Conference 7.286::digital

    This is an experiment:
    
    Answer the following question in one screenful or less.  
    
    	When deciding on a course of action, would you rather 
    			    be right
    				or
    			        win?
    
    I believe the sum total of "our" individual answers will show what kind
    of corporation we are.  The content may also contain guidence on what
    we should be.  Note: this experiment does not allow the right AND win
    choice.

My title answers your question. But, I have been specifically told by more than
one manager that being right is not as important as "winning". They defined
winning, BTW, as not rocking the boat; going along.


I would like to make one tentative suggestion regarding the original note.

I think that describing our behavior in terms of ancient tribal terms does a
serious disservice to those ancient tribes. My feeling is that while what you
say about preparing to deal with kill or be killed issues  is true, it is only
a partial truth. I believe that tribal peoples were very, very much driven by
the survival ethic. This is more than kill or be killed. It is, doing the
right thing.  What's right? Well, what helps the tribe survive and prosper?
In some cases it is kill or be killed; but, in others it is co-operate or be
killed. Tribal members grew up knowing the distinctions.

The big difference between us is that our society today is much more complex
and, therefore, it is difficult to determine what the right thing is. We are
not trained from the day we are born to understand the choices we need to make.
The complexity is so great that I think it drives people to try and simplify
decisions. How many times have we heard KISS as the way to do things? Well,
in the world of business concentrating on "competition" is simple. It reduces
the corporate survival ethic to the kill or be killed, there is no analog
to the cooperate or be killed.

We need to avoid looking at corporate survival in only one way. Whether the
way is co-operate or kill looking at things exclusively one way will result
in failure. 

>                      <<< Note 1779.2 by MILPND::GLAZER >>>
>                         -< choose: Be right -or- Win >-

	This is a false dichotomy.

	In an unfettered market, being right means you DO win !

	A good example is DEC's early to mid 1980s performance.

	We were right ( VAX, Ethernet, etc. ), and we kicked
	some established players' cans all over the playing field.

	But, what makes us technologically right in one decade
	makes us a dinosaur in the next.   DEC can win by being
	right again.  ALPHA looks real promising.  It may very
	well be "right" for the 90s.  OSF may very well be another
	"right" move.

	Competitiveness is not something you do with meetings,
	graphics, ads, press-release posturing, etc.  Competitiveness
	is only possible when you have the "right" solution, or
	one of the "right" solutions.

	Steve H

    	Being right in the 90,s is being open and WE are making lots of
    moves in becoming open.
    
    	To answer the question being right is very importent.

    Bravo, .0!  Someone with both the historical perspective on Digital
    to know what he's talking about, and the ability to articulate very
    well the essential question "Whither Digital (and us)?".
    
    I believe it is possible to be both meaningful (i.e., helpful to
    humanity) and successful in the financial sense, even in these times,
    but I'm not quite sure how to go about that.  My best times in this
    or any other company were when I did something that helped another
    person do their job better or eliminated their problems for them,
    and experiencing their reactions.  To me that's success!  It happened
    to bring financial success as well, so much the better.  In fact, it
    never occurred to me until the last few years that the two weren't
    in fact inextricably linked.
    
    Nowadays, apparently, many if not most corporations don't see it
    that way.  If it must come down to "be right or be successful",
    then I'd rather be right.  Perhaps this whole concept is at the
    core of much of the dissatisfaction expressed by many in this
    conference and elsewhere.
    
    In the end, we must find ways to be both helpful to others and
    financially successful.  If not, companies that choose to be "only"
    successful may find that the ones who would rather be "right" won't
    be around long enough to ensure that success.
    
    Chris

    Adolph Hitler once said that it is not right that matters, but victory.
    
    Given that, I would rather be right.
    
    But, what does "being right" mean?
    
    Right for whom?  Empire builders?  Your boss?  The person du jour that
    you are tryng to impress?  Or maybe, the customers?  Whose customers?
    Ours?  The competitions?  
    
