UPFRONT Ringing the changes at Dell

Even the world’s most sales and numbers driven organisations can change their ways. At least, that is the message super successful IT company Dell Inc is selling.
Dell VP and managing director of Australia and New Zealand David Miller was in Auckland last month to hoopla the appointment of eight-year company veteran Derek Leitch as Dell’s new country manager for New Zealand.
“Until couple of years ago our people had the impression that they were expendable and not all that important,” he said. “We had this maniacal focus and discipline on execution. Now the fourth strategic initiative is all about people.” Dell has found its “Soul”.
A plunging share price in 2000 and some re-thinking about how to turn US$30 billion business into US$60 billion giant set company founder Michael Dell and, more particularly, its then VP for strategy and now chief executive Kevin B Rollins, on journey of organisational re-discovery. They were laying off people and watching employees lament the dive in their stock options and retirement dreams.
As Rollins has been quoted as saying; “I realised we had created culture of stock price, culture of financial performance and culture of ‘what’s in it for me?’ throughout our employee base.”
And now, says Miller, “We focus more on our people, making sure we have the right people initiatives in place. We had to put our money where our mouth was and lift our management game. We used to base 100 percent of our pay and performance ratings on the question ‘did you hit your number?’. Now it is case of ‘did you hit your number – in the right way?’,” he adds.
Dell now conducts twice-yearly employee survey that asks how the company is doing in meeting the new people-focused initiatives? “The process has shifted people’s attitudes significantly. They are talking about warmer, softer side of Dell.”
According to Miller, the company now talks about and has introduced management evaluation processes that encourage work/life approach to career development. “That kind of dialogue just never happened before at Dell. The question we are all asking is ‘can we make this evolutionary change and not lose the edge that makes Dell so great?’,” he says. “And the answer is yes. We think we are proving that we can soften up the organisation and keep our competitive edge.”
Rollins turned to books to get his thinking straight on what needed to happen at Dell. He immersed himself reading about leadership and dived deeply into the lives and aspirations of America’s founding fathers – John Adams, Aaron Burr, Benjamin Franklin, Alexander Hamilton, Thomas Jefferson, James Madison and George Washington. “I went on journey to read every book about the founding fathers,” he is reported to have said. “I found that their whole mindset of what they were thinking and doing to create the country fitted with what I was thinking and wanted to do with Dell’s culture.” The outcome was speech Rollins wrote for the company entitled “The Soul of Dell”.
The document has become guiding principle for the company, says Miller. And part of that principle is greater focus on Dell’s employees and how they should conduct business and themselves. The KPIs for measuring individual performance have changed. “Where once it was 100 percent focused on the result now it is maybe 70/30 on getting the result the right way,” says Miller. “And I think we will see that continue to shift toward maybe 50/50 measurement of getting results the right way.”
According to Miller employees now have greater ownership of their own career paths and managers are obliged to be supportive of individual’s development and aspirations. “It used to be that managers owned individual’s career path options. That is not the case any more. Individuals now know they have to take ownership of their careers and management is charged with bringing people through.
Talking work/life balance, individuals are, for example, asked if the amount of overtime they do is reasonable? They are then asked if they get support from management in their efforts to balance their work/life. “And the answers need to be yes for the managers who are responsible for these people,” says Miller.
The company has invested heavily in personal and leadership training to deliver Dell’s future. “We knew we could never become US$60 billion business without major effort,” explains Miller. “So we studied Wal-Mart and other companies that had grown successfully and we found the common denominator was people and people leadership. This was the ‘aha’ we had in the company about two years ago and we realised we had to spend more time and more money developing our leaders.”
The company has so far rolled out three training and development programmes, the latest is its ‘Leaders Imperative’. “It is about making sure leaders are equipped to deal with the growth in our company and with style of leadership that will drive the cultural change that we are embracing, such that our people want to stay with Dell and help us grow,” says Miller.