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Dell will eliminate 8,000+ jobs over the next 12 months

Last week, Dell announced that it would extend its reach into the retail sector by partnering with Wal-Mart. According to the deal, Dell will provide sub-$700 desktop computers to Wal-Mart and Sams Club locations in the United States, Puerto Rico and Canada.

The move to retail is expected to help Dell expand its business and better compete with #1 PC maker Hewlett-Packard.

"Our strategic intent is to simplify information technology for our customers by removing cost and complexity," said Chairman and CEO Michael Dell. "No other company is as well positioned to unlock value for our customers - empowering them to implement simpler and smarter technology solutions."

The company announced another move today that will help the company cut costs: a 10 percent reduction in its global workforce.

Dell currently has a global workforce of over 88,000 employees and expects to trim more than 8,000 employees over the next twelve months. According to the company, "The reductions will vary across geographic regions, customer segments, and functions, and will reflect business considerations as well as local legal requirements."

"While reductions in headcount are always difficult for a company, we know these actions are critical to our ability to deliver unprecedented value to our customers now and in the future," said Michael Dell.

Rumors of the impending cuts have been looming around the company for at least the past three weeks. "Everyone knew it was coming. I got out of there early, but we knew it had to happen for the company to survive," said one former Dell sales representative who left the company on May 7.

Interestingly enough, Dell witnessed operating income of $947 million USD for Q1 FY2008. This was up from $762 million USD in Q1 FY2007.

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Does this mean less English Speaking employees?
By sapiens74 on 5/31/2007 9:31:03 PM , Rating: 2
I have been routed to Honduras, Costa Rica and India on the same call before being sent to Austin, Texas to get the mattered resolved.




RE: Does this mean less English Speaking employees?
By TomZ on 5/31/2007 11:38:07 PM , Rating: 2
quote:
They work for less money, so your dell computer will cost less.

...or Dell will profit more. I'm not saying profit is bad, however, your implication that Dell simply passes all the savings on to the customer is not necessarily true.


By tacoburrito on 6/1/2007 5:08:07 AM , Rating: 1
Name me a more reliable computer manufacturer that offers the exact same configuration at less than what Dell offers. You won't find it.

To say Dell doesn't pass their own savings on to their customers is bad business. Dell wouldn't become the 2nd largest PC seller if their prices were as high as boutique makers.


By FITCamaro on 6/1/2007 6:58:52 AM , Rating: 2
Uh how about yourself. Except the bottom of the barrel piece of shit Dell (well, they all suck), you can build a similarly equipped computer for the same or less (often less) money.


RE: Does this mean less English Speaking employees?
By TomZ on 6/1/2007 7:30:23 AM , Rating: 2
I agree - I would never buy a PC since they are so easy to build.


By Vanilla Thunder on 6/1/2007 12:05:28 PM , Rating: 2
Just like a house right? Because it's just ridiculous that all of these people buy pre-assembled homes when it's just so easy to build one. And so much cheaper. The same analogy aplies.

Vanilla


By DkFFIV on 6/1/2007 12:55:45 PM , Rating: 3
The analogy is flawed in that it takes requires far less time and skill to build a house compared to a computer.

Spending a day reading a how to guide, another day planning and purchasing parts, and a third actually assembling the computer can result in overall savings, depending on how much you value your own time.

Not saying that building is for everyone, but if the user intends to use his/her computer for more than just music, WP, and the internet, he or she probably has enough interest that learning how to build a computer would be beneficial.


By TomZ on 6/1/2007 6:26:36 PM , Rating: 1
quote:
Just like a house right?

If I could build a house in a couple of days, I would do that too. I don't get your point.


RE: Does this mean less English Speaking employees?
By TomZ on 6/1/2007 7:29:16 AM , Rating: 2
quote:
Name me a more reliable computer manufacturer that offers the exact same configuration at less than what Dell offers. You won't find it.

How about HP and eMachines/Gateway. That's two.


By FITCamaro on 6/1/2007 9:04:11 AM , Rating: 1
eMachines shouldn't even be rated as computers. They're even cheaper pieces of crap than a Dell.

Gateways have gone up in quality lately. I have a Gateway at work with a 22" widescreen LCD and its a nice computer. Yes I could build a better one than what my company paid for it but it still seems to be a quality built PC thats nice and quiet. The monitor is especially nice. 1680x1050, 8ms response time, DVI w/ HDCP, VGA, Component, and S-Video connectors, rotate and tilt adjustments. The only bad part of it is the Gateway logo can take over a minute to go away when you turn it on unless you press a button.


