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Technology Stocks : Compaq -- Ignore unavailable to you. Want to Upgrade?

To: JDN who wrote (79490)	3/14/2000 3:10:00 PM
From: Salah Mohamed	Read Replies (1) \| Respond to of 97611

JDN ... About Storage Here is the info they provided about Storage in the analysts meeting: compaq.com compaq.com compaq.com compaq.com compaq.com compaq.com

To: JDN who wrote (79490)	3/14/2000 3:33:00 PM
From: rudedog	Read Replies (1) \| Respond to of 97611

JDN - re: CPQ has to be horribly mismanged Well, I guess I have to agree with you - and apparently so did the board, since they bagged 7 of the 9 senior managers from EP's crew. But it was as recently as 1998 when CPQ got rated among the "top 10 best managed companies"... CPQ Classic management was pretty good, at least when I worked with them in '95 and '96 - focused, cost sensetive... they were making over $1M per employee. I suspect that the "Digital culture" (which was producing about $200K per employee) had a lot to do with the current situation. Lots of smart experienced people but many years at a company where financial performance was not part of the requirement left them with poor habits and priorities. CPQ Classic had about 14,000 employees and just a handful of senior managers - they had only 15 VPs, I think, and maybe 40 Directors. Digital had over 70,000 employees, 400 VPs alone... Lord knows how many other "senior executives". I think that CPQ should have done aggressive load-shedding right at the time of the acquisition - spin off the unprofitable businesses, make the cuts. Suffer the pain right away and get over it. But that went against Pfeiffer's goal of "a $50B company by 2000", which never struck me as a strategic goal. If CPQ had the same market performance and revenue stream but cut costs by only 10% they would be at the upper end rather than the lower end of the pack. re: This Capellas fellow is supposed to be from manufacturing isnt he? No he was originally an engineer, then in financial and then IT - did general management stints at SAP and Oracle. The manufacturing slot was run from CPQ's founding until last year by a guy named Greg Petsch - who did a great job for much of CPQ's history but either lost interest or "didn't get it" when the shift to BTO happened. His replacement, Ed Straw, did not seem to have much impact either. The Inacom deal should help with PC manufacturing. I think the Enterprise manufacturing is OK - they seem to be better than SUNW or IBM but I don't have the details. In the Enterprise sector, it is more lack of focus and too many people working on stuff that does not contribute much to revenue, IMO...