A Report On A

Business Leader:

Michael Dell

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Letter of Transmittal

March 27, 2016

Khondokar Asef Safa Kabir

Department of Management

Senior Lecturer

North South University

Subject: Submission of informational report on Michael Saul Dell.

Dear Sir:

This is to inform you that we have completed the “Biographical Analysis on Michael Saul Dell”

that you had assigned us for the course MGT 321 for the semester of summer 2016. In writing

this report, we have followed the guidelines that you have given us in the class. We have also

applied relevant concepts that we have learned throughout our course like personality traits,

leadership style, and success factors. The contents here are all of our own, although some

information and references have taken from different sources to improve the report.

We sincerely hope that you will enjoy reading the report. We will be very glad if the report can

serve the real purpose and very much eager to clarify any inconsistency that may appear.

Sincerely Yours,

Mustafizur Rahman

Abu Sayeed Chowdhury

Shubhajit Mazumder

Md. Arman Biswas

Somaiya Nuri Era2

Table of Contents

Introduction.................................................................................................4

The Success Factors..................................................................................6

Individual Level Factors........................................................................6

External Factors.....................................................................................8

Personality................................................................................................8

The Myers-Briggs Type Indicator..........................................................8

Source of Michael Dell’s motivation......................................................11

Decision Making Style............................................................................12

Analysis of leader’s / Manager’s Organization:.....................................14

Communication.......................................................................................15

Communication method:......................................................................15

Leadership Style.....................................................................................16

Transformational Leadership-..............................................................16

Quotes by Michael Dell..........................................................................17

Conclusion..............................................................................................18

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Executive Summary

The main purpose of this report is to analyze how OB theories are implemented in practical life

by reviewing the characteristics of a successful business leader. A thorough research was

conducted and different types of journal, books, websites and external factors are taking into

consideration to see if the learned OB theories align with the story of a successful business

leader. The results show that learned OB theories are very much present in the making of a

successful business leader. The report concludes that theories are very much underestimated in

the today’s world where it is literally ever-present in the making of a successful business leader.

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Introduction

The report is about the biographical analysis of Michael Saul Dell (born February 23, 1965), an

American business magnate, investor, philanthropist and author sum up to a successful business

leader of the present time. It will first consider why he is famous, how he implemented OB

theories in the real world scenario. Then it will go on to describe his success factors, personality,

sources of motivation and decision-making style. Then it will cover the analysis of his

communication process, organizing style and leadership quality. He is famous for founding Dell

Inc. one of the world’s dominant sellers of personal computers (PCs). He is the acting CEO of

the company. Michael Dell born in 1965 in Houston, to a Jewish family. His parents were

Lorraine Charlotte, a stockbroker, Alexander Dell, an orthodontist. He attended Herod

Elementary School in Houston. He wanted to enter the business world early. So when he was

eight he had applied for high school equivalency exam. In the early days of his life, he basically

invests all the money in stocks and precious metals that he earned from part-time jobs. When he

was 15 years old, he bought his first apple computer and started disassembling it to check if he

really can put it back all together. In his high school time, he got a job of selling newspaper

subscriptions and as he was apt in data research skill he discovered a market that was waiting to

tapped. From that market, he earned $18,000 in a single year. With that money, he bought a new

computer and a BMW to reward himself. He started a small business with that remaining money,

selling computer disk drives out of his dorm room. There was a difficulty for the consumer, they

could only get their desired product at a retail store. Moreover, features of those had no

customization, things were dictated by the manufacturer. His starting investment was $1000 and

soon he registered his business with the Texas. A small advertising and promotion brought him a

large customer base on his campus due to his advantage in quality and pricing and contract from

outside also followed quickly. Within a month, he moved out from campus, rented an apartment

and filled with computer parts and assembled new computer parts from scratch at the least cost.

By spring his venture had monthly sales of $80,000. From then he started to run his business

full-time by quitting the study. He pioneered selling personal computers through telephone order.

