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Layoffs At Now-Private Dell May Hit Over 15,000 Staffers

timothy posted about 3 months ago | from the layoffs-happen-to-public-firms-too dept.

Businesses 287

schwit1 writes "Curious why Michael Dell was so eager to take the company he founded private? So he could do stuff like this without attracting too much attention. According to the Channel Register, the recently LBOed company is 'starting the expected huge layoff program this week, claiming numbers will be north of 15,000.' Of course, with a private sponsor in charge of the recently public company, the only thing that matters now is maximizing cash flows in an environment of falling PC sales, a commoditisation of the server market and a perceived need to better serve enterprises with their ever-increasing mobile and cloud-focused IT requirements — things that do not bode well for Dell's EBITDA — and the result is perhaps the largest axing round in the company's history. But at least the shareholders cashed out while they could."

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287 comments

I'm sure they're grateful for COBRA (3, Funny)

haruchai (17472) | about 3 months ago | (#46149053)

At least they get health coverage for the next 18 months.

Re:I'm sure they're grateful for COBRA (5, Funny)

ebno-10db (1459097) | about 3 months ago | (#46149161)

At least they get health coverage for the next 18 months.

If they can afford it. The charming thing about COBRA is that you get hit paying 100% of premiums when you can least afford it. Heaven forbid that we become a bunch of commies like those Canucks. I've heard that even the snow is red up there.

Re:I'm sure they're grateful for COBRA (0)

Anonymous Coward | about 3 months ago | (#46149257)

Yeah, but if we all became Canucks, we'd have to put up with Torts.

Re:I'm sure they're grateful for COBRA (1)

ebno-10db (1459097) | about 3 months ago | (#46149287)

I give up, what do you mean by Torts? To me they're a matter of civil law, and we've got plenty of them.

I will however always refuse to say "about" funny.

Hockey Reference (0)

Anonymous Coward | about 3 months ago | (#46149575)

John Tortarella, coach of the Vancouver canucks. He did something douchey in a game break a few weeks back and got in the news.

Re:I'm sure they're grateful for COBRA (0)

Anonymous Coward | about 3 months ago | (#46149271)

those Canucks. I've heard that even the snow is red up there.

Only after a hockey riot, eh.

Re:I'm sure they're grateful for COBRA (1)

DoofusOfDeath (636671) | about 3 months ago | (#46149279)

But at least you're getting a group-policy rate that the employer had negotiated, rather than an open-market individual/family rate. It's better than (pre-ACA) open-market plans, I suspect.

Re: I'm sure they're grateful for COBRA (0)

Anonymous Coward | about 3 months ago | (#46149329)

Current group rates are about the same as ACA, but tend to have somewhat better deductible and copay conditions. COBRA is not as crucial anymore as it used to be.

Re:I'm sure they're grateful for COBRA (2)

Critical Facilities (850111) | about 3 months ago | (#46149445)

But at least you're getting a group-policy rate that the employer had negotiated, rather than an open-market individual/family rate. It's better than (pre-ACA) open-market plans, I suspect

Not always. I worked for the largest commercial real estate company in the world a few years ago. When I put in my notice, there was going to be a lapse of about 30 days between when my insurance would expire with my present employer, and when my new benefits would kick in with my new employer. When I received the COBRA notification explaining the details of my coverage (if I were to have chosen to take it), I was shocked. My premiums more than tripled....not exaggerating. Coverage for me and my young daughter for a fairly standard health policy (which still had copays, co-insurance, and deductibles, mind you) was going to be well over $600 for 30 days.

Suffice to say, I was able to find a term based health insurance plan, and get us both covered for about $150-$175 for 30 days, with better co-pays and a much lower deductible.

Re:I'm sure they're grateful for COBRA (2)

ebno-10db (1459097) | about 3 months ago | (#46149511)

It's better than (pre-ACA) open-market plans

The ACA is, to put it charitably, a day late and a dollar short. I honestly hope it's better having that piece of garbage than not, but the only way that will really be true is if it leads to further changes. The US is the only country to rely on for-profit companies as the source of basic health insurance.

