Digital chief says company to become 'customer-focused'

November 06, 1992|By New York Times News Service

BOSTON -- Robert B. Palmer, the new president and chief executive of the Digital Equipment Corp., said yesterday that the company was being restructured into eight to 10 "customer-focused" business units by the end of the year.

Managers of the individual units would have "complete responsibility for business strategy, investments, revenue generation and profit and loss statements," he said.

Addressing the company's first annual meeting of shareholders since he succeeded Digital's founder, Kenneth H. Olsen, in July, Palmer said he would announce the specific units and the executives in charge of each by the end of December.

He also said that he expected to cut up to $300 million from the company's $1.8 billion engineering budget, in part by rethinking the company's product line.

Mr. Palmer said he would not rule out spinning off some of Digital's business units, like the fast-growing personal computer group. But such a move would not be made in the short term, he said at a news conference that followed the meeting.

Although he stopped short of predicting when the company would return to profitability, Mr. Palmer assured shareholders that Digital was undergoing structural changes aimed at increasing revenues. Digital reported a loss of $2.8 billion for its last fiscal year and announced a loss of $260.6 million for the quarter ending Sept. 26.

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