Michael Dell shares ten principles from building Dell Technologies, starting with the "point of impact"—how leaders must shift focus as companies scale. He emphasizes rapid experimentation over perfection, seizing opportunities during downturns, and learning from failures. Dell was founded during a PC market downturn when Japanese dominance seemed certain.
He's an American business magnate, philanthropist, investor, and author. He's the founder and CEO of Dell Inc., one of the world's leading sellers of personal computers. Forbes estimates his net worth to be $19.5 billion. He's Michael Dell, and here are his top 10 rules for success.
You have to think about the point of impact. If you're running a business with 100 people, the point of impact for the leader is very different than if it's 1,000 people or 10,000 or 100,000. And so that's the frame of reference that I've always used is to say, okay, if I'm leading this organization, what are the things that actually I can do to cause it to be successful? If it's 1,000 people, it's very, very different than it is for me today. So today I'm a lot more focused on strategy because that's the point of impact on a 110,000-person company. On a 100-person company, you know, you're sort of doing any job in the organization. You're doing every job in the organization, you know, potentially. And that might be okay at that point. One of the things I see in new businesses is they're often looking for perfection. And I think this is a really big mistake. I think you ought to be— looking for experiments and quick experiments. It's okay to have little failures. What you want to do is learn as much as you can very quickly and try things. Certainly when we were a small business, we'd go out and try all sorts of things to find what would work. Then we found something that worked, well, we'll do that 100 more times or 1,000 more times. We still do it today as a large company. When I was 16, I got this job working for a newspaper in Houston, and my job was to sell subscriptions to the paper on the telephone. And I realized two things when I was doing this. I realized that people that were buying the newspaper generally had two things in common. Either they were moving to a new residence where they were getting married. And it turns out that you could go find information about both of those things in enormous quantities. So in the state that I lived in, in Texas, when you get it— when you want to get a marriage license, you have to file with the state, and it's public information, particularly the address that you want the license sent to once it's issued. So I hired all my friends and went to every county in the surrounding 16 counties in Houston, captured the addresses of all the people that applied for marriage licenses, and sent them a direct mail offer to offer them the newspaper for a free trial and then a subscription. And I ended up making a fair sum of money for a teenager. You know, in our situation where we were creating a new way of doing business, that was actually part of our culture as well. And as we wanted to attract people from, let's say, related spaces, we didn't actually want them to bring, you know, the culture of the other companies. We might want some insights from their experience and that sort of thing, but we had to be very explicit about what the Dell culture was really all about. What the values are, particularly as we expand around the world. We say, no, these aren't necessarily American values. These are the Dell Company values. And this is incredibly important. And this is the way we operate our business. One of the things that people do instinctually when there are tough times is they kind of do nothing. And they don't— they kind of hunker down. This is frozen rabbits in the headlights. Yeah, it's kind of just complete stunned turned into inaction. And I think that's actually the worst thing to do. I think times when everyone is confused and kind of stunned present, you know, the most enormous opportunity because nobody's really doing anything. So, you know, I think this is a time where the seeds of really successful new businesses will be created. In fact, if you look in our industry, which I'm most familiar with, you know, the greatest companies kind of came out of and were formed in some of the most difficult times in the industry when no one was really looking and everyone thought the whole thing was going to go south. All of a sudden, a whole new breed of companies, you know, emerged. So, for example, if you look at, you know, when Dell was formed in the early 1980s, 1984, this was pre dark time in the US economy. The personal computer industry had just gone through a big down cycle, and the prevailing wisdom was that all electronics would be dominated by the Japanese. Yeah. You know, and that we had this big boogeyman called the, you know, Japan Inc., and that no one could compete with Japan Inc., especially in something like computers. Well, it turned out to be completely wrong, and there, you know, was enormous opportunity, and huge waves of productivity were unleashed with the computer industry, you know, flourishing. Be willing to experiment and fail. You know, a lot of people go into business and they're looking to never make any mistakes. That's not the way to succeed. You have to be willing to try things, experiment, ask a lot of questions, don't be stuck on any one position, and, you know, most importantly, to listen and look for breakthroughs and ideas that haven't been out there. As a business grows, the natural tendency would be to take fewer risks and to be cautious and to have contingency plans. But in a business that's changing very quickly or one that you want to grow, you actually need to be explicit about accepting risk. One of the people who work with me kind of described it this way. I was sort of encouraging this person, "Hey, let's try this. Why don't we do this?" how about this? And at some point he kind of came back and said, so what you're telling me is you want me to try to do 10 things, and if I only get 8 of them, you know, you'll be okay with that, you know, if I don't get all, you know, all 10 versus, you know, having 5 things and doing all 5 perfectly. That's exactly right. You know, we want to accept some experiments. If you just dissect the IT sector, you know, look at the whole thing, you've got roughly a $3, $3.5 trillion industry. And there are about 10 companies that have more than 1% of the $3 trillion. We have 2%, but nobody has like more than 5 or 6%. So it's a, it's a actually quite fragmented space. So we work extensively with partners across the ecosystem And it's a big part of how we evolve rapidly, go quickly, reach new customers, gain access to the latest ingredient technologies, whether it's in semiconductors or software ingredients. And so the partnerships and alliances are incredibly important part of how we grow. If you really don't know what it means to be an entrepreneur, Maybe you aren't one, you know. So I think there's a bit of kind of self-initiative and self-starter, you know, that is incredibly important part of entrepreneurship. I mean, no one can sort of tell you how to do it. You have to sort of have an instinctual, you know, feeling or an idea about something. And you gotta be passionate about it. I mean, I think people that look for great ideas to make money, uh, you know, aren't nearly as successful as those who say, okay, what do I really love to do? What am I excited about? What do I know something about? When we have had failures, those have ultimately resulted in some of the greatest successes we've ever had. You talk about those, particularly when someone comes to see you and they say, yeah, feeling really bad because this didn't work out. Okay, well, let me tell you about some other things that didn't work out that we learned a lot from. And, you know, let's pick ourselves back up and let's figure out what we learned from this and how we go apply that next time. You know, when you're in the zone of doing things that no one's ever done before, if you're only succeeding, you're not taking enough risk.
Thank you guys so much for watching. I made this video because of one of you asked me to. So if there's a famous entrepreneur that you want me to profile next, leave it in the comments below and I'll see what I can do. I'd also love to know which of Michael Dell's top 10 rules meant the most to you. Leave it in the comments, we're going to join in the discussion. Thank you so much for watching. Continue to believe and we'll see you soon.
