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international workforces by 26 and 33 percent, respectively, to realign our staffing
levels with market realities. Finally, we moved away from our previous focus on exter-
nal growth, making profitability, financial soundness, and cash flow our top prior-
ities. This allowed us to slash inventories and debt, dispose of non-performing
assets, and cut expenses, improving our financial structure and bottom line.
QWhat results did the innovation initiatives launched in 1997 have in 1998?
A The greatest accomplishment of 1998 was the doubling of productivity through-
out our production lines. As we worked to become a more responsive organization,
breakthroughs resulted in more efficient processing procedures. We changed our oper-
ating cycle for production, sales, and inventory management from a monthly to week-
ly basis. In the area of personnel, we implemented a new decision-making and
responsibility structure centered around the business presidents. This decentraliza-
tion of power from headquarters to the divisions has strengthened divisional auton-
omy and decision-making speed, implanting an organizational culture that empha-
sizes simplicity, speed, and autonomy.
7
Forbes Global Business
& Finance named us the
world’s premiere
consumer goods and
services company in
January 1999, further
enhancing our position as
a global player.
“
”
ity video, this VCR interfaces with
TVs and set-top boxes via the high-
speed IEEE 1394 interface. Apr 30
World’s first 256Mb DRAM chips pro-
duced. Manufactured with 0.18-
micron process technology and oper-
ating at 167MHz, an industry first,
the chips are the same size as current
64Mb products. We now have a
one-year lead over the competition
in this chip category. June 18
Alpha Processor Inc. established.
This U.S. subsidiary will handle sales,
marketing, and software develop-
ment support for the 64-bit Alpha
processor line, the world’s fastest.
Strategic alliances with Compaq and
Microsoft are also formed during the
year. July 10 TFT-LCDs capture
No. 1 global market share position. Our
market share shot up 175% over
1997, giving us 18% of the world
market.
Aug 19 Flat-screen TV developed. A
2-year, US$8 million project resulted
in a 29-inch TV that offers zero screen
distortion and a computer-like pro-