Turnaround time for Michael Dell

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Those changes appear to have caught Dell off-guard. One of Rollins' goals as CEO was to find a way to make Dell more than a PC company. But in focusing on new products and forging into new markets, the company may have taken its eye off its core business.

Ticked off Dell customers were documenting their concerns all over the Internet in 2004, but the company didn't significantly address the problem until May 2006 when it announced plans to spend $100 million upgrading its customer support. It later announced plans to simplify the customer experience on its Web site with more transparent promotions and a redesign of the page. Dell even launched a blog in hopes of reaching customers more directly.

"Our intention with this blog is to address issues that are important to our customers. Give us some time and we'll prove it," wrote Dell's Lionel Menchaca on the second day of Dell's blog.

Michael Dell

Likewise, PC customers are becoming more concerned with the look and feel of their systems these days, and have little time for boring boxes. Dell recognized this by introducing its XPS lineup of flashy high-end PCs, but did not start overhauling its mainstream units until late last year under a design initiative previously headed by product guru John Medica.

"We are seeing that the product design expectations from small businesses and consumers are becoming more different. It is very likely that in the future we will deliver products that are more tailored to those specific customer expectations," Medica told CNET News.com in November.

Demand for AMD's processors was strong throughout 2005, as the company enjoyed a performance lead over Dell favorite Intel. But Rollins stuck with Intel until 2006, just as Intel started rolling out chips based on a new design that erased AMD's performance advantage. The company adopted AMD much later than the competition, and alienated a long-time partner just as it was reasserting itself.

And Dell's famous cost advantage throughout all those years became less important as the industry shifted to notebook PCs, which are generally built and assembled by third parties in Asia. Dell chose to do much of its notebook assembly in-house, actually creating a situation where its costs were higher than those of its competitors.

Rollins' departure follows a steady exodus of longtime Dell executives from Round Rock, Texas over the past few months. Company veterans such as Medica, small-business sales chief Joe Marengi and Chief Financial Officer Jim Schneider have all left or signaled their intentions to leave following a tough year for the PC company. New executives--many from outside the tech industry--have joined Dell in hopes of injecting new thinking into the company.

Unfortunately for Rollins, however, his ultimate legacy might be the outcome of the accounting investigation. His mantra as the business side of Dell's two-headed leadership team placed responsibility for accounting squarely on the shoulders of both him and Schneider: both of whom are now gone.

Michael Dell was in an enviable position when he announced plans to hand over the CEO reins to Rollins. The company was at the peak of its powers and seemingly could do no wrong. Now Dell gets a chance to add to his legacy with a bid at a turnaround project that was already under way in Rollins' last days with the company.

"The company is going to be invigorated with the change," said Samir Bhavnani, an analyst with Current Analysis. "Even though Michael Dell was around the last two years, he wasn't able to have the impact on the company that he had when he was the CEO. Now he can."

[darix2005]

interesting

nice article

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[johnxtampa]

Maybe NOW they'll build PCs faster...

I know it's a catch 22.... but I don't bother looking at Dell any more because of the very thing that got them all their success in the first place (where they don't make the PC I'm buying until after I order AND pay for it in advance).... it takes too long to get the PC I want... I'll settle for one that's not quite as customized, and get it sooner somewhere else.

[ServedUp]

AGAIN this changes nothing...

Kevin Rollins during his tenure at Dell basically took a back seat.

Michael Dell was always driving behind the wheel. First and
foremost its his company, Rollins was a babysitter at best.

So theres a big hoopla article now that hes suddenly taking back
the CEO position.

Where's the story?

[vm019302]

Maybe this is an acknowledgement...

that Dell isn't doing well and something needs to change. Kevin Rollins may be taking the fall. But you're right -- it's going to take more than an executive shakeup to make a difference. Unless Dell fixes their customer satisfaction issues they're going to continue to slide.

[Norseman]

Could it be...

...that Rollins was close to cutting a deal with Apple to put OS X on Dell machines?

Or--it could be that he WASN'T!

[paulsecic]

Cheap parts

I've read Dell puts cheap parts in it's puters. My last Dell I had the
intergrated sound blew.

[HansinYabutay]

It's Simple: Quality Sinks, Now Stinks

Dell used to rule the waves. You can give a whole lotta reasons why Dell is having problems, but none is more clear than the quality just flat out stinks to high heaven now. Do they buy their hard drives from Somalia? I've had to replace Dell hard drives in my last two (and I do mean LAST) Dell laptops.

Memo to Dell: stop buying crappy components. Stop shafting us. We can very easily take our money elsewhere. It will be a LONG time before I ever even look at a Dell.

