Conference 7.286::digital

Are you saying that CBUs now do report to Ed Lucente or is it just a scenario?

Any way, I always was curious about what do the CBUs mean organizationally?
Engineering seems to be carrying on their bit, so do the sales, services and 
geographies. Base product marketing still exists, so does the channel marketing.

What are these CBUs and what do they do? 

Avinash

	The questions of the day are: Why the sudden change and who has P&L
	responsibility ?

Charlie

    re .1
    
    Yes, this is real.  VTX NEWS today reported that all the CPU heads now
    report to Ed Lucente, although remain on the SLT. So, the "scenario" is
    real.
    
    Steve

Is this a tacit admission that the CBU concept was a failure?

    re: -1
    
    Sounds like they were given one quarter to show a profit;  they didn't,
    so the Lucente product emphasis won out.  Actually, it may be a wise
    move;  they didn't have much to offer their industries to begin with. 
    In reality, how many industry specific solutions do we have?  I'm sure
    there are some, but none come to mind.  We've been talking sellling
    solutions for years, when the reality was we had none to sell.  We had
    technical solutions, but not really industry solutions.  
    
    Nevertheless, the CBU strategy could have yielded solutions over time. 
    This move may have the effect of doing giving them time, although I
    doubt if anyone is seeing it that way.  
    
    Clearly, Lucente has been positioned to be responsible, totally
    responsible, for sales.  For all practical purposes, the CBU's are out
    of business.  They cannot bring value to the table.

    re .2- Who has P&L?  I was told by a reliable source this morning that
    P&L has been removed from the CBU VPs.  I suppose that Lucente now has
    it.   And, yes, the CBU's are now powerless.  The announcement
    basically turns them into marketing organizations.  I've been around
    this business a long time.  I've never seen a company change it's mind
    about so many things in so short a time as Digital.  Looks sort of like
    we don't have any idea what we are doing.  Commission plan, vacation
    plan, CBU plan, P&L owned by account managers, industry focus vs
    product focus, and on and on and on.
    
    CW

    I'm surprised this note isn't getting more discussion.
    
    When Bob Palmer took over in October 1992 he promptly reorganized the
    company into CBUs. Several times I've heard him say something along the
    lines of:
    
    ALL P&L is with the 9 CBUs, no exceptions.
    
    Not an exact quote but close enough. He then goes on to talk about the
    functions supporting the CBUs (engineering, manufacturing etc).
    
    With the 5 customer focused CBUs now reporting into the head of the
    SAles and Marketing FUNCTION (Ed Lucente) it kind of tips upside down
    the grand reorg. What does it all mean? Is this another example of DEC
    continually reorging rather than moving forward. Do CBUs still have P&L
    responsibility.
    
    The interesting thing is that the companies internal revenue reporting
    system (DRC) was totally reorganized during FY92 to report revenue
    based on CBU for FY93. That system is now in place. The CBU focus
    seemed very key to the company.
    
    Not to mention that the company trumpeted the fact that it was the
    first big computer company to reorganize on an industry basis.
    
    I'm totally confused. What do the 5 customer CBUs do now. Are they now
    little more than Industry Marketing Groups? Wasn't that how the company
    was organized prior to the Bob Palmer reorg?
    
    I'm totally confused by the complicated management reporting structure.
    There seems to be lots of people with several managers. Managers in the
    CBU, managers in the geography, managers in the function etc.
    
    Oh I guess I forgot that the main mission of this company is to ensure that
    there are enough jobs to go around for all the middle managers. When
    due to TFSO there are less people on the front line:
    
    	1, More middle managers are required to debate why a customer
           can't be satisfied.
    
    	2, More middle managers are required to squabble over exactly who
    	   claims credit for a sale.
    
    	3, More middle managers are required to signoff on $50 software
    	   requisition orders.
    
    	4, More middle managers are required to schedule the few people
           left that actually deal with customers.
    