    No easy answers here.....
    
    If dec said we want all customers, I would say that is right.
    
    If dec said, the customer is never wrong, I would say that is right.
    
    If dec said a customer problem is a dec problem, I would say that is
    right.
    
    If dec said we are best in class in <whatever>, is dec right?
    
    Unfortunately, The expression "do the right thing" means 118,000
    different things to 118,000 different employees.  
    
    Leadership with a firm committement to the customer, period, is what
    I believe is right for dec.  Instead, we have management concerned with
    winning.
                                                              

    :.7
    
    or management too insecure or overconcerned about their own behinds ...
    
    There are lots of doers in this company who know what is right
    (customer focus), and in many years past, who made that collective force
    work.  Those were the days when DIGITAL was "kicking butt" in the
    marketplace.
    
    I think the tide began to change when the collective weight of
    management to subvert and impede tilted the balance away from "right".
    And unfortunately, the defensive nature of the management beast (now
    that its being called into question) is not to correct its problems but
    to apply positive feedback, amplify them, and make them worse.
    
    Not all management fits this model, just seems like too much of it for
    our own good ....
    
    Jack Bouknight

    
    
    I know that the author of .0 has been in the forefront of getting
    Digital people to pay attention to the Voices of Customers through
    QFD's, much of this QFD work has been on components - pieces of hardware
    or software.  What we need now (and I don't know if its doable) is
    a sort of super QFD that can take a very broad look at  customer
    needs in a wholistic way and help point us to a some higher vision
    of where we should be going and how we should get there.
    
    
    
         

re: .10 (A Super QFD?),

>    What we need now (and I don't know if its doable) is
>    a sort of super QFD that can take a very broad look at  customer
>    needs in a wholistic way and help point us to a some higher vision
>    of where we should be going and how we should get there.
    
	I agree.  I stumbled across this same conclusion back in my note
    #1761.103 where I attempted to address this very need.  Rather than
    rathole this discussion however (or note #1761 for that matter), I
    am creating a separate note for this discussion.  See note #1780
    entitled "Total QFD (what TQM should consist of)" for more details.

    				   -davo

    RE: .0 and tribal context of survival,
    
    Read Ruth Beebe's "Hanta Yo", a re-telling of tribal history of a
    Lakota Souix (sp?) band in the 17th century at the beginning of contact
    with the new settlers.  Fascinating historical story-telling, excellent
    writing.  Originally written in the Lakota language by a
    socialist-historian with 25 years contact/living with the survivors. 
    She derived the historical "fiction" from the recollections of the
    "grandfathers" and their deerskin picture books.  She wrote it in the
    original Lakota tongue to preserve the Indian psychology and expression
    and then translated it to English.  I have read it three times since I
    saw it reviewed in the "Smithsonian Magazine" 10-15 years ago.
    
    The title "Hanta Yo" roughly means "get out of my way" and is
    allegorically stating "do the right thing, regardless".  A little like
    "damn the torpedos, full speed ahead" when you are are so right so as
    not even to have to think-about/question your motives.
    
    Blue-eyed, blonde and squareheaded - Fred (ie, not an Indian)

RE: .0

This is a for-profit company, not a charity.  I'm here to make a contribution
to DEC's bottom line, not to contribute to customers or to my fellow humans.

>    I've been at Digital since 1960 and until the most recent few years
>    never thought we were particularly oriented toward competing.  Back
>    when we were making double-digit profits and doubling (early '60s) or
>    50%-growing most years (later...) we were not focussed much on
>    competitors it seemed, we were more focussed on customers.

Actually, I would say that in those days, DEC was focused on technology.
Whatever it was focused on, it wasn't customers.  There was a saying in
the computer industry at the time: "Minicomputers aren't sold, they're
abandoned."  They were talking about DEC and its absolutely atrocious service.

