Conference 7.286::digital

    Maybe no one is left to write.
    
    Jim Morton

    I just heard a few hours ago about the next round on Monday...I have
    not been told that I am at risk yet...but I`ve been out sick all week.
    I know that I have a meeting next thursday with my manager for a job
    plan.

    the rumor here is that aprox 50% of the end-user sales force will be
    let go next week.  
    
    Film at 11:00
    

	Same here, 

	Rumor has it that sales people will be told at their DEC100 event,
	(Monday next week), then let go on Weds. Also heard 50% cut in 
	Sales Support. Oh Well...this is the worst I've seen it around here,
	good people, I mean really good people are being told that they're out
	of here. People that have good, long relationships with "key customers",
	gone. 

	 Sales people that have been successfull, always. People that have been
	"good leaders", no not good, but "great, caring individuals".
	People that have fought for their people and "fought for what was 
	right for the customer (and Digital)" gone. 

	People.... that followed whatever Corporate Edict was handed down at
	the time...... if you do this, and achieve this budget, with these
	margins, you and your group will have contributed to the Corporation.
	Each time they did do just that. Year in and year out, consistently
	contributing, following the guidelines handed to them, that would 
	say "you and your group were successfull".  


	The new Digital, will be leaner and meaner, I like the new organization,
	I like the "elimination" of Matrix management, I also think that 
	Digital will emerge from this being "more effective" with its resources,
	with more control on "strategic direction", with everyone pulling in
	the same direction. This is something that has been needed for a long
	, long time. No more competing products, one voice, not a multitude of
	voices, each speaking in their own language, confusing everyone 
	(including the customers). The Corporation working together for 
	a change.   What is happening, is a positive for 
	Digital, but it is also sad for those people, that have done what 
	they were told, each year feeling they accomplished "good for the 
	Corporation", only to be told goodbye.

	RC

    Hallo,
    
    well, Mr. Damiani told last week to the German employees, that
    about 1500 of 4000 in GY has to leave until the end of the year,
    but we told him, most of us will fight for the jobs.
    
    Layoffs are so easy, because the law about working etc are veriy different
    in GY.  And the more they speak about layoffs, the more are unionised
    and organised. Maybe they will close the German company, but in that
    case DEC has left Europe.
    
    	
    Volker

    Yeah, if you believe the rumor there's a 72% reduction in sales support
    in one region.  Clearly, the company is getting better at controlling
    rumors (i.e. a 'communications disclipline') and has been requiring
    managers and other people in responsible positions to re-sign
    non-disclosure agreements to assist in developing the disclipline.

    
    	Re.6
    
    
    	".... In that case DEC has left Europe"?

    Well we here at the Technical Consulting Center just got assigned under
    sales support, and were getting hit Monday bigtime. Also was told Decsale in
    Atlanta too.
    
    Moe

    
    You have to remember that where Germany starts and ends has been a
    matter for some discussion over the last 200 years.
    
    N.
    

What I liked was the positive message in Bob Palmer's DVN.  He's going to do
all that he can to get the (now read this carefully) *major* downsizing over
with in the next 12 months.  Isn't that just peachy??  Soon we'll be just
having to deal with minor downsizing...oh, it's just a couple thousand people,
nothing to get excited about...

Re .6 and .8,

Theoretically, DEC has left Europe.  The question is whether, or not, Digital
in Europe will survive :-).  But, I think that the point really is, should
the German subsidiary go down the tubes, particularly if Palmer and Co. push
if off the edge, then all of the european countries will have major problems.

Since management in Germany is talking about a layoff of 1,500-2,000 (ie more 
than a third of the remaining employees), one has to ask the question, as I
think everyone is asking: when do we reach the point where, due to too few
people, the business dies from neglect?  It's already suffering immensely,
but at what point does it really cease to exist?

The problem here, and elsewhere, is that management does not seem to be able
to deal with the changes and create a working structure after the layoffs.  I
guess that I would at least *feel* better, if I had some confidence left in
management.  German management seems to be of the opinion (well, at least
Klaus Lutz, Arbeitsdirektor - sorry, I couldn't find a translation for it,
but basically the 2nd in command in Germany, mainly responsible for HRO, etc)
that they are able to make a business plan that will tell them where the 
layoffs will come from, but they see no hope for themselves being able to 
then manage, or sensibly reorganize, the mangled bits that are left over.

They realize that everything will basically be broken after the next round of
layoffs, and at least Klaus Lutz realizes that German management is incapable
of dealing with that.  The problem is that he thinks our only hope is an
external consulting company that will come in and tell us how to fix the mess
they've created.  Personally, I think that it will just cost a ton of money,
and deliver too little too late.  But, at least it will give management a 
really good scape-goat.

It's a sad state of affairs, and one that is commonplace today within Digital.
We throw people out in order to reach some "magic" number, but we have no con-
cept for making things work once all those people are gone.  Well, OK, at
least we have; after 21 months of pain, loss of revenue, and declining confid-
ence in Digital's ability to survive all of it's reorganizations, come to the 
realization that the matrix management structure has to go.  It's too bad that
we didn't realize that several thousand employees and several $100s of millions
ago.  But, the fact remains, once you axe all these people, things, not just 
accontability, have to change.

