Conference 7.286::digital

re Note 3052.0 by SETC::HYDE:

>     Bob Palmer quoted from a memo he says he sent to Digital Senior
>     Managment "... This will mean sharply reducing our popluation... we
>     must aggressively and immediately cust costs in every part of our
>     business..." 
>     
>     Why is layoff the only option we ever hear discussed?
  
        It wasn't the only option mentioned -- another option was
        selling a part of our business.

        Bob

    I seem to remember that in the Mid 80s Hewlett Packard had a serious
    profitability problem. As I recall, all staff were asked to accept a
    cut in salary and benefits, on the understanding that this would negate
    the need for large scale layoffs, AND, upon return to profitability the
    money would be returned over an agreed period of time.
    
    Oh, and as I remember, senior management had to accept double the
    reduction of the worker bees, on the same basis.
    
    
    Another way to save company cash: Stop this ESPP instant sell nonsense,
    the company should only consider subsidising our buying stock if we are
    intent on keeping the stuff for some time. After all, it is the
    ownership of stock that creates commonality of interest, not selling it
    instantly to get some cash to buy that washing machine you always
    wanted !.
    
    Rgds,
    
    AW
     

re Note 3052.2 by RDGENG::WILLIAMS_A:

>     Another way to save company cash: Stop this ESPP instant sell nonsense,
>     the company should only consider subsidising our buying stock if we are
>     intent on keeping the stuff for some time. After all, it is the
>     ownership of stock that creates commonality of interest, not selling it
>     instantly to get some cash to buy that washing machine you always
>     wanted !.
  
        That is simply a pay cut in another form.

        Many of us (myself included) cannot invest the cash we put
        into the ESPP for any more than the known fixed period (6
        months at most) and known return (not absolutely guaranteed,
        of course, but almost as good).

        (And would I have to state the obvious that holding the stock
        any longer has, in recent years, been a good way to LOSE
        money?)

        The money would simply not be put into the ESPP.

        For me it's not a washing machine, it's my children's
        education, and it comes WAY above Digital in my priority
        list.

        Bob

    The SEC might have something to say about how long the company (any
    company) can force the employees to hold onto the stocks. I think the
    old ESOP was better than this one.

    Re 3052.3
    
    Point taken. However, I made my comment in the context of what 'else'
    could the company do to reduce costs rather than just layoffs. If you are
    laid off, then ESPP, in whatever form, becomes distant history.
    

>                    <<< Note 3052.2 by RDGENG::WILLIAMS_A >>>
>                        -< 2 More ideas for saving $$ >-
>
>    I seem to remember that in the Mid 80s Hewlett Packard had a serious
>    profitability problem. As I recall, all staff were asked to accept a
>    cut in salary and benefits, on the understanding that this would negate
>    the need for large scale layoffs, AND, upon return to profitability the
>    money would be returned over an agreed period of time.

This MAY be true, but the HP situation of that time that I KNOW to have been 
true was a 5% pay cut and one enforced day off every other week.
Cut the time, cut the pay.
I know of no aspect of that plan that would have repaid the lost money.

- tom]

	I have to agree that there could be additional alternatives
        to massive layoffs.  HP, IBM, and other high tech firms
        have already  done the turnaround.  There was a time when HP had
        employees on a 4 day work week.  IBM encouraged  people to leave
        with a  package  open to most, if not all of the employees.
        Tandem forced employees to take vacation several years
        ago to make the numbers look better.

	On a related issue,  cost cutting  efforts which could have a dramatic
        effect on the bottom line (dollar for dollar  impact), still have
        a long way to go.  With travel being our 3rd largest expense, this
        must be 1 area  we can realize significant and wise savings.  I 
        am not implying that all travel be cancelled, but that
        more options  be made available for  purchasing "cheaper"
        tickets than what Thomas Cook quotes in most cases.  

        Recently, I received information from Digital "up north". It
        had been FEDERAL Expressed to me and to others in my  same location.
        The information in the package was not  something that required
        FEDEX (sent out too late to begin with or something like that).
	So, these type of costs really need better controls.  

        Another area where we have not used our own technology to improve
        telecom expenses is in the Call Center arena.  We  sell our
        service to other corporations and show them how much money
        they can save.  In 1 case, a customer will pay approximately
        $250,000 for a Call Center solution and  will SAVE over
        $663,000 in the first year.  With call volumes increasing
        this savings will be even greater.  So with paybacks of
        less than 6 months, we could be implementing similar solutions
        internally.  Instead, we will lay off people or sell off
        pieces of the business.  We DO need to divest of products/services
        that are not profitable and/or not  market leaders, BUT the
        layoffs should not be the assumed mode for returning us
        to profitability.

