When things go wrong; FoxMeyer Drug took a huge high-tech gamble; it didn't work

Article Abstract:

FoxMeyer Drug Co's $65 million investment in a computer system for managing its mission-critical operations has resulted in the company filing for bankruptcy protection. The company had $5.1 billion sales for 1995, but it was overwhelmed by the costs of the hardware, software and consultant fees involved in the new system. FoxMeyer filed for bankruptcy protection in Aug 1996 and was sold to chief rival McKesson Corp for $80 million in October. The company's parent, FoxMeyer Health Corp, saw its stock price drop from $26 in Dec 1995 to just $3 per share. A 1994 study shows that 31% of all corporate software-development projects are never completed, and they cost two to three times more than expected as well as taking three times longer than estimated. Some of the larger projects, such as the Denver airport's automated baggage-handling system, garner media headlines, but most corporations quietly hide their failures.

Drugs and Druggists' Sundries Wholesalers, Drugs, proprietaries, and sundries, Drugs Wholesale, Management, Pharmaceutical industry, Company systems management, Company process management, Information management, Production processes, Drug wholesalers, FoxMeyer Drug Co.

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AT&T sells on-line unit to Manzi's Industry.Net

Article Abstract:

Industry.Net acquires AT&T New Media Services in exchange for an undisclosed percentage of Industry.Net stock, providing the online service with access to a broader base of potential clientele. Industry.Net CEO Jim Manzi intends to leverage the name-recognition of AT&T's services and the spot that Industry.Net will receive on the AT&T WorldNet at Work Web site. Analysts suggest that the agreement could serve as a springboard to other strategic alignments for Industry.Net. Both AT&T New Media Services and Industry.Net, which Manzi intends to rename Nets Inc, have concentrated primarily on the Web's business market, providing technical information to engineers and acting as a general online network.

Telegraph & other communications, Specialized Telecom Services, Wired Telecommunications Carriers, Mergers, acquisitions and divestments, Telecommunications services industry, Telecommunications industry, Company acquisition/merger, Internet services, Company internet strategy, AT&T New Media Services, Industry.Net

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