrives, he refocusses your company,
    generally by refocussing your boss, and sets everything on a course
    for final destruction.  Timelines shorten.  People who think long-term
    are sent off to 'plan'.  Perception becomes reality.  Expediency
    is the rule.
    
    Some examples:  If you want to gloat, look at Burroughs.  Technically 
    w-a-y ahead, almost as powerful as IBM, but controlled by bag-men.  If
    you want to be scared, look at Digital.  
    
    The questions we should be asking ourselves are (among others):
        1] If we are financially sound, not floating bonds, and not
           doing stock issues for capitalization, why do we care what
           Wall Street thinks?
        2] If we plan to be 'the other full-line computer company' into
           the next century, why are we alienating our staff (and losing
           the most employable among them)?
        3] If we are a Computer Company and not a Bank, why is a bag-man
           taking over?
    
    This story continues...
    
                                             

    < Note 910.33 by CGOA01::DTHOMPSON "Don, of Don's ACT" >

>    Digital is a *glowing* negative example, not by virtue(?) of being
>    bad and evil, but because we have gone from the "builders" stage to
>    the "bottom-liners" stage in thirty short years.  Generally it takes
>    a lot longer.
    
>    A Company [...] starts out with a few builders who wish to either
>    a) get rich quick; or b) creating a product which is then sold,
>    hopefully for a profit.
    
    No company, ever, suceeds by "hoping" to make a profit.  Profit
    is the only reason for a corporation to exist; it is and must be the 
    primary goal; it is most certainly the only reason General Doriot gave 
    Ken Olsen money to build logic modules.  Don't confuse what we do with
    the reasons for doing it.
    
    The profit we made on $12MM revenue last year was not exactly
    stellar.  In fact, I'll bet we could have done *almost as well* if we 
    had simply invested the cash we have on hand and dumped the rest of
    the company. Think about that for a minute.
    
    The technology we sell is not an end unto itself.  The only reason
    it is of value is because it helps customers solve business problems.
    It won't matter at all how flashy our products are or how well our
    financial management is if we forget that single fact.
    
    Al
    

    Re: a few back about "the higher, the rosier; damn the truth." 

    I am at the 765/875 page point in "ABOUT FACE, The Odyssey of an
    American Warrior," by Colonel David H. Hackworth (U.S. Army, Ret.) and
    Julie Sherman, Simon and Shuster, 1989. 

    Warning:  It has taken me a month or two to get this far,
    notwithstanding: 

    Highly recommended reading by many reviewers. Fascinating autobiography
    about the US Army from 1946 to the present by a gung-ho private thru
    battle-field commissioned not-so-gung-ho colonel who retired by not
    conforming to the "ticket punching" mentality that pervade (-ed?) the
    institution he loved. At least that is his name for it.  He ("Hack")
    was described by many of his peers as the best soldier/leader of those
    years! 
    
    The question this book has caused me to think about recently is the
    distinction between "leaders" and "managers".  In an active war it may
    be easy to recognize the leaders: they are out front getting shot at,
    first by the enemy, and maybe by their own troops if they are not good
    leaders.  They also survive by being very lucky too.
    
    So far I have not figured out as clear an understanding of the
    analogies in business.  Anyone care to take a shot at it (me? :-).

    Fred 
    

    Let me be blunt, there's something screwed up in a company whose return
    on equity drops from 18.9% to 13.8% in one year.

re .34

>                                                             Profit
>    is the only reason for a corporation to exist; it is and must be the 
>    primary goal;...

To the extent that "profit" as used here means making money, I disagree.

Long before money was invented, people worked to create things of value
for themselves, and to exchange with others.  It's natural for people to
want to improve their living conditions, and to enjoy the fruits of human
labor.  Before money was invented it wasn't always practical to store wealth
(it might spoil), or trade the value you produced for the value you wanted or
needed.

Money was a brilliant invention.  A tool to allow people to store wealth,
to exchange things of value easily, to organize resources for more efficient
production and distribution.

But somehow we've lost sight of the fact that money is a tool to help
us manage human economic affairs.  Money represents the value of human
labor and previous investment.

To seek money as an end in itself regardless of need and without
producing something of corresponding value is taking from others.
If carried to extreme, it will ultimately impoverish society.

On our planet, millions suffer in severe poverty, while the wealthiest
among us are often engaged in financial speculation, leveraged buy-outs,
or other manipulations of the economic system to accumulate vast wealth
without producing anything people really need.  Ironically, we sometimes
even destroy wealth in the pursuit of money (by improperly disposing of
hazardous materials for example).