	Layoffs seem to be the easy answer  to a not so easy question:
	"How can Digital return to profitability in a very short time?"

	Linda Bramblett

	Employee and Shareholder

    Has this DVN been released to the public yet? Has there been any
    reaction to it from "outside"?

    re 3052.6
    
    By 'returned' I meant levels adjusted back (plus, back to full time),
    not that they gave back the money saved during the period of the
    reduction. [Apologies for not being clear].
    
    Again, I make this point only in the context of an 'alternative' to
    layoffs (.. see base note).
    
    AW

Ahem...I guess you guys missed the common thread throughout Mr. Palmer's
presentation. That common thread was that this company will never be
profitable until management can be brought under control. Matter of fact
Palmer even explicitely said that the biggest obsticle to getting things
done within is management. He also said that clear marching orders from the
SLT arent implemented in the 'field' the way they were intended to be. I
beleive his memo to the SLT spoke to this problem as well. So, my question is
if they knew what the problem was why wasnt it 'fixed' much earlier on?

    WRT The Employee Purchase Plan and immediate selling.
    
    Westinghouse (a lotta years ago) had a Employee Stock Plan where they
    contributed 50% (matched your contribution by 1/2 again) BUT you had to
    leave AALL of the stock in the plan for 5 years after the purchase.  My
    wife recieved her last certificate 4 1/2 years after leaving
    Westinghouse.
    
    I would go for a plan like this, as it would enforce and INVESTMENT in
    where we were going, not a way to grant one's self a mini raise every 6
    months.   Maybe if we had been holding the shares we bought 5 years ago
    there would be a little less moaning and a little more pulling, as the
    +50% contribution would make the resulting shares worth it, even if you
    had to wait 5 years to get them AS LONG AS *WE* KEPT THE COMPANY
    PROFITABLE and the stock price level to improved.
    
    Flame now please  (WOOOSH)
    
    I HATE LAYOFFS.  Ken was right, it is an indication that Management
    messed up royally, of perhaps grew too big.  Bob mentioned that
    MANAGEMENT needed to be fixed, BAD if I read him right.
    
    At least he SAYS he agrees with something I have known for most of the
    last 10 years, as a global issue.
    
    Water please (pssst)
    
    Bill
    

re: .10

>Palmer even explicitely said that the biggest obsticle to getting things
>done within is management. He also said that clear marching orders from the
>SLT arent implemented in the 'field' the way they were intended to be.

Well, it's just been demonstrated in the past week that if marching orders
aren't followed, heads can roll. If the above is the problem, why doesn't
the SLT make some responsible heads roll to correct it? Wouldn't that make
more sense than hacking away senselessly at the more productive lower layers?

-Jack

Jack,

>>Well, it's just been demonstrated in the past week that if marching orders
>>aren't followed, heads can roll.
Whos that?

>> If the above is the problem, why doesn't
>>the SLT make some responsible heads roll to correct it? Wouldn't that make
>>more sense than hacking away senselessly at the more productive lower layers?
Exactly!

    
    	Maybe HP employees at the time hadn't had 3+ years of zero % salary
    increases when they were asked to take a 5% pay cut.  We have had a 20%
    pay cut already, over here.
    
    	I gather that our salaries are now so low compared with the rest of
    the industry over here, that the other companies no longer use DIGITAL
    salaries for comparison purposes, certainly I've heard that Sun no
    longer look at DIGITAL.
    
    			Fed up of the UK,
    					Malcolm.

    I thought the reason that we were off the comparison list was that we
    were no longer considered a credible employer in the particular
    industry segment.

re: .13, Jim

> Whos that?

Was that a rhetorical question?

I referred to "the 3G's".

-Jack

    The ESPP is fundamentally flawed.  I tried to denonstrate this through
    a DELTA idea submission nearly 4 years ago that got burried by
    Treasury.  They didn't want to listen to anything about facts and
    stockholder equity depletion in the $100M+ range every 6 months... I'll
    spare you the detail here.  
    
    Suffice it to say it's nearly 4 years later and nothing (and no one...)
    has changed.  Unfortunately, ESPP is now one of the only avenues left
    for the company to raise cash.  We've effectively been shut-off from
    everything but collateralized financing since our Q3 results were made
    public.  Our commercial paper and debt is teetering on "junk" ratings,
    and pending stockholder lawsuits prevent more financing.  So, ESPP is
    likely to remain as is since cash is now king over giving away
    stockholder equity, profits, market share, growth, etc...  We are in
    survival mode.