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IN 1986, his company named PC’s limited was offering the first toll-free technical support

service. Later computer industry followed his footsteps by implementing his idea. As his

business growing at a fast rate, Dell continued to keep the same offer, a discount of 10 percent

below his competitors through Just in time (JIT) supply practices. Dell purchases parts after the

order and only assembled product for urgent delivery. Implementing JIT supply practices Dell

had no inventory to store so they could pass the savings on to its consumer and had an edge in

the computer industry. In 1988, they took the company public and changed its name to Dell

Computer Corporation. Not surprisingly the business went global; it raises $3o million in its

initial public offering. They made partnership and subsidiaries in Europe, Asia, Australia and

Latin America. By 1992, a huge milestone achieved. Dell computer had entered the Fortune 500

list of the world’s largest company. He was 27 and already he was the youngest CEO ever to run

one of the 500. Dell Company. In July 1996 Dell filled its first online order, the business world

was not convinced about online sales. But Dell website proves the community otherwise by

selling 30 to 50 computers a day without any sort of promotion. By the end of the decade, the

online sales were $18 million. Dell Inc. had become the most profitable personal computer

manufacturer in the world. In 2004, Michael Dell stepped down as CEO while continuing to

serve as Chairman of the Board. At the age of 40, his net worth was at close to $20 billion. In

2005, he was the fourth richest man according to Forbes magazine. Michael Dell stepped down

and focused on doing philanthropic activities. On the other hand, the company missed his

presence. It had fallen into the number two place in the industry. Michael Dell returned to the

company as CEO in 2007 and started working to reclaim its place in the market. Dell introduced

Inspiron 8000 which was the most powerful notebook at that time. Much of time they were

dependent on telephone and the internet but Michael Dell adapted to the changing environment.

Dell began to start doing business with national retailers like WAL-MART. They also entered

into the huge Chinese market. They want to be less dependent on Microsoft Windows and Intel

Microprocessors so they produce personal computers that support Linux and other operating

systems. The result was $60 billion sales in the year of 2008, a new milestone. In 2008-2009, an

unforgettable recession took everything down. Manufacturers also took the hit but when the

economy recovered no one wants to buy personal computer anymore. Consumers were more into

smart phones and tablet computers. For the first time in a decade, PC sales fell and Dell felt the

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hit along with many of industry giants like Microsoft, Hewlett-Packard. Michael Dell wanted to

implement a new strategy to thrive in the market again. He took the company private again. Dell

Inc. was a public traded company for nearly 25 years. Michael Dell had a 16 percent stake in the

company and remained as an acting CEO. IN 2015, Dell took a huge decision. They bought

computer data storage provider EMC for approximately $67 billion. That was identified as one

of the biggest takeover ever. This deal makes Michael Dell CEO and Chairman of two

companies simultaneously. Everything was not so smooth for him, in 2010, he had to pay $100

million to settle charges of accounting fraud. Dell computer had misled investors about its real

earning.

The Success Factors

Individual Level FactorsIn every leader in the making, there are a couple of turning points which dictates their ultimate

destiny. The road to glory often depends on a couple of factors as we learned from OB theories

like heredity, ability, and learning. Heredity plays an important role in the success of Michael

Dell. He comes from a Jewish family and his parents want him persuade Medicine study but he

was always passionate about the tech industry. The business leader works hard than most other

people to build a start up. They don’t complain about work/life balance because they have a real

passion for their work so work doesn’t feel like work to them. Work energizes them. It might

seem crazy to work those long hour but for them its fun. Michael Dell’s father had an adding

machine. When he was a child, he types some equation in them and the machine made some

interesting noises. After sometimes the results came out. From that time he was hooked on

technology. There are a couple of abilities that makes Michael Dell distinguished from all the

other mediocre business leader. They are courage, vision, persistence, confidence, self-assurance,

Conscientiousness and obviously emotional stability. He had the courage to pursue his dreams in

the tech industry. The difference between a business leader and a guy with an idea is action. To

act you need courage. He earned $1000 from his part-time job but he didn’t fear to invest in his

dream. Although at that age to invest such amount of money in a start up which was never 7

tapped was a really big gamble but the gamble paid off. But the gamble paid off and it didn’t

happen overnight. By following his intuition and persistence he overcame all the obstacle.