The attitude of placing profit or money ahead of meeting human needs
is destructive, and will not sustain the organization which allows
profit to be realized.

As a point of interest, Digital has published a statement of corporate
goals and philosophy which I've seen in the guide to engineering at DEC.
Maximizing profit is not, and should never become the primary goal of
this corporation.

I do agree with your statment that:

>    The technology we sell is not an end unto itself...

- Peter

    re: .37
    
    The particular statement of philosophy to which you refer is:
    
    PROFIT
    
    We are a public Corporation.  Stockholders invested in our Corporation
    for profit.  Success is measured by profit.  With success comes
    the opportunity to grow, the ability to hire good people and the
    satisfaction that comes with meeting your goals.  We feel that profit
    is in no way inconsistent with social goals.
    
    
    I think that says it all.  The stockholders didn't invest their
    money for the betterment of society (although there is no reason
    why that can't or won't be a consequence), they did it for their own 
    personal gain.
    
    Al
    

Yes, but the statement also says:

  FIRST RULE

  When dealing with a customer, a supplier, or an employee, do what
  is right in each situation.
.
.
.
  ENVIRONMENT

  As good citizens we have a responsibility to keep our environment free
  of pollution and to set an example by these activities.


I'm not saying profit is bad.  I agree with the statement that profit
is not inconsistent with social goals.  What I disagree with is:

  "Profit is the only reason for a corporation to to exist;"
                 ^^^^

  "it is and must be the primary goal"
                         ^^^^^^^

This seems too narrow a view of human and corporate responsibility to me.
I think there are other reasons for corporations to exist, and principles
that are more important than profit (like honesty, which is listed before
profit in the statement).

>    I think that says it all...

This is what I disagree with.  Why does the statement include all
this other stuff, if "Profit" says it all?

- Peter

    The statement says that success is measured by profit.  No profit,
    no success.  The stockholders will not find comfort if we were honest
    and good to our employees but forgot to make a profit.
    
    We make take on additional responsibilities as we like, but ultimately
    they take second place to profit.  How we make our profit should
    be consistent with our values,  but we do what we do to make a buck.
    You could poll a thousand different stockholders, and you might get 
    10 thousand different reasons why they invested in Digital.  I'll bet 
    your paycheck that not a single one of them would say they didn't 
    expect to make money.
    
    It's like I said in the original note - don't confuse what we do
    with why we do it.
    
    Al
    

If all stockholders ever wanted to do was make money then they'd all 
put their money behind bank robbers, kidnappers, drug kingpins, and
South Africa.
And some people do.

Profit is a common denominator behind investment, but there is a growing
rank of companies, brokers, and investors who are seeking investments
that explicitly include other goals (social, environmental, non-traditional)
as almost as important as profit.  It's a copout to dismiss these reasons
for investment by saying that "all people want is to make money."

Yes, without profit, an enterprise can only survive with a subsidy,
and there do exist entire categories of enterprises in which people
invest without expectation of monetary return just because of the other
good these enterprises create.  Let's take a world view that includes the
ability to accept reduced monetary profits as a valid tradeoff for other
successes.

And I of course realize that "success" means be able to keep doing things 
the way you want to, not at the behest of your subsidizers, so I certainly
acknowledge that self-subsidy (profit) is the safest way to go to preserve
your autonomy.

The founders of an enterprise are often closer to the other goals, since 
these founders chose the business for some combination of profit and pleasure.
Some seek to create wealth by advancing an art, creating a new technology,
or personal glory.  Investors can share those goals, and they can be part
of the creation of non-traditional wealth.

- tom]

re .40

I agree our stock holders expect us to make money, but they also expect
us to play by certain rules.  Analyzing the statement is not my intent
however.  I'm more interested in discovering what attitudes and beliefs
we would need to hold in common to insure the continued well being of our
planet and everyone on it.  This includes attitudes about the purpose of
work and organizations like Digital.

We live in a society that places great value on getting ahead, being
financially successful, individual freedom, but freedom to do what?
What is the purpose of all these things we work so hard to achieve?

A hundred years ago, people saw their work as a calling.  A person
who became a blacksmith was making a commitment to provide a needed
service to the community they lived in.  Today we work for large
bureaucratic organizations where the value of our work is often abstract
and far removed from our daily lives.  Many see their careers as just a
way to earn a living, and perhaps some respect from their peers.

If the only purpose of work is to make a buck, what's left besides greed?

As a nation, we seem intent on mortgaging our future to prop up the present.
I see this attitude spilling over into corporations as well.  As the pressure
to maintain the bottom line, to lower spending, to get products out the door
faster mounts; we seem increasingly willing to sacrifice process or long
term prospects.