Since we are obviously going to divest ourselves of a good few businesses in 
the coming months, and since many of those will be in the software domain,
why not encourage groups whose projects are likely to be cut, to put together
a business plan for taking their work outside of Digital, for Digital to take
some equity investment level in them, and basically help them get launched.
We have all the legal and financial services in the company to help such
small businesses get launched. Those projects actually need to survive for a
while anyway, since there are customers (albeit quite small in numbers) who
depend on their products. What will happen if DEC doesn't support our own
spin-offs is that we'll sell the rights to these products to 3rd party

"care & maintenance" companies (as we did, for instance, with some of the CASE
tools recently) and we'll retain a small royalty from future sales. We'll
then lay off the original project team members!

Imagine - everyone would win in this scenario: DEC would not lose loyal
customers, since products would be sustained, for a while at least; employees
who would otherwise be laid off get a new lease of life in a small company,
with some backing from a large parent; DEC gets to achieve its downsizing 
numbers in a humane and business-sound way........

What's to lose?

RE: VFOVAX::BRAMBLETT's comments (Hi Linda!)

>>  Recently, I received information from Digital "up north". It
>>        had been FEDERAL Expressed to me and to others in my  same location.
  
Yep, everyone in the Atlanta office received the April C/S announcement via
FEDX.  Talk about a ridiculous waste of money.  Somebody ought to have their 
butt handed to them for that one!

>>        Another area where we have not used our own technology to improve
>>        telecom expenses is in the Call Center arena.  We  sell our
>>        service to other corporations and show them how much money
>>        they can save.  In 1 case, a customer will pay approximately
>>        $250,000 for a Call Center solution and  will SAVE over
>>        $663,000 in the first year.  With call volumes increasing
>>        this savings will be even greater.  So with paybacks of
>>        less than 6 months, we could be implementing similar solutions
>>        internally.  

Linda, you are trying to use LOGIC again for this company!  We did a Business 
Needs Assessment in 1992 and showed how we could save the company
a potential of approximately $12M in cost savings was identified, $2.6M  
of which could be achieved with little or no capital investment.!!!!  

Nobody ever bothered to implement the recommendations.  :-((((

Keith R>

    If we had better data on what our costs are, maybe it would
    be apparent what we could cut (other than jobs) to reduce our losses.

    Compared to $183 M, is it worth talking about telephone bills?
    Fed EX?  Plane tickets?  Office rent?  Individually, no.  But if totaled?

    Or to put it another way, could 85,000 people have collectively
    reduced our costs by that much money?  For those lacking a calculator,
    that's $ 2153 each. ;-)

    I'd argue that it's possible.  That if you were given an itemized list
    of every expense incurred by you or on your behalf, it could be done.
    I'll admit the "on your behalf" expenses might be tough to root out.
    But we could start by looking at every payment made outside the company
    to another firm, and use those numbers as the area to cut.  Even excluding
    components and raw materials that we purchase, we must be spending
    more than $ 183 M per quarter!

    But the trouble with personal sacrifice and belt tightening is that 
    most people aren't willing to do it unless they're sure that everyone 
    else is doing it also.  And some folks will only do it by edict.  

    So odds are, we'll all be seeing a lot fewer of us in the near future.

    re:  .19 Hutchings
    
    That is the best idea in the conference.  I'm sure someone is thinking
    about it, but that is the way to successfully spin off businesses.  Any
    ideas how to make it happen?  Which businesses?
    
    - Don Randall

    Actually, our French subsidiary seems to have already done something
    a little bit imaginative.  In Context magazine No. 37 (purchased last
    week at my local healthy-food supermarket) said on page 44:
    
    "...no employee at Hewlett-Packard [in France] works more than a four-
    day week, although the plant is in operation seven days a week.
    Digital offered its 4000 employees the choice of a four-day week
    with an accompanying 7 percent pay cut, and 530 employees opted for it,
    saving 90 jobs that otherwise would have been cut..
    .
    .
    .
    "Martine Desmond, a personnel manager for Digital who was one of the
    530 to opt for the four-day week, told New York Times reporter that 'I
    am more efficient in my work, less stressed out and speedy (off work),
    and have not seen my life style much affected by the pay cut.'"
    
    I head we recently had some turmoil in France in which employees
    expressed strong feelings against a new layoff being planned--I think
    I saw it in a note not long ago on this Notes conference.  Maybe someone
    can enlighten us about how the 4-day week idea looks a few months
    later?  (The New York Times article evidently came out Nov 22 1993.)

    Re: .19
    
    It doesn't have to stop with software companies.  I also believe good
    salespeople can be encouraged to set up direct distributorships of
    our products with similar guidance and funding, allowing the remaining
    sales force to focus on the top 50-100 accounts.
    
    What do you think, Bob?
    
