Michael Dell needs to get his story straight. He recently said that Dell's (NASDAQ: DELL) sales were doing well in China and the Middle East. Investors should look at that as a good sign.
Now, the CEO of the No.2 PC company says his firm needs to make really big cuts. According to The Wall Street Journal, "The company is imposing a hiring freeze, offering employees voluntary buyouts and asking workers to take one to five days off without pay." The "without pay" thing seems a bit bizarre for a company that is still profitable.
Based on information from last quarter, Dell had $8 billion in cash and made $784 million in net income.
Dell is asking a lot of the people who are still with the company after several rounds of restructuring. The company's founder and CEO is not doing anything to pitch in. Not only is he a billionaire, but according to the firm's last proxy, he made $2.3 billion.
Dell got his company into trouble by overbuilding manufacturing operations. He can afford to take $1 a year so that the people he is asking to do more feel that he is in the trouble with him.
But he did not cut his salary one penny.
Douglas A. McIntyre is an editor at 247wallst.com.
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Reader Comments (Page 1 of 1)
11-05-2008 @ 8:47AM
Virgil Bierschwale said...
Good article..
Thats typical of our new leaders.
The new leader asks you to do the things that they wouldnt do themselves.
The old leader led by example and wouldnt dream of asking you to do something that they wouldnt do themselves.
Makes you wonder what our schools and universities are teaching our new leaders.
Virgil
http://www.KeepAmericaAtWork.com
11-05-2008 @ 9:17AM
John said...
Keep in mind that Michael and Susan pretty much send his salary to support education and health around the world through the Michael and Susan Dell Foundation.
11-05-2008 @ 10:04AM
John said...
www.msdf.org
11-05-2008 @ 2:01PM
RC said...
Don't ask what the company can do for you, but what you can do for the company.
Very JFK, very communist party.
11-05-2008 @ 6:57PM
Charlie said...
Mikie Dell should be ashamed of himself, I guess an over abundance of money really does shrink the mind....if he is unable to live on a paultry salary like some of his employees he should be "Put Out to Pasture"
11-05-2008 @ 11:04PM
ynot said...
I will have you know that Mr. Dell is holding his money so Barack Obama can redistribute it for him. Man, the guy tries to do his part and you jump all over him.
11-06-2008 @ 2:55PM
Beltway Greg said...
Remember that Andrew Carnegie built thousands of libraries but didn't pay his employees enough money so that they could actually take time out to read the books. CEOs who give the money away should be closely scrutinized. They profess to care oh so much about distant lands and far off causes but methinks it may be their own reputations they care about the most. And what was that he said about Apple computer a couple of years ago? Shut it down and return the money?
Beltway Greg
11-07-2008 @ 7:26AM
Sal DiGiacomo said...
When I first started in business in the 1970's with an insurance company, they didn't believe in debt and every week the people who turned 100 had their pictures taken with the check for the amount of their life insurance from the company. I remember the head of accounting going downstairs to take the receipts of the kiosk that the company operated at street level to invest the proceeds overnight. Now, insurance companies give
bonuses to the workers who refuse claims that the bean counters who now run the show determine to be good workers. When I went to college I remember that the Sears credit card I had paid on for 4 years refused to allow me to buy 4 needed tires because it would go over the credit limit of $200 that I had. What happened is that the graduate schools became MBA issuerers without anybody knowing how the company in question worked and full of people who specialized in credit such as the reknowned credit default swap. My oh my!!!!
-Sal DiGiacomo
11-12-2008 @ 10:55AM
dannyN said...
Another poorly written and researched article by one of the worst bloggers ever. The amounts awarded to Dell are in MILLION not BILLION. In fact, if he'd bothered to read the proxy he would see that Dell's salary is under $1M. Still alot of money but not much compared to Financial guys receiving 10's of millions in buyouts for 2 months work. His compensation is half of what it was the previous year. Dell still has $8 BILLION in cash. With a stock price of $11 most of these stock options are useless.