I'm sure that it will be a great help to be able to better pin the blame for
our continued demise on some individual.  Certainly it's an improvement com-
pared to the nebulous mess that we're now dealing with.  But, when is manage-
ment (as Bob Palmer mentioned in his DVN) going to start listening to the 
people closest to the real work.  Perhaps we should do it *before* they're all
gone.  Before we get to the point where the only ones left are the ones that
have been a long way away from the real work (ie the customer) for a long time.

I know that I'm preaching to the choir, but I enjoy preaching. :-)

Rob

    
    re .11
    
    Wouldn't disagree with some of what you've said but...
    
> Theoretically, DEC has left Europe.  The question is whether, or not, Digital
    
    Has it ?  Why do you say that ?  And do you mean all of Europe or just
    mainland Europe ?
                                        
>in Europe will survive :-).  But, I think that the point really is, should
>the German subsidiary go down the tubes, particularly if Palmer and Co. push
>if off the edge, then all of the european countries will have major problems.
    
    I fail to see why if Germany is, say, closed down that other european
    countries would have problems.  Or are you just refering to mainland
    Europe ?  
    
    Did Lutz really say that he eas putting together a plan that could not
    work !  I find that slightly hard to believe (i hope).
    
    
    Nigel
    
    

>> Theoretically, DEC has left Europe.  The question is whether, or not, Digital
>    
>    Has it ?  Why do you say that ?  And do you mean all of Europe or just
>    mainland Europe ?

.12: You must have missed the smiley face which followed in .11. I think .11
simply meant that there is no more "DEC" (anywhere) - it's officially "Digital"
(at least in the minds of those who are supposed to have them).

Some employees just don't get it.  Unionizing and organizing
to fight for a job that has been identified as one that is
not essential to Digital's success, is ludicrous.  This will
not help Digital become successful, it will only help to
drag it down further.

I don't understand why some employees believe they have a
"right" to continued employment with a given company.  You
as an employee work for an employer at the employer's request.
The employer does not give you a position because it is your
"right", nor do they gaurantee it is yours for long as "you"
want it.

Digital is in business to make money.  It is not in business
to provide employees with paychecks.  Employees are merely
a "means" to an end.  The end being profits.  If it's not
making profits, then it doesn't need the employees.  It's time
that we, the employees realized this and accept the fact
that we may be identified as the next to leave.  If this
happens, we should not get angry and try to destroy that which
supported us, but accept it and move on.  Albert Einstein once
said,

	"In the middle of adversity lies opportunity."

Let's grasp the opportunity.  For those of us that have to leave,
let's move on to the next step in our lives. Let's not make it any
more difficult for those that are asked to stay, because we all
know what a monumentous task is ahead of them.

DC

    I kinda tend to agree to a point.
    
    I just wish that in MY contract, that Digital agreed to pay
    me few million when I left......
    
    Look what's happened so far, fourth round after Bob took over
    I personally saw hundreds of 'talented' grunt level people be
    pushed off a cliff......management was re-directed to individual
    contributer status to take the place of the 'talent pool' lost.
    Some others became PERSONAL CONSULTANTS to a cost center manager....
    
    WTF!?
    
    And just after that crash......we hired about six new VP's???
    
    Where's the sense?
    
    And to answer your question, the reason no one has posted a solution
    to get back to profitability here, is that we are not given the 
    'information' required to do so..........
    
    Vent_off
    
    Parrot_trooper.

I agree wholeheartedly that the transition of talented
"grunts" has come before that of non-contributing management.
Unfortunately, those close to the known requirements for
Digital's success (grunts and 1st level supervisors) are not
"empowered" to make the selections on non-essential
workers (middle management) to be let go, nor are they asked
what their perceptions of essential and non-essential work
are.

Isn't it odd, that the perception the grunts have is that
management levels are increasing while the grunt population
decreases.  It appears now that we need more chiefs for
fewer indians.  And those chiefs that don't have anymore
indians get to become 1/2 chiefs (ICs and PCs).

Let's hope that Enrico's statement of ridding Digital
of matrix management, really means management.

DC (aka Go_for_the_throat!)

    What we need here is a BOXING WEEK!!!!!!
    
    think of it, the individual contributors selecting who
    from the management ranks is unwarranted, undeeded, and 
    just plain UN!
    
    Think that would cause a stir??
    
    parrot_trooper
    

I think it just might pick up morale a bit...

    Well I'm sure I know of at least one from my office, that I think most
    will agree upon!  Where can we sign them up!
    
    - Mike
    

    re .14
    
    | Some employees just don't get it.  Unionizing and organizing
    | to fight for a job that has been identified as one that is
    | not essential to Digital's success, is ludicrous.  This will
    | not help Digital become successful, it will only help to
    | drag it down further.
    
    You are making the assumption that those who identified the jobs
    to shed know what they are doing. It is clear that this is not
    the case. Firing the 10-20% deadwood is easy. But going beyond this
    requires a lot of consideration. This is not a coal-mine. Most of
    the people who are being asked to go often have at least as good of
    an education as our senior management. The unionizing is a vote of
    no confidence for those who decide our future.
    
    We all helped build this company. Many of us have spent a large
    percentage of our working lives in Digital. Some are content with just
    getting out. Others want more influence over deciding what the
    future will be. In particular when they know that the package is
    very slim and their chances of getting another job may not be
    as easy as for a good Windows programmer around Boston. Raising your
    voice in places like this notesfile only helps you and me deal with
    the stress .. but has little influence of anything relating to our
    jobs. Raising your concerns with management, too loudly, will mark
    you for the next round.
    