    So bottom line what's a CBU now?
    
    Dave

Note 2711.7 by SMAUG::GARROD
    
    >    I'm totally confused. What do the 5 customer CBUs do now. Are they now
    >little more than Industry Marketing Groups? Wasn't that how the company
    >was organized prior to the Bob Palmer reorg?
   
    your not alone dave. i can't make beans out of the whole mess. worse
    yet our front line sales reps are totally confused about "what" they
    should sell. it's depressing at best as the bean counters have gone
    totally bezerk.

    >yet our front line sales reps are totally confused about "what" they
    >should sell. 
    
    they should sell what the customer wants and needs.
    
    why would that be confusing?
    
    \nasser

    Re: >...sell what the customer wants and needs.
    
    Customers want solutions.  Customers need products which can help
    implement those solutions.
    Now before you can deliver on that, or even think about making a
    profit, you have to get the customer to WANT your products and
    solutions.  I thought CBUs were supposed to achieve that.
    

Note 2711.9 by STAR::ABBASI
    
    >they should sell what the customer wants and needs.
    
    as soon as digital figures this out let me know. beaurcrats continue to
    tell us (those in the field) what we can and cannot sell. they do it
    with metrics - rewards and punishment. what the customer may or may not
    want seems irrelevant. sad. but true. 
    
    >why would that be confusing?
    
    really? you should walk a mile in my shoes.
    

    The CEM (Comms, Edu and Media) CBU was in Singapore last week holding
    the CEM Pacific Rim conference. We heard all kinds of exciting news,
    claims, commitments etc from the likes of Bob Griffin, Ruth Gaines,
    Eric Lawrence... Now that the CBU don't have P&L, I wonder how much of
    those commitments are going to be kept :(
    
    In fact, the CEM CBU VP (Kozlowski) was supposed to be present as the
    keynote speaker, but could not make it "due to urgent meetings with the
    SLT". I suppose we now know what that meeting was all about.
    
    The news broke during the conference, but no apparent panic was
    detectable.

So, is the official word that the industry-oriented CBUs have no P&L?
If so, do you suppose that the world-at-large will see this as consistent
with the plan our senior leadership presented publicly less than one year
ago - with manifest resolve and confidence?

<<< Note 2711.7 by SMAUG::GARROD "From VMS -> NT, Unix a future page from history" >>>

>    The interesting thing is that the companies internal revenue reporting
>    system (DRC) was totally reorganized during FY92 to report revenue
>    based on CBU for FY93. That system is now in place. The CBU focus
>    seemed very key to the company.
    
   No Dave, in FY92 we put in place the 3*3 organization for FY93, 
   it's in FY93 that we prepared the CBU for FY94 (should I say Q1 only?)
   For memory in FY91 we prepared the inverted pyramid (account-focus) for FY92
   Before that we had different flavors of country-based and function-based
   reporting systems.

   We used to rebuild from scratch all our reporting systems on a yearly basis.
   It seems that CBU lasted only one quarter, we must be proactive and envisage
   going directly to a weekly reorganizaton. 
   By chance people in charge of DRC kept a "traditional" view.
   What a good idea!!! I would suggest that all our management
   reporting applications start with a first choice:

	- Traditional view
	- This week view
	- 11-Oct view
	- 04-Oct view ...
	 
   I'm sure with this approach our customers would be amazed how flexible 
   our decision support systems can be... if we still have customers and
   decisions to support.

   Jo�l 

    Re .-1
    
    Yes I made a typo in my reply. I meant FY93 where I said FY92 and FY94
    where I said FY93.
    
    Yes I'm sure glad the "TRADITIONAL" view (ie product focused view) was
    left in DRC. I presume the CBU view is now an anachronism.
    
    I wish I understood what is going on. It is kind of worrying when
    something as important as the new strategic direction seems to have
    been reversed less than 3 months before it went into affect.
    
