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Non-Tech : Iomega Thread without Iomega -- Ignore unavailable to you. Want to Upgrade?

To: RedCrystal who wrote (4811)	12/4/1998 7:40:00 PM
From: David Colvin	Read Replies (1) \| Respond to of 10072

Can you tell us a little more about Scott Flaig. When did he join Iomega? As I recall he joined Iomega in the late summer or early fall of last year. Up until the end of last year Iomega was consistently having problems with component shortages and I believe the shear logistics of the situation was simply overwhelming. No doubt they were ordering way more of some components than they really needed at times because, quite frankly, they probably didn't know what they needed. These kinds of problems can result in unwarranted, excessive inventories that directly affects the bottom line. Hence the hiring of Scott Flaig to implement a system to control the processes and flow related the massive production volumes Iomega was dealing with. Make no mistake about it...Iomega is getting the situation under control. Just call it growing pains. Remember AOL's problems when they experienced a large increase in AOL memberships? Remember what happened to the stock? Look at it now. Good management can eventually solve problems. In Iomega's case it just couldn't be solved overnight. Fortunately, Jim Sierk, the interim CEO, was very familiar with quality processes and firmly guided Iomega in the right direction for the 6-7 months of his tenure. I believe that Iomega's biggest mistake was throwing away all that advertising money on those silly TV ads that didn't even make sense to anybody (one costing $1.3 million for 30 seconds during the super bowl). That money affected the bottom line and contributed quite a bit to Iomega's losses for the first two quarters of this year. They gambled and lost this year, but the game is far from over. I further believe that Iomega will eventually be in the situation of making a small profit on selling a lot of "things". Look at McDonald's....they never made a lot on each hamburger but they sold a lot of them. There are 80-90 million new computers sold every year. Just think, if Iomega could net only $2 on each OEM zip drive and if zip drives were included in only half of those computers, much less the practically sinful profits on each patented zip disk. Dave