Everybody was unsure about online sales of personal computer but he understood what the world

wanted. He started selling online and by the end of the decade, 18 million personal computers

were sold online. Everyone loves customization so he wanted to know what the final say of the

consumers. He gives the power to the customer to install their own computer. Persistence is all

about self-assurance. More or less it is a common success factor for all the business leader

around the world. There are ups and downs in every business. So when a business leader is

taking the hit, he has to be strong. He needs to believe in his idea more than ever. In 2008-09

recession hit everywhere, the sales of personal computer went down. But it isn’t the end on the

top of that when economy recover from that rescission people were more into smart phone and

tablet computer. That’s the time when persistence of a business leader is tested and Michael Dell

passed it successfully. He didn’t give up and formulated a new business strategy to match the

customer demand. He took the Company to private, a tech company Silver lake joined and they

bought data storage provider EMC to cope up with the changing nature of tech industry. Michael

Dell stepped down as a CEO once and that’s when they lost the market. He had the confidence

that he could reclaim the top position and took Dell where it belongs, top of the ladder. He

returned as a CEO, analyzes the consumer demand and formulated strategy which he calls

‘Direct Calls’ which means listen to the final word of a consumer to give the customer-focused

service. Overall individual level factors are very much present in the success factor in the making

of a successful business leader

External FactorsIndividual level factors are much more visible since external/environmental factors are very

much invisible but they are as influential as the first. Dell was founded on an easy concept which

by selling directly to customers. Dell’s mission statement tells us Dell is much more focused on

globalization, rapid change, diversity, and innovation. Michael Dell made the decision according

to his company goal, objectives, and action plan. Technology and telecommunication industries

were changing rapidly and Dell understood the market and made an immediate decision that is

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risky but worth it like acquiring data storage provider EMA for $67 billion which seems a huge

amount of money.

Personality

The Myers-Briggs Type Indicator

The Myers-Briggs Type Indicator (MBTI) is the name simultaneously used for a theory and a

measure of personality types, based on a typology introduced by psychiatrist Carl Jung in the

early 1900s. It characterizes people by their attitude toward the inner and outer world,

extraversion and introversion, and by their cognitive preferences, either perceiving or judging.

The perceiving preferences describe how we take in information either through our senses, called

sensation, or intuiting stuff, called intuition. The judging preferences describe how we process

information using logic, called thinking, or a more emotional way through feeling. The last

preferences, called judgment and perception, refer to whether we use a judging or perceiving

function to deal with the outside world.

Michael Dell, is reportedly an introvert. Many of those under Dell thought him to be impersonal

and emotionally detached which is something very common with introverts. It seems that

Michael Dell processes information logically, and takes step as par to that.

Big Five

The five factor model popularly known as the Big Five is a taxonomy aimed at covering most

aspects of personality. It claims to do so with five major factors – Extraversion, Neuroticism,

Conscientiousness, Agreeableness and Openness.

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Two of these five traits are pretty apparent in Michael Dell, agreeableness and openness. He

listens to his employees and helps them to have a vision that contributes to the success of the

company.

Emotional Intelligence

For leaders, having emotional intelligence is essential for success. After all, who is more likely to

succeed – a leader who shouts at his team when he's under stress, or a leader who stay in control,

and calmly assesses the situation?

According to Daniel Goleman, an American psychologist who helped to popularize EI, there are

five main elements of emotional intelligence:

1. Self-awareness.

2. Self-regulation.

3. Motivation.

4. Empathy.

5. Social skills.

Being an introvert, Michael Dell has shown remarkable promise in this perspective. His

involvement with all the stakeholders of the company indicates that.

Type A Personality

It is a temperament characterized by excessive ambition, aggression, competitiveness, drive,

impatience, need for control, and focus on quantity over quality and unrealistic sense of urgency.

Typical responses of TABP include:

Competitiveness

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Type A individuals tend to be very competitive and self-critical. They strive toward goals

without feeling a sense of joy in their efforts or accomplishments.