    The cynic in me says some high level VPs thought they'd better
    reorganize before somebody got to hold them accountable for something.
    Can't be held accountable for something under transition so the safe
    thing is to reorganize AGAIN.
    
    Dave

I ignore all this CBU PBU stuff and just help sell stuff to customers.  Why
bother trying to learn this alphabet soup when it will change again by the time
you come in tomorrow?  Someone must think all the constant artificial
maneuvering is important, but it all seems like a waste of time to me.  Our
customers certainly don't care.

Paul

    There is essentially NO reason to believe that any change of
    significance has happened to the CBU's. The CBU managers happen to
    report now to someone new. There is no reason to believe that there is
    a change to their charter, responsibility for P&L, or responsibility to
    understand and deliver what our customers want to buy. Why does a
    simple change which combines the reporting of the cbu organization with the 
    reporting of the sales organization cause anyone to believe that the
    CBU focus has changed, or that the reasons for which the CBU's were
    created have changed?

    
    RE; .17
    
    Responsibility for the company's P&L vested in Sales & Mktg? Not
    an important shift?
    

    What ever happened to the concept of clear lines of responsibility?
    
    E. Lucente is the World head of Sales & Marketing.
    CBU World heads report to him.
    CBU US heads report to them.
    	*BUT*
    R. Gullotti is the US head of Sales & Service.
    S. Roeth is the US head of Sales & Marketing reporting to him.
    	*BUT*
    G. Brebach is the World head of Digital Consulting.
    R. Linting is the World head of SI (a part of DC).
    M. Mayer is the US head of DC.
    
    Now, if you're a technical person in the field, who do you really
    report to?  Are you part of the CBU chain-of-command, the geography
    chain or the DC chain?  Or is it all three??
    
    mystified after 11 years of Digital,
    Bob Gallo

        
    >Now, if you're a technical person in the field, who do you really
    >report to?  Are you part of the CBU chain-of-command, the geography
    >chain or the DC chain?  Or is it all three??

    I made it easy for myself a few years ago when I noticed that the
    structure above me kept changing. I really report to the person who
    does my review. Everyone above that is someone elses problem.

    		Alfred

re .20,

Alfred,

Exactly.

Paul

    Except you have to pay for him/her so it is your problem.
    
    tom_p

    RE: .20 and .21
    
    	The more that we work as individuals and as very small teams, the
    more we lose ground to the competition. The key point is making Digital
    and the customer successful. It almost seems too obvious to mention, but
    in making Digital successful, one really needs to make yourself, your
    associates, your manager, and your manager's manager successful.
    
    	And....that SHOULDN'T BE SO DARN DIFFICULT! Where it is so darn
    difficult, ie. Here at Digital!, the organization structure should be
    simplified. That's as straight forward as it can be.
    
    	So please don't put your head in the sand, your organization and
    its structure is critical to our success. When it becomes confusing,
    insist that it be clarified/simplified.
    
                                                               

re:            <<< Note 2711.17 by MRKTNG::BROCK "Son of a Beech" >>>
                           -< Not a big deal really >-

	I'd be curious to know all the time and energy we put in this
	CBU stuff. All the time spent to discuss partnership agreements
	between territories and CBU. The time spent to report the numbers
	more or less accordingly. The time spent for each CBU and each
	3 geographies to recruit (hopefully internally) some Finance people,
	HRO people and maybe other functional people (IM&T, Law...), not to
	talk about sales.

	I do not know if the CBUs are really dead but if they are this will
	imply plenty of new meetings, travels... to put all these people
	who get specific CBU missions to work ... togheter on Ed's mission.

	Not a big deal, are you sure?

