Less Management and No More Bonuses for Dell

When Michael Dell returned as the head of the company he founded, he told his employees in a memo that Dell looks forward to eliminate bonuses, as well as reduce management. This step is going to be made in order to cut the company's costs.

When Michael Dell returned to the company as a chief executive officer, he stated that he looks forward to stay at the helm of the company “for the next several years”. Dell said that in the near future the company will not hire another chief operating officer.

In his memo he wrote that the although the company had great efforts it did not show great results, which is an unacceptable and disappointing fact.

The computer making company had a great slowdown in 2006, when it lost its share to another computing giant Hewlett-Packard. Afterwards SEC started its investigation on Dell concerning possible accounting improprieties. These were also the main reasons why several executives left Dell during recent months. Among them there is Jim Schneider, Chief Financial Officer, who thought of leaving the company at the end of January.

Till now the company is under investigation by the SEC concerning its over accounting issues. The computer manufacturer said that this issues occurred due to the significant revaluations to its earnings before the 2006 fiscal year. Dell's officials did not stated the exact nature of the company's accounting issues. However, they have mentioned that they involve revenue recognition and that the company is not associated with any practice regarding stock-option backdating, which has trapped hundreds of companies during the last year.

Dell's memo was reported for the first time by Austin American-Statesman. It presented a copy of the e-mail on its website. Dell's spokesman justified the e-mail for the Associated Press.

The company's founder and Chief Executive Officer, Michael Dell, in his memo wrote that the bonus plan is to be replaced by “limited discretionary awards”. Besides senior management the awards will be available to all.

Dell also wrote that he is concerned with bureaucracy, which is the cause of the company's slowdown.

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