Interrelated with this is the presence of a significant life imbalance.  This is characterized by a

high work involvement.  Type A individuals are easily ‘wound up’ and tend to overreact. They

also tend to have high blood pressure (hypertension).

Hostility

Type A individuals tend to be easily aroused to anger or hostility, which they may or may not

express overtly. Such individuals tend to see the worse in others, displaying anger, envy and a

lack of compassion.

When this behavior is expressed overtly (i.e. physical behavior) it generally involves aggression

and possible bullying (Forshaw, 2012). Hostility appears to be the main factor linked to heart

disease and is a better predictor than the TAPB as a whole.

Michael Dell does not fall under this category.

Proactive Behavior

In a business, when the manager is delving into figuring out future incidents and takes necessary

steps needed to deal with those incidents, he is a proactive manager. Michael Dell is a

transformational leader, thus, proactive.

The reason why he is such a popular personality is the Michael Dell leadership style.

Michael Dell leadership style is a transformational one. He is a role model, does the things he

speaks of and is a hands-on leader. But he doesn’t come across as authoritative or as someone

who would simply let his decision known and others would have to fall in line. In independent

reports published by research firms and surveys, Dell Inc. has consistently featured as one of the

best places to work. There are two primary reasons for that. One, Dell Inc. has a lucid and caring

open communication system within the company. Everyone has the right to speak out and what

is being spoken, shared or shed light on, is seriously taken into consideration by Michael Dell

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and his board, in other words the senior management. Two, Dell Inc. has active participation of

Michael Dell who takes up the task of inspiring the employees of the company, to allow them the

freedom to achieve their fullest potential and he makes everyone feel cared for and important,

right from the junior most executives to the customers and distributors.

Michael Dell leadership style is unique because he cares for all and sundry. He treats his

distributors with the same care as he does with his customers and the employees who are being

paid get the same respect and attention that customers who are paying the money get. It is this

unique environment and the precious principles that have been put in place at Dell Inc. because

of Michael Dell leadership style.

Source of Michael Dell’s motivation

"You don't have to be a genius or a visionary or even a college graduate to be successful. You

just need a framework and a dream."-Michael Dell

What inspires and motivates a man with a vision? What makes one aim for higher grounds?

According to Michael Saul Dell, it’s a dream and structural thinking that drives success. Just like

every other success people, he started with almost nothing but the ideas in his head. Michael

Dell wasn't the only young entrepreneur to ride the computer boom of the late 1980s and early

1990s from rags to riches. Like Rod Canion of Compaq and Steve Jobs of Apple, Dell turned a

fledging start-up into a multibillion-dollar computer empire. But unlike the ill-fated Canion and

Jobs, who lost control of their creations as they grew, Dell has managed to hold on to the reins

of his maverick venture and achieve the unique distinction of being the computer industry's

longest-tenured CEO.

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Locke’s Goal-Setting Theory Reflected In Michael Dell’s

Style of Leadership

We can see a strong reflection of Locke’s Goal-Setting Theory in Michael Dell’s life and work

style. The key features can be discussed as following:

1. Michael Dell is a very committed guy, when he created a plan, he’ll pursue it with full

strength. Knowing what you want in your life is one of the most important success

strategies that you must adopt. If you don’t know what you want to achieve in your life,

you’ll never achieve it. First set your target, then keep on pursuing it. Just like what

Michael Dell did at the age of 19, he planned his life and set his goals to achieve higher

success. (Specific and difficult goals, with self-generated feedback).

2. His business idea was fresh because he assembled all the computers according to his

customers’ preferences and started to sell those directly at a comparatively low price.

He was the first to introduce the direct sales method in the IT industry. The direct sales

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Higher Performance

Increased Confidence

Higher Self-Set Goal

Given Hard Goal

clicked and there was huge demand for computers. (focus, direct attention, difficulty

that increased persistence)

3. Just like any successful people, Dell kicked off small. Most of his orders were placed

through his close people like friends, who used to spread the word around. And by

steadily developing his business, he moved to a small office and hired a few people to

take orders and upgrade machines. (Goal commitment, Task characteristics).

