Conference 7.286::digital

    DELTA is a class Company and the base note cleary shows that.
    
    Regarding Digital; I believe that cuts need to be made and that has
    been done.  My concern is how deep will Digital go.  A major issue I
    have is that Digital is not making their cuts across the board.  Thus
    far senior management and management in general has been exempt from
    cuts.  Too many good people have been at the wrong place at the wrong
    time.  This indeed is sad.  How many times will management go through a
    given group and makes cuts?  When is enough enough?
    
    Would a 5% cut of EVERYONE's salary at Digital help?  Maybe.  I'd be
    willing to try it to save jobs.
                                                   

    
    Re: .1
    
    Ditto. 
    
    Frankly, I think Mr. Palmer should try an Iococca and pay 
    himself a $1 salary this year.  The man *CAN* afford to do so.  
    the gesture would be symbolic at best, but it would certainly help
    the morale of those of us who remain.  
    
    -Ed_waiting_for_a_stay_of_execution
    
    

    
    
    It is said that a burden shared is a burden divided and as yet it 
    would appear the senior management (with the exception of those who
    have left the company for financial/personal/political reasons) has
    not equitably shared or divided the hardships.  I don't feel that 
    the "staff" harbors any ill-will toward management but does feel as
    though it would be morally, ethically sound as well as and more 
    productive if we could see everyone involved in sharing the pain.  
    After all, we are expected to be part of the solution that will 
    bring Digital back to profitablity just as much as management. 

    re: DELTA Non-contract employees get 5% cut - top management is taking
    a *20%* cut.

A couple of entries back someone stated that they would be willing to
take a pay cut to stop/slow the current carnage. I would also...

1) Could something like this be set up  so that volunteers could take a cut
	with the hope (but not guarantee) of getting the money back when/if
	we return to profitability?

2) I would suggest that the reorganizations and closings still take place,
	just place the effected employees in more productive roles (train
	if necessary). We would have to continue to streamline the company
	if we are ever going to be profitable.

3) If the cuts were non-voluntary some people may leave the company, but we
	need people out of the company in any case. We would not have to pay
	those people to leave.

What do you think?

joe

    re 5
    
    Those who would leave due to an involuntary pay cut, IMO, would not be
    the high paid individuals (management) but would be those who cannot
    afford to support the company.  Some of whom have already taken a large
    hit with the loss the company car due to the arbitrary mileage
    restrictions.

    It's not as bad as it may appear. In the NAC downsizing at least 2
    Senior Managers (SRI 41) were TFSOed. Also I know the names of at least
    10 managers and supervisors that were TSFOed in NAC. I believe the figure
    was put out that 15% of people between SRI 40 and 42 (and may have included
    supervisors as well in addition) were TSFOed. From what I saw of the
    NAC downsizing I think it was as fair as it could have been under the
    circumstances. I hope it was as fair in the rest of the company.
    
    Also I've heard a rumour that I believe that Palmer will be swinging a
    pretty heavy axe through VPs and senior managers in January ie the
    people will be gonzo. If you look closely you'll see it's already
    started.
    
    Remember in any downsizing the managers are last to go. Managers send
    to go when their organizations disappear.
    
    Dave

    I have said it before, and am glad I am still here to repeat; I would
    like to see more visibility of the leadership since I feel the company
    really needs it. Slashing cuts, while evidence that someone is doing
    "something", offer no leadership value and surely demand, as well as
    provide opportunity for, visible leadership which becomes more
    desperately needed daily. We are not silicon. 

    
    A better approach than a pay cut would be a freeze of pay raises.
    This is far less disruptive than taking away what we already have.
    
    Jon
    

    all these approaches will be trying to solve the symptoms of the problem,
    not the problem itself.

    the main problems, is that there are SO MANY PEOPLE out there looking
    for work and SO MANY PEOPLE are graduating from schools looking
    for work.

    to really get to the bottoms of this we need not keep having SO MANY
    BABIES! yes, this is the long term plan, if we dont have so
    many babies, we'll have less people graduating, which means
    less people looking for work, which means NO TFSO's !

    we must reduce the number of BABIES! we keep getting, period! no other 
    lasting effect will have an enduring effect on our economy and future
    standard of livings!  i know how CUTE they are when you hold
    them in your hands and they giggle at you and all, but we must
    put our emotions inside for the benefits of our great and great
    grand children. plane on only ONE Baby at the most, if you must!
    tax credit wil be given to those couples who dont have any, and
    less tex credit to be given to those who have the most.

    think about it, if there were not so many people around, who ones
    were all BABIES, NO ONE WILL BE TFSO'ed!

    i wonder if we have the will and political muscles to go for it
    in a referendum or some other means.

