Michael Dell is interviewed by Professor David Yoffie in Spangler Auditorium.
Michael Dell rolled into Spangler Auditorium on Thursday October 2 with affability and poise. He has no doubt long since perfected the art of entering a room. Billionaires arguably aren’t short on confidence. They are perhaps short on time. The hour-long interview of the famous CEO by Professor David Yoffie was conducted between the hour hand as precisely as an HBS class. With nearly every answer, Mr. Dell managed to elicit laughter from the audience, proving that you do not have to take yourself too seriously just because you’re serious about your business.
Early in the interview Mr. Dell was asked to look back. To reflect on the time as Chairman that he had to fire his CEO. Would he have done anything differently? “Sure.” After a pregnant pause he told the crowd that for ten years they were growing at 10x, “After some time, even though we were doing well on some metrics – it was time to reflect. big companies don’t change instantly. It takes time to move the ship.” Professor Yoffie then prodded him further, asking if Dell was guilty of getting caught in the competency trap. “That’s very fair. When we were doing much better than our competitors they went back into the cave and came out with a better plan.”
The “cave” was evidently a good place for some of those competitors, namely Apple – which was brought up by the interviewer. Professor Yoffie reminded Mr. Dell that ten years ago, the best advice he had to offer Steve Jobs was to close up shop and give money back to the shareholders. Back then, Apple commanded a fraction of Dell’s sales. Now their market capitalization is some three times Dell’s. “Let’s go back to that remark.” Unshaken, Mr. Dell tells the audience the story behind the maligned quote. He takes us back to the setting: he was at a symposium for enterprise IT professionals. At the symposium he was asked what he would do if he was the CEO of Apple. “I am not the CEO of Apple (next question).” He was asked again. At that point, he was annoyed. He was asked a third time. At that point, he gave the flip response. Perhaps like the video of Coach Bobby Knight’s chair throwing episode, we see evidence of fact out of context. Mr. Dell offered praise for Steve Jobs for the audience’s benefit: “Apple has raised the bar in industrial design. The elegant simplicity of thoughtful design.”
Professor Yoffie further pursued the comparison to Apple, hinting at their success with directly owned retail stores. Mr. Dell wasted no time: “Well you know, an interesting thing happened in the second quarter. A company grew market share faster than Apple. That company was Dell.”
The notion of being a green company was also brought up. Is being green good, or good for business? “Whether you like green (the environment) or green (the money), it’s good.” The CEO segued to job opportunities and challenged the audience: “Come on down to Texas! The temperature outside (~65 degrees Fahrenheit)- You know what we call that in Texas? Winter.”
There were a few minutes for Q&A at the end of the interview. One student asked Mr. Dell how he had become such a sophisticated businessman despite never having studied business. “I did take Macroeconomics. I found it pretty interesting. Whenever I encountered something I didn’t understand, I just dived into it. I like to be curious. I like to think about things. Not in a conventional way.”
I had never heard Michael Dell speak before and did not know what to expect. Platitudes about business process improvement? A regurgitation of facts and ratios that I could download from Dell’s website or the case the RCs had studied just days ahead of the interview? Regardless my expectations, I left Spangler awed by Mr. Dell’s gentility and humility. I felt like he had been in my living room that afternoon- like two old friends talking about the state of affairs over coffee. I also learned the following: It pays to keep things in perspective. Whether your industry is tech, finance, packaged goods or anything else – you can always benefit from a sense of humility as well as a sense of humor. As Michael Dell says: “I learned a lot by making mistakes. Don’t be afraid to experiment. Don’t look for the perfect answer.”