RE: Does this mean less English Speaking employees?
By Moishe on 6/1/2007 8:30:32 AM , Rating: 3
hate to break it to you, but Dell ain't what it used to be and while their prices are great at the lowest end, they go up really fast at the mid and high end.

In Feb 2007 I and my friend both bought computers. He bought his from Dell and I built mine.
He got an AMD X2 3800+ w/ 1GB, every component low end and relatively crappy for around $500. I paid $900 and got C2D E6300 2GB and high end parts all around. You may think, wow this chump just paid $400 more... Well I priced Dells at the same time and the extra 1GB ram was $130 more, the C2D was $80 more, I also got a 7600GT which Dell didn't even offer on any low end machine.

Dell didn't offer me the choice of a low end machine with a few high end parts. It's either low end all the way or high end all the way (making the price very high). None of this even takes into account that I have quality parts from reputable name brand companies and the Dells low end stuff are no-name, who knows what the specs are, etc. My ram is faster, I got a nice case, extra case fans, a nice PSU, a nice CPU fan, a quality Mobo, faster ram (800 vs 533 from Dell), and with my setup I was immediately able to overclock to 3Ghz without extra cooling. I can play all the latest games and my friend cannot.

So yes, Dell will ALWAYS win if you're comparing the cheapest Dell machine to the cheapest self-built machines. BUT as soon as you click "customize" on Dell's site and start adding things you quickly realize that the prices rise quickly and your choice of components is very limited.

If you're looking purely at price, Dell looks great. If you want an email and internet machine for Mom Dell is great, but don't expect a quality machine from Dell. As soon as you move to mid-range specs, Dell starts to become even with Newegg prices, and on the high-end Dell cannot compete with Newegg.

As a disclaimer, I KNOW that I'm a techie and grandma cannot build a PC. But we're talking about price and how Dell supposedly builds amazingly good machines for such low prices. This is BS. Dell machines are "good enough" for super low prices. They're "good enough" for grandma, for email and internet. They're NOT good enough for gaming or anyone who wants performance.


By Schrag4 on 6/1/2007 10:12:25 AM , Rating: 2
I think you guys are all missing the point. You're a techie, and you game. Dell wouldn't mind selling to you, but you're not who they're really after. You mentioned that they're '"good enough" for grandma, for email and internet', and I would say they're EXCELLENT for grandma/email/internet. I had to replace my mother's aging computer that I had built (6 years ago), and the Dell I got was WAY cheaper than anything I could have built. Not only that, but it's extremely quiet too, which I could not have offered at bottom of the barrel prices. It's no gaming monster, in fact, I consider it a slow machine. However, it's neat, clean, and quiet, and it does email and internet (and whatever else Mom does), and it costed her next to nothing. I don't regret recommending that machine. Oh, and even though she has 2 techie sons, neither one has time to build PCs for relatives (we barely have enough time to build our own machines, with small children and all).

I hope you got my point though. They do sell high end systems, but I'm guessing the vast majority of their sales are on bottom of the barrel PCs, because they're more-or-less easy to order and setup, and they cost so little. You can't come close to the price if you build one yourself. You'll always just build your own PC, but you must remember that you're in the minority. Yes, this is a techie site, so most people here can build their own monster PCs for fairly cheap, but that's not what Dell is about.


By skaaman on 6/1/2007 12:35:41 PM , Rating: 2
quote:
but I'm guessing the vast majority of their sales are on bottom of the barrel PCs, because they're more-or-less easy to order and setup, and they cost so little.


You are on track. Always to much techie flaming going on. You are correct that the vast majority is the low to mid system range, but remember, that majority applies to only the 20% of revenues that come from the Consumer market. 80% of Dell revenue is still generated in the SMB, Mid and Corporate business world and there aren't to many gaming systems going into those channels. FWIW...


Great!
By night2004 on 5/31/2007 7:31:37 PM , Rating: 1
So does that mean your already poor customer service is going to get better or worse?




RE: Great!
By kknd1967 on 5/31/2007 7:34:37 PM , Rating: 1
same poor CS. But you now need to wait on the phone line longer.


RE: Great!
By night2004 on 5/31/2007 7:36:45 PM , Rating: 2
Well, I guess they'll probably loose more business as a result too. I'm already thinking about canceling one of my current orders because it is in backorder...