Given a trade-off between more polution or more profit, does profit come first?

The profit motive doesn't seem to be able to keep our Savings and Loan
institutions solvent (the S&L bail out), or provide affordable housing
for our citizens (the HUD scandal), or affordable health care, or quality
education.  I don't think these problems are isolated exceptions.

In a way, the Russians are lucky because they see the need for "perestroika".
The truth is that we also need to restructure our thinking in the United
States, and it's going to be difficult because we don't think we have a
problem.  Look at our economic imbalances; look at what we are doing to
the environment.

- Peter

    Unfortunately, this discussion is no longer germaine to Digital;
    it would be better placed in Soapbox.  
    
    I would simply point out once again that you are confusing WHAT
    we do with WHY we do it.  There is only one ultimate goal of a
    business; that is to make a profit.  If that's not the purpose of
    an enterprise, it's not a business but a hobby.  Profit is WHY we
    bother to make computers.
    
    WHAT we do, or more specifically, HOW we do it must, ON THE WHOLE,
    support our profit motive.  That does not mean that EVERY action
    or policy undertaken by the business is expected to turn a profit;
    I assumed that was obvious.  We do many things which are, by
    themselves, unprofitable.  Insofar as we might agree those things
    are "good", that does not discharge our obligation to the stockholders.
    
    Al
    

    Re: .43 and all the other "Profit is our most important product"
    folks.
    
    Safe assumption:
    
    If Mr. Olsen were given an unlimited supply of funds, Digital would
    continue to do what it does.  We would make nifty things and tell
    people about them and try to CREATE something.
    
    Employees (many, anyway) would still come to work because it is
    a basic human need to BELONG somewhere, and a decent corporation
    is a satisfying 'tribe' to attach one's self to.
    
    Yes, we'd still want to take home some money becasue we have certain
    other needs the meeting of which is simplified by the use of money.
    
    I still stand behind what I said back when, that we are first and
    foremost a computer company, (and, yes, computer companies are good
    investments for those who's sole interests is money) and we are
    NOT a BANK.  Nor are we an investment firm.  If we shift our focus
    to MONEY, we will lose our edge in the business we are in AND we
    will not do well in the business of MONEY.
    
    Besides all the current business nonsense, 
        "The love of money is the root of all evil".
    
    Getting unbelievably rich making computers is not.
    
    And, to put it in perspective, 
         (approximates)   DIGITAL -  $13B sales,  $1+B profit
                              IBM -  $62B sales,  $5+B profit
                           C ITOH - $145B sales, $15+B profit
    
    The last guy on the list, the one with the better numbers and
    percentages, is NOT a bank, nor a beancounter.  It is a Trading
    Company, and it's success is measured by the TRADING it does (which
    conveniently translates into profit).
    
    Don  Who-wishes-this-company-knew-what-it-wanted
    

>    < Note 910.44 by CGOO01::DTHOMPSON "Don, of Don's ACT" >
>                       -< Money, money, money money... >-
>
>    Re: .43 and all the other "Profit is our most important product"
>    folks.
    
    You too seem unable to distinguish between what we do with why we do 
    it.  No one has suggested that profit is our most important product.
    Our product is computers - we make product to earn profit.  We might
    earn more profit by trading pork bellies or becoming gigolos, but
    someone decided a long time ago to do it by building computers.
    Which is just as well since we would probably not be good as 
    gigolos.  Successful businesses concentrate on doing what they do
    best in order to maximize their return.
    
    Successful businesses DO NOT turn a blind eye to the financial
    management of the company and simply "hope" (your choice of words)
    to turn a profit.  The numbers have to be worked just about as hard
    as the creative or productive aspects of the business in order
    to be successful.
    
    Pat Sweeney is right - this company is screwed up.  If we don't
    fix it, there will be little comfort in watching it bleed to death
    during the next decade as we become the next Wang or DG.
        
    Al
    
    
    
    

re .43

Okay, lets suppose the purpose of an individual business is to make
a profit.  What is the purpose of the concept of business?  Why do we
organize our economic affairs as groups of people engaged in business?

Is it just so these businesses can make a profit, or is it to produce
goods and services people want or need?  (like food, clothing, shelter,...)
If the purpose of having all these businesses is to produce goods and
services people need, then the purpose of the individual businesses must
also be to produce things people need.

Profit is a MEASURE of how successful a business is AT producing things
people need efficiently.  Of course it's important, of course we need to
pay close attention to it, but I don't think it's the ultimate goal in itself.
As a measuring tool, it has some limitations.