    Unionizing is one of the few ways you can give it a last shot. And,
    yes, it may be at the expense of those who think it is the same as
    bringing in Tony, Luca and the Hells Angels to run the company.
    
    | I don't understand why some employees believe they have a
    | "right" to continued employment with a given company.  You
    | as an employee work for an employer at the employer's request.
    | The employer does not give you a position because it is your
    | "right", nor do they gaurantee it is yours for long as "you"
    | want it.
    
    Of course they don't have a right. But don't forget that at
    Digital we are all employees. This is not like a family operated
    country store. After 10 years you become an integral part of this
    company. Just like Bob Palmer. Even more so than Pesatori!!! Given
    the past 4 years when other employees, most of whom you do not know,
    say that you have to go you obviously want a good explanation. If
    those who were elected to make the decisions had made the right ones
    I doubt you would have seen the unionizing.
    
    | Digital is in business to make money.
    
    I doubt it. For the longest time money was just a bi-product of
    having fun at Digital. The kind of crazy decisions that went on
    just five years ago would baffle anyone with experience of running
    a business. It really is a miracle that it lasted this long. We have
    recently re-discovered that we need money to have fun. But in many
    cases it is too late. We seem to have lost those who were able to
    generate money. Some employees feel that unionizing is the only
    remaining way to losen the gridlock and bring forward the right minds
    and the right decisions. 
    
    I am not suggesting we should unionize all of Digital. Rather, let us
    not condemn it. Let's keep an eye on it. At worst they will fail as
    miserably as our senior managers have ..
    
    >Per

    Just to add grist to the mill. 
    
    
    I heard somewhere that the German govmt wouldn't let DEC lay off any
    more since they (govmt) provided DEC with money to help reduce
    unemployment in certain areas by setting up factories etc.
    
    Any truth ?
    
    Alan

    re.14,.20,21:
    
    Mature companies in Germnay learned from that: You better have real
    good managers or you go down the tube. How can you sign a contract 
    with your workforce which includes a severance package so generous 
    that when you want to layoff workers just 8 months after you signed 
    it you realize that you'll be bankrupted?
    
    I think DEC has excellent technical people (customers told me so, too)
    who make excellent products. But seems this is not so true for the 
    'other' part. Been with DEC in Germany for 10 years I've listened to
    quite a bunch of upper managers...mostly missed their excellence.
    But they mostly lasted only a few months (no wonder why).
    
    Guenther

    
    What you have to remember, is that the harder you make it for an
    employer to lay off staff in times of crisis, the less likely it is to
    rehire in that country when things start picking up (because it
    remembers how hard it was to get rid of them),
    
    That is one of the main reasons why in the last 10 years the USA has
    created 10 million (or so ) new jobs, and Europe 0 (zero) net new jobs.
    
    Look at the last year or two.  The only country in Europe when
    unemployment is falling is the country with the least restrictve
    employment laws. 
    
    Draw your own conclusions.
    
    
    Nigel

re.14:

>Note 3277.14 by ASDG::CORLISS

I believe your note relects a very sad and cynical view of life. 

If a business does not serve a community then why do we need that business? 

To be of service to the community, a business must be successful, thus it is
in the interests of the union to help that business be successful. 

Dave.

    re .14: I think it is pretty ludicruous to say that the current
    difficulties are in any way caused by unionization - it's really the
    other way around.
    
    According to DEC ..oops.. I mean Digital philosophy we operate in each
    country according to the local legislation and customs. Here in
    Germany, the constitution (and other jurisdiction) _does_ put a certain
    social responsibility on the employer.
    

RE: 3277.23 

    
>    What you have to remember, is that the harder you make it for an
>    employer to lay off staff in times of crisis, the less likely it is to
>    rehire in that country when things start picking up (because it
>    remembers how hard it was to get rid of them),
    
    In times of crisis, the easier you make it for an employer to lay off, the
    easier he will lay off. I don't understand why he will create new jobs
    if he has to lay off.
    
>    That is one of the main reasons why in the last 10 years the USA has
>    created 10 million (or so ) new jobs, and Europe 0 (zero) net new jobs.

    From here, in France, it seem's that the USA has the same pbs that we
    have. We have to choose between share the work, or be payed less to give
    some money to the non-workers.
    
>    Look at the last year or two.  The only country in Europe when
>    unemployment is falling is the country with the least restrictve
>    employment laws. 
    
    I know other countries where employment increases when the 
    restrictive employment laws decrease.

				_ Pierre _

Re .12, Nigel,

As was said in .13, there was a smiley face at the end.

As far as Digital in Europe having major problems...all I was trying to do
was to clarify what Volker said in .6, ie:

>> Maybe they will close the German company, but in that
>>    case DEC has left Europe.

There seemed to be some confusion (see .8) about what he was saying.  All
I was trying to say is: should Palmer and Co. close the Digital subsidiary
in Germany down, then it may enter the minds of our customers throughout all
of Europe (and the world?) that Digital would do the same thing in other
countries.  Would you buy products or services from a company that closes
it's subsidiaries, or allows them to go bankrupt?  Certainly customers with
long-range plans, and a need for long-term commitments from their suppliers,
would think twice about it.  Hence, "major problems" for all the european
countries.