    Pat Campbell
    Program Manager/former Sales Exec

    
    To .23 :
    ------
    
    Unfortunatly the French top mgt doesn't believe in part time
    working anymore. More exactly the new top mgt ...
    
    Martine Desmond is not in Digital anymore.
    
    In the new layoff plan, part time was not proposed 
    in the first draft but as you know the first draft of this
    plan was cancelled by the French administration (see note 2957 and
    2970) 
    Digital France was forced to propose part time in the
    new draft of the layoff plan by the French administration 
    
    See note 2957.105 to get informations about the saga
    of the 5th layoff plan in France ...
    
    
    

    I don't remember the specifics, but Digital DID help a large group of
    employees "spin off" into a seperate company back arond the first TFSO
    era.  It was a bunch of folks who worked at BUO (Bedford, MA)... seems
    to mee they did something along the lines of course development or
    technicaL writing.  I just don't remember.
    
    The notion has merit, and I believe it also has precedence.
    
    tony

There is a Digital group (Digital Assets I think) that is helping people with business
plans to buy some of our products and start their own company. In some instances
they are looking at taking whole engineering and support groups with them.

John

    re .26
    
    MCG, Media Consulting Group, was outsourced. Some of the people were
    hired at Quantic Communications. Digital guaranteed business at Quantic 
    as well as using it as a preferred vendor over a certain amount of time
    for a specific amount of money. The contract ends this July, I believe.
    
    Lisa

    I'm no genious but....
    
    If I were to go looking for a spin off, on the order of 10-20K
    employees, I'd look in services first.  That is Digital Consulting,
    MCS, etc.  As a group, I assume that services people make up more than
    the required 10-20K.  In addition, MCS and Digital consulting
    specifically could be "divested" cleanly; meaning only that it can be
    viewed as separate business.  
    
    Not sure if this is what they have in mind.
    
    IMHO; it would seem a lot of DECqueries, etc would need to be sold off
    (see Touch Tech announcement) to equal MCS and/or DC.
    
    FWIW;
    
    Jack Boyle

    Suits me. We in MCS could be even more profitable if we didn't have
    to keep giving away the store to  make the customers want
    to keep buying DEC equipment (three and four extra trips on installs
    due to short ships, DOAs, etc ... free service because sales/account
    manager/whoever promised it ... and on and on).
    
    Time marches on and things change.

   I go to school with several executives from ATT/GIS.  They are
   working ferverishly to build they type of business that Digital
   Consulting does (they currently own 3% of the market).  They might
   want to buy a nice, ready-made SI and Consulting operation.  I even
   know what office I would like (although they did get rid of the nice
   park).

    	Probably MCS would be the best part to spin off. At the moment they
    are regarded with suspicion by customers as not being independant and
    not giving independant advice, and this is probably justified.
    
    	As an independant company they would be more encouraged to give
    equal service to all of the multi vendors products in a customer
    environment. A customer using them as service provider would be less
    constrained towards DEC as the supplier of hardware or software, and in
    turn MCS would be able to attack customers with *no* interest in DEC
    more easily.
    
    	Attached to DEC they possibly help our hardware and software sales,
    but it is at a liability to themselves as a group.
    
    	Another possibility is chip manufacturing. We are already
    contracting our Ayr facilities to meet another companies shortfall. It
    could equally well be the other way round, with us outsourcing Alpha
    chip manufacture to them.
    
    	The PC business is largely independant of the rest of DEC anyway,
    and so is disk drive manufacturing.
    
    	DC has already been suggested as another business to spin off.
    
    	By that point I think the largest single group in the company would
    be the vice-presidents, and maybe we could out-source them?
    
    	The one thing that has always distinguished DEC has been its
    architectures, whether hardware (PDP-11, VAX, AXP, Q-Bus, Unibus, ...),
    software (GEM, ...), communications (DECnet phase I to phase V and many
    contributions to international standards), open systems (technology
    submitted to OSF), security (DSSA), ...     These have always been the
    best available in the industry at the time, and in many cases have been
    de facto standards and some of them formal standards. This is DEC's
    core business, because in almost every other case there is either some
    other company doing it better, or (like PC manufacture) it is clearly
    independant.

    A four day work week?
    
    cuts the salary expense, but not the workforce and not the revenue
    generating population
    
    gives you a little something back for your sacrifice, a day off.
    
    

    RE:-1

    	I'm only guessing but I'd have to say that there isn't a whole lot
    of folks out there that can afford a 20% pay cut and still stay afloat.
    Well maybe our chief cook and bottle washer Mr. Palmer can afford a 20%
    pay cut but he's in a category all by himself.