Decision Making Style

Types of decision making:

1. Programmed decisions: routine, almost automatic process.

- Managers have been made decision many times before

- There are rules or guidelines to follow.

- Example deciding to reorder office supplies.

2. Non programmed Decisions:

- NO rules to follow since the decision is new

- These decisions are made based on information, and a manager’s intuition and judgment.

- Example should the Dell invest in a new technology? 14

Eight steps of decision making process:

1 Identifying a problem, my sales reps need new computers?

2 Identifying decision criteria – memory and storage, display quality battery life, warranty.

3 Allocating weights to the criteria.

4Developing alternatives – Toshiba, Sony Dell, HP etc .

5 Analyzing alternatives –Toshiba, Sony, Dell, HP etc.

6 selecting an alternative

7 Implementing the alternative- HP

8 Evaluating decision effectiveness.

Couple of decision making styles are followed:

1. Decision Making is the act of choosing between two or more courses of action.

(However, it must always be remembered that there may not always be a 'correct'

decision among the available choices).

2. Effective Decision Making Decision making can be defined as the process of making

choices among possible alternatives. The skills considered important to effective

decision making are based on a normative model of decision making.15

3. Stages of Decision Making 1. Listing all possible solutions/options. 2. Setting a time

scale and deciding who is responsible for the decision. 3. Information gathering. 4.

Weighing up the risks involved. 5. Deciding on values, or in other words what is

important. 6. Weighing up the pros and cons of each course of action. 7. Making the

decision.

4. Dell is largest seller of computers. Michael Dell is the founder of Dell. Dell is ranked 51

on the Fortune 500 (2013) Starting Business from $1,000 (1984). Employee: 108,800

Michael Dell

5. This company history is full of interesting developments. And we couldn't help but pick

out a few of our favorite milestones to share: 1984 at the age of 19, Michael Dell found

PC's Limited with $1,000 and a game-changing vision for the technology industry. 1988

We complete our initial public offering, raising $30 million and increasing market

capitalization from $1,000 to $85 million. 1992 Dell debuts on the Fortune 500, making

Michael Dell the youngest CEO on the list. 1996 Dell.com launches, generating $1

million in sales per day just six months after site is live.

6. 2001 Dell becomes the No. 1 computer systems provider worldwide. 2005 Dell tops the

list of "America's Most Admired Companies" in Fortune magazine. 2010 Dell is ranked

the No. 1 healthcare information technology services provider in the world according to

Gartner, Inc. 2013 Michael Dell and private equity firm Silver Lake Partners buy back

Dell from public shareholders to accelerate our solutions strategy and to focus on the

innovations and long-term investments with the most customer value.

7. Dell plays an important roles for their decision making.

8. Financing of Dell, Revenue US$ 56.94 billion • Operating income US$ 03.01 billion •

Net income US$ 02.37 billion • Total assets US$ 47.54 billion • Total equity US$ 10.68

billion (2013)

9. Smart. Fast. Now. That's how we grow. With 65 interactions per second, 5.4 million

discussions per day and 2 billion total interactions each year, Dell really engages with

customers. We serve a diverse population that circles the globe, rounds out nearly every

industry and rests at the heart of millions of households.

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Analysis of leader’s / Manager’s Organization:

Effective from of leadership that causes change in individuals and organizations.

Michael Dell a good leader not only to the people in his organizations – but also to the

suppliers and customers.

Michael dell exercises transformational leadership - he act as a role model for his

employees.

Dell also listens to his employee and help them to have a vision that contributes to the

success of the company.

Creates valuable and positive change for the employees with the end goal of developing

them into leaders.

Communication

Communication is essential to develop trust and gaining commitment. As a leader Michael dell

always try to communicate with his employees much. When a new project launched he always

wants that everyone one in Dell Inc. gets the clear message about the project. He always thinks

that communication is utmost important to motivate employees and almost every day he spent

most of his time communicating to his team and staff.

