•You will hear a radio interview between a woman journalist and Michael Dell, Ch

Michael, why does a young, healthy guy like you want to give up such a great job?
Dell: I’ve still got the same job. We run the business together, and we’re going to continue. But I thought it was appropriate to publicly recognize Kevin’s achievements and capabilities. So he is the CEO now.
Rollins: People don’t realize that the way Michael and I have been running the company was irrespective of rifles. We just worried about what needs to be done and who’s available. When Michael talked to me about the CEO job, my first reaction was to ask, "You’re not going to do anything different as part of the deal, right?" I wasn’t interested in having a lot more to do. It’s a big company, growing very rapidly, and it takes two of us to do it.
Dell has just come off another incredible quarter in which every single thing was at a peak — shipments, revenues, earnings per share, net income.
Rollins: Other than during the little dot-com dip around 2000, our quaterly earnings have always been records. It. was actually quite a wake-up call for us in 2000 when we stopped setting records. So we rethought where we were going.
Dell: Back to the drawing board.
Rollins: We set new strategic goals, financial goals, organizational goals, and started our change-of-culture activities, We set up a whole range of initiatives. Michael and I have changed in terms of our maturity about how to run a company this big and sustain growth -- how you become not just a great financial institution but also an organization where people develop. That’s necessary to have a great company at $60 million or $70 million.
Dell: Your people want to build careers. We are starting to manage our cultural elements much in the way we manage operational excellence.
Did you have to change your own behavior?
Dell: We put a priority on it. We made examples of ourselves.
Rollins: We now have a 360-degree evaluation process. Michael and I share the 360 feedback, good and bad, with all our direct reports. They have a free shot at telling us what they don’t like about us and what they think we could do better. They wanted more feedback. They wanted an opportunity to participate more in the decision-making. They wanted us to be more open. We were maybe not as friendly as we could have been in making them want to stay here socially.
Those changes have rippled through the company. How does that fie to Dell’s strategy?
Rollins: Our strategy is the direct business model: bringing great value to customers through a unique and world-class supply chain, customer intimacy, and great support. It’s also the bedrock for our relationships — direct communications. It’s how Michael and I deal with each other. It’s how we deal with our teams. It’s how we expect our teams to deal with each other. It’s how we expect them to deal with customers.
Dell: It’s free flow of information, no intermediaries, no boundaries, fast reaction times.
So you’re sure it’s effective?
Dell: We’ll be looking at much larger markets five to ten years from now than people can imagine today. Think about what’s going on in Asia in the consumption and demand of technology. The U. S. is sort of the prototype for how the world could be massively productive using technology. But the U. S. is only 3.5 % of the world’s population. The opportunity is pretty huge, as we see it.
Rollins: People usually gauge opportunity based on the static idea of what the world sells and buys today. But a few years ago people didn’t think that little desktop computers would lead to the explosive use of digitization in all of entertainment. The same thing is true in the corporate world.
Dell: Small biotech startups with 15 to 20 employees call us on the phone and buy 64 servers, and all of a sudden they’ve got a high-performance computing cluster, and that’s their production engine for research.
On the other hand, IBM has struggled to grow beyond the range of $ 80 billion to $ 90 billion in annual revenue.
Rollins: We’re a little different from IBM. We have the R&D to put together the technology, which is similar, but we also have our sales engine, which is more like a distributed retailer. So people say; "Dell is IBM." Well, not really. "Dell is Wal-Mart." No, not really. "Dell is an Intel." No, not really. Combine all those and you would end up with a new animal, which potential people don’t realize yet.
Dell: What people have never understood is that we’re not like other companies.
While we’re on the subject of lowering cost, what about something highly controversial that Dell does offshoring?
Rollins: We believe in all-shoring, not offshoring. That means you hire where you are and you stay close to the customer. In the past year we’ve added thousands of people in the U. S. , in India, and hi China. If you think that the Indian government is going to let us sell goods in India and have no employees there, no, it’s not. And as you lift the income level of those people, what do they do? They buy technology. Who created that technology? The United States of America. So increasing the standard of living for China and India is going to benefit the U. S.
The manufacturing jobs in the U. S. have gone down, but manufacturing productivity has gone through the roof. I can take you to a factory of ours down the street where productivity increases 30% per year.
How big is the open-source Linux operating system going to be? How important is it in the Industry?
Dell: Linux is the new Unix. Just about every customer we talk to is moving from Unix to Linux. Also, it’s lower cost, because customers can run it on $5,000 servers, as opposed to $50,000 or $100,000 servers.
Rollins: Linux is here to stay, alongside Microsoft, although Microsoft will remain a lot bigger. There’s value to customers in having both.