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Research

David Goodwin

Digital Equipment Corporation (DEC): A case study of indecision, innovation and company failure

Summary

The minicomputer began a revolution in the computer industry and was influential in the industry for over twenty years until superseded by client server computing and the personal computer. The subject of the thesis is a case study of how DEC, which was number two in the world in 1988, became a takeover candidate for a PC manufacturer in just ten years. It is a business history that considers the decline from the viewpoint of the decision makers and their strategic choices. We examine whether management indecision or technological leadership played a part in DEC’s problems. This thesis considers the part that Schumpeter’s Creative Destruction and Christensen’s theories on Innovation played in the downfall of Digital Equipment Corporation (DEC) in particular his assertion that it was the rise of the PC that was instrumental in the failure. It also considers Schein’s theory of the money gene as the cause of the failure and Saxenien’s view that the east coast versus west coast was at the heart of DEC’s demise. The study uses a variety of sources including interviews with senior technical and managerial employees, archival material and reports to examine the company history, the ways in which it achieved its success, and the reasons for its downfall. It compares similar computer companies of the time, looking at how they either avoided the mistakes that DEC made or how they fell into similar traps.

David Goodwin

Supervisor: Prof. dr. Peter van Baalen

Co-supervisor: Prof. dr. Wout Buitelaar

Dissertation David Goodwin (08-09-2016)