Re:I'm sure they're grateful for COBRA (2)

hendrips (2722525) | about 3 months ago | (#46149805)

That's only guaranteed to be true if you coverage needs are the same as the plan your former employer offered, and if you are as risky or riskier than the average employee. To use myself as an example, I was laid off a couple of years ago from an employer which had a high average age and a high smoking rate (average age: late 40s to early 50s, 10%-20% smoked, if I had to guess). Their health plan had a 300$ per year deductible. As a result, their COBRA premiums were about $1500 per month for a couple. Pre-ACA that's probably still a better rate than a pair of 50 years old smokers in questionable health would have gotten on the individual market.

My wife and I, on the other hand, were nonsmokers in our 20s with no preexisting conditions. We also have a sizable emergency fund saved up because I hate spending money, so a $300 deductible would have been ridiculous for us. When we bought open market insurance, it cost us less than $200 per month. Obviously, that's just an anecdote, but it illustrates how hard it is to make blanket statements about American health insurance*.

*Other than "it sucks," which I think everyone on both sides of the spectrum would agree on, even if they argue about why or what to do.

Re:I'm sure they're grateful for COBRA (3, Insightful)

CohibaVancouver (864662) | about 3 months ago | (#46149583)

At least they get health coverage for the next 18 months.

America is bananas. You lose your job with all the stress that entails, then on top of that you have to worry about whether you have the coverage required if your kid gets sick.

Hey USA, get with every other first world nation on earth (and a few second and third world ones) and get some universal healthcare for YOUR people.

Re:I'm sure they're grateful for COBRA (1, Flamebait)

CubicleZombie (2590497) | about 3 months ago | (#46149885)

America used to be a lot more sink-or-swim. Work hard, innovate, or you die. Health care ended up being tied to employment because everybody worked. It was our grandparents who made this nation the greatest in the world. Now we're well on our way to a European social-wellfare system, and Universal Healthcare will be part of that after Obamacare fails (listen to Obama's speeches before he became a Senator - this is just one step in his plan).

Universal healthcare, living wage, equal outcomes. It's all coming. Along with it comes the loss of the U.S. competitive edge. Work hard? Why bother. Just join the Occupy Wallstreet crowd and stand in line for a government handout.

It's all well and good until there's nobody left to pay for it.

Re:I'm sure they're grateful for COBRA (1)

Anonymous Coward | about 3 months ago | (#46149957)

The bullshit machine is up early today!

Dude you're getting (-1)

Anonymous Coward | about 3 months ago | (#46149055)

Laid off. Lol owned

Good (-1)

Anonymous Coward | about 3 months ago | (#46149075)

Fuck Dell. Shitty warranties, declining product quality, poor customization. You shoot yourself in the foot and you deserve to limp.

Amazon and Google, you're next.

Wrong (5, Insightful)

u38cg (607297) | about 3 months ago | (#46149097)

This should have been done by the previous management. Dell is running a company whose business is in serious decline where no-one really knwos where the market will be in five to ten years time. Doing anything else would be commercial suicide.

Re:Wrong (1)

rmdingler (1955220) | about 3 months ago | (#46149223)

Nobody wants to have to lay off 15% of its employees (103,300 total:Wiki).

When market forces dictate your primary product sales growth is endangered, you have to change or die.

Dell's recent spate of acquisitions is an attempt to diversify and keep pace with HP and Lenovo. Many job losses will be duplications, I suspect.

Re:Wrong (3, Insightful)

capedgirardeau (531367) | about 3 months ago | (#46149769)

Of course people want to lay off 15% of the workforce. That is very typical in leveraged buyout processes and part of the plan from square one.

You are take out big loans to buy the company, knowing you are going to immediately gut it maximize profits in the short term so you can pay off the loans. Then you continue to milk what remains as profit, letting the business decline knowing you can sell off chunks to get the last drop of value out of the company, and then at the very end, when you have loaded it up with debt again, you declare it bankrupt and walk away.