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Communication method:

Sent out company- wide “massage from Michael” emails posters in high traffic areas and

numerous brown bag lunches and whole company gets together.

He also prefer face to face communication, through emails and many other ways which can help

him to communicate not only with the company staff but also the suppliers. He also talks about

the intention and how he felt about the new projects or the procedures he is going to follow. In

dell Inc. open communication is practiced to share information throughout the whole

organization. He always prefer his employees to roam around to have interactions, unplanned

interactions to hear spontaneous remarks. Dell employees always practices the same

communication style with customers to know about their feedback and offer better solution to

them in a reasonable price. Their communication with the customers helped dell to come up with

new products which suits their customers.

This leads to the success of the dell till now. Michael dell’s this strategy has been successfully

leading the company and makes it better and makes it a better competitor in this sector. This

strategy has been running successfully throughout these days.

Dell’s suppliers also share their vision and goal and as well as Michael dell explain the vision

and goal to suppliers to be able to support dell and both grow together at the same time.

Managers from dell visits their suppliers as frequent as possible and trough several meetings

information being exchanged.

Dell managers always encourage to ask more questions and it actually helps to understand more

than any method. Michael also promotes the art of listening to everyone and the listening skills

ensure them to provide the quality and scope of experience. It also able to bring information

from the outside world into dell.

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Through this communication Michael Dell ensure his success in this industry. To bring out

success communication to the employees, customers and suppliers are must

Leadership Style

Effective form of leadership that causes change in individuals and organizations. Michael Dell is

a good leader not only to the people in the organization but also to the suppliers and customers.

Transformational Leadership-

Transformational leadership is a style of leadership where the leader works with employees to

identify the problem and vision and inspires people to follow him. Here he works as a role

model.

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Assumptions-

1. People will follow that person who inspires them.

2. The peoples person with a vision and passion can achieve great things

3. Only method to get things done is by injecting enthusiasm and energy.

Michael Dell exercises transformational leadership and he acts as a role model for his

employees. He develops a vision and share with his employees. This vision helps the employees

to contribute the success of the company. He develops the vision to take forward dell Inc. and

after developing the vision is to sell the vision constantly. Michael Dell never stops to sell his

vision. He not only sell the vision to the employees but also to the suppliers and other members

outside the company. The final step in transformational leadership is to take the charge and keep

it that way. He is showing dell how things done and working as a role model to the employees.

By the leadership quality we can say that Michael Dell is a successful leader and he is doing his

work without any kind of trouble and still with his effort Dell Inc. is running successfully

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Quotes by Michael Dell

1. “Don’t spend so much time trying to choose the perfect opportunity, that you miss the

right opportunity.”

2. “Try never to be the smartest person in the room. And if you are, I suggest you invite

smarter people … or find a different room.”

3. “We are all gifts to each other, and my own growth as a leader has shown me again and

again that the most rewarding experiences come from my relationships.”

4. “You don't have to be a genius or a visionary or even a college graduate to be successful.

You just need a framework and a dream.”

5. “I was, you know, rebellious–an 18, 19-year-old and just did what I wanted to do and all

worked out OK.”

6. “Sometimes you just have to belly up to the bar and take a chance. We made some

mistakes, but we also had the strength to work our way out.”

7. “There are a lot of things that go into creating success. I don’t like to do just the things I

like to do. I like to do things that cause the company to succeed. I don’t spend a lot of

time doing my favorite activities.”

8. “Whether you’ve found your calling, or if you’re still searching, passion should be the

fire that drives your life’s work.”

9. “It’s through curiosity and looking at opportunities in new ways that we’ve always

mapped our path at Dell. There’s always an opportunity to make a difference.”

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Conclusion

Michael Dell is a true visionary leader who had his framework and a dream to make the change.

He has a proactive personality as a leader that actually helped him to start from the scratch and

become what he is today. His motivation is mostly related to Locke’s Goal-Setting theory which

basically helped Dell Inc. to be one of the big shots in the IT industry with comparatively

cheaper selling price.

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