    Joe

    
    	In countries having marginal income taxes at the level up to
    	60 %, 20 % pay cut would mean only 8 % pay cut in net income.
    	And if you are extremely lucky you end up getting some benefits
    	from the society as your salary goes down - so it might be a better
    	idea than it sounds, to begin with.
    
    	Pirkko Schildt
    	DC Finland
    

    re .35: well, not quite, you should check your math...
    
    Of course, in a highly progressive tax system (as in many European
    countries, especially in Scandinavia), the net loss is less than the
    gross loss - but the formula isn't a simple (100% - marginal rate) *
    pay cut...
    
    Just a (very) simple example: assume your taxable income is 10,000, the
    marginal rate 60%. Your total tax rate might be, say, 40%, so your net
    is 6,000. Now, a cut of 20% would mean a net cut of 800 (assuming the
    marginal rate is linear in this range), or 13.33%, not 8%.
    

    re.36
    
    Well, you need to check your math not .35
    
    In Finland, the tax rate is 60% not 40%.  You took $4,000 home from the
    $10,000 salary.  20% pay cut means you take $3,200 home that means 8%
    of the total.

re .37:

If you used to take home $4000 and you now take home $3200, it's a 20% cut.

    It amazes me that management seems to think in black and white terms
    regarding layoffs. For example: It seems to me that a slight pay cut
    for all of us may be prefereable to some of us having a complete pay
    cut (layoff).  Also the 4 day workweek might keep more people working
    and help get DEC profitable. I don't hear of managment considering
    compromises.  Why don't they?
    
    Jeff

    
>    It amazes me that management seems to think in black and white terms
>    regarding layoffs. For example: It seems to me that a slight pay cut
>    for all of us may be prefereable to some of us having a complete pay
>    cut (layoff).  Also the 4 day workweek might keep more people working
>    and help get DEC profitable. I don't hear of managment considering
>    compromises.  Why don't they?
    
    I do not know.  
    
    I do know history has proven that most of the alternative approaches,
    shorter work weeks, lowering everyone's pay, early retirement packages, 
    etc tend to have the side effect of driving away a higher percentage of
    your "high performers" while keeping more of the "mediocre" workers. 
    Layoffs can allow the most focussed expertise targetting.
    
    That said those definitions of "best" workers are open to argument. 
    What is the value of the loyalty of someone who hangs in there with a
    cut in pay?                       
    
    Greg
                                
                                                              
    

Too many people around here feel vulnerable going into the next
round(s) of layoffs. Who wouldn't feel vulnerable? It doesn't matter
if you are a good or poor performer. It only matters that the company
feels it doesn't need you or can't afford you; in either case, it is
out of your control. It is natural to feel all sorts of unpleasant
emotions and to cast about for alternatives. 

Imagine a group, deep in the bowels of the Mill, whose purpose it is
to design and produce an Alpha AXP (tm) computerized Toaster-Oven.
They work long, hard hours. At the end of every day, they go home and
just collapse from exhaustion. Eventually, they produce a world-class
toaster-oven hailed by the Toaster-Oven Institute of America. And
then, out of the blue, the whole group gets laid off. Gasp. 
Unbelievable. It turns out that despite the brilliant work, the long,
hard hours, and even an excellent product, it costs twice to make as
what they can sell it for, and besides, we still make computers, not
toaster-ovens. 

Layoffs, as they are generally rationalized, apply to people whose
jobs are no longer needed or no longer affordable. Therefore to
continue to employ such people means subsidizing unneeded or
unaffordable activities. A *manager* who fails to act in such
circumstances is an idiot, is failing to manage, and should be the
first one out the door. 

But to ask the *employees* for a paycut to forestall layoffs compounds
the lunacy. It means asking the general worker to subsidize the
continued employment of people who are *by definition* unneeded or
unaffordable. It means the manager not only is failing to manage, but
s/he also escapes having to *pay for the consequences.* Such silliness
makes the company weaker, not stronger, and thereby jeopardizes
*everyone's* continued employment. In the above example, it would mean
we lose, say, 10% of our salaries, so Digital can make toaster-ovens. 

If reality says that some people need to go, then you act decisively,
let them go, and move on from that point. To do otherwise is to deny
what reality says. How long can a company last that habitually denies
reality? 

It may be harsh; it may be cruel. But so is the market and world we
live in. Refusing to face it doesn't change it. The sooner we face
reality - at all levels - the sooner we will be back to profitability.
AND - the sooner that posturing, whimpering, indecisiveness, and
reorganizations cease being this company's chief products, the sooner
we will secure our market position, and the sooner working here can be
fun again. 

Kevin

    re .37: .38 is right - I don't know what kind of math you had in
    school...
    