Re:Wrong (5, Insightful)

Herkum01 (592704) | about 3 months ago | (#46149313)

If this were done by the previous management, the stock price would have gone up and M. Dell would not have been able to purchase the company. Hence, leaving the company limping along was probably the plan all along.

Just another way management can screw over the stockholders.

Re:Wrong (0)

lister king of smeg (2481612) | about 3 months ago | (#46149499)

If this were done by the previous management, the stock price would have gone up and M. Dell would not have been able to purchase the company. Hence, leaving the company limping along was probably the plan all along.

Just another way management can screw over the stockholders.

Um it said in the title that Dell is now a privet company there are no stockholders to screw

Re:Wrong (3, Interesting)

ppanon (16583) | about 3 months ago | (#46149581)

Um it said in the title that Dell is now a privet company there are no stockholders to screw

Guess you missed the part where he implied deliberate mismanagement to keep the stock price down when it was still public in order to keep market capitalization lower and make the leveraged buy-out possible. I'm not saying that he's right, but if he was then his characterization that it was a failure to uphold the fiduciary duty to those shareholders seems reasonable. Finding enough evidence to prove it in a court of law as part of a (past) shareholder's lawsuit would be the tricky part.

Re:Wrong (0)

Anonymous Coward | about 3 months ago | (#46149963)

Dell is now a privet company

Michael Dell demands a shrubbery and that 15,000 employees should cut down the highest tree in the forest with a Herring?

Re:Wrong (0)

Anonymous Coward | about 3 months ago | (#46149513)

Mod Parent UP

Re:Wrong (1)

Xest (935314) | about 3 months ago | (#46149635)

Yeah, this is probably one of the most stupid Slashdot summaries ever, but then, it's based on an article from The Register so I guess I'd be a fool to expect anything other than sensationalist propaganda.

The fact is that the alternative to Dell reinventing itself which yes, involves massive layoffs, is that all 110,000 employees lose their jobs instead. Surely it's better to lose under 15% of the workforce than end up with the whole workforce screwed?

Or even worse, the whole thing could've been asset stripped including the pension fund raided if Icahn had gotten his way.

Precisely (1)

RogueWarrior65 (678876) | about 3 months ago | (#46149927)

IMHO, schwit1's summary is a typical leftist rant that assumes that every job position in the company is valuable and should be permanent even if the company is bankrupt. To that I say "Should the people who used work on the incandescent light bulb production lines still be allowed to make them?"

Now that it is private? (4, Insightful)

alexander_686 (957440) | about 3 months ago | (#46149099)

Of course, with a private sponsor in charge of the recently public company, the only thing that matters now is maximizing cash flows ......

How is it different now that they are private? Don’t public firms try to maximize profits? I know back in the 80’s, LBO tried to generate as much as cash flow because they have mortgage everything and were up to their eyeballs in debt. Dell is nowhere near that.

No, this is because Mr. Dell wants to take Dell Inc. in a new direction as fast as he can – away from the low profits of a commodity business.

Re:Now that it is private? (1)

jmauro (32523) | about 3 months ago | (#46149139)

The difference is if the company was public all the metrics that the big financial companies would use would go completely haywire during the layoffs, causing the stock price to drop like a rock (even if it was good for the company in the long run). As such, once private you can do these sorts of maneuvers without the financial markets screaming bloody murder, since you're not tradable.

Re:Now that it is private? (2)

murdocj (543661) | about 3 months ago | (#46149165)

Is this really true? I seem to recall the markets applauding big companies that "slashed costs" by layoffs, even though the long-term results might be disastrous.

Re:Now that it is private? (5, Interesting)

ebno-10db (1459097) | about 3 months ago | (#46149265)

I seem to recall the markets applauding big companies that "slashed costs" by layoffs, even though the long-term results might be disastrous.

Believe it or not, once upon a time layoffs would cause a company's stock price to fall. The markets figured, usually correctly, that layoffs meant the company was in trouble. In Dell's case I'm afraid the layoffs might be necessary, as the company is in serious trouble, but when profitable companies have needless layoffs, it's ridiculous. You can almost always make the company's finances look better in the short term with layoffs.

