Conference 7.286::digital

    maybe that's why Digital will have a group of people in FY95 who do
    nothing but sell Digital network products.  They will have a sales
    budget and will be responsible for all aspects of the nmetwork products
    sale.
    
    In the field, sales without a large Digital product component are now
    being frowned upon.  In fact, Lucente was here a few months ago and
    singled out a very large sale, which the CBU claims to be a great
    success, as the sort of business we should not go after, which is a lot
    of third party hardware.

    Re .1
    
    Hmmm!   Let me get this straight.  We have products to sell, but since
    the are not made by DIGITAL, we shouldn't sell them.  We are being told
    that selling products we have, that are built by another company is bad
    business.  I guess I really don't understand business...
    
    Jim Morton

    There's an easy solution to satisfying Ed Lucente, the BOD, our
    stockholders, and any other interested party:
    
    When trying to sell consulting to customers in the U.S., they'd always
    accuse us of "just trying to sell us a box".  I fought this for a long
    time, but I now have come back to the realization that Digital is a box
    maker, and so what's bad about that?  Let's just put together package
    deals in which the customers not only get the box, but they get X
    amount of consulting with it also.  One stop shopping.
    
    /d.c. 

For years we were beat up for being ironmongers; new visionaries have
recently tried to convnce us that all iron is commodity and the that the
new paradigm is in services. When we *do* have iron that is great and
competitive, it does not fit into someones pre-concieved notion of what
customers want... if it doesn't match with our metrics, then customers
don't want/need that, right?

Meanwhile, other vendors that focus on customers rather than their own
internal metrics continue to pick us off.

'Think customer' is given lip service, 'Think metrics' is our bread and
butter.

Lee (Hi Pete!)

    
     Billable hours............ cannot have them without selling something
    right? The metrics are on a short-term cycle, we want cash now!
    
    >>>'Think customer' is given lip service, 'Think metrics' is our bread
    >>> and butter.
    
    Most unfortunately true, have seen it first hand. Customer has cash
    laying on table, set amount, "digital I need ....", digital responds
    we cannot go after that business because it does not meet our models.
    
    Customer goes elsewhere, gets what they want, elsewhere grows business
    five-fold. You figure it out. When you bringup what is happening,
    everyone says we know, but we cannot do anything about it. Senior
    management cannot do anything about it? 
    
     We cannot sell products or services with our metric system. It is up
    to senior management to fix it. Witness other notes in this conference
    about shadow certs, sales credits, shark meat.
    
    -Later,
    Mike Z.
    Digital Consulting 

    About 7 years ago, I used to work as a consultant in the field
    organization. After spending the first week in the customer site, I
    submitted the weekly report with Billable hours as 36 hrs for the week.
    ( I had to attend the staff meeting for the during week at my unit,
    which obviously did not bill the customer. My manager called me to his
    office and asked me change the Billable hours to 36 divided by 4 ( i.e
    9 hours) to look good on paper. When I asked for the clarification, he
    told me that it appears that one hot shot sales rep sold the consulting
    services for $35 per hour as a part of major system sales. Obviously we
    cannot tell this to the corporate. So for every 4 hour I spend at the
    customer site as I was asked to report in paper as 1 hour ( so that the 
    consulting fee will appear as decent $140 per hour. This is well and
    good till the review time, when the employee gets shafted for reporting
    only 25% Billable hours ;-)..Being new to Digital at that time, I could 
    not believe, that one arm of Digital cheats the other arm of Digital.. 
    Well ! This was a old story..

    About 3 months ago I happened to meet one of the managers who has several 
    consultants working for him told me that such a practice still goes on 
    at some places. No wonder we are in such a trouble. 
           
    

    this whole scenerio would be laughable if it's result were not so
    tragic. i have said for years, sometimes in this forum, that the
    metrics are absurd. i have also forwarded to senior management concrete
    examples and recommendations on what I think is needed to change the
    mess we are in. I'll be the first in this company to jump in here and
    scream "THERE IS A GOD IN HEAVEN" when i don't have to COMPETE with the
    guy sittng next to me for the next sale. 
    

    Metrics are only part of the problem.  The Digital Consulting (DC)
    business model suffers from a major disconncect with the business model
    of our traditional core business.
    
