Michael Dell is back to save his ailing company as Dell kicks out Rollins as CEO.
Who’s next on the chopping block for poor CEO performers? Sony’s Howard Stringer or Steve Ballmer of Microsoft? Where does the ax fall next?
The handwriting has been on the wall for months as Dell’s misery grew and performance tumbled. Sales were off, profits were down, market share was down, customer satisfaction was down, the stock was down.
Ultimately, a tanking stock is worse, so Dell said goodbye to CEO Kevin Rollins, replaced by company founder, Michael Dell.
Isn’t he the same guy who said Apple should close down and give money back to the shareholders? Hey, Michael. What goes around, comes around, buddy!!
Dell’s problems were neither unique nor unexpected. Hewlett-Packard’s market share and profits were growing all the while Dell’s were crumbling.
What of other major PC players? Apple, of course, remains highly profitable, with growing market share and revenue, and a more diversified product line.
Sony’s problems have become public with a steadily dropping market share in consumer electronics, a PC battery scandal slashing profits, and less than lackluster performance in the portable music industry contribute to Chairman and CEO Howard Stringer’s woes.
Both Sony and Microsoft’s stock have performed better recently, easing some of the pressure to make changes at the top.
Microsoft’s CEO, Steve Ballmer, and Chairman Bill Gates hit the road recently to launch Windows Vista and Microsoft Office 2007.
Am I the only one who thinks that putting out a product with last year in the title makes today’s purchase of Office seem old already?
What happened to Dell? Only 15-percent of Dell’s business comes from consumers and home users. That means the rest of the revenue comes from business and business isn’t buying as much Dell.
Why? Prices. High performance costs less than ever and Dell provides nothing extra to the hardware they peddle, so buyers look elsewhere. A bad customer service reputation didn’t help.
Another problem is that Dell sells computers online, not in PC stores. Many consumers want to touch and feel before they buy. Perfect evidence of that fact is Apple’s packed retail stores.
Sony is expected to weather their string of recent problems, though Stringer may not. Fortunately for Apple, Microsoft’s Ballmer may also weather his self-inflicted storms as the company’s stock buy back program, and a general increase in the stock market has improved the stock’s performance.
It was just a few years ago that the term “beleaguered” was applied to Apple Comuter, Inc. Today, Apple is just Apple, Inc. and roaring through the marketplace, while beleaguered applies to Dell, Sony, Microsoft, Gateway, Creative, and many other companies competing against Apple.
What happened? Apple stayed focused, disciplined, and continued to innovate in the marketplace, while competition piled miscue upon miscue.
Apple is not without a few problems here and there—iPhone, stock scandal, unrest in Europe over Digital Rights Management, no heir-apparent to Steve Jobs—but the company has never been healthier.
What goes around, comes around. Last year was good for Apple. This year’s risks have taken a higher profile. What do you think could cause Apple to stumble in 2007 or 2008?
Stock scandal? Leopard? iPhone? Legal troubles? Quality control?