    /nasser

    Aren't they already doing that in China, Japan? I forget which one.

    
    The short term problem is that Digital Equipment is BROKE.
    If we don't pull a profit before too long we're dead, see WANG.
    
    The long term problem is that the computer industry is changing
    to a commodity (read: made in Mexico) market, how does DEC fit in?
    
    I'm still shocked when I think that little Apple grew to a $6B
    company right under our noses.  While we had the cash we could have
    done great investments (loss leaders) to caputre / create markets.
    Now we don't have much latitude to take risks.  We can't afford to
    make mistakes, the great cash cow in the sky is running dry.
    
    Jon

re: .9

A pay freeze doesn't cut expenses though.  A pay cut indexed to your job
level would be effective at cutting expenses in the short terms and possibly
saving jobs in the long term, e.g., 20% cut for VPs, 10% cut for SRI 39 and
up, 2% cut for other Wage Class 4s, etc.

But it won't happen...layoff addiction has already taken hold.
								- paul

Don't forget that this company tried for years to avoid layoffs, even when it
was obvious to almost everyone that we had way too many people. How many? Well,
try 20,000, 30,000, maybe even 40,000. 

The company never injected any sanity into its hiring process, and continued to
believe the hype that all the employees were excellent performers, were
necessary and valuable to the company's success, blah blah blah. And it kept
blaming the lackluster economy for its financial problems when its problems
really reflected both bad management and structural changes in the industry.

I don't blame the company at all for the layoffs (although I wish more managers
had been axed). I only wish it had initiated the layoffs earlier, for the
people who were "in transition" and didn't have any useful work to perform.  

I wouldn't be happy about a pay cut for everyone. But a pay cut for managers
might be a good idea. 

Vicki Meagher

    When WANG resorted to a pay cut, the company set aside an amount of
    stock for each employee equal to the lost wages. The employee would 
    receive the shares if they stayed with the company for some period of time 
    after the freeze was lifted. I don't remember the particulars even
    though my wife was affected, but I seem to recall receiving 50% of the
    stock after 6 months, and the remaining 50% after an additional 6
    months (or it may have been something like 'all or nothing'...i.e. 100% 
    after 1 year, and nothing for any lesser period.)
    
    Seems somewhat hollow, given the subsequent developments at WANG and
    the current price of WANG stock, but at least they tried to take the
    sting out of the pay cut. 
    
    (p.s. almost without exception, every WANG employee we know/knew sold
    the stock as soon as it was received....:^)

    
    
    A few years back when HP was in a money crunch they came up with a
    great idea (IMHO).
    
    They asked EVERY employee to take 1 non-paid dayoff every month.
    
    Think about the cost savings!  
    
    Sure you take a slight pay cut, but at least you get something in
    return.
    
    This idea would get my vote.
    
    

    	Involuntary pay cut? Sure, might as well open the floodgates now.
    You might not notice it at first...but about a year from now when
    you're looking for what new products the company is going to ship,
    guess what! There aren't any!
    	By the way, as far as I know, there's been absolutely NO word on
    salary planning for 1993. Usually, the planning starts in November. Not
    this year. So without coming out and explicitly saying so, we may be
    under a pay freeze now! Perhaps the memo explaining this got lost in
    the Christmas mail...Yeah...that's it...

    Salary planning is going on now.  Not all groups have started yet, but
    some are.
    
    Brian
    

    Not to rub salt in the wound, but this year Apple grew to $7B.  Even
    with reduced margins they still increased net profit (to around $500M)
    through a combination of cost reductions and increased volume.
    
    And Microsoft is hiring around 2000 people this year, mostly in
    support.  (see last week's Fortune)

    And note the difference between the computer industry and the airline
    industry.
    
    Delta is one of the best-run airlines, and is not in Chapter 11, which
    is a lot better than its competition.  Delta employees aren't about to
    jump ship to some well-heeled startup.
    
    The computer industry still has many successful companies, all smaller
    than Digital.  Our best employees can easily join the competition if we
    freeze their pay once again.  BP knows it, and won't let it happen.
    
    Remember, Digital isn't a charity.  We don't employ people for the sake
    of the community.  We pay people because we want them to work for us.
    Or we stop paying them.

    >They asked EVERY employee to take 1 non-paid dayoff every month.
    
    Yeah, but would I have 1 day less work to do?   
    

Again, the purpose of .0 was not to single out DELTA, nor their 5% cut.

It was to discuss other companies response to "hard times" and the difference
with Digital's response.

My point was - "here's what appears to be a quality response to difficult
business conditions -- what are other companies doing that makes sense for 
Digital to evaluate?"  Not everything would be a good idea here ... but there
haven't IMHO been a lot of "good ideas" demonstrated by Digital thus far.