	I agree with some previous remarks: to have a working organization is
	important to get people effective, empowered and motivated.
	(I do not talk about a "good" organization)

	Jo�l

    re -1
    
    Yeah, I am sure. Why is there a belief that the time spent establishing
    partnership agreements with the areas and territories was wasted? Why
    was the time developing a business plan and P&L by CBU wasted? The
    CBU's are still the dimension by which we will measure the performance
    of the company. PBU's plus CBU's equals Digital total. There are no
    other P&L's.
    The time and effort spent to align the marketing organization and the
    selling organization around a common dimension - the customer - is
    hardly wasted!
    Will there be some changes to, and within the CBU's as a result of
    this? Maybe. Will the fundamental dimension of an alignment around
    classes of customers - alignment of strategic marketing, alignment of
    sales, and the measurement of performance around this dimension change
    significantly? I doubt it.
    
    Maybe it's time for everyone to spend as much effort making this work
    as finding fault.

    re: -1
    
    Once the CBU's lost the sales force, were relegated to an
    "advisory" role, and started reporting to Ed Lucente, they in effect
    lost a significant measure of their autonomy.  Instead of being 5
    somewhat autonomous units, they became one.  So where once we had 9
    BU's we now have 4.  That seems like a major structural change to me.
    

    re -1
    Why do you believe we went from 5 BU's to 1 bu? Seems to me there are
    still 5, still in the same business, same responsibility. The BU
    managers have a new boss is all.

    re: -1
    
    My understanding is that the PBU's do not report to Lucente.  Is that
    not correct?

    Who holds the P&L , CBUs or Lucente ?

    Lucente holds the P&L, as I understand it.

    It's been my observation that splitting a corporation into business
    units flat-out doesn't work *unless* those units are spun off
    completely into subsidiaries.  Time and again I've seen corporations
    try the "separate but together" approach (examples that come to mind
    off the top of my head are Stratus and Sun).  Inevitably the division
    is announced with great fanfare and later quietly dropped as the 
    desired results fail to materialize.
    
    There are two factors I can think of that can cause this: First, 
    unless the break is total (complete with separate corporations,
    payrolls, facilities, badges, whatnot) the old stovepipes remain
    in place and the new structure cannot take hold.  Second, unless
    the subsidiaries are shoved out of the corporate nest and left to
    fly or crash on their own, they will always have the mentaility
    that if things *really* get bad they can always count on Corporate
    to bail them out.  This leads to a continuation of the "business
    as usual" that got them into trouble in the first place because
    there's no incentive to try anything radical...
    
    Just the way I see it...
    
    --jim
    

    If Lucente holds the P&L, then can the CBU managers be really regarded
    as "business" managers as they do not have the final say on investment
    in their patch.
    
    As such, are not the CBUs relegated to adjunct marketing operations
    rather than prime business lines ?   Still immeasurably valuable, but
    not the final decision-makers ?
    
    What is the received wisdom on this situation ?
    
    John

    RE: .32
    
    Adjunct marketing operations?
    
    	Just saw an article in Livewire about a new "unified product
    marketing" organisation led by Bud Enright and reporting to both Ed
    Lucente and Bill Strecker. One of the items in this new orgs. charter
    is to integrate marketing efforts of the CBU's.
    
    	Is this a key element of a new re-org that began with the CBU's new
    reporting structure underneath Ed Lucente?

    I am encouraged by what I hope is happening with the Bud Enright
    re-organization.  I believe we will be a stronger marketing company if
    we can get the marketing people out of the engineering organizaton and
    into an independent group with the power to fund engineering projects.
    
    Let the engineers engineer.  Let the marketeers market.
    
    							--jim
    

     re .134
    
    ...... and let Engineering and Marketing talk to each other than live
    in their ivory towers as they have in past editions of Digital.
    
    John
    

    However, with all the new VPs, I've just had another VP layer added
    between me and the CEO.  Now have 4 VPs, 1 Group Manager and 1 Manager.
    I'll try to find the value-added to our customers through this new
    string of VPs, as we are clearly customer focused, and all the 
    organizational structures should be in place to add value to the
    customers, or so the story goes.
    
    Mark
    

    Two months later, and we see that this was the start of something big
    afterall. Was it not?