The best analogy I've heard (and this from a serious business analyst) is that many of these companies are like the participants in a body building contest. For those that don't know, they usually take lots of diuretics and what not for a few days before the contest to increase muscle definition. It also leaves them weak as hell. You could probably knock them over with a feather. That's the way a lot of companies are these days. Superficially they look great on the balance sheet, but they're actually quite weak when it comes to anything beyond the next quarter.

Re:Now that it is private? (1)

MightyYar (622222) | about 3 months ago | (#46149285)

I don't think layoffs are a problem at a public company, but revenue decreases seem to elicit a negative response from stockholders. The market punishes companies that are trying to downsize, even if it means better long-term viability. If these layoffs will result in reduced revenue, the market would probably crush the stock price.

Re:Now that it is private? (2)

alexander_686 (957440) | about 3 months ago | (#46149393)

Slashing costs can take different forms.

Are you slashing costs because you business is going down the tubes? You trim costs to match reduced revenue. To overstate the case, the PC market is going down the tubes.

Are you trying to make yourself look good? There are companies that need to lose weight. Some do it via the crash diet method – not very effective but it looks good in the short run. Some do long term cuts. In Dell’s case they can cut a good number of accountants because they no longer need to be SOX complaint.

In Dell’s case, it is because they want to head in a different direction. I know some of their divisions have been hiring and are continuing to hire as Dell expands into new markets. I am going to guess that over 5 years that these will more or less net to zero. (I am making a lot of assumptions here – like Mr. Dell’s plan works and Dell grows.)

Re:Now that it is private? (1)

murdocj (543661) | about 3 months ago | (#46149623)

The PC market is not "going down the tubes". It's saturated. People will continue to buy replacement PC's / laptops, but the demand has stabilized, and people are now buying replacements, rather than new units. 5 years from now people will still be buying replacement PCs.

Re:Now that it is private? (1)

mlts (1038732) | about 3 months ago | (#46149903)

The PC market isn't going down the tubes. It just has reached a point where it isn't growing, because there are so many players for that market. However, even now, the desktop isn't going away. It is a content creation device while tablets and smartphones are intended to be content consumption items. Yes, in theory one can use a BlueTooth keyboard with a tablet, but that tends to be a cautious exception.

It wouldn't be hard for Dell or PC companies to revive the desktop market. It could be little things like putting a copy of the OS install media into a read-only flash drive on the motherboard (not a new concept -- some Tandy AT compatibles had MS-DOS in ROM.), having a read-only recovery ROM that boots Linux or Windows PE with the ability to have updated AV definitions on a USB flash drive.

There can perhaps be bigger jumps. A lot of people use their desktops/laptops as "servers" where the machine holds their synced music, eBooks, Quicken documents, Office items, etc. Why not add server functionality, such as a hypervisor so one can have different VMs for tasks, a smarter drive controller which can actively deduplicate present logical drives, snapshot, perhaps even autotier. Backups could be handled by the controller by attaching a USB drive, and saving the snapshots off similar to how it is done in ZFS. Plus, this gives a layer of abstraction so a hardware upgrade would just mean moving the VMs to the new machine rather than having to reinstall and reload apps.

Yes, desktops/laptops are stagnant, but definitely not dead. There is plenty of room for innovation.

Re:Now that it is private? (4, Informative)

Anonymous Coward | about 3 months ago | (#46149145)

News Flash: Businesses exist to make a profit. This is not a charity. He is acting rationally.

Re:Now that it is private? (2, Insightful)

Sockatume (732728) | about 3 months ago | (#46149207)

To serve their stakeholders, private companies must maximise net revenue, while publicly traded companies must maximise share price. The means to achieve those two goals are not always the same, because very often the market price is decided by idiots.

Re:Now that it is private? (4, Insightful)

DoofusOfDeath (636671) | about 3 months ago | (#46149291)

I would think that private companies can maximize whatever the hell they want: short-term profit, long-term profit, the number of frogs in Ohio, etc.

