DEC Is Dead, Long Live DEC : The Lasting Legacy of Digital Equipment Corporation

Digital Equipment Corporation achieved sales of over $14 billion, reached the Fortune 50, and was second only to IBM as a computer manufacturer. Though responsible for the invention of speech recognition, the minicomputer, and local area networking, DEC ultimately failed as a business and was sold to Compaq Corporation in 1998. This fascinating modern Greek tragedy by Ed Schein, a high-level consultant to DEC for 40 years, shows how DEC's unique corporate culture contributed both to its early successes and later to an organizational rigidity that caused its ultimate downfall. Edgar Schein is one of the founders of the organization development field, a widely respected scholar and a bestselling author • Shows how the unique culture of DEC was responsible both for its early rise and for its ultimate downfall-a real-life classical tragedy • Schein was a high-level consultant to DEC throughout its history, with unparalleled access to the company's story as it unfolded over the course of four decades DEC Is Dead, Long Live DEC tells the 40-year story of the creation, demise, and enduring legacy of one of the pioneering companies of the computer age. Digital Equipment Corporation created the minicomputer, networking, the concept of distributed computing, speech recognition, and other major innovations. It was the number two computer maker behind IBM. Yet it ultimately failed as a business and was sold to Compaq Corporation. What happened? Edgar Schein consulted to DEC throughout its history and so had unparalleled access to all the major players, and an inside view of all the major events. He shows how the unique organizational culture established by DEC's founder, Ken Olsen, gave the company important competitive advantages in its early years, but later became a hindrance and ultimately led to the company's downfall. Schein, Kampas, DeLisi, and Sonduck explain in detail how a particular culture can become so embedded that an organization is unable to adapt to changing circumstances even though it sees the need very clearly. The essential elements of DEC's culture are still visible in many other organizations today, and most former employees are so positive about their days at DEC that they attempt to reproduce its culture in their current work situations. In the era of post-dot.com meltdown, raging debate about companies "built to last" vs. "built to sell," and more entrepreneurial startups than ever, the rise and fall of DEC is the ultimate case study. Contents......Page 6 List of Illustrations......Page 8 Preface......Page 10 Acknowledgments......Page 14 1. Purpose and Overview......Page 18 2. Three Developmental Streams: A Model for Deciphering the Lessons of the DEC Story......Page 33 Part one: THE CREATION OF A CULTURE OF INNOVATION: THE TECHNOLOGY, ORGANIZATION, AND CULTURE STREAMS ARE ONE AND THE SAME......Page 46 3. Ken Olsen, the Scientist-Engineer......Page 50 4. Ken Olsen, the Leader and Manager......Page 64 5. Ken Olsen, the Salesman-Marketer......Page 88 6. DEC’s Cultural Paradigm......Page 97 7. DEC’s “Other” Legacy: The Development of Leaders......Page 107 8. DEC’s Impact on the Evolution of Organization Development......Page 130 Part two: THE STREAMS DIVERGE, CAUSING AN ORGANIZATIONAL MIDLIFE CRISIS......Page 142 9. The Impact of Changing Technology......Page 148 10. The Impact of Success, Growth, and Age......Page 163 11. Learning Efforts Reveal Cultural Strengths and Rigidities......Page 185 12. The Turbulent 1980s: Peaking but Weakening......Page 212 13. The Beginning of the End: Ken Olsen’s Final Efforts to Save DEC......Page 239 Part three: LESSONS AND LEGACIES......Page 256 14. Obvious Lessons and Subtle Lessons......Page 260 15. The Lasting Legacy of Digital Equipment Corporation......Page 272 A. DEC’s Technical Legacy......Page 286 B. DEC Manufacturing: Contributions Made and Lessons Learned......Page 290 C. DEC, the First Knowledge Organization......Page 297 D. Digital: The Strategic Failure......Page 300 E. What Happened? A Postscript......Page 309 References......Page 320 B......Page 324 C......Page 325 D......Page 326 E......Page 327 I......Page 328 L......Page 329 N......Page 330 P......Page 331 S......Page 332 V......Page 333 Z......Page 334 About the Author......Page 336 Dec Is Dead, Long Live Dec Tells The 40-year Story Of Dec's Creation, Demise, And Enduring Legacy. Author Edgar Schein Consulted To Dec Throughout Its History And So Had Unparalleled Access To All The Major Players, And An Inside View Of All The Major Events. He Shows How The Unique Organizational Culture Established By Dec's Founder, Ken Olsen, Gave The Company Important Competitive Advantages In Its Early Years, But Later Became A Hindrance And Ultimately Led To The Company's Downfall.--jacket. Three Developmental Streams: A Model For Deciphering The Lessons Of The Dec Story -- The Creation Of A Culture Of Innovation: The Technology, Organization, And Culture Streams Are One And The Same -- Ken Olsen, The Scientist-engineer -- Ken Olsen, The Leader And Manager -- Ken Olsen, The Salesman-marketer -- Dec's Cultural Paradigm -- Dec's Other Legacy: The Development Of Leaders / Tracy C. Gibbons -- Dec's Impact On The Evolution Of Organization Development -- The Streams Diverge, Causing An Organizational Midlife Crisis -- The Impact Of Changing Technology / Paul Kampas -- The Impact Of Success, Growth, And Age -- Learning Efforts Reveal Cultural Strengths And Rigidities -- The Turbulent 1980s: Peaking But Weakening -- The Beginning Of The End: Ken Olsen's Final Efforts To Save Dec -- Lessons And Legacies -- The Lasting Legacy Of Digital Equipment Corporation -- Dec's Technical Legacy -- Dec Manufacturing: Contributions Made And Lessons Learned / Michael Sonduck -- Dec, The First Knowledge Organization: A 1991 Memo / Debra Rogers Amidon -- Digital: The Strategic Failure / Peter Delisi -- What Happened? A Postscript / Gordon Bell. Edgar H. Schein ... [et Al.]. Includes Bibliographical References (p. 303-305) And Index. From an insider, the forty-year saga of the rise and fall of Digital Equipment Corporation, one of the pioneering companies of the computer age. Digital Equipment Corporation created the minicomputer, networking, the concept of distributed computing, speech recognition, and other major innovations. It was the number-two computer maker behind IBM. Yet it ultimately failed as a business and was sold to Compaq Corporation. What happened? Edgar Schein consulted to DEC throughout its history and so had unparalleled access to all the major players, and an inside view of all the major events. He shows how the unique organizational culture established by DEC's founder, Ken Olsen, gave the company important competitive advantages in its early years, but later became a hindrance and ultimately led to its downfall. Coauthors Schein, Kampas, DeLisi, and Sonduck explain in detail how a particular culture can become so embedded that an organization is unable to adapt to changing circumstances even though it sees the need very clearly. The essential elements of DEC’s culture are still visible in many other organizations today, and most former employees are so positive about their days at DEC that they attempt to reproduce its culture in their current work situations. In the era of post-dotcom meltdown, raging debate about companies “built to last” vs. “built to sell,” and more entrepreneurial startups than ever, the rise and fall of DEC is the ultimate case study. Telling the 40 year story of the creation and demise of a pioneering company of the computer age, this book explains how a particular culture can become so embedded that the organization is unable to adapt to changing circumstances even though it sees the need very clearly. "The story of Digital Equipment Corporation (DEC) is fundamentally a forty-year saga encompassing the creation of a new technology, the building of a company that became the number two computer company in the United States with $14 billion in sales at its p"