What Klaus Lutz said was essentially: management has, in the past, not been
able to reengineer the processes within the company after the previous layoffs.
The current layoffs will bring everything to a screeching halt, with a loud
CRASH!!! at the end, unless the internal processes are fixed.  Management has
the responsibility to put together a business plan that determines where the
layoffs will be made, in spite of the fact that they don't have the ability 
to fix the processes.  Hence, an external consulting company needs to come in
and tell us how to fix all the stuff that management has broken so far, and
in particular, how to fix all the stuff that they, through this next round of
layoffs, are going to be breaking.

Rob

    Couple of points..
    Digital has already lost deals(and I am referring to a monster one here
    but,for the sake of many,won't say who)simply because we are not seen
    as a reliable long term partner.Pulling out of any major
    country,particularly Germany,is commercial suicide and would spell the
    end of Digital direct selling in Europe.
    Germany is a classic case of working with unions for the common
    good.One basic tenet is social responsibility and the other is that it
    is assumed that workers have some ideas on how to run things and should
    be heard.De facto,this does imply that 'management' might not have the
    monopoly on good business sense.
    If I was running a country and provided an infrastructure for
    businesses to set up and make a profit,I would not allow them to dump
    their problems back on my social security system when it suited
    them-would you??

    re .26
    
>>    What you have to remember, is that the harder you make it for an
>>    employer to lay off staff in times of crisis, the less likely it is to
>>    rehire in that country when things start picking up (because it
>>    remembers how hard it was to get rid of them),
    
>    In times of crisis, the easier you make it for an employer to lay off, the
>    easier he will lay off. I don't understand why he will create new jobs
>    if he has to lay off.
    
    Companies (except those is controlled societies) tend to go through
    cyclical phases.  They hire, they lay off, they hire again.  If a
    country makes it far harder to lay off, then companies will hire in
    those countries that they can lay off in.    You have to start thinking
    longer term, and averages.
    

   > From here, in France, it seem's that the USA has the same pbs that we
   > have. We have to choose between share the work, or be payed less to give
   > some money to the non-workers.
    
    The USA is in a completly different league. They have 6% unemployment,
    Would you care to state what the French unemployment is ?  And the
    increase over the last year ?  And ask yourself why the average
    GDP/GNP/PPP is greater than over here ?  And how is it they've managed
    to create so many jobs when the net figure in the great command
    economies of Europe is so low (about zero). And what is the rate of
    French (or any European ) GDP/GNP growth.  Has it hit 5% recently ?
    
    Deregulation works.  You don't get a job for life, but you tend to find
    more people employed for longer.
    
    
>    I know other countries where employment increases when the 
>    restrictive employment laws decrease.
    
    Great !  So you agree that restrictive employment laws will reduce the
    level of the workforce over time.
    
    
    
    Nigel
     

>    Look at the last year or two.  The only country in Europe when
>    unemployment is falling is the country with the least restrictve
>    employment laws. 
>    
>    Draw your own conclusions.
    
    
    Since unemployment is falling here in Holland I assume the conclusion
    the writer wants me to draw is that the Netherlands has the 
    least restrictive employment laws...
                      

    According to the latest statistics, unemployment is falling in Austria,
    Greece, Ireland, Italy, the Netherlands, Norway, Sweden, Switzerland,
    and in UK in Europe.

I don't know the exact figure for Germany but I'm pretty sure, that the 
unemploment rate in Germany is under 6%. The last thing I heard was about
4%+. I'm not glad about this because I still think it't too high but it
also shows me, that German laws are not too bad.

There are still reasons to invest in Germany. Qualified workers, a very
good infrastructure etc. Germany doesn't need Digital, but Digital does
need Germany!

Stefan�

    re .32: Sorry to disappoint you, but the unemployment rate in Germany
    is about 8.4%. (USA is about 6%).

-1, -2

Only when the governments concerned start counting in the same way can 
you make direct comparisons like that..

David

    I guess the European numbers are rather consistent, don't know about
    USA.
    
    Of course, I only believe in statistics I've forged myself...

    re: <<< Note 3277.33 by BHAJEE::JAERVINEN "Ora, the Old Rural Amateur" >>>

    < re .32: Sorry to disappoint you, but the unemployment rate in Germany
    < is about 8.4%. (USA is about 6%).
    
    'course, it matters not that the two governments COUNT differently
    
    
    ;^}
    
    t

    The unemployment rate in all of Germany (combined Western and Eastern) 
    is more than 10%.
    
    Spain has perhaps the most restrictive employment laws in Western
    Europe and as a result has 22+% unemployment.
    
    Withg Digital having at least 25,000 extra employees by all comparison
    benchmarks, it should have downsized long ago. It must do now and
    immediately because survival is at stake. No ifs and no buts.
       

      I doubt very much that the European numbers are that consistent, or
    very reliably reported in some cases. What they do not show, either, is
    how many jobs are 'makeworks', since this varies widely from country to
    country. Germany's official unemployment may be 8.4%, it would be a
    good bit higher still if some of the less efficient industries
    (principally, but not exclusively, in the ex-DDR) were subjected to
    commercial realities. France is in much the same situation; the state
    owned computer company has been making losses comparable to ours for
    years, while the French governemt is trying to support Air France with
    a huge subsidy. The airline is extremely unprofitable, due principally
    to chronic overmanning. In the UK, hundreds of thousands, possibly
    millions of people do not appear on the unemployment register because
    they are on 'training schemes', registered disabled, etc. All the
    governments fiddle the figures in some way or other, to various extents, for
    various political reasons.
                                                                        
    Ken         

	The point that started this discussion has been lost in the
	tossing back and forth of unemployment figures (which, in any
	case, vary considerably in the near to mid term: the USA has
	pulled much farther out of recession than Europe, and the
	figures here in Germany are skewed by the former East).

