Monday, February 05, 2007

A Letter From The CEO

You may have received an odd email last week if you work for DELL. The email was from Michael Dell. Your CEO.

Click Here To Read The Email

A CEO is a chief executive officer. You can usually find her atop an ivory tower overlooking her subordinates. You may even get a glimpse of her taking off on the company jet. About the only time that you'll read a personal note from her is in the company's annual report. And that's only because it's a legal requirement.

Michael Dell didn't say anything groundbreaking. He didn't solve all of Dell's problems. In fact, he didn't solve any of them. But he did talk about them. And he talked about his ideas for change. And he asked everyone for their help. Like this.....

"We had great efforts, but not great results. This is disappointing and it is unacceptable. The result is that there will be no bonus this year. I know this is a big deal for you and your teams. We're going to fix that so that our efforts translate into great results and success for our teams."

No bonus for this year because there is no reason for the bonus. In other words, you get paid based on the company's performance. And your performance is what makes the company's performance.

Paying for performance works. But it can only work if two criteria are met.

1. The metric for performance has to be legitimate.
2. The bonus really has to be a bonus.

If you work on an assembly line, then you need to know how your job contributes to the bottom line. And once you understand that goal, then you need to have a real reason to care about achieving that goal. From assembly line to CEO, everyone is accountable. Every job is measurable.

You know all about our pay for performance plan. Everything matters. From cleaning dirty toilets to filing papers. Every task is accountable. Read this if you're not familiar with our pay for performance plan.

There is a lot more juicy business talk in Michael Dell's letter. Read it. It's refreshing to know that a CEO can still talk about the business. And it's refreshing to know that every CEO isn't Conrad Black or Ken Lay. Of course, he does own this vacation home.

Then again, he did start a business from scratch and built it into a $50 billion dollar enterprise. Gotta love America.

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