RE: Great!
By Comdrpopnfresh on 5/31/2007 8:27:01 PM , Rating: 2
Actually this is a result of them going retail. They'll increase the outlets from which they can sell, earn some market share, and be able to lay people off. Its a bad thing to do to employees, but it makes sense in the cold business world.
I'm interested to see what the top-tier manufacturers like Dell will do when Barcelona comes out. If it is a direct competitor with Intel's core (please just take this hypothetical situation rather than arguing this...) will AMD move out of the budget systems provided by the companies? Will one be offered above another? Maybe they'll be equal (before Alienware was bought by dell they used to start off a system customization by letting the customer choose AMD or Intel). If Barcelona outperforms Core, then AMD being accepted by manufactures (because of the impending monopoly suit against Intel) may be a bad thing.
If it is being sold by a company like Dell, AMD cannot do anything about their higher performing chips being sold in worse or lower configurations than those featuring Intel.


RE: Great!
By night2004 on 5/31/2007 8:54:50 PM , Rating: 2
Well, what ever they are doing it is already affecting the company. Right now, I'm on the Dell forums speaking with a few people who have ordered monitors and are still waiting almost a month later. Someone screwed up the supply side of the line...maybe he/she will be one of the 8,000+ cut?

In the meantime, I'm going to re-evaluate my decision to purchase that Dell monitor. I have the time to check them all out again as my order has already been delayed once.


RE: Great!
By skaaman on 6/1/2007 12:55:46 PM , Rating: 2
It really looks like two questions here. AMD screamed out of the low-end market with their Opteron servers. It wasn't that long ago that Intel was singing the blues and Dell was getting it's butt kicked for not being able to offer it to their largest customers. Intel core has now supplanted the opterons as the business pack leader and they seem to have righted their ship. AMD will counter with barcelona, and I expect it to be a spectacular chip. I think the low end AMD systems offered by Dell was a throw the dog a bone appeasal more than anything else. Dell (if anyone) was certainly privvy to the core roadmap, but it took to long to come to market and market conditions forced the AMD hand. In the end, it may work out for the best as they can now offer the best of both worlds, whichever it happens to be.

Barcelonas biggest challenge will be price and Intels move to 45nm. It will be superior in a number of areas, but the business customer will be the deciding factor in it all. The scary part is AMD needs results quickly.


By Oxygenthief on 6/1/2007 5:33:59 AM , Rating: 2
I am sure they are all great people there but if I can't understand someone's broken english its not good customer/tech support.

If Dell wants to hire someone from Mali, India, Iraq, or some other god forsaken place to build components or systems I could give a rats ass. As long as the component or system did what it was supposed to who cares right?

Now take that same mentality and apply it towards Dell's current tech/customer support system. I, along with most others, cannot understand half of what is said over the phone. Thus it is not a very good service being provided. And we aren't talking about mom and pop customer/tech support, we are talking about tier 1 support here.

Would anyone accept a system that had half its components damaged upon delivery??? NO! They would RMA the POS back to Dell. Let's hope Dell has finally conceided to the thousands of complaints on this issue.




By TomZ on 6/1/2007 7:32:03 AM , Rating: 2
quote:
I am sure they are all great people there but if I can't understand someone's broken english its not good customer/tech support.

I noticed on Gateway's site the other day that they say they have all US-based support. I thought that was interesting.


80% Commercial
By Brovane on 6/2/2007 9:42:39 PM , Rating: 2
80% of Dell's business comes from businesses. Home users is only a miniority part of Dell's business. From the commercial side I have been overall very happy with Dell's business machines and servers. Basically the real money is selling to Businesses not home users. From me personally I use nothing but Dell at home myself. With 4 year warranties with complete care and two young children in the house no worries on my part. I think when some people compare prices they forget to add in the warranties that Dell can offer. Is Dell perfect no, but no computer company is either. Overall Dell's manufacturing process is incredible. I went on a tour of there manufacturing facility in Round Rock and I was very impressed with there efficiency of production. It is incredible what you can do with only 200,000 sq/ft of factory floor.




Cost Complexity
By wallijonn on 6/4/2007 11:59:38 AM , Rating: 2
quote:
"Our strategic intent is to simplify information technology for our customers by removing cost and complexity," said Chairman and CEO Michael Dell.


How is it that if you buy directly from a manufacturer that you have to wait weeks for a rebate? Why not do away with the complexity by just reducing the price right on the website and foregoing rebates entirely?




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