It's easy not to be particularly oriented toward competing when you are selling
into an unexploited niche market.  All you have to do is sit back and
take the orders.  And that's all DEC did.  Then we grew out of the minicomputer
niche.  We now have to actually answer the phones when customers call, or
they'll take their business elsewhere.

--PSW

    
    Re: .13
    
    > This is a for-profit company, not a charity.  I'm here to make a
    > contribution to DEC's bottom line, not to contribute to customers
    > or to my fellow humans.
    
    This view has been prevalent for a long time and for some of that
    time was OK or at least didn't interfere with a company's ability
    to remain viable.
    
    The world is changing.  This attitude is not going to fly much longer.
    Throughout the world customers are starting to show evidence of
    evaluating whom they do business with not only with regard to the
    actual product/service they are purchasing, but also with regard to
    whether that company is ethical and a "good world citizen".  If we keep
    thinking this way, one day we'll wake up, while on our way out of
    business, and realize that the world's values have moved on while we
    remained static with a worn-out, profit-hungry, old-style capitalist
    mindset.
    
    fwiw,
    Steve
    

re .14    
>    The world is changing.  This attitude is not going to fly much longer.
>    Throughout the world customers are starting to show evidence of
>    evaluating whom they do business with not only with regard to the
>    actual product/service they are purchasing, but also with regard to
>    whether that company is ethical and a "good world citizen".
    
    Whether the customer wants a company that gives good products and
    services or one that recycles, doesn't use CFC's, etc, is irrelevent.
    The bottom line is to give the customer what they want. If they want
    the latter, and we give it to them, it's still capitalism. We're
    doing it (being good world citizens) to make money, not to go out of
    business with a clear conscience. Let's not kid ourselves. Doing
    these nice things that make interest groups happy isn't solely
    out of the goodness of our hearts. It's because it'll make us
    money, by reacting to the customer that you described. Plain and
    simple.
    
    John

    Well, I hope somebody else has the time to write the flame .-1 so
    richly deserves.

    
    Re: .15
    
    >Whether the customer wants a company that gives good products and
    >services or one that recycles, doesn't use CFC's, etc, is irrelevent.
    >The bottom line is to give the customer what they want. If they want
    >the latter, and we give it to them, it's still capitalism. We're
    >doing it (being good world citizens) to make money, not to go out of
    >business with a clear conscience. Let's not kid ourselves. Doing
    >these nice things that make interest groups happy isn't solely
    >out of the goodness of our hearts. It's because it'll make us
    >money, by reacting to the customer that you described. Plain and
    >simple.
    
    Yes, of course we want to make money, but in the mindset I am talking
    about profit is the byproduct NOT the goal.  You can argue that as
    long as you make the profit what difference does it make, but where
    profit per se is the goal, experience shows that companies make short
    term decisions which hurt their long term prospects i.e. often killing
    the goose for the golden egg.
    
    Successful companies today are pursuing customer satisfaction as their
    strategy for competing, surviving, and making their profits.  This is
    a new game for the typical U.S. company.  While we're worried about
    profit someone else is worried about satisfying their customers.  It
    doesn't take a genius to figure out which focus is more likely to "take
    care of business" for long term survival.
    
    It doesn't matter how much profit you show this year, if in doing that
    you've set in motion the events that will put you out of business next
    year.  They won't remember how good your margin was, but they *will*
    remember you lost what it took to survive.
    
    The game is no longer to show profit.  The game is to stay in business!
    The competitive environment really IS that serious.
    
    Steve
    

    Time, and the ability to lie well...
    Do you really think reacting to society's demands is done for other
    than a financial reason?

    (.18 was in response to .16, btw)
    
    re .17
>    Yes, of course we want to make money, but in the mindset I am talking
>    about profit is the byproduct NOT the goal.
    I'd disagree with this in particular, but overall your reply makes
    sense.
    
    >  You can argue that as
>    long as you make the profit what difference does it make, but where
>    profit per se is the goal, experience shows that companies make short
>    term decisions which hurt their long term prospects i.e. often killing
>    the goose for the golden egg.
    Profit can be looked at with regard to various timeframes, and any
    company that wants to stick around needs to think long-term.
    
