Ken Olsen by Richard Seltzer
The is an excerpt from my book One Family, which is on sale at Amazon.
I used to work for the Ultimate Entrepreneur. That’s the title Fortune Magazine gave Ken Olsen in a 1986 cover story. It’s also the title of his biography by Glenn Rifkin and George Harar. I wrote MGMT MEMO, the newsletter Ken used to motivate and guide the 20,000 managers at DEC (Digital Equipment Corporation). Ken wanted to empower them to carry his messages to the company’s 130,000 employees worldwide. From humble beginnings as a tiny startup with little money but big ideas. Ken built the second largest computer company in the world, which challenged IBM for dominance. (This job was before I became the “Internet Evangelist.”)
The company culture was college-like, more focused on ideas than profits. At Ken’s instigation, the first criterion for making decisions was “do the right thing.” “Right” meant not just for DEC and its shareholders, but also for its customers, suppliers, and employees and the communities where they lived and did business.
DEC didn’t last forever. Technology changed rapidly, and the company was getting so large that it was hard to change course. Ken compared his job to that of the captain of a aircraft carrier going down a river. You can nudge it this way, then that, but you can’t steer it.
For a brief and shining moment, DEC was Camelot. It was a family, sharing common goals and ideals. We were proud to work for DEC, to work for Ken. We felt that what we did mattered, not just for us and the company, but for the world, and not just what we designed, made and marketed, but how we did it.
Product ideas started with individuals and worked their way up. Corporate management, in the role of gatekeeper, decided what to fund and support. And throughout the company, when you were in charge of a project, though you were responsible for its success, you often had no authority over the resources you needed to accomplish it. You had to convince others to support you because it was the right thing to do.
One year, when I was with the fledgling Internet Business Group, it was my job to get the company’s Internet offerings displayed at trade shows. I had zero budget, but I got us into 150 shows, with recruits and resources from other parts of the company. Rather than ordering people to do what you needed done, you got them to “buy in.” This system, which from the outside looked like chaos, bound us together with tangled threads of interdependence.
DEC turned an abandoned armory in a depressed section of Springfield, Massachusetts, into a manufacturing plant. They hired local people and trained them not just as assembly workers, but as managers, and the plant became an effective and productive part of the overall business. That happened not because Ken said to do it, but because the team selecting the site had internalized his values.
Local managers at a manufacturing plant in Enfield, Connecticut, initiated a team style of work. Everybody on a team knew everybody else’s job as well as their own. They could fill in for one another. They could rotate. And they could take pride in what they did as a team. This was in sharp contrast to the typical assembly line, where work is divided into small meaningless machine-like tasks, to eventually be done by machines.
A rogue computer-design team developed a major product in secret, working on their own time with borrowed resources. Instead of presenting a project plan for corporate approval, they rolled a working prototype into a meeting of the Operations Committee. The DECSYSTEM-2020 was a next-generation mainframe computer that normally would have taken years and significant investment to develop. What they did went counter to the company’s product strategy, which called for abandoning that family of computers in order to focus on minicomputers with a very different design. Yes, computers, too, have families and generations.
No one told those engineers to do this work. They were explicitly told not to. They went ahead and skunk-worked it anyway, without being noticed, much less helped by management.
For them, this was a work of love. They weren’t working for the company. They were the company. They did what they did because they felt it was the right thing to do. They did it with gusto and pride regardless of whether they would ever be rewarded. They were a band of brothers on a self-chosen mission. For them, the difficulty of doing it this way was an incentive. They designed that new computer system in record time, with fewer engineers than was deemed feasible. And they did a great job of it. The Operations Committee approved it, and customers loyal to that family of products were surprised and delighted.
I wrote a story about the DECSYSTEM-2020 development for the company newspaper, but, at the insistence of Legal and PR, I had to rewrite it to create the appearance that management had given its blessing from the start. The outside world wouldn’t have understood a corporate culture that made such a rogue project possible. What felt natural on the inside would have looked chaotic to outside observers. The company’s reputation and stock price might have suffered. So, as historian, I had to modify the facts.
Now, more than a quarter century after the company went out of business, swallowed by Compaq, which was then swallowed by Hewlett-Packard, there are no Legal or PR gatekeepers to stop me from finally telling this anecdote. The DECSYSTEM-2020 was an exception, an outlier. But it epitomized the unique work environment that fostered such initiative and rewarded the team for their results rather than punishing them for breach of rules and procedures.
What I experienced at DEC was very different from the capitalism that Marx described. Ken Olsen reminded me of Robert Owen, the 19th century Scottish industrialist whose utopian values and practices Marx ridiculed as impractical. Owen’s showcase factory was in New Lanark, Scotland, just 13 miles from the castle home of the Lords Fleming (our ancestors). He, like Ken, demonstrated that a work force treated like family and motivated by idealistic values can perform wonders. And the potential yet remains for people to work together creatively rather than mechanically, sharing and cooperating, motivated more by pride in their work than by material gain.
