Innovation to order
Published: 01 May 2007 16:03 BST
When Michael Dell announced in February that he was stepping back up to helm the company that carries his name, we said that only radical change would make the move more than a short-term exercise in charming Wall Street.
Three months on and Dell has presented the manifesto for his second term. In an internal memo released yesterday, sent to the whole company and thus to the whole world, Dell laid out a plan hinged on "simplifying IT" for all its customers and embracing life beyond direct sales.
Although addressed to employees, staff were last in the pecking order of recipients. The memo has the grandiose but vague tone of language spun to woo Wall Street and other investors — reassurance that the company has plans to improve but with no risk of true radical departure.
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Unfortunately for Dell, business as usual just won't cut it anymore. As the chief architect of Dell's short circuiting of the sales channel that outflanked the competition in the late 1990s, Michael Dell knows the difference between merely playing at change and change itself. Monday's memo may mark the start of true reform, its carefully chosen wording designed to keep investors calm while Dell redesigns itself. It could just be a collection of platitudes and vague promises.
Talk of "innovating beyond hardware into solutions" is encouraging, and Dell Enterprise Services has made good ground in establishing the company as more than an online box-shifter for several years now. But Dell has little track record in true innovation — famously, it "leverages the entire industry's research and development budget" through its policy of adopting ideas after others have proven them. The memo hints at change here, but makes no promises.
There are areas where Dell can innovate without taking on the challenge of becoming an HP or IBM. System management is crying out for simplification and automation. Whether Dell will invest in the people and time needed to become a true creator here, or whether it's content to buy in what its competitors have built first, will prove to the rest of us whether it's serious about adapting to the new climate — or whether it'll be just a memo in the history books.
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