>    The game is no longer to show profit.  The game is to stay in business!
>    The competitive environment really IS that serious.
    I wouldn't (de)value profit as you state, but staying in business
    certainly comes first. I just don't agree with the implication that
    the nice things companies do, which don't seem to directly affect
    revenue, are being done for reasons other than financial.
    
    John

    Re: .-1
    
    >> I just don't agree with the implication that the nice things companies
    >> do, which don't seem to directly affect revenue, are being done for
    >> reasons other than financial.
    
    Why does Digital match charitable donations?

RE: .14

I never said we shouldn't be ethical.  However, in our zeal to serve customers,
we must always remember which company writes our paychecks.  There are
situations where DEC's best interests and a particular customer's best
interests diverge, and in those situations we must remember that we are working
for DEC, not for the customer.  Based on some notes I've read here and
elsewhere, some people seem to have forgotten that fact.

--PSW

    You wouldn't be thinking of the distribution of software to customers
    without licenses or internal PAKS on external systems, would you?

    Clever designers look to serve multiple values with each choice we
    make, right?
    
    So why can't a Corporation serve multiple values?  Why is there this
    tendency to speak as though *either* the customers win *or* the
    investors win?  (*or* the employees, *or* suppliers, *or* neighbors...)
    
    Certainly, there are localized occasions when win-lose dichotomies
    can develop.  Obviously, if customers want us to give away the store
    I'm against that.  But that's not a theme, that's merely a variation on
    the general theme that a business enterprise must have *all five*
    viewpoints be winning positions to survive long-term and prosper.
    
    I think our tendency to either-or thinking is some kind of crazy artifact.
    In part, since it seems consistent with the ancient tribal structure
    that I imagine (the one that Lionel Tiger writes about in Men In Groups
    based on observations of Baboon troops...) I conjecture that we boys
    have been sold on a dog-eat-dog model as part of a loyal commitment to
    make sure we do what has to be done for the survival of our tribe.  And
    in part, it might be I suppose an artifact of the serial nature of
    languaging itself, in which the Tortoise and the Hare cannot be spoken
    of simultaneously:  this allowed Zeno to construct his famous tricks.
    
    But whatever the source of this kind of thinking, if you think about
    businesses a while the craziness of trying to select between
    victimizing customers, victimizing investors, victimizing suppliers,
    victimizing employees, or victimizing neighbors becomes just obvious.
    We can't afford to do *any* of those!  There is no viable choice among
    those.  All 5 have to be glad they are in a relationship with the
    business.  All 5 have to view themselves as winning, without having to
    make any of the others lose.  It's not easy to run a business in such
    a way that all 5 continue to win together--but it is possible and
    Digital has been, I think, over the years a wonderful demonstration of
    that fact.  So let's not talk ourselves out of the truth of this
    accomplishment.  We have worked smart and hard, and have maintained this 
    continual 5-way win for decades.  It's a little like an animal with
    5 major organs.  Can the heart win at the expense of having the liver
    lose?  It's all part of one whole system.
    
    I know there are those who think Digital just happened into a lucky
    niche and took orders, and now that we are unlucky we have to get into
    a more "real" world where to preserve the lungs it might be necessary
    to let the spleen atrophy.  I've been working pretty hard here since
    1960 and as far as I can see, we're as lucky as ever--the world has
    always held major challenges for this company I believe.  It wasn't an
    accident that we had unchallenged niches once in a while:  we earned
    'em!  It was no accident that we invented what later became defined as
    a "market."  We worked hard to find out what needs customers had that
    we could fill.  Sure, there were engineers who were technology-junkies;
    probably I could have qualified for that label for about 20 years. 
    But I also visited customers, got phone calls from customers, talked
    with sales people about customers and their needs, wrote literature for
    customers to read, went to DECUS and met with customers--you name it.
    