    I think that DC cannot be successful while still tied to the rest of
    us.  I think that the rest of us cannot be successful while we are
    still tied to DC.  
    
    I believe that DC should be cut loose, and that the traditional company
    should maintain only a small core of system designers who can quickly
    customize solutions based on off-the-shelf software products.  
    
    Anything complex (new inventory systems, etc.) should be referred to 
    consulting companies like DC, or AC, or EDS.  The complex solutions and
    resulting projects can support the management overhead, project
    management methodology, and financial tracking/reporting procedures
    used to control such efforts.
    
    For the traditional core business, the empahasis would be on using our
    middleware in combination with the software packages of others to craft
    quick but workable solutions.  This class of solutions leverages
    product sales, and leverages account relationships.  It is closer to
    what we used to do.
    
    DC metrics say nothing about leveraging the well-being of the rest of
    the company.  We need a support arm that does that.  DC metrics say
    that they will meet their utilization numbers and their budgeted profit
    goals -- they don't say that they will help increase hardware or
    software sales, or build Digital's credibility with the customer.
    
    The traditional core business is based on building trust relationships
    with large customers (yes, I know I am leaving out our commodity
    products...those are vital to our well-being, but our core business is
    built on accounts and account relationships).
    
    Our account relationships are based on mindshare, a willingness to talk
    to us, to share their problems.  In doing so, the customer has an
    expectation that we will try to solve his problems, or at least the
    majority of them.  Otherwise, he does not have time to deal with us.
    
    DC's business model is based on picking off the good prospects:  the
    ones we can win, and deliver most profitably.  This is a most rational
    and understanable and supportable model for a pure consulting company. 
    They are always resource constrained (if not, they are very
    unprofitable because their utilization is low and they have many
    available resources).  Their metrics force them to turn away from the
    vast majority of the opportunities, optimizing their profits.
    
    Yet our customer expects us to suggest solutions or propose to solve the 
    vast majority of the problems they bring to us, or else we are wasting
    their time.  Business model disconnect.
    
    Fortunately, most of the problems they bring to us can be solved with a
    minimum of customization, using mostly existing middleware and
    interconnect solutions.  Unfortunately, however, our attempts to do
    this in the current model must undergo the same procedures, embrace the
    same methodology, and support the same profit models, as the large and
    complex project opportunity.  Business model disconnect.
    
    The result is often a slow response, frustrating in its ponderous
    procedure-based methodology.   The answer is usually no (by definition,
    being resource constrained).
    
    After one or two of those, the customer avoids asking us again.  The
    result is that our equipment doesn't go in, our softare isn't running,
    and the account relationship is de-leveraged.  The spreadsheets and
    profit models of DC doesn't show those effects.
    
    The result is a slow malaise.  The fact is, almost every sale today is a
    systems integration sale of one sort or another, by definition, because
    it is not going onto a blank piece of paper.  Every one of those
    existing systems will be affected by whatever solution is picked.  The
    company that can solve those interoperability solutions will prosper.
    
    Of course, the main benefit is hardware sales, and DC doesn't benefit
    from downstream dollars.   There's the disconnect.  
    
    There is a math theory called "global sub-optimization through local
    optimization."  It means that sometimes to leverage the whole, you have
    to accept less in a certain area.
    
    DC is trapped in its own birth canal.  It is wants to be an "SI" company,
    when our traditional core business just needs some "si."  DC suffers
    from the perception that it is pushing hardware, and therefore can't
    succeed.  The irony is that it is not leveraging the hardware much at
    all, and in fact is interfering with those sales because of slow
    response, overkill methodology and resulting overhead, and a disregard
    for the effect their business decisions have on customer relationships.  

    Re .8
    
    "The fact is, almost every sale today is a    systems integration sale
    of one sort or another, by definition, because    it is not going onto
    a blank piece of paper.  Every one of those    existing systems will be
    affected by whatever solution is picked."
    
