Prime cuts 20% of work force, or 2,500 people; action by computer firm renews worry on effect of buy-outs in industry

Article Abstract:

Prime Computer Inc will cut 20 percent of its workforce in an attempt to reduce costs, following the leveraged buy-out of the company by J.H. Whitney and Co. Prime will dismiss 2,500 people in various areas of the company, although half the layoffs will occur in Prime's Massachusetts headquarters. Prime will reorganize its business into four parts: computerized design equipment, minicomputers, service, and international sales and marketing. Customers are worried that Prime's computers will not evolve technologically if the company skimps on research funds. There are few changes planned in the company's Series 50 minicomputer line, although Prime insists that research and development on the line will not suffer financially. The belt-tightening is an attempt by Prime to pay off the bank debt created when the company spurned MAI Basic Four Inc's takeover attempts in favor of J.H. Whitney's offer.

Investors, not elsewhere classified, Human resource management, Layoffs, Layoff, Cost control, Cost Reduction, Reorganization

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John Shields, senior officer at Digital, quits; long-rumored move again raises succession issue at No. 2 computer firm

Article Abstract:

DEC Senior VP John J. Shields resigns, raising new questions about who will be picked to succeed Pres Kenneth H. Olsen. Shields supervised sales, service, marketing and international operations for almost 10 years, and recently he has been blamed for an overly optimistic growth forecast and a decline in customer satisfaction. DEC's net income fell 18 percent in 1988, and sales growth slowed for the second year in a row. A DEC spokesperson reports Shields resignation was voluntary. Olsen has hesitated to name a successor despite being pressed by analysts and consultants to groom a strong second in command and announce a plan. Insiders name Senior VP John F. Smith or Senior VP Winston B. Hindle as jockeying to succeed Olsen. No replacement has been announced for Shields.

Leadership, Digital Equipment Corp., DEC, Executive, Resignation, Olsen, Kenneth H., Shields, John J.

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Ex-Gould chairman James McDonald tabbed as president of Prime Computer

Article Abstract:

James F. McDonald is named president and CEO of Prime Computer Inc. following Prime's acquisition by J.H. Whitney and Co. McDonald does not plan to sell off any of Prime's operations but instead will break them into smaller units to separate the profit and loss reporting. Prime's staff will be trimmed as will research and development funds. McDonald claims Prime's profitable computer service business generates enough money to pay the $150 million a year interest payments incurred by the Whitney buyout and to help fund research and development for Prime's fast-growing computer aided design business. Russell H. Planitzer is slated to become Prime's chairman.

New Appointment, McDonald, James F.

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