	But the issue is not unemployment, it is the creation of NEW
	JOBS, something Europe has not been very good at.  Now the
	richer half of Europe hasn't really had to be: its population
	has achieved essentially zero growth, and those industries
	that should have failed have been maintained by subsidies.
	The fall of the iron curtain changes all of that.  Industry
	in the former Soviet Bloc is essentially noncompetitive, and
	to maintain it through subsidies would bankrupt us all.  So
	new, modern industries and attendant jobs are required.  Has
	anybody seen any indication that Europe will rise to this
	challenge?

	I am forced to agree that a major reason for the failure so
	far is the high cost of European labor and the lack of
	flexibility in the labor market.

    re.37
    >Withg Digital having at least 25,000 extra employees by all comparison
    >benchmarks, it should have downsized long ago. It must do now and
    >immediately because survival is at stake. No ifs and no buts.
    
    This is easier said then done.
    Most European subsidiaries are making a profit. When a company in 
    countries like Holland and Germany is profitable it's extremely
    difficult to be allowed massive layoffs. There for social plans are
    put in place in order to comply with corporate directives.
    These plans have to be devised in cooperation with the social partners
    (works council and/or unions) or the government.
    If during this proces it looks like a company is downsizing only and
    there's no sign of a solid plan to return to profitability by other
    means, agreement on the social plan and on the number of employees
    which have to leave is not easily reached.
    Mind you, this has very little to do with job protection, but
    everything with preventing companies to dump staff in the social
    security system.
    
    Charles
        

       >Most European subsidiaries are making a profit. When a company in
       >countries like Holland and Germany is profitable it's extremely
       >difficult to be allowed massive layoffs.
    
       Every region and division in Digital claims that it's profitable.
       I wonder where all the massive red ink is coming from. Didn't Mr.
       Damiani claim that Digital Europe has one of the lowest
       Revenue/employee among Computer companies in Europe ?   
       

    >Every region and division in Digital claims that it's profitable.
    >I wonder where all the massive red ink is coming from
           
     Maybe this is why one was so suprised when Q3 turned out te be as bad
     as it was?
     Anyhow, our management tells us that we're still making a profit, but
     that are margins aren't what they should be. In a situation like this
     cutting your way to profit is not the smartest thing to do, as is
     proven by cases where courts either ordered Digital to pay more money
     to rightsized people, or ordered that Digital had to re-instate people
     in their job.
    
     Charles

         
    Which squares the circle, as it were.
    
    By making it more difficult for Digital (and other companies) to lay
    off workers during hard times, they will be less likely to employ more
    when things start to get better. Which is one of the main reasons why
    net job creation in the EEC has been non-existant in the last 10
    years.
    
    After all, you don't need to manufacture items in a country to support
    that country.
    
    Nigel

    
    6% of the US population means about 16,000,000 PEOPLE unemployed
    and 11% of the UK is about 6,500,000 and 8.5 percent of Germany is.....
    When you count 'em this way, it strikes me that both systems are
    no worse or no better than each other.
    
    Colin

    .44 
    
    Oh dear.  Try 6% of the working population (or should we send 10 year
    olds back up the chimneys and 90 years olds to empty the litter bins )
    ?
                          
    The rest of your logic completely escapes me.  Are you trying to say
    that a 100% unemployed begium would be equivalent to a 10% in the UK ?
    
    
    Nigel
    

    Re .44
    
    The unemployment percentage is NOT of the entire population. I believe
    that it is (in the US, at least) a percentage of the "employable
    population. I don't have the exatc numbers, but that's probably about
    175M or so, so a 6% rate would come to ~10.5M people.
    
    Steve

    re .23:
    
!    Look at the last year or two.  The only country in Europe when
!    unemployment is falling is the country with the least restrictve
!    employment laws.
    
    That may be true. But less restrictive labour laws does not legitimize
    dumb or uninformed decisions. If the company had been well managed then
    we would not have had to suffer from restrictive labour laws in the
    first place!
    
    And, I assume you are not inferring that we got into trouble because of
    restrictive labour laws or that our recovery was hampered by them. I get
    the distinct impression that things had gone wrong for quite some time
    before we started getting affected by labour laws. In other words, if our
    only problem was to lay people off we'd be in pretty good shape ..
    
    >Per

                                        
    re .47
                                                               
    Nope, i am not defending management.  The original point of some way
    back was that digital was going to have to recind its layoff plans and
    pay some more money because they had broken local employment laws.
    
    I am arguing that these laws (in the long run) do more to cause
    unemployment.
    
    To defend management slightly, it has to be said that NO computer
    manufacturer has correctly judged the changes between the mid 80's and
    now.  And i don't think that anyone could have predicted the market
    changes.  Short of having huge cash injections (where from ?)  the
    company has to cut it's cloth etc... 
    
    20/20 hindsight is a wonderful tool.
    
