Kemble here is the third, Mort's replacement. So Dell is like a 200 foot sequoia, only growing at a 30% compound rate.
"To me, this is real simple. We took the desktop. We've now taken back the portable business. We took workstations. Now the big opportunity is servers and storage. That's it. If we just do what we gotta do, we'll get to $70 billion." (by the end of 2003 ).
NOTE: This does not include service!
Best,
Mike
dallasnews.com
Vanderslice had to adapt from the culture at IBM
07/16/2000
James Vanderslice
Vice chairman,
Dell Computer Corp.
Q: So were you ready to leave IBM?
A: No, I was not. Someone by the name of John Thompson at Heidrick & Struggles, who has known me for years ... John had tried to get me out of IBM for a number of years, and he said, "Would you meet Michael Dell in New York?" And I said, "It's not going anywhere, John. I'm not interested." And John being John, he's a great guy, he said, "Jim, he's a customer." So I met Michael in New York.
And Michael said, "Well, what do you think?" And I said, "Michael, look. I'm one of the chief advocates for Dell at IBM. So why don't you hire someone else, and you'll have two advocates for Dell?" And Michael laughed, and I went back to Connecticut and Michael went back to Texas. John called me in the next day or two and said, "Michael's very serious. You have to continue the discussion. These guys are very tenacious." I have a great deal of respect for these guys because, again, they are very smart, very committed and tenacious.
Q: And apparently irresistible.
A: Well, I'll tell you, it was a difficult decision. It wasn't all one way, either. It was a difficult decision for me, and I wanted to make sure that it was a difficult decision for them, because even though I think I was their choice, this was an important step for them. So it wasn't all neat and clean. After that first meeting, I met with most of the management team. Believe me, there was no question that I knew I could get along with these people. And Michael, I mean the man is a saint. He's kind of crotchety sometimes, and on the other hand, direct and very tough and thoughtful. At Michael's age, to be so sensitive to the environment and to his people, is amazing.
Q: Did you have to rid them of any preconceived notions they may have had about you as an IBM lifer?
A: I'm sure they had notions and still do. This transition, it's been straightforward and I think I have a lot of the personal attributes that fit here. I would tell you that I'm sure they have concerns about my previous life that probably worries them a bit: "Jim's going to have to adapt a little more to the Dell culture." But those kinds of things are why they brought me here. If I was exactly a replication of a Deller, it's probably not what they had in mind. But I have to tell you, the one I've left out here is Kevin. He in every way has been open in terms of my entry in here. It's really been remarkable. I couldn't believe this three-in-a-box thing at first. When John Thompson said to me, "Well, they have this management structure here with two or three in a box," I said, "Are you out of your mind?"
Q: Why, you thought that was too cumbersome? Or too newfangled?
A: Well, I'm used to an environment where you get the job and you're held accountable. The interesting thing in this is, we all have so much to do. But you know, it's not work. It's in the zone. My wife says I'm in the zone. And so it's a great in-the-zone experience.
Q: How are the responsibilities of the vice chairmen spelled out?
A: We try to cut off all the big pieces as best we can. Obviously, there are different experiences and background that kind of help. I have points of contact. Kevin has points of contact. I have the operations that work for me, manufacturing and most of the development, but that doesn't mean that Kevin doesn't meet with them on a regular basis and get updated. For example, Japan is one of my contact points. Kevin was there last month, and I was in Asia.
Q: Did you know you would be working that closely with him? Or is that something you had to work on?
A: I think we're both working on that a little bit, candidly. I think we're both leaning into the wind a little bit, to over-communicate. I think it's one of those things that takes attention in your mind to make it work. Not that it's bad, it's not bad at all. It's very positive. But you have to be sensitive, and say, "Hey, I better go tell Kevin about that."
Q: What does Kevin bring to this three-in-a-box structure?
A: Kevin is very analytical. He likes to study the numbers, figure out from a market point of view the opportunities.
I'm analytical when it comes to the operation side and getting things done, figuring out when you look at a particular operation, whether it's working or not working and what has to be done to get it fixed. So, one doesn't exclude the other, but together I think we're very much complementary. The delicate thing is that we make sure directionally that we keep everybody in sync.
Q: Is there anything about this company and the way it's positioned now in its development that reminds you of anything comparable at IBM?
A: What I find interesting, a better way for me to look at it, is that I come to work excited and energized.
Q: Every day?
A: I really do. My kids are in their early 30s, late 20s, and they say to me, "Dad, you are so unbelievably blessed to be, at your age, so charged."
I think this company has unlimited opportunities and it goes like this. We have captured Number 1 in workstations. We focused on workstations a short time ago, took it to market with the Dell model and successfully achieved Number 1, knocking out HP and Sun. Now we're after the server market and we're Number 2, adding 10 points of market share in the fourth quarter and five in the most recent quarter. We don't forecast or make predictions, but if we were to grow at 30 percent annually, by the end of 2003 [Dell's fiscal 2004], we'd be a $70-plus billion company!
Q: Dell has had to recalibrate other people's expectations of the company. You can't keep up the 40 and 50 percent growth rates. How hard is it to manage expectations without overselling or underselling the company when the market is so unpredictable?
A: That's a real good question, because I've been thinking about that in my own mind. I think we sometimes get too complex in our messages. To me, this is real simple. We took the desktop. We've now taken back the portable business. We took workstations. Now the big opportunity is servers and storage. That's it.
If we just do what we gotta do, we'll get to $70 billion. I think what we tend to do sometimes, we tell them everything we're doing, and it just fries the brain. Some of those things will work to varying degrees and some won't. But in the base business, we've got enough to generate plenty of growth and plenty of returns for shareholders and exciting work for our people.
Q: Dell wants to be known as a services company, but you're not there yet. And everybody claims to be doing it.
A: What happens is everybody points to the bleachers. I think you have to say: Who does it now, who supports their customers? Who can customize an order? Who can order parts from the Net? We know how to do all that, and by God, I was sitting here today with a consulting outfit that asked if they could take our intellectual property to market because they are so impressed with how we manage our suppliers.
Q: Will you do that?
A: I always look at everything.
Q: Do you think being a successful enterprise has always been about capturing intellectual property?
A: Absolutely yes.
Think about the semiconductor business. For years, there were only a few players. It was like the railroads. Only a few players with capital to invest, and therefore, the intellectual property was generated in those companies. And they were vertically integrated. Now if you look at these big semi foundries in Taiwan, even IBM now, and every shop with two designers and a dog can leap into a multibillion semiconductor facility. Think about what that's done to the world.
I have always thought of the Internet as opening up the intellectual property of everybody and communicating it. Moving the human experience much faster. That's what happens when you get everybody online. You communicate.
Q: How long do you plan to be here?
A: I don't know. Till I'm not having any fun. That's not even the right answer. You know, when I first proposed this to my wife, she literally thought I had fallen off a turnip truck.
I thought I'd never, never work this long. |
