Michael Dell Interview

Exceprts from a News.com interview:

Our strategy for development is different than Microsoft’s or Intel’s. Those are ingredient companies. We’re a computer systems company. We have a higher return on R&D than any other computer systems company, about five times the profit for every R&D dollar spent…We only do the kind (of R&D) that benefits the customer. We don’t try to reinvent things that other companies have (invented).

If you look at innovation, it doesn’t just occur in the lab. Comdex is the place you go to show things that nobody knows what to do with, because they haven’t found a market yet. We don’t develop things nobody knows what to do with. We develop things people want to buy and buy in volume. Innovation can occur in supply chain and logistics, manufacturing and distribution, and sales and service. We’ve made computing products far more affordable. If you look at the cost of computers 20 years ago versus now, we’ve caused the whole industry to get more efficient.

Increasingly they’re the same companies in both categories. In the digital home, people want to hook things together. I’ll give an example: If you look at digital cameras two years ago, most had proprietary methods to connect with the PC–special cables, special interfaces. The user said, “Forget that, I want USB.” What’s really winning here is the PC. It continues to be the major point of influence in the use of this information in the home, whether it’s music or pictures. I think you’ll see the same thing happen with video. I’m not suggesting that consumer electronics companies will go away. I’m just suggesting that all companies in this digital home are going to be forced to fit into this framework where consumers want things to hook together.

When you talk to users, you continue to hear the focus move away from memory-processor into other things–video, media, networking. We as an industry have to make our products more reliable, safer, more productive, more entertaining. If we don’t they won’t buy it.


Published by

Rajesh Jain

An Entrepreneur based in Mumbai, India.