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August 12, 1997


Digital restructuring India tree

Digital Equipment India Limited is restructuring its organisational and business tree in keeping with the new worldwide policy of its US-based parent, Digital Equipment Corp.

The most significant outcome of the exercise - which began last month - is the sharp reduction in the number of 'business units' within the company.

DEIL has already done away with the business units handling the sales of computers based on its high-speed Alpha microprocessor and those based on Intel Corp's processors. "We have merged all our product lines into a single unit and done away with most of our business units. As a result, the customer will now have the comfort of interacting with only one person from Digital for all of his requirements," said Binod Singh, vice-president (channels and alliances), DEIL.

Singh, who headed the business unit responsible for Alpha- based machines prior to the restructuring, said the company would merge its indirect sales channels into a single unit.

DEIL's direct sales force would be restricted to the handling of large customer accounts, he said.

DEC put in place the 'business unit model' five years ago when it decided to place special emphasis on promoting its newly introduced Alpha processor. "The idea was to give specific focus to Alpha and driving up volumes (for the chip)," he said.

In addition to the Systems Business Unit (for handling Alpha-based machines), a separate business unit - with its independent sales channel - was created to handle sales of PCs and servers based on the cheaper Intel chips.

Singh said the restructuring exercise is in response to changing customer expectations. "Now, customers ask for a solution based on a software platform of their choice - like Novell Netware or Windows NT. Whether these run on Alpha or Intel (processors) is not an issue any more," he said.

"Our earlier structure meant that the person selling Intel machines was not able to provide customers with information about Alpha. And the Alpha person would not talk about our Intel-based machines. All this only served to confuse the customers," he agreed.

According to Singh, DEIL will have fewer pains in handling the restructuring than its counterparts in other countries, as the Indian arm has already been employing a common sales force to a large extent. "In a way, we are ahead in the curve at Digital. What DEIL did yesterday, DEC is implementing worldwide today," he claimed.

DEIL will, however, retain two business units - the recently launched network products business unit and the semiconductor business unit. "We have retained separate business units for these two functions because we felt that they needed special focus," Singh said. The promotion of Digital's networking products was one of the most important tasks the company had set for itself this year.

Though DEC has had a Network Products Business unit since 1994, the products were introduced in India only a few months back. Singh, however, feels the late entry will not be too much of a handicap - even though competitors like Cisco and 3Com have already established a strong presence in the country. He said technology changes in the networking arena would work in favour of DEIL.

Unlike its competitors - each of whom specialised in one type of networking equipment - Digital offers comprehensive suites of products including hubs, switches, routing products and network adapter cards, he claimed.

The company also claims to be pioneering a convergence model for networking in which hubs, routers and switches are deployed on a single integrated platform.

DEIL would also be able to offer the networking products as part of its system integration solutions, Singh said.

The company is in the process of creating an independent channel for the network products unit, he added.

The company's semiconductor business unit is hoping to exploit the emerging opportunity in the form of the so-called 'network computers' and other network-based devices.

Singh said DEC have already captured 65 per cent of the worldwide NC market with its StrongARM processor. He said DEIL is already in talks with VXL Instruments, the first Indian company to announce plans for making NCs, to convince the latter to incorporate the StrongARM processor in the product.

Headquartered in Bangalore, DEIL has a presence in computer hardware, software and systems integration.

- Compiled from the Indian media

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