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Technology Stocks : Dell Technologies Inc. -- Ignore unavailable to you. Want to Upgrade?

To: edamo who wrote (127111)	5/20/1999 9:20:00 AM
From: rudedog	Read Replies (1) \| Respond to of 176388

ed - yes those were renault engines, and most of the gearbox was renault also. I did a little SCCA racing but long before that (in the 60's, showing my age again...). Lotus ran yellow with green trim. CPQ is about 3-4 years ahead of DELL on the growth curve - they made # 1 in PCs in 1994 and by 1995 they were well into the planning for what happens next. But even then, they were getting 60% of their revenue from "high end" enterprise sales, DELL is still below 20% in that category. CPQ determined to go "up the food chain" into the space occupied by IBM and HP. They have done a good job of developing the capability - both in technology and services infrastructure - but the machine is still sputtering a little, mostly, I think, because some of the key executives were either "Compaq Classic" execs still locked into the old volume PC model, or transplanted DEC and Tandem execs who had years of experience in a high-cost money-losing business and don't understand how to build as a market leader. I think that's why Rosen is being forced to do such a comprehensive house-cleaning. There is strong middle management talent and a clear idea at that level of what needs to be done, but upper management was slow to change. DELL seems caught between wanting to keep the old system running (world's most efficient PC company) and converting to some new model which sustains long term growth. It is of course hard to change a growing and successful business ("Like doing a heart and lung transplant on a guy running a marathon" is how a CPQ exec described it in 1996). But clearly DELL is out of runway. I thought they would be taking bold steps in late 1998 and early 1999 to create expectations in the market and start the cultural change process within DELL but I have not seen the evidence yet. I'm sure they have something in the works. I hope they don't get caught up in the kind of indecision between maintaining current business and changing the model that has plagued CPQ for the last 2 years.