>                              There is only one ultimate goal of a
>    business; that is to make a profit.  If that's not the purpose of
>    an enterprise, it's not a business but a hobby.  Profit is WHY we
>    bother to make computers.

So we don't make computers because people need or want them,
we do it to make a profit.

We don't grow food because people need to eat, we do it to make a profit.

From my perspective, our society has confused what we do (measure success
by profit), with why we do it (to produce goods and services people need
efficiently).  This is causing many of our institutions to fail.

I realize this is not a widely held view.  Many people today really believe
they do what they do only to earn a profit.  I think this is too narrow a
perspective.

- Peter

    < Note 910.46 by HANNAH::SICHEL "All things are connected." >
                        -< What is the larger context? >-

    The larger context?  It's quite simple.  We more or less operate
    in a free market.  This market is driven by price and profit.
    Information regarding what to produce (and how much) is transmitted by 
    price; the incentive to produce it is provided by profit.
    
>So we don't make computers because people need or want them,
>we do it to make a profit.
    
    No, that's not quite correct.  We make computers because people want
    them AND we can make a profit at it.  As an example, you might find
    an insatiable demand for VMS workstations at $100 apiece, but NOBODY
    will meet that demand because there is no way to make a profit at
    it.
    
    Unless you can tie this back to Digital in some way, this conversation
    should be carried out elsewhere.
    
    Al

Our attitude toward what we do and why we do it is quite important to Digital,
but I agree this may be getting too abstract for this conference.
I'll stop now.

- Peter

    The numbers given in .44 do not agree with the numbers published
    in Business Week. Just FYI
    
                    How Companies Stack Up Globally

              Sales                          Profits         
          Billions of US$                Billions of US$    

     1 Mitsui & Co.     117.0      1 IBM               5.49
     2 General Motors   110.0      2 Ford Motor        5.30
     3 C. Itoh          108.5      3 Exxon             5.26
     4 Sumitomo         103.6      4 Royal Dutch/Shell 5.23
     5 Marubeni          96.1      5 General Motors    4.63
     6 Mitsubishi        93.3      6 General Electric  4.63
     7 Ford Motor        92.5      7 British Telecom   2.41
     8 Exxon             87.3      8 Dow Chemical      2.41
     9 Royal Dutch/Shell 78.4      9 AT&T              2.27
    10 Nissho Iwai       72.9     10 Du Pont           2.19
    11 IBM               59.7     11 Toyota Motor      2.17  
    12 Mobil             54.4     12 Fiat              2.10
    13 Toyota Motor      50.4     13 Amoco             2.06
    14 Sears Roebuck     50.3     14 Philip Morris     2.06
    15 Hitachi           44.7     15 Mobil             2.03
                     --------                        ------
                       1219.1                         50.24

    {Business Week July 1989}

                                  R&D in 1988

       Total Dollars             Precent of Sales      Per Employees
       millions US$

    1 General Motors    4,754  Amgen              89.5 Amgen       112,269
    2 IBM               4,419  Centocor           61.3 Centocor     78,658
    3 Ford Motor        2,930  Alza               39.3 Genetech     64,037
    4 AT&T              2,572  Genetech           34.6 Chips & Tech 60,828
    5 Du Pont           1,319  Continuim          29.0 Weitek       45,717
    6 Digital Equipment 1,307  Evans & Sutherland 28.6 Alza         45,578
    7 General Electric  1,155  Hogan Systems      27.2 BMC Software 42,622
    8 Eastman Kodak     1,147  BMC Software       26.9 Bolar        41,273
    9 Hewlett-Packard   1,019  Cypress            24.2 Alliant      36,638
   10 United Techologies  932  Cullinet Software  24.2 Ashton-Tate  36,208

    {Business Week 1989 special Innovation Edition}

To try to tie the discussion of the purpose of business back to Digital;

I think it is very dangerous to assume that there is only one motivation
for doing _ANYthing_, including going into business.  You open yourself
up to being blindsided by those whose values are not your own, and who
may therefore behave in ways that you will not predict and prepare for.

Be that as it may, if we assume that profit is some part of a business (ok
Digital's) reason for existance, we need to look at short-term vs long term
profitability.  IMHO that is the biggest problem facing Digital today. 
Is it inherently profitable to do R&D on future possible products? No.
Is it necessary for the company's long term viability? Yes!
Same questions for going out of your way to keep a customer satisfied and
happy.

I see far too much short-term thinking, and I fear that it endangers our
long-term prospects.

Kevin