    I don't know what the tax rate in Finland is nowadays - but the .35
    talked of the _marginal_ tax rate being 60%, it didn't say anywhere the
    tax rate is 60%.
    
    If you have a fully linear tax system, then a cut of x% in the gross
    pay obviously results in a cut of x% in the net too (as you so
    beautifully demosnstrated). If the taxation is progressive (as is
    usual) a cut of x% results in a net cut which is less than x% - but how
    much less depends on the progression, and the calcuation in .35 simply
    wasn't quite correct.
    

    Re .35 and its string discussing salary reduction as a %age...
    
    If the 20% salary cut is all taxed at 60% then it's true that the
    reduction in nett pay is 8% of gross.
    
    But I suspect that most of us would compare the _take home pay_, before
    and after the reduction.  This certainly raises the cut to a figure
    above 8%.
    
    One person I know who took the 4 day week in Digital France found that
    he didn't reduce his working hours at all -- he just did them in 4 days
    instead of 5 -- but he did have his salary cut.

    Well, at least I understood .35 to mean a reduction in _net_ pay,
    which is what most people probably would consider relevant.
    

    
    	Beeing quilty of the erroneous calculations a couple of replies ago
    I suppose I have to come back to the subject ... My "normal" tax rate
    nowadays is about 45 % and the marginal one, to be exact, I would quess
    about 62 % (including about all the things you can't avoid paying to
    the society from your monthly salary, even if some of them are not
    called taxes ..). But of course, the point here isn't just mathematics.
    The reduction in net pay would be less than in gross - whatever the
    exact figures are ;-)
    
    	A comment to the reply which stated that reducing the number of
    working days per week means in long run that you loose top performers
    and the overall morale might go down: to some extent I agree with you.
    Living in a country with unemployment rate at 20 % you can't avoid
    thinking from time to time that it doesn't make sense that every fifth
    person does nothing and the other four usually works more than the
    required 37.5 hours per week. But these things can't be solved at
    individual or even at company level - the solutions must be society
    wide. I mean that actually, who prevents me from negotiating with my
    boss to have a 4 day week and a reduction in pay. He might allow me to
    do it and in some circumstances in Finland you are entitled to do it
    (small children, studies etc.). But the point is - that somehow I at
    least feel, that if I did it, as an individual, I would give a very
    strong message to my boss that job is not the most important thing to
    me and actually the company should not count on me. But if this were
    the norm in the society, to have a 4 day week, things would of course
    be complete different. I would love to have more time off. And actually
    I could afford the reduction in pay. But this does not mean that I'm
    not serious in what I'm doing, I might even think of myself as beeing
    something of a top performer.
    
    Pirkko Schildt
    

    Flame #1...
    
    re: .29:
    
    The company is looking to divest itself of successful (read,
    marketable) but non-core businesses, i.e., those which we are
    not choosing to concentrate big money in.  From what I have heard, we 
    are not looking to create subsidiaries, either wholly or partially
    owned, but rather to divest completely -- get out of that business,
    period.  
    
    We certainly cannot afford to divest completely of MCS; shall we sell 
    system boxes and periphs with no warranty at all, because we have no
    longer have an organization to provide the services?  I might also add
    that, if nothing else is beneficial about MCS, our constant presence in
    accounts keeps Digital's name in the customers' minds...not always in a
    positive light, certainly, but more often than not.  
    
    As for DC, selling this would certainly cripple a core business,
    client/server computing -- take NIS, for example...how do we call 
    ourselves the biggest, the best, the pioneer, if we cannot assist 
    the customer with the cable plant design and install that ties 
    the clients to the server?
    
    I don't necessarily agree that the storage or software business are
    "the" units to sell, but I definitely see the value of MCS and DC, from
    the inside out -- I've been a revenue-producing member of both 
    organizations during this single fiscal year.
    
    **********************************************************************
    
    Flame #2...
    
    Re:  the dozens of thoughts already expressed on 20% pay cuts or days
    off -- 
    
    I, for one, can certainly not afford a 20% cut in pay, I'd be among the
    homeless in two weeks flat.  As for a four-day work week, 
    even though I am *not* an MCS engineer, I already carry a beeper 
    so that my customers and our engineers & vendors can reach me whenever
    needed.  I haven't taken a single vacation day in 2 years that 
    didn't see my pager go off at least once, and forget about resting on 
    sick days!!  I don't work a normal 40 hour/5 day week *now*, 
    why would I take a 20% cut in pay to get a non-existent day off?  
    And I'm not alone in working hard.  I talk to sellers and finance 
    people and admin folks and many others who are putting in the 
    big hours all the time.  
    