    See, the idea that you can't be a technology-junkie and *also* have a
    profound concern for customers and their needs is probably another one of
    those phantasms of opposition that might come from the serial structure
    imposed by languaging.  Of Course we can do both!  People are versatile!
    
    So let's not talk ourselves into giving up on what we have amply proven
    we can do.  All we have to do is find out what we used to be able to do
    and regain the ability.  In my view, one of the things we used to have
    was very close contact between product developers and customers,
    largely thru DECUS and facilitated by our small size.  We didn't need
    to theorize about it, we just did it.  Now, when a lot of our customers
    don't fit the DECUS model and we are too big to have all the developers
    go to DECUS meetings anyway, we just have to become more artificial and
    purposeful about something that used to happen more or less naturally.
    Contextual Inquiry (and QFD to integrate the irritation-for-invention it
    generates into good business-and-product planning) is one set of ways.
    
    And, not to give away the store or in any way victimize investors.
    On the contrary:  when we think of ways to serve customers that nobody
    has thought of before, we have a temporary monopoly and customers will
    willingly pay the kind of profit margins monopolies command.  Later, of
    course, monday-morning experts will say we were merely in the right
    place at the right time and took advantage.  Well, of course I'd agree
    except I don't think there is anything mere about it.
    								Russ

    re .20
    
>    >> I just don't agree with the implication that the nice things companies
>    >> do, which don't seem to directly affect revenue, are being done for
>    >> reasons other than financial.
    
>    Why does Digital match charitable donations?
    DEC does a lot of donating - and it's all pretty much for the same
    set of reasons. Being known as a generous company with charities
    builds the company's image in the community and outside (hence the
    "good world citizen"). That impacts people's buying decisions,
    and that impacts DEC's bottom line.
    It's a write-off too.
    
    John

Business is *not* a zero sum game!

   [Lecture on Economics]
   
   The Communists lost the political war, but they had some
   victories in the propaganda war.  Specifically they were
   successful in convincing many capitalists that business is a
   matter of exploitation.   Over and over, people seem to have
   the hidden assumption that when a business transaction
   occurs, somebody got cheated.  That is false.  If two (free)
   parties make a deal, they both win.
   
   If I buy a computer, I wanted the computer more than the
   money.  If I sell the computer, I wanted the money more than
   the computer.  Both parties win.  
   
   [End of lecture]
   
fwiw

Dick

    The "Body Shop" chain of stores operate with certain clear goals
    around product development that most companies in that business
    (such as Proctor and Gamble) do not share, and would even consider
    to be handicaps.
    
    Yet Body Shop is very profitable and has made Anita Roddick one of the
    richest people in the world.

>>
>>   The Communists lost the political war, but they had some
>>   victories in the propaganda war.  Specifically they were
>>   successful in convincing many capitalists that business is a
>>   matter of exploitation.   Over and over, people seem to have
>>   the hidden assumption that when a business transaction
>>   occurs, somebody got cheated.  That is false.  If two (free)
>>   parties make a deal, they both win.
>>

Just because the Communist dogma ("all business is exploitation") is wrong does
not mean that the Right-Wing dogma ("no business is exploitation") is right!

Your argument has some validity when both parties to a transaction have similar
bargaining power and full information.  This is an idealized situation used for
basic economic textbooks.  In the real world, there are many instances in which
these conditions are violated:

        - Big business and government generally have much more economic power
	  than individual employees or customers.  However, when the customer
	  of a big business is another big business, some balance is restored.

	- Companies generally seek to hide or downplay the negative aspects of
	  their products, rather than giving the market full information.  The
	  full information may sometimes be available from other channels, but
	  it also may be hidden as a "trade secret"

	- Entry costs to become a major player in an industry may be so large
	  that potential competitors are excluded.  Small companies that are
	  fortunate enough to grow into large ones often attempt to "burn the
	  bridges" behind them.  See for instance, Sculley's book, where he
	  said that his strategy at Apple was to spend enough money on ads to
	  gain a #2 place behind IBM and lock out everyone else (paraphrase).

