EDS chief says business fundamentals still apply

The rising death rate of dot-com companies proves one thing, according to EDS chief Dick Brown: Companies can't lose sight of basic business practices if they want to survive.

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LAS VEGAS--The rising death rate of dot-com companies proves one thing: Companies can't lose sight of basic business practices if they want to survive, said Dick Brown, chief executive of computer services and consulting giant EDS.

"Our industry has Comdex 2000:
Back to the future been so consumed with chasing the 'e-space,' we lost sight of basic fundamentals," Brown said in his keynote address Wednesday at the Comdex trade show here. "In the rush to build the next Web site, we missed (the opportunity) to build sustainable companies. We had the glitz, but we missed the guts."

Brown said businesses must focus on establishing trust with their partners, suppliers and customers. They must "collaborate in new ways" through partnerships with other companies and "seek improvement" by thinking ahead of the competition, changing business strategies quickly if needed.

Brown also said companies must eliminate generational boundaries and arm their workers with mobile devices and wireless technology. "There is no Old Economy. There is no New Economy. There is only the Digital Economy, and we must champion mobility," he said.

Brown, whose speech was accompanied by video clips from the movie "The Matrix," said EDS has focused on those key areas to retool its own business. Brown, who joined EDS nearly two years ago after serving as the chief executive of telecommunications company Cable & Wireless, has cut thousands of employees from EDS' payroll and streamlined the company's operations into four units.

The company, which last month was awarded a Navy outsourcing contract worth nearly $7 billion, competes against services companies including IBM Global Services and CSC Consulting.

The Navy deal helped jump-start the old-line services giant's stock price, which had languished because of lackluster revenue growth in recent quarters.

Businesses "are abandoning the Old Economy practices that inhibit collaboration and the sharing of knowledge," he said. "They're enabling relationships, not just transactions. Communities win over individual companies heads down. A start-up cannot even get off the ground today if it can't partner from the get-go."

Not surprisingly, Brown later hawked EDS' consulting services to help businesses retool. "We identify client needs and develop strategies to address those needs," he said. "We're the ones who can pull it all together.

"That goes beyond the providing the hardware and software. It's about providing insights and relationships. In the Digital Economy, hardware and software are meaningless without services."