You suck, Dell.

[JayWes]

Selling the Second one

I had a Compaq, Compaq stopped selling thru computer stores for a while. I had a Northgate, excellent service, but they left the market

Now I have a DEll. First Dell mixed my order up with another person and was not going to send the upgrade for office. Then I had problems with cold boot; evidently others had the same problem. For 3-years though extended warranty the problem was not fixed by Dell. Guess what on a recent update of the computer, Norton find a registry problem and fixed the problem. Evidently Dell left the Audit Mode in Windows turned on; this was supposed to be turned off prior to shipment. In spite of logs sent, copies of the register the service people did not discover what Norton found.

Selling the first computer to someone is easy, Building a loyal following that will buy additional computers is harder.

I know that us people at home only buy them one at a time, but we deserve help too. I would bet that now there are as many computers at home as at work.

Dell has never replied, to E-Mails that I sent recently to tell them what the real problemis.

[open-mind]

After reading all these comments...

...I think Mike should sell off the company and return the money to its shareholders.

(Sorry, couldn't resist. :-)

Here's my Dell story...

A good friend bought a pretty high end Dell system ... about $2K.

Each time she has a problem, she asks me to help her call Dell tech support, since she can't understand their very heavy accents.

One of the problems was her optical USB mouse. The pointer on screen would sometimes become eratic or jump around on its own. Dell support insisted this was normal or that she was using it on the wrong type of surface. They wouldn't help her, and I got tired of hearing her complain about it. So I bought her a $10 replacement USB optical mouse ... the cheapest mouse I could find! It works perfect.

[Stating]

Weird Problem On New laptop

A friend of mine recently bought a new Dell laptop with Windows XP Media Center. He wanted me to break it in for him. Out of the box, I noticed that the mouse cursor would appear to flicker -- I have never seen something like this. It looked like brief hourglassing. I figured something running in teh background was caausing it. I started disabling XP services that were not part of core operation. At the point where I turned off the XP Media Center Extender service the flicker went away. It seems like Dell should have caught this problem in QA before the laptop went out the door. I can only imagine how many others have thsi same problem and are clueless as to what is going on. God forbid they have to talk to Sunil in India about it.

[Jim Satterfield]

One Semi-Omission

You made one semi-omission, only touching very lightly on bad customer service. Frankly, since they decided to try to focus on selling to business the typical consumer has been shafted, with only large business tech support coming back to the U.S. And the quality of their Indian support staff is pretty darn low. I'm good with accents and I've had trouble making out what some of their support people are saying. In addition if their mastery of English isn't better than what I've seen it's very easy for support and a customer to just talk right past one another, with neither understanding what the other is saying. And this bad service has gotten a lot of publicity with articles here, Business Week and other large circulation publications.

[Stating]

No Mini Form Factor, 5-10 Day Ship

I simply do not understand why in this age of media center PCs, Xboxes, Mac Minis, etc., Dell does offer small form factor PCs, ala Shuttle. Their XPS 210 is still way too big, and too expensive at $1000.

Many people do not want a mini-tower form factor PC in their living room or bedroom. They want something small and quiet that they can put in a bookshelf. The lack of form factor diversity shows a lack of imagination on Dell's part. Also, in this day of instant gratification, Dell's 5-10 day turaround seems an anachronism. You can drive to a CompUSA or Circuit City and have a new PC in an hour. You can even order online and go pick it up at the store in 15 minutes. What could be simpler.

[Hans131]

Dell

After a few month of taking delivery of a Dell PC I moved back to Canada where the Dell developed a problem. The 800 number I was given was trying to help until they found out that the machine was now in Canada which as they said was out of their territory. They gave me The Dell number in Canda
who nicely refused to deal with my machine because it was from the US. The PC now sits in my basement with a large screwdriver through it's heart. My resolve, never another Dell!
Behaviour by compamies of that kind will in time make itself felt to be sure, plus the mouth to mouth word. Thank you kindly for listening to me griepe:) Best regards, Hans H Mueller

[whitiing]

Service Service Service - where is it at Dell?

There service slipped just when folks needed confidence in them to go into new markets not a good time to farm out support! I stopped buying from Dell because of sales support/service and service of the end product both stink now!!

[mjd420nova]

Dell started on the cheap

When Dell first started, he hired the cheapest people, built with the cheapest parts to the cheapest designs. A pattern for a good startup to compete against IBM, Apple and Compaq. He made his money and turned his profits back into the business. Smart, money wise but dumb for the consumer.