Changing BOC Relationships with Vendors Mean Large Sales for the Right Suppliers.
In September, U S West's busines consumer products subsidiary--as yet unnamed--announced agreements with TIE Communications, Technicom International and NEC Telephones. And U S West also announced preliminary agreements with Ztel and AT&T Information Systems. The NEC agreement calls for marketing a new information management system.
The subsidiary also will offer some specialized business temrinals from Technicom, and from TIE some larger kay systems as well as digital voice and data systems. In addition, it will offer a PBX from Ztel and the Merlin from AT&T Information Systems.
During the term of the agreements with these companies, U S West Expects to purchase over $100 million in products to serve our customer's communications needs.
Another example is in the purchase of switching equipment for another of our U S West subsidiaries. This one does have a name--it's called NewVector and it will handle cellular mobile communications. Instead of going with the traditional Western Electric switch, NewVector went to a smaller, more economical system manufactured by Northern Telecom. New Vector will put that equipment to work in Seattle, Portland, Denver and in the Minneapolis-Saint Paul area. You might be interested to know that that contract amounted to about $20 million.
The responsibility for purchasing equipment and supplies for U S West, and its three operating companies, will be handled by Bell Tri-Co Services. This is a regional organization--which I head up--and 90 percent of our 1,800 employees will provide procurement services for Mountain Bell, Pacific Northwest Bell and Northwestern Bell. That includes product selection, purchasing and material management--functions largely done by Western in the past.
To date, purchasing agents for Bell TriCo Services have a data base of more than 5,000 vendors to choose from--and they intend to save money and obtain high-quality products smart shopping. Folks at Tri-Co are actively negotiating contracts with vendors--these contracts set the ground rules for purchasing specific products. From Cable to Paper Clips
In short, we figure we can save money by pooling together the equipment requirements for the three operating companies. That gives us greater contract negotiating power because of the large volume of goods involved. We plan to purchase everything from cable to paper clips on a bulk purchase basis.
The Bell Tri-Co operation is simply a matter of practicing common sense and good financial management in achieving a balance of quality, quantity, price, delivery and service--at the lowest overall cost. At the same time you'll remember statements by our CEO Jack MacAllister that U S West is not just a regional telephone company but rather that it owns three operating companies. Tri-Co will function totally under the direction of the three operating companies.
Now, you may ask what will we be looking for from suppliers? I think the answer rests with our customrs. They want flexibility--as opposed to "standard" solutions.
They want products that provide modular hardware and which can be augmented with software. And they want the ability to reprogram theri communicatins from their own location.
What do we in the Bell operating companies need? We need equipment which will help us become increasingly competitive in meeting customer needs at the right cost.
We will deploy new technologies--including digital switching--at a faster level to meet customerhs needs. (By 1986, 90 percent of PNB's customers will have digital technology at their fingertips.)
We certainly need testing systems which will help us reduce costs and improve service.
And we do not want suppliers to forget our existing plant. The supplier who helps us find ways to make better use of our existing network--who can help us exploit the copper wire which leads to every house and business in this country--the supplier who can help us find ways to hold cost down--and to make money--in the smaller cities and small towns of America--that supplier is going to do very well, indeed!
The supplier who understands that our entire business is competitive--and sets out to help us maintain quality, reduce costs, gain more revenue and make money--is the supplier who will do well. We will count on you to analyze our needs, listen to our problems and help us solve our problems.
Certainly, for you suppliers, there is no time like the present. We'll be giving y ou the business.
We're looking for the product that gives us the competitive edge, and you suppliers who help us solve our problems--you are the ones we will look to in the future.
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|Date:||Jan 1, 1984|
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