CASE

DIGITAL EQUIPMENT CORPORATION:

THE INTERNET COMPANY (A)

TOPICS

• Digital Equipment Corporation Today
  
  
• DEC's Challenge in 1994
  
  
• Reengineering DEC Using the Intranet
  
  
• Generating Revenue Using the Internet
  
  
• Establishing an Internet Business Unit at DEC
  
  
• Critique of DEC's Internet SBU
  
  
• Key Lessons
  
  
  

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  THESE TWO GRAPHS SHOW DIGITAL'S STOCK MARKET POSITION TODAY
  
  
  STOCK PRICE:
  
  
  
  
  
  SHARE SALES VOLUME:
  
  
  
  What does this data Suggest?
  
  Topics
  
  

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DEC's Challenge in 1994

1. What is the state of DED's business in 1994?
   
   
2. What are the issues burning on the CEO's plate?
   
   
   
   Topics
   
   
   
   
   
   
   
   
   
   
   
   
   
   
   
   
   

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Reengineering DEC Using the Intranet

1. How can DEC use the Internet internally to reduce its expences and overhead?
   
   
2. How might the Intranet change a DEC sales representative's job?
   
   
3. What barriers must be overcome to exploit these reengineering opportunities?

OPPORTUNITIES

KEY KNOWLEDGE AND INFORMATION

CHANGE REQUIREMENTS

Topics










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Generating Revenue Using the Internet

SCENARIO

Imagine this: A manager at Biggee Corporation is writing an important document at work on a Unix workstation. At the end of the regular work day she leaves the office to go home for dinner. After dinner our manager decides to finish the project she was working on earlier that day. So, she calls a local Internet supplier's host and, using TELNET, logs onto the Sun workstation located back at Biggee Corp.

Unbeknownst to the manager, a cracker/hacker has installed a "sniffer" -- a special Unix utility -- on one of the host computers belonging to the Internet service provider. The cracker has captured and logged the managerŐs entire session to his the Unix workstation, including login and password. After the manager logs off, the cracker/hacker logs onto the Biggee manager's workstation using the captured password, and then begins the invasion of every host within the Biggee network. The craker repeats the procedure by applying sniffers to every new host he is able to enter with subsequent attacks using the same methods, . Does our Biggee manager need a FIREWALL?

What is a FIREWALL?

1. What are the opportunities?
   Security products and related consulting services.
   Electronic catalogs.
   Bundling the Internet software into products.
   New custom-built applications using the Internet
   Gateway access provider.
   Consulting on setting up an maintaining web servers
   Reengineering services helping customers rethink their businesses.
   Services helping customers redesign their communication networks.
   Internet education.
   Continuing to extend DEC's current line of server computers.
   
   
2. How should DEC pursue them?
   
   
3. Who should be DEC's target group for generating revenue from its Internet opportunities?
   
   
4. Who and how effective are its potential competitors?
   
   
   
5. What are the resource requirements for securing these opportunities?
   
   
6. What barriers must be overcome to exploit these marketing and sales opportunities?

OPPORTUNITIES

KEY KNOWLEDGE AND INFORMATION

CHANGE REQUIREMENTS

Topics

Establishing an Internet Business Unit at DEC

1. Should DEC go into this business?
   
   
2. Would you go and work for this new strategic business unit? Why? Why not?
   
   
3. Will this business make money? How can it?
   
   
4. What resources will it take?
   
   
5. Does DEC have the necessary are competencies to compete in the Internet market?
   
   Topics
   
   
   
   
   
   
   
   
   
   
   
   
   
   

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Critique of DEC's Internet SBU

1. What are your reactions to Rose Ann Giordano's business plans?
   
   
2. What are the critical success factors for the new strategic business unit?
   
   
3. Outline a business proposal targeted to CIGNA Corp.'s CIO, Ray Caron.
   
   Topics
   
   
   
   
   
   
   
   
   
   
   
   
   
   
   
   

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Key Lessons

• In order to benefit you must CANABALIZE old products and processes!
  
  
• The Information SuperHighway is having impacts on business strategies, opportunities, processes, communications, and coordination mechanisms -- internally and externally!
  
  
• Industries boundaries and modes of competition will be redefined!
  
  
• There are significant reengineering opportunities!
  
  
• Barriers to be overcome include: technological legacies, security, information culture, human resources, and senior management's assumptions!
  
  
• The Internet is a toll for Time-Based Competition!
  
  
• Internet businesses are basically "pull" businesses!
  
  
• Barriers to entry on the Internet are very low!
  
  Topics