How Michael Dell innovates to keep Dell Inc. on the cutting edge
Michael Dell founded Dell Inc. in 1984 with $1,000 and an idea to build relationships directly with computer buyers. In 2010 his company earned $52.9 billion in fiscal net revenue, in a market that is more competitive than ever before.
Dell’s first rule to keeping an edge: failing.
“When you get a business that changes very quickly, you get some of that naturally,” he says.
“You just have to change. To be successful, what you have to do is have an acceptance of risk and you have to be pretty explicit about that, because if you don’t accept risk, you don’t get any innovation. And that means part of risk is you have to accept failure because not everything works.”
Failure can be your best lesson for your next big success. Dell says, “When things are going well, it’s hard to learn because you’re just growing, so you have to make mistakes. One of my guys says I’d rather try to do 10 things and get seven right than try to do five and get five right.”
With the advent of social media, its easier to manage problems with customers. Dell.com has more than 500 million users per year, and 2 billion conversations per year with customers through social media such as Twitter.
Dell’s reasoning for investing time and energy in social media is simple business. “The first thing you have to realize is the conversations are going to happen whether you are there or not, so you might as well pile in and get engaged in conversations and begin to understand,” he says. “What we found, for example, in social media, is it has reduced our time to understand new trends and problems.”
Dell says, “Be willing to take risks and change,” if you want to stay successful. And that means engaging with customers at a whole new level.