Content area
Full Text
Can you believe it? I mean, the ride was rough enough until now. You've tried to keep pumped up, but it was hard with most of the cubicles being empty, mute reminders of those who left holding a pink slip or celebrating a new job. Of course, the writing was on the wall- Just a few months earlier, your buddy in marketing sentyou an e-mail hinting that the new CEO of your parent company said that if your division, Packard Bell NEC, didn't start making money, there would be no further bailouts. it was sink-or-swim time and there wasn't a damn thing you could do about it. And now, the ax has fallen. That new CEO is on his way out, and so are you.
But, cleaning out your desk, you remember the good times, the years when Packard Bell kicked major butt. And you ask yourself the question that managers and employees alike have been debating for the past two years. What the fuck went wrong?
Packard Bell. There was a time when people said those words with the same respect that they use today for Dell and Gateway. It was a giant, dominating consumer PC sales, selling first-time machines to novice buyers through retail outlets like Sears. Packard Bell meant computer power to the people: cheap, convenient and full of the features that customers wanted in a home computer, like multimedia hardware and preinstalled software.
By 1990, the company was booking half a billion dollars in annual sales and growing like gangbusters. By 1996, the company had sufficient clout to acquire Groupe Bull's PC business and NEC's PC business outside of China and Japan, creating a PC conglomerate that shipped nearly one out of seven of the PCs sold in the United States, according to figures from International Data Corp. (IDC). By the end of 1998, however, the party was over. US. market share had plummeted from 14.1 percent to 5.5 percent, and worse, Packard Bell NEC had managed to lose $650 million for the year. The company was in the midst of massive layoffs, desperately trying to staunch the flow of red ink. Its goal was to reduce the loss to $100 million in 1999. But despite valiant efforts, the loss...