Re:Now that it is private? (2)

alexander_686 (957440) | about 3 months ago | (#46149465)

Not in Dell’s case. Private does not mean personal property. Dell has other owners then Mr. Dell and owes other people fiduciary duty – such as the bond holders. So not frogs, and there is less of a difference between short term and long term profits.

Risk is one thing that Mr. Dell has better control, as in “let’s dump or PC business and strike out for new grounds.” Dell could squeeze a lot of profits out of a declining PC business at low risk. Warren Buffett was able to do so with Berkshire Hathaway – you know – the company that made broadcloth.

Re:Now that it is private? (1)

RabidReindeer (2625839) | about 3 months ago | (#46149517)

Not in Dell’s case. Private does not mean personal property. Dell has other owners then Mr. Dell and owes other people fiduciary duty – such as the bond holders. So not frogs, and there is less of a difference between short term and long term profits.

Risk is one thing that Mr. Dell has better control, as in “let’s dump or PC business and strike out for new grounds.” Dell could squeeze a lot of profits out of a declining PC business at low risk. Warren Buffett was able to do so with Berkshire Hathaway – you know – the company that made broadcloth.

And how do you know that the other major investors in Dell aren't frog-lovers?

Re:Now that it is private? (1)

MightyYar (622222) | about 3 months ago | (#46149301)

Mostly I agree, but I'd add that many public companies also need to concentrate on their dividend - so it isn't quite so black and white.

Re:Now that it is private? (1)

RabidReindeer (2625839) | about 3 months ago | (#46149523)

Mostly I agree, but I'd add that many public companies also need to concentrate on their dividend - so it isn't quite so black and white.

Dividends are more popular these days than formerly, but not as much, I think as back before about 1980. A lot of companies are focussed more on growth than on dividends.

Dell has gone private (0)

Anonymous Coward | about 3 months ago | (#46149303)

So much for your rant about capitalism.

Re:Now that it is private? (1)

alexander_686 (957440) | about 3 months ago | (#46149341)

I will have to disagree with you there. First, I think you mean earnings, not “net revenue”. Second, there is no difference if 1 person owns the firm or 1 million – the purpose is to maximize value for the owners. The calculations of both earnings and value are the same; it is just that for the private firm the numbers are more opaque to the public.

Well, value is a bit different. You post the accounting numbers and get the consensus value (from the stock market) back for public firms. For private firms you don’t get that feedback.

Re:Now that it is private? (2)

Junta (36770) | about 3 months ago | (#46149249)

On the one hand, layoffs are frequently considered a 'good thing' by investors, if they believe the company may still be capable of functioning afterward. I don't think Dell is in this boat, but layoffs have upon occasion been taken as a sign of the end times for a particular enterprise.

As to your point about taking it in a new direction as fast as he can, away from a commodity business; the challenge is Dell has yet to show capability in any candidate market. Investors eat up announcements by IBM for decreasing stake in the hardware business because they have shown data that they have already established themselves in other markets. Contrast to when Apotheker announced an intent for him to take HP away from hardware and be a software company. HP's stock took a nosedive because they were not seen as a credible software company, but giving up on their bread and butter to chase a dream. Even if that hardware business isn't as profitable, it's better than nothing.

Re:Now that it is private? (2)

Talderas (1212466) | about 3 months ago | (#46149895)

Cash flow is similar but different from profit. It's even more important than profit. In general, your cash flow is a much better indicator of the healthiness of the business because it represents the ability to purchase goods and make investments. Dell recently made a lot of acquisitions which cuts severely into their cash flow. When you hear that they're trying to maximize cash flow there's trying to recover a drop, likely significant, in cash flow due to all those acquisitions.