    Nigel
    

    | Companies (except those is controlled societies) tend to go through
    | cyclical phases.  They hire, they lay off, they hire again.  If a
    | country makes it far harder to lay off, then companies will hire in
    | those countries that they can lay off in.    You have to start thinking
    | longer term, and averages.
    
    I think we need to separate national economic theories from decisions
    made by Digital management. Many computer companies are doing well,
    why not us? Should we be satisfied with that we have been hit by some
    random bad luck and high density of confused people?
    
    Given the track record so far no data is available to support the
    theory that Digital will recover if we could just fire enough people.
    It is still only speculation. Each time we've laid off in the past
    we've been told that we are poised for recovery. Are you suggesting
    that we've been told lies? Or, perhaps that management really wanted
    to lay off 50,000 in the first round but settled for 3,000? Doesn't
    compute.
    
    The problem with Digital is not restrictive labour laws. HP, SUN and
    Microsoft are under the same laws as us.                        
    
    >Per

>    To defend management slightly, it has to be said that NO computer
>    manufacturer has correctly judged the changes between the mid 80's and
>    now.

We don't consider "PCs" to be "computers"?  Still... (!)

    
    re .49
    
    read my .48 
    
    But regarding your examples.  HP.  As good as collapsed in the
    early/mid '80's.  If my memory serves me they completely changed from a
    propriarty system to unix.  There workforce was slashed, but i can;t
    remembr the numbers.
    
    Sun was a new starter.  Now having problems as it has got bigger and
    the market is moving away from it.  
    
    Microsoft is software, no hardware component.  When windows 1.0 or 2.0
    came out no one foresaw that in 1990 (?) windows 3.0 would steal the
    market place.  Also, again a small company.  Turnover still less than
    Digital.  For other examples look at other software companies who were
    big in the '80's. 
    
    N.

    re .50
    
    Ok, What i meant and perhaps should have said was 'established 
    computer manufacturers'.
    
    Out of interest, which big PC players from 1985 are still with us ?
    
    Since the IBM PC only hit the streets in '83 (i think) i wouldn't have
    thought that there were that many !!
    
    
    Nigel
    

    | To defend management slightly, it has to be said that NO computer
    | manufacturer has correctly judged the changes between the mid 80's and
    | now.  And i don't think that anyone could have predicted the market
    | changes.  Short of having huge cash injections (where from ?)  the
    | company has to cut it's cloth etc...
    
    Predicting trends is easy compared to adapting to the changing needs
    of business reality. Being able to adapt means you have to be ready,
    ready for any change and then move quickly to captialize on it. Not
    only then can you further trim the system to stay ahead by predicting
    your next move.
    
    To some extent it feels as if we have failed to recognize that our
    biggest asset is our empolyees, not our products. And in a sad
    way our most adaptable employees are also those who resign rather
    than wait for the axe to fall.
    
    >Per

    re .43:
    
    �After all, you don't need to manufacture items in a country to support
    �that country.
    
    We don't manufacture anything in Germany (not anymore). But to sell &
    support our systems here, or to do consulting, systems integration,
    etc. you need to be present. or do you think it could all be done
    remotely, say, from UK (where labour, at least currently, is cjeaper)?

    
    > The rest of your logic completely escapes me.  Are you trying to say
    > that a 100% unemployed begium would be equivalent to a 10% in the UK ?
    
    No, the point is that the spurious comparison of percentages ignores
    that fact that both systems have millions upon millions of unemployed.
    Which figurs should also include supported spouses and children
    (or don't they count?)
    
    The "my-dog's-bigger than your dog" mentality of it.....

    re: -1
    
    Selling off even a portion of our non-US operations would put us at a 
    severe disadvantage against most of the competition, particularly IBM, 
    as they are solidly embedded in the world market.  As insular an 
    American as I sometimes wish to be, I have to say that any success 
    Digital may have in the future will be largely dependent upon our 
    global capabilities.  
    
    M.

re:.54

Digital doesn't manufacture any products in Germany?
Why do we need 4000 employees to sell, service, and
consult?  Is Germany really that big?

From a Germany outsider, this organization sounds
"fat".

DC

Since we seem to be arguing about unemployment we probably
are not talking about the same thing.  I do not know how
other countries measure unemployment but here is how the
USA does it.

There are three things that the USA tracks.

1. First time unemployment claims on a weekly basis.

2. New jobs created called the employment report which is based
   on a telephone survey of 65,000 employers.

3. A phone survey of a certain number of individuals as to
   if they have jobs.

The criterion for our unemployment rate is that you must be
eligible to work;

   1. Not under 16 years old.

   2. Not officially totaly disabled.

   3. Not dead.

   4. Looking for a job.


Note number 4!!!  In the USA you must be looking for a job to be
counted.  If you have given up looking we do not count you!

Now this may seem strange, however if you look at our system you
will see what is happening.  After WWII we started keeping
statistics and simultaneously sent most women back to the home
from the factories that they had been working in.  In order not
to have large unemployment figures these women were not counted
as unemployed because they were not looking for work.  Also
unemployment is state administered program so you do not have federal
involment except to bankroll the system.

So in the USA if your unemployment benefits run out and/or you stop
looking for work we do not count you.

This is why unemployment goes up at the start of a recovery when 
non-farm payroll (measurement number 3) goes up also.  Also
until very recently the military was not counted as employed or
unemployed so comparisons to the size of the US population,
255 million people are not acurate.

