Will Dell tell CEO Kevin Rollins to take a hike?


As reported in the Red Herring, Dell (NASDAQ (GS):DELL) CEO Kevin Rollins may be made to exit the company in the face of trying times. The report casts no blame on Rollins in particular. In fact, the article is tacitly defensive of him while still expressing that there are issues at Dell that Rollins has allowed to get out of control. It should noted that CEO Rollins has remained steady at the helm while many of the individuals beneath him have left the company in search of a new vessel. It is rumored that many of them have found sanctuary at Hewlett Packard (NYSE: HPQ). I find this indicative of a pattern that has become much too familiar, where a management team runs a good company onto the rocks and then seeks higher ground.

Dell had returned earnings beyond expectations at its last quarterly report. This is believed to have bought some time for Kevin Rollins, but has it given him a reprieve? The analysts aren't saying so. Share holders are expecting something that can be termed a "turn around" for the company. I think possibly a few impatient people are expecting too much too soon.

We have yet to see any big and bold adjustments to the way Dell does business. There seems to be some particular disdain building for Dell's unrelenting grip on their tried and true customer direct marketing approach. I think they had better keep doing business that way because it worked very well in the first place and made Dell what they are today. I agree with many people who say that Dell needs to create a new spin and to find ways to invigorate growth. But in my opinion, they had better not just blow out the old marketing plan just to try something new.

We'll see how the SEC investigation into Dell's accounting and reporting practices goes. We'll see if any of those executives who have fled the company will be made to answer for company ills. We'll see if the investors decide to give Kevin Rollins more time to adjust. Personally I hope they do.

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