    Deinately a "truism"...EVRY system sales is integrated into the clients
    existing systems and the basic infrastructure. In my case, my client
    has an in-house SI business entity, which then supplements SI projects
    with either AC (in the US) or CAP in Europe. The SI prime then
    supplements the team with technology resources from either local
    body-shops or DC (in most cases...we've "primed" one or two projects).
    Why are we relegated to this role (lower volumes, and typically lower
    margin)? Well, either we've shown ourselves:
    
    	A) Unwilling to undertake the business (cherry picking is in -.1)
    	B) Not competitive in costs because our 
    		1- risk factors have priced us out
    		2- we don't effectively leverage the change order process
    			opportunities
    	C) Our track record on the ones we've one is NOT good (due both to
    		B-2 and the good/bad aspects of overengineering an elegant 
    		solution)
     

    
    re: .8
    
    Well put!  That was one of the most cogent analyses I have seen
    here in a long, long time.  I hope you are in a decision making
    position.
    
    Glenn

         Am I missing something obvious or is the answer as simple as it 
    appears to me? -- an internal market.  The full nine yards with 
    separate P&L, economic (not Mickey Mouse) pricing, contracts, 
    invoices etc.  Then the Systems and DC businesses are both free to 
    buy and sell where they will but will tend to resort to each other, 
    DC because Systems will be by far their biggest customer and Systems 
    because DC will be the largest source of Digital expertise available 
    to them.  Systems and DC would also do joint planning so that they 
    get their volumes in synch.  The DC unit would then get the added 
    value of their services sale and the Systems unit the _incremental_ 
    value of their product sale.  Incidentally, Systems sales would be 
    able to bid for the DC sales account.
         
         Of course this would require a major change in our plan of 
    accounts and systems to reflect the recursive relationship, 
    "ProfitCentre TRADES_WITH ProfitCentre" rather than the two-level 
    model that bookkeepers understand: REVENUE and EXPENSES.  Still, they 
    haven't had an original idea since double entry, about seven hundred 
    years ago :-)
         
    dave_P

    re .11
    You are probably right and it would work too.Eventually the
    relationship would be both symbiotic and parasitic but would allow the
    freedom for each to do what it is good at.The fear I have is that,once
    the boys have implemented this simple idea,we would have much room for
    many reorganisational tuning exercises,much room for politics and
    strategy and much room for abuse.Imagine this scenario(which actually
    happened at Honeywell)-your sales team can sell what they want as long
    as they get money in,even if it has nothing to do with your direct
    business or is in direct competition with the company product
    strategy.I can easily see this as an outcome of a split.You can see it
    now-Systems has just won a major outsourcing contract against strong
    competition from DC,who bid with IBM and EDS.....

    re:  .12
          
    Systems and DC might bid against each other?
    
    That would be the natural outcome of a true spinoff.  In an "arms
    length" relationship, there would be internal pressures to try to bid
    together.
    
    I agree that there would be lots of politics and room for abuse.
    
    re:  .11
    
    It would only be fair for DC to be able to solicit bids on a sales
    force, if Systems was free to team up with competition.  In actual
    fast, today there is NO requirement TODAY that sales reps give DC first 
    crack at any project.  There is, however, a natural inclination to do so,
    given that the sales rep doesn't get credit for the SI content
    otherwise (and would just get credit for hardware and maintenance).
    
    There is also a tendency to use DC because you have a better chance of
    maintaining some measure of account control (although DC is sometimes
    apt to start doing things that benefit their project but poison the
    long-term account relationship).
    
    I would recommend that DC actually hire their own sales force.  They
    would then start to find out some of the problems involved.  As it is,
    they don't know how tough it is to build mindshare in an account, and
    they don't have to stick around while the account is cleaned up after
    they leave.
    

Re:   <<< Note 2908.13 by ANGLIN::ROGERS "Sometimes you just gotta play hurt" >>>
    
>>    I would recommend that DC actually hire their own sales force. 

They did.  They're known as Customer Service Principals (CSP's).  

    Don't think so.  Those people are resources to the sales force, to help
    guide them once an opportunity is identified.  I don't yet know how
    this will work, since ours has never bothered to talk to the sales
    team, even by telephone.
    
    If you think they're sales people, just ask them how many customer
    calls they made this month.  Then ask them who set those calls up, and
    who identified the opportunity.  Ask them how many executives they have
    personally met, who their key contacts are, which ones they talk to on
    a regular basis...