This measurement system fails because we in the USA are grouped as
families rather than individuals and the family decides if both
parents work outside the home.  Therefore you cannot measure if
on of the parents is voluntarily or involuntarily unemployed.

Sorry to muddy the waters however the truth is often not very
clean and clear.

In summary there are three questions that should be asked to get
accurate unemployment figures.

1. Are you working?

2. If not are you looking for work?

3. If you are not looking for work, should you be looking for work?

    
    	It looks as there were 12 specialists cut from Remote Sales.  1/2
    of these came from the PC support split.

As the basenoter - I have taken the liberty to amend the note title to reflect
whats going on in here.

And - my last day in Digital is Friday (barring magical acts).

.58>From a Germany outsider, this organization sounds
.58>"fat".
    
    I would agree with that from look-and-feel but plain numbers show:
    
    Revenue DEC Germany is ~10% of DEC worldwide
    Employees DEC Germany is ~5% of DEC worldwide.
    
    I think other European countries are even better off.
    
    Still I agree...it could be 'leaner'. But who's responsible to grow all
    that fat? Not too long ago the then country manager of Germany
    made a business decision: He was targeting a revenue increase of
    10% for DEC Germany. The way he wanted to accomplish that was by
    hiring 10% more people...which indeed happened...but not the 10%
    increase in revenue. I often wondered what kind of education,
    experience and qualification these managers demonstrate.
    
    Guenther

    re .58: Yes I'm sure there's still some fat to cut... but we're cutting
    individual contributors also, which e.g. in the case of DC usually
    can't happen without consequences to the revenue.
    
    And as G�nther points out, Germany accounts for about 10% of our
    revenue with roughly 5% of the workforce, I'd say the organization must
    be fatter somewhere else.
    
    And we used to have manufacturing (disks in Kaufbeuren) but the plant
    was closed at the end of the FY. Those employees are not included in
    the 4000 (in fact, formally, the factory had nothing to do with DEC
    Germany).

    
    	I agree with .63.  I don't know what is the percentage of employees
    outside the US of A, but last I heard, the percentage of revenue was
    for the US of A to bring in a little UNDER half the total.  So one must
    ask how these figures stack up.
    
    	At one stage, the UK and Ireland alone produced 25% of DIGITALs
    revenue, although I'm sure that isn't the case presently.
    
    	Perhaps someone has the true figures for the present time, then we
    could see the relevence  of comments about Germany (or anywhere else)
    being fat or not.
    
    				Malcolm.      

    Re: [workforce in Germany]
    
    End of July 91 we had 4.200 ressources in the GmbH (I hate that word ...)
    End of July 92 we had 3.750  "
    
    In 91 (or was it 92?) DEC bought Kienzle (from Mannesmann which before
    bought the computer division from Philips (not the PCs)).
    
    So end of July 93 we were 6.500 Holding (GmbH + Kienzle).
    Mid June 94 we were about 4.900 " (thats -24,6%).
    
    Now our downsizing-management said they will reduce the workforce
    to 3.000 - 3.500 (that's another reduction of -28% [or -38%]).
    
    Revenue/employee by end of July 93 about 508.000DM (~$330.000)
    in the GmbH.
    
    So we're making about 8,4% of the Corporation's revenue with 3,9% of
    the workforce. These numbers are just the GmbH.
    
    So do you think we are a 'fat organization'? 
    
    End of FY 95 we wil have 'correct' numbers, Kienzle will be integrated
    within the GmbH. That's the actual plan from our Germany management.
    Perhaps they'll manage it ...
    
    	Ach!m (DECie since July '86 whe we had more people than today ...)

    re .65: Kienzle was bought on December 19, 1990.
    
    Or, to be exact, we took over 65% of Kienzle shares.
    
    Kienzle had 4300 employees at that time. At the end of FY '90 (i.e.
    about six months before the Kienzle deal) Digital had 4526 employees.
    So one must assume that the whole holding in Germany must have had
    ~8800 employees at the peak.

    
    Dangerous string, if not interpreted with great care.
    
    Almost impossible to compare country-to-country productivity, 
    without considerable effort to take account of key variables such as 
    manufacturing, engineering etc. 
    
    Once you are down to comparing apples with apples the comparison 
    becomes more relevant, but don't forget to factor in profitability.
    Revenue by itself is a highly suspect measure ........ but may give a
    snapshot when comparing (say) country sales & marketing organisations
    that are captive distributors to service internal manufacturing.
    
    I once used to do much of this analysis on a cross-industry basis
    when employed pre-DEC. Can be very revealing, but just make sure 
    that the corrections to improve what is revealed are indeed cause 
    & effect. 
    
    Migration of effort to cheap labour countries may be the solution 
    -- or may not be. Depends on many factors, including perceived quality,
    manufacturing dependencies, staff skills & attitudes, raw material 
    availability, delivery, transport costs, language, customer preferences, 
    political & social ideology, logistics infrastructure etc etc etc. Some
    of these have bearing on the long-term success or otherwise of the UK 
    governments attempts to sell the country on a "cheap labour" basis.
    
    
    Colin
    
    

    Re: .-1, .-2
    
    Absolute right, I've just tried to give some more background information
    about that country 'behind the ocean'...
    