    While I certainly don't agree that layoffs are the solution,
    particularly since they will affect more of the "worker-bees" who
    bring in the bucks (engineers, SBU and MCS sales, selling support
    folks, etc.), I don't think wholesale pay cuts are the answer, either. 
    
    The only thing I really can say I know is this:
    everyone here in my part of the field seems more than happy to 
    implement the "vision" or "strategy" laid out by the SLT, if only 
    we had some practical idea what it was they wanted us to do.
    
    We are told that Digital is being re-engineered to have a more
    marketing-based focus and that our processes are being changed to be
    best in class.  I haven't seen this yet...
    
    How about some decent advertising that sells the product, the
    service, not just the name?  Maybe some processes and systems that 
    work *for* us, not against us?  Instead of cutting and slashing and
    hacking away, eliminating the people and supplies we need to get the
    job done, couldn't we try to capitalize on what we have for once?
    
    *sigh*...wishful flaming, huh?

    Greetings from the tip of the spear,
    
    As a MCS person, I can comfortably say.... Its the bucks! The best
    reason to sell F/S is they (the rest of digital) would get a pot load
    of money for the organization. (I recall when Lee I. was in the midst
    of turning Chrysler around he sold the Tank making division to General
    Dynamics, he said he would rather have sold the car division and kept
    the tank which was making money!) I can imagine a number of wonderful
    things that could come out of divesting MCS away from Digital. 
    
    1. The competition could buy it merely to eliminate a competitor. 
    
    2. Digital could contract out the service they guarentee a.k.a. Sun 
    and Bell. 
    
    3. The thinking has been (at least for the last 17 years I've been a
    repairin' things) that anyone can fix a broken box. Therefor therefore
    there is no reason to have a serious service force. There is only one
    module to a sable cpu. I recall a person telling a group of us that 
    soon the wordprocessors (at the time hot products at $15000 per) would
    be so easy to fix the customers would just tell us what was wrong and
    logistics would mail them a correct module. 
    
    So I can see good reasons to sell or not to sell. It boils down to 
    the goose that lays the golden egg and weather or not they will go
    for it. I'd call it a toss-up. 
    
    Fred Mudgett

    re .45: In late 80's and beginning of 90's, Germany generally moved
    from a 40 hour workweek to 36 hours today. Not even the employers have
    denied that it increased the number of jobs. On the other hand, they
    obviously try to compensate with higher productivity (and the
    productivity tends to rise even without such incentives) so you
    certainly can't just say that such a decrease in weekly working hours
    increase the number of jobs by ~11%.
    
    The above mainly refers to manufacturing jobs; at Digital (excluding
    our manufacturing for the moment) many can be regarded as individual
    contributors, who simply have a job to do; if they formally only work 4
    days a week, they usually still end up doing exatly the same tasks as
    they used to.

                
    re: .47
    
    	Fred, you make some good points. As it is, with all of the
    factionalizing going on within mother DEC, various organizations are
    tempted to cut the apron strings as well as the corporation trying to
    rid itself of what it views as non-core businesses. However, as the breakup
    continues the glue that used to bind this company will dry up, and we may
    no longer be able to present a coherent view to our customers, as we
    continue on the road to becoming DMOCC. 
    		(Digital Management, Outsourcing and Consulting Corp.)
    	That's the down side to the company and customers I see, however I
    haven't decided if this is for better or worse. 
    	Technology is moving at such a pace that we are placing a tremendous 
    burden on our customers already. The key question in my mind is whether 
    customers want to deal with a single entity, such as Digital, for all
    of their needs, or a multitude of smaller, specialized groups (right
    down to the panhandlers on the Internet) for the same. Although I
    believe sales, marketing, services, support, quality, design, mfg. etc.
    should be tightly integrated within a single entity, corporate culture
    seems to be moving away from this view. I would then question the
    alternative view of outsourcing for services and support, let's say, if
    we failed to manage our own internal cross-organizational relationships.  
    	   
    
    Regards,
    
    	Jim K
            

    re. .41  Not facing reality etc.
    
    I thought we alreay 'had' the layoffs over the last few years?  Wrong!
    Well, we DID have them, but were going to have some more!
    
    You idea about having layoffs instead of an overall salary reduction 
    sounds 'good' in that DEC can get rid of the deadwood, and keep the
    producers, but thats not what actually HAPPENS for the most part. Lots
    of good people get let go too.
    
    I still say that having all of us take a little hit instead of some of
    us a big hit is a good idea, unless the ship is so far gone that only
    MAJOR efforts will save her.  Unfortunately that seems to be the case.