Note 2908.15 ANGLIN::ROGERS
    
    >Don't think so.  Those people are resources to the sales force, to help
    >guide them once an opportunity is identified.  I don't yet know how
    >this will work, since ours has never bothered to talk to the sales
    >team, even by telephone.
    
    so we get to the crux of the problem. for the record, i have worked
    extensively in sales and delivery/sales support/EIS/DC. also for the
    record, i am NOT a resource to be used and summoned at beacon call for
    the sales force. i am a professional, a network consultant, that
    prefers to work with other professionals for the betterment of the
    company, my peers, and myself. the animosity between these
    organizations is real, long standing, and MUST end. simply put, they
    NEED each other. yet today they frequently don't cooperate or
    compliment one another. I sugest we all decide, for survivals sake, to
    strive to overcome this me-you attitude that exists between them.
    
    >If you think they're sales people, just ask them how many customer
    >calls they made this month.  Then ask them who set those calls up, and
    >who identified the opportunity.  Ask them how many executives they have
    >personally met, who their key contacts are, which ones they talk to on
    >a regular basis...
    
    as a member of DC i talk to customer DAILY. I set up calls and identify
    opportunities WEEKLY. and i get asked, yes ASKED, by senior executives,
    regularly, to develop strategies and present DEC products.
    
    we're in this together. i suggest you start thinking like that or get
    rid of any/all stock you may currently have.

>>   <<< Note 2908.15 by ANGLIN::ROGERS "Sometimes you just gotta play hurt" >>>
>>                    -< If so, DC needs to step up the pace >-

>>    Don't think so.  Those people are resources to the sales force...

I don't think you understand Brebach's long range plan.  Yes, the CSP's will
work with the account managers, but don't think for a second they're a 
"resource" for sales (quite the opposite, if you ask me).  Sales will simply
get them up to speed in the account, and they  (CSP) will drive (uncover, 
propose, close and manage) all consulting efforts in their account.  Sales will
get credit and will work with DC to coordinate activities relative to the 
account plan, but sales will not "drive" the consulting business for very long.

Now, as far as whether the people currently named as CSP's and whether they're
capable of handling the job, you've hit upon the key to the puzzle.  Many of
these folks come out of the management ranks in the old DC organization and
wouldn't know a customer if they tripped over one.  I predict there will be
quite a turnover in the CSP ranks in the next 12-24 months.

    Just though I'd finish off the note...
    
    Well, the project DID close. I wasn't for $180K, it was for $230K !
    
    So you think DEC management would say "Great job Pete ( and Don 
    and Bill ) " 
    
    Nope.
    
    I though I'd do the right thing by letting the organization that was
    CREATED for such things ( namely NETexpress ) deliver the project instead 
    of doing it myself so I could have time to chase the next VA job in the 
    pipe ( which has a potential of $1M to $2M dollars ). I turned the job 
    over to the NetExpress people to order, ship and track the parts. 
    
    My manager called me in today to basically threaten/warn me ( and my
    counterpart ) that if we didn't get my BILLABLE UTILIZATION up to a 
    higher level it was very likely that I might become a TSFO victim. 
    
    He suggested strongly that I take a 911 call in California for 5 months. 
    This was done in the presence of my counterpart in the group ( who is 
    married ). My manager didn't even copy my counterpart on the 911 call 
    because he knew that this individual is unwilling to work away from home. 
    This is  exactly what he said.
    
    Gee, lets' have some JUSTIC along with our poor management. I'm gonna
    be the one that get's TSFOe'd because I'm single and should be willing
    to put MY life on hold for 5 months because the married guy isn't really 
    expected to take out-of-town assignments in order to keep HIS billable 
    utilization up ! 
    
    Pete

Ummm,
I know a LOT of married folks in DC who have been given basically no
choice about jumping on planes and spending long streaches 
(3-9 months) accross country from their families.

This is not new.  Its been going on for a couple years at least.  If
you're just now being hit with it, you've been lucky.

I am not saying that its a great way to live.  It sucks.  But then, that's one
of the reasons I bailed out of the field.

I have a friend up here who'd probably trade his stint in Alaska for yours in
California...

    My only complaint is ... " fair is fair " ...
    
    If I ( the single person ) is being asked to accept long term away from 
    home assignments then my married counterpart here should be asked to do the
    same.
    
    It's really a local issue :^{ 
    
    I agree. I'm seeing LOTs of people ( married and otherwise ) who are
    being asked (or forced) to spend HUGE amounts away from home.
    
    	Pete