Thursday, September 28, 2000

Michael Dell: “Avoiding the Internet no longer an option.”

According to a new “e-census” conducted by the University of Texas only a handful of today’s businesses scratch beneath the surface to use the full potential of Internet technologies. Michael Dell, speaking at Wednesday’s American Chamber of Commerce Leadership Series in Hong Kong, says that’s not good enough. Avoiding the Internet is “no longer an option”. Using online technologies, according to Dell, makes companies more efficient, removes the friction of traditional business methods and increases the velocity of business. Dell’s message was familiar: get into e-business or you’ll be out of business. With over $ 50 Million USD being conducted per day at, Michael Dell knows something about e-business, too.

Everyone knows Michael Dell (in fact I am adding value to one of his computers right now), at the helm of Dell Computers, a company sixteen years old that this year will surpass $33 billion USD in revenues. Worldwide the company has 12% market share (5% in Asia Pacific) and an ROI of 294% that Dell claims comes as a result of integrating the Internet into business. Dell is one of the pioneers of integrating suppliers, customers and the Internet into one chain. The company is on a torrential growth path, and judging by Michael Dell’s wit and passion at Wednesday’s AmCham lunch, there is no end in site.

Creativity lies at the source of all sustained growth. That is a philosophy Dell believes in, too. Dell attributes his company’s success to being a disruptive innovator, claiming his company has been “draining industry profit pools towards more productive means” from the beginning. (At one point Dell quipped, “in fact, we’ve been assisting IBM with the decline of their PC revenues,” as if to suggest Big Blue had hired Dell to do the job!) Dell added that open architecture always wins in the end, even if proprietary technology looks more attractive in the beginning. But the future of the personal computer is intact, for the time being anyway, since Dell claims, “the Internet is only as powerful as the device it gets delivered on.”

So, what is the future according to Dell? Michael Dell claims that wireless technologies and storage are the way of the future. Dell even went so far as to say “the biggest beneficiaries of wireless will be Dell Computers.” Dell explained how wireless data networks pose a tremendous opportunity that will pave the way for VOIP and drive traditional phones to extinction.

“But what about PDAs?” Dell asked the audience, to which he quickly responded that PDAs are extensions of PCs… “Personal computers are not going away.” (So much for my Kiss Your PC Good-Bye Article!)

Managing a company of Dell’s size must be tough in such a rapidly changing environment, especially when the company hired 10,000 staff in the last year alone. To this Dell offered excellent advice for managers and leaders needing to communicate business strategy to their organizations. First, there are plenty of messages to deliver to an organization but prudent leaders only select one or two most important communications. Otherwise employees will hear too many confusing and possibly conflicting messages that could too easily be reduced to the “flavor of the month.” Second, the top messages should capture and focus on the company’s strategy, goals and vision for the year. Third, reflect and reinforce these messages in all management actions. Finally, acclimate employees to new things and change while delivering the top messages.

Responding to the question, “How can Hong Kong become a regional and global leader in e-business,” Dell offered the following advice.

First, focus on education because the educational system is the feeder system for any society’s future. Dell advocated teaching children computer and Internet skills at a very young age, and making the absolute best technology available for those involved in higher education.

Second, “drive as many methods as possible to the technology.” In other words, make the Internet and all related technologies easily accessible. This includes shaving down the cost of access as low as possible to make Internet technologies available to all socio-economic levels of society plus heavy private and public sector investment in infrastructure. Dell even proposed public access to the Internet to increase availability for those who find the Internet out of reach despite society’s efforts to reduce costs.

Finally, Dell emphasized the importance of a “continuous learning approach.” With rapidly changing technology, society needs to be oriented around change with a willingness to learn about the next wave of technology.

Dell’s speech was compelling, refreshing and with 33% growth and 294% ROI, I’d probably be that happy, too! The luncheon speaker also took a moment to acknowledge four Asian companies Dell had invested in:,, TechPacific.Com and

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