Article Abstract:
DEC shifts its corporate strategy in a competitive computer market and introduces small business minicomputers based on an Intel Corp microprocessing chip. The second-largest computer maker also announces that it will change the proprietary operating system that the VAX computer lines uses and make UNIX-based products compatible. The move toward open systems is a painful one for DEC but the market is more receptive to systems that allow users to mix and match equipment from different vendors. Computer makers that use open systems, such as Sun Microsystems Inc, have annual revenues of around $200,000 per employee; DEC has annual revenues of around $100,000 per employee. DEC plans to cut up to 8,000 jobs by the end of 1990.
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Article Abstract:
George H. Conrades, who was in charge of IBM's US operations, was appointed as senior vice president of corporate marketing and services, a move seen as a demotion. Conrades will be reporting to C. Michael Armstrong, chairman of IBM World Trade and member of the five-man management committee. With the reorganization, Armstrong is now seen as the man most likely to succeed current chairman John F. Akers, who retires in four years. IBM is also expected to announce more changes in its structure in an effort to reverse its poor market performance in the US. These changes may include making its divisions more financially autonomous and letting go of more employees.
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Industry observers wonder if Kenneth Olsen's departure comes to late to benefit Digital Equipment Corp (DEC). Olsen founded DEC 35 years ago, and he built the company into a $14 billion business, but in recent years, DEC's fortunes have declined. Observers say DEC needs to change: as one of them puts it, DEC is stranded in the 1960s, when the minicomputer was especially significant. Everyone agrees that Kenneth Olsen, who is nearly legendary in the computer industry, has established his place in the industry's history. Even so, critics point out that DEC missed out on opportunities presented by microcomputers, workstations and mobile computing.
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