Stubba - I agree completely with your comments. While it may turn out that the current policy will pay off, I would be more comfortable if I believed that the decisions were made after a vigorous dialog in which a range of options were considered - something that seems less likely with Merideth out of the picture.
As far as the impact of cost cutting on the culture, it is really the middle managers that carry the soul of the company. One of MSD's great strengths was the creation of a culture and mission which everyone understood and could articulate. But the recent job actions - which seem targeted heavily at longer-term middle managers - remove the people who understand that culture most intimately.
Compaq also had a strong culture in the early 90's - with less than 50 vice presidents, and about 200 directors who actually controlled all the money and project execution, it was still possible to get everyone who influenced how the company was run into a single meeting. In 1997, Compaq generated well over $1M per employee. The acquisition of Tandem was supposed to take the somewhat old-line Tandem culture and infuse it with that "can-do" Compaq attitude. With 7,000 Tandem employees and 15,000 Compaq employees, that seemed possible - but Tandem had twice as many VPs and Directors as Compaq, so at the middle and upper management level, they outnumbered the Compaq people 2 to 1. The culture meld went the opposite way from what was intended - the management-heavy slow decision cycles and turf protection that was a hallmark of Tandem became the norm at Compaq. Development cycles went from 6-9 months to 12-18 months. The buddy system protected unproductive people and fostered perks and power over execution. The DEC acquisition, in that environment, was madness from a cultural standpoint.
The acquisition folks have been talking about is Unisys - they have a high end product line, a big service organization, and the price is right. I would predict that the introduction of Unisys thinking into DELL would be like pouring sand into the gearbox. That deal would only make sense on paper. UIS has 36,000 employees - the reality of that kind of acquisition would be serious degradation, if not elimination, of the DELL culture. |