>    You idea about having layoffs instead of an overall salary reduction 
>    sounds 'good' in that DEC can get rid of the deadwood, and keep the
>    producers, ...

	Maybe the real problem is that the "deadwood" is determining who is
	laid off?

    It's frustrating watching the company getting rid of good productive
    people first ***BEFORE*** fixing the unproductive and costly 
    processes/barriers that remain.  
    
    Isn't anyone up there listening?  Things are broken and the hidden cost
    of the tons of rework that has to be manually completed is labor
    intensive.  But instead of spending some bucks to ***FIX*** and/or
    ***REPLACE*** what's broken, get rid of the productive individual
    contributors who are keeping this bandaid company approach staggering
    along together.
    
    Reminds of an 'ole story that bears repeating:
       This farmer had a horse that ate 100 lbs of feed per day.  With
    costs rising but the amount of return the farmer was getting kept
    getting smaller so he had to take cost cutting measures.  He reduced
    the feed given to his horse to 80 lbs a day and saw that his horse was
    still working and he still needed to cut costs so he reduced the feed
    to 50 lbs per day and saw the horse still gave him a days work.  Still 
    needing to cut costs, he cut the amount of feed to 25 lbs per day.  He 
    then dropped the feed down to 5 lbs per day.  Unfortunately he still had 
    to cut costs and stopped feeding his horse altogether.  The next
    morning he was shocked to learn that his horse not only didn't get up
    in the morning to work the fields, the damn horse was dead!  He cussed
    the stupid horse the entire time his bank auctioned off the farm.

    Seeing the way Digital (and many other companies) handle layoffs
    reminded a co-worker of the story about the boy who wanted to
    dock his dog's tail.  To minimize the pain, he did it an inch
    at a time.

    Or (since we're trading anecdotes) how about the farmer with his
    famous pig?  The farmer was exceedingly proud of the quality of this
    pig.  It was practically a member of the family.  But, one puzzled 
    onlooker asked the farmer why it was that the pig had only three legs.
    To this the farmer replied, "Well, with a pig this special it just
    doesn't make sense to enjoy him all at once ..."
    
    Steve

Being a single working mother, I've considered working reduced hours many times.
The pros are that I'd get more time to take care of my sons, home and health.
The cons are that I'd 'lose' some money but more importantly I'd lose
credibility.  There are still many folks in Digital who believe that if you're
not working 50-60 hours a week, you can not be taking seriously. There is also
a resentment factor. I would love the opportunity to reduce my hours and have it
not only be accepted but be the normal way we work.  All my perceived threats
would be gone.

I'd be willing to lose a little money but not willing to risk losing all the 
money. Not to mention the opportunity Digital gives me in terms of personal
growth and career development.  I also think that Digital has some of the best
people.  (Yes, I still get alot more besides money from working here.)

BTW - In my case, the money I would lose reducing my hours each day could almost
be made up in what I pay for afterschool care. That would no longer be needed if
I could get home at 3:30 each day.  Considering my salary and taxes I pay, plus
reduced child care expenses, I'd be losing little money each month.  I'd be ok.

On the other hand, there is so much work to be done (now that more than half of
my group is laid off), it's hard to imagine everyone reducing their hours and
still produce what's needed.  

If Digital did promote/mandate reduced hours, do you think it would be required
to take a full day off or would flex hours still be accepted?  One full day off
as opposed to working reduced hours each day would blow up my "save money on
childcare" theory.

						Roxanne Young
						IDC/Systems Strategies
						Nashua, NH

    "Digital" can of course only promote or mandate what is in line
    with local custom, culture and law.
    
    Here in Holland for example a parent (mother or father) is legally
    allowed to take up to 50% reduction in hours (with associated
    pay decrease) for a contiguous period of up to 6 months for
    sometime up to the child's 4th birthday.
    
    Not that too many people do actually take it but it has served
    to break the "50-60 hour otherwise you're not serious mold" w.r.t.
    child upbringing. The way the reduction is arranged (full days/half
    days) is subject to negotiation between employer and employee. My
    gut feeling is that here most managers would actually prefer a
    constant presence every day rather than the full day/no day mode.
    
    Certainly, the culture here is that people (manager or no) would
    bend over backwards to help a single working mother continue to
    pursue a career and raise a family.
    
    Above and beyond all of the above is perhaps the realisation that
    it is not just reduction of workhours but flexibility both in
    time and place that can help. Perhaps being able to work some
    hours extra one or two evenings a week and being home early the
    other days. It won't reduce the cost but it might reduce the
    hassle. Perhaps a couple of hours of teleworking a week might
    be a possibility. You might want to ask about this in the TELEWORKING
    conference.
    
    Anyway, my $0.02
    
    re roelof