	- Copyrights and patents are monopolies the government grants for the
	  purpose of encouraging innovation/ensuring that ideas eventually go
	  into the public domain.  Their effect is to create artifically high
	  prices.

	- The marketplace may be so technical that customers have very little
	  chance of fully understanding the transaction.  How many people can
	  second-guess a surgeon or a nuclear engineer in an informed fashion?

A completely unfettered so-called "free market" is not a pretty sight to see!
We had something like this back around the turn of the century - the results
were things like

	- 14 to 16 hour work days
	- extensive use of child labor
	- inhumane, dangerous working conditions not fit even for animals
	- unsanitary food (read Upton Sinclair's "The Jungle" sometime - the
	  horrifying descriptions of food processing it contains turned out
	  to be, if anything, UNDERreporting the problem)
	- extreme levels of pollution

This is why, in civilized free-market societies, government regulates business
to prevent the worst of such abuses, and courts of law consider the ability of
each party to influence a deal when contract disputes come before them.

A responsible business will actually welcome much of this regulation - because

	- without regulation, businesses which exploit others will have
	  an economic advantage over caring businesses, forcing the
	  latter to
		- accept lower profits/possibly go out of business, or
		- lower their standards

	- with reasonable regulations, there is a level playing field -
	  those unscrupulous businesses who attempt to cheat can be put
	  out of business if they fail to clean up their act.

    Re: .24
    
>    Why does Digital match charitable donations?
    
>>    DEC does a lot of donating - and it's all pretty much for the same
>>    set of reasons. Being known as a generous company with charities
>>    builds the company's image in the community and outside (hence the
>>    "good world citizen"). That impacts people's buying decisions,
>>    and that impacts DEC's bottom line.
    
    Digital has explicitly chosen to make its donations low key. KO has
    said himself repeatedly that the company's involvement will be via its
    employees.  Digital's image in this area would be considerably stronger
    if it took the same money and made the donations in the company's name
    and made the donations public.  Mostly it hasn't done that. Therefore I
    disagree with the thrust of the above statement that Digital matches
    donations in order to help the bottom line.
    
>>    It's a write-off too.
    
    Yes, it is a write-off, which means no taxes are paid on the donated
    amounts, but if the donations were never made, the bottom line would
    improve. Your comment is true, but without merit regarding donations
    and the bottom line.

    I don't know if it still works with the changes to tax laws which
    occurred a few years ago, but at one time charitable donations by
    Digital definitely DID add to the bottom line.  The way it was
    explained to me when I took the "Finance for the Non-Financial Manager"
    several years ago went something like...
    
    Suppose Digital donates a computer system worth $100,000 to a
    recognized charity.  The $100,000 is MLP without discount.  DEC can
    take a $100,000 tax deduction which, under the 48% corporate tax rate
    that used to be in effect, was worth $48,000 on the bottom line.
    Since this system typically might cost Digital $20,000 to produce, the
    $100,000 charitable contribution added $28,000 (48,000 - 20,000) to the 
    bottom line.
    
    The corporate tax rate has changed since I took this course, but as
    long as Digital's cost to produce a system is a smaller percentage of
    MLP than the current tax rate, there is a profit to be made from giving
    it away.  
    
    Why doesn't DEC give everything away?  Because there is a limit on
    charitable deductions that a corporation may deduct.  I don't know what
    the corporate limit is - for individuals it's 15% of gross.
    
    Larry

    You were mislead. A contribution is an expense, not revenue to DEC.In
    your example DEC gets expense relief for the cost of the system.  Now
    why would we do that.  If it is a old product we get it out of
    inventory without having to scrap it and get recognition as being a
    good company.  Nothing wrong with this, but no REVENUE is involved. 
    The cap on contributions 5 or 10% is that, just a cap on how much any
    company can give away in any year.