    	Ach!m

Fat cannot be determined by revenue/employee.  It must
be determined by the work required and the number of 
employees needed to do it.  This is merely playing with
numbers to suit your purposes.  I still believe that
for a sales/support/consulting business in Germany
you do not need ~4K people.  As stated in note 3286.1,
Compaq blew by Digital to become #1 in the server market 
and generated $2.5B in revenue last quarter with 234
sales people.  234 sales people!!  How can we support
a larger population and remain competitive.

The bottom line is that required work and number of
employees absolutely needed to do it is the metric
that will provide Digital with maximum return on
investment.  Which probably equates to Germany
creating 10% of Digital revenue with 2% of the total
population.

DC

    re .69:
    
�Which probably equates to Germany
�creating 10% of Digital revenue with 2% of the total
�population.
    
    And when the others do the same... we generate 100% of the revenue with
    20% of the _total_ population... what do the remaining 80% do?
    

    
    
       	>And when the others do the same... we generate 100% of the revenue with
        >20% of the _total_ population... what do the remaining 80% do?
                                          *****************************
    
    	They don't let the door hit them in the ass on the way OUT!

    On the other hand, I guess that's the way it's always been even at DEC
    (not to mention Digital) - 20% of the population creates 100% of the
    revenue... :-)
    

re: .70 and .72

You missed the point.  I was merely stating that with the work that
has been done in Germany, some trimming down could maximize profitability.

If you want to encompass all of Digital, you have to include those
organizations not represented in Germany (i.e. manufacturing,
engineering, research and development, etc.).  This would increase
the total population without increasing the revenue....

I'm quite sure that we could generate 100% of Digital's revenue with
20% of the population, IF we were only a sales/distribution company
for someone else's products.

DC

    I don't think I missed the point, but your math simply doesn't
    compute...

    �And when the others do the same... we generate 100% of the revenue
    �with 20% of the _total_ population... what do the remaining 80% do?
    
    Are they the managers?
    
    :-)
    
    Andy
    

    Re: .73, .74
    
    Surely that's the direction we are moving in? The PCBU and CSBU will be
    making product and selling them entirely through channels, of which the
    Accounts BU will be one? Since P&L should be measured by each business
    unit, it will be easy to see where the BUs are performing and what the
    headcount should be.
    
    Jim

Let me rephrase it into a question for you.  How many employees do you
think Digital needs in Germany to get the required work completed?
Bear in mind that we need to be cost effective and profitable.

Gee, if 20% create all the revenue, I guess being a so-called 
"twenty-percenter" isn't so bad after all....

    te .77:
    
    How do you define "required work"?
    
    As I aid earlier, sure, there may be some fat to cut. If we believe we
    can do 80% of the business through indirect channels, we can throw out
    some salespeople, maybe some support people, maybe some admin people.
    But this doesn't work in all areas - if we say consulting is not
    "required" work, we can get rid of all the consulting people, but we
    rid ourselves of the revenue at the same time. If the goal is to be
    something like Compaq, sure we can throw out almost everyone.
    
    What is profitable at the subsidiary level cannot be easily determined.
    All multinationals try to show profits in places where the tax burden
    is low - and it is easy to control. There's no need to show profit in a
    given country, say Germany, if the tax rates are high.

    
    
        Hmmm..., 20% of the people to bring in 100% of the revenue; 
        let's see, 20% of 85,000 is 17,000 ....
        of course, the revenue doesn't change in the meantime ...
        now the only trick is to find the right 20%, starting with you 
        and me ....
    
        Any of you folks on SLT, you sound like management material.
    
    
    	:-) 
    
        Peter

>   The USA is in a completly different league. They have 6% unemployment,

 Assuming your figure is correct, the next issue is the quality of the
jobs. I have spoken with numerous recent college grads in the physical
sciences whose only choices are grad school or "McJobs".

I have also spoken with numerous "professional" people who have been
laid off in the last few years. For many, particularly those 40+,
they cannot find equivalent work.

So yeah, sure, you can get a job in this country, as long as you like
to flip Big Macs or clean toilets.

>So yeah, sure, you can get a job in this country, as long as you like
>to flip Big Macs or clean toilets.

Do I detect a bad attitude here?

If you're in software, there are about 2-300 job postings per day on
misc.jobs.offered. The *rest* of the computer industry seems to be
doing quite well.

    
    
    >If you're in software, there are about 2-300 job postings per day on  
    >misc.jobs.offered. The *rest* of the computer industry seems to be
    >doing quite well.
    
    
    	There is some truth to this statement, but, the problem is,
    	people are looking for something close to the same pay they left
        DEC with, after years of employment....
    
    	I know of many who have found jobs, but only to take a 10 to 20k
    	yearly pay cut...

    10 - 20k yearly pay cut!?
    
    I'd be paying _them_ so I could work.     :^}

	And I know many that have gotten a $5-$15k/year raise by leaving
	DEC. 

							mike

    
    
    
    	rep. last>
    
    
    	Well!! Then what are you waiting for?????

    Someone in another note suggested a 4k cut we should take. Well, I
    don't agree with it to take cut in $$$ but what about removing the top 
    4k managers? This surely would save the same amount in salary (not to talk
    about travel expenses) as laying off 20k indians. There's enough
    equivalent management skills left to fill in a couple of these positions
    and enough honey bees left to do the work. And definitely a new atmosphere 
    after that 'thin air' removeable.
    
    Guenther

    re .23:
    
    Have a look at topic 957 in ROCKS::UK_DIGITAL (reply 25 and on).