A month after I wrote Dell to exit global smartphone business, now I hear rumors that Dell is going private.
Many years ago I was predicting that an Asian company would buy Dell, but I wasn’t expecting Dell going private.
The Dell story kind of upset me. Dell, which is right on my “backyard”, is/was an Austin darling, used to rule the personal computing world. Today, I am not surprised of what is happening at Dell; I have been saying this for years. The Round Rock, Texas company missed the boat in a major way. You need to understand that this didn’t happen over night. It has been a slow but expected process/result — I am talking about 10 years, which is the same time-period that it took personal computing/Mobile to evolve into what it is right at this moment — just look around and you know what I am talking about: Smartphones, Tablets, personal information devices. This mess all started during the days of Kevin Rollings.
For Dell, Mobile always meant laptops. The company wasn’t able to understand that personal computing was transforming, right in front of their eyes, into the new form of Tablets and Smartphones. Actually, some inside the company did, and they created prototypes and Tablets and Smartphones *but* without a proper business-plan and without proper vision. They thought they were in control, but they weren’t. Then, they couldn’t adapt fast-enough. They couldn’t make it happen; didn’t know how-to. Technology leadership requires vision and investing in R&D — Dell didn’t do either. Then Apple and Google-and its partners all ate Dell’s lunch. It wasn’t a tech problem, but a total lack of vision — a business (management) problem.
Shame on you Dell management.
Rumors say that Microsoft would invest $2 billion on the deal. Good money — but Dell would once again miss to identify root causes. Dell needs to understand that part of the reason it has failed and is failing is truly related to its dependency on Microsoft for all things Software. Dell needs to realize and learn that Software is where differentiation comes from. Software runs the world. It must take ownership and leadership both on software and hardware.
It is no surprise why both Dell and Microsoft missed the personal computing boat — the mobile opportunity. It is a problem with the way of thinking and lack of vision (that is, lack of proper leadership).
As I wrote recently, moving forward, Services and Cloud is perhaps what Dell should focus on, and forget about the rest. The problem is that Dell’s dependency on PC revenue is still at 70%; it is a tough problem to solve.
The new personal computing (aka Mobile) is perhaps too late for Dell at this point. But with the right leadership, anything can happen. If Dell insists on addressing the personal computing market, it must do a re-boot, and bring totally new minds (business and tech) into the equation — something they should be able to do now if they go Private.