Cash flow represents the company's ability to fund its operations. Let's look at an example. Let's say a company has $5,000,000 in cash. They produce widgits which sell for $10,000 and cost $5,000 to produce meaning each unit sold has a profit of $5,000. Right now the company has the ability to produce 1,000 widgits a year and has currently has 250 widgits built and delivered on net terms (a profit of $1,250,000). The company is seeing demand for their widgits and they can't produce enough to meet the demand. So they get a loan to expand their operation by another 100 units and spend $4,000,000 of their cash. They now have $1,000,000 in cash and the capacity for 1,100 widgits a year. The problem the company has is that it can only produce 200 widgits with its on hand cash which is only 18% of their annual production. Translated that means they can run the business a maximum production for just over 2 months. At this point its entirely on accounts receivables to hound the buyers for them to pay for the widgit. That $1,250,000 could run production for another couple months and if they fail to get those payments in the company is going to have to lower production to preserve cash (taking loans for operating expenses is not usually a good idea). That means fewer units produced which means fewer employee work hours which means employee hours are cut or employees are laid off.

But they still need more H1-B Visas, right? (4, Insightful)

TWiTfan (2887093) | about 3 months ago | (#46149103)

I bet he'll still go to Congress this year and tell them that he needs more visa to import more indentured servants.

15,000 (0)

Anonymous Coward | about 3 months ago | (#46149107)

a lot of Indians called "steve" are gonna be pissed off

Re:15,000 (1)

Anonymous Coward | about 3 months ago | (#46149197)

why are you assuming the layoffs are in low-wages-india and not high-wage-usa?

Re:15,000 (0)

Anonymous Coward | about 3 months ago | (#46149235)

or low-Indian-wages-usa...

And? (5, Insightful)

Dan East (318230) | about 3 months ago | (#46149121)

PC sales have been steadily declining for years. Large PC maker lays off employees. And? Same thing happened at record player companies. And typewriter companies. And factories that produced film. If you want to complain about something, the complain about how Dell couldn't turn itself into Apple or Google. Laying off people is the only way to save the company at this point in time.

Re:And? (1)

Kjella (173770) | about 3 months ago | (#46149507)

The PC business is still huge, but what Dell was built on was rapid custom-assembly of components. Between integration and computers out-perfoming the needs it's much more back to the traditional "we need five million laptops of model X" production lines. You even see Apple moving away from the traditional components to custom made-to-order formats that only fit the Mac Book Pro or Mac Pro. Lots of companies still makes lots of money on the PC, but Dell is struggling to find where they can add value to the process.

Only 12% of workforce (1)

snsh (968808) | about 3 months ago | (#46149153)

A tech company laying off around 10% of its workforce isn't drastically shrinking. They're just doing routine housekeeping.

Quality, Too (1)

Akratist (1080775) | about 3 months ago | (#46149163)

In my personal experience, their quality has been declining in recent years (poor internal design, bad fit and finish, on the boxes by them that I've had to use). A shift to mobile computing is part of the blame, probably, but I don't think the Dell brand has the same strength in recent years as it had in the past.

This is slanted wrong (3, Insightful)

rjejr (921275) | about 3 months ago | (#46149167)

Usually when big companies make big moves like this their stock price goes up as they are cutting costs. This article makes it osund like it would have been a bad thing to fire people while it was still a publicly traed company. Publicly traded companies fire people all the time, it' snot better or worse or different now that they are private.

Re:This is slanted wrong (1)

Anonymous Coward | about 3 months ago | (#46149253)

I agree with this comment. This is slanted wrong. Public companies have share holders to answer to. Share holders who probably bought the shares to make money. A private holder, a guy who is already rich, he can do what he wants. Maybe try to make money. Maybe try a long term growth strategy that won't make money for a few years. Maybe keep people on the payroll who should be layed off now, just so they will be ready to go to work in 6 months. I'd be way more critical of what public companies do to make money than I would be critical of private companies.

Re:This is slanted wrong (-1)

Anonymous Coward | about 3 months ago | (#46149283)

Michael Dell took the company private. There is no stock price, as Dell is no longer publically traded.

FUD (0)

Anonymous Coward | about 3 months ago | (#46149391)

Dell is a private company now. If you're going to rant about how evil the market is please at least try to keep up with current events instead of vomiting up the same garbage over and over.

how soon before (-1)

Anonymous Coward | about 3 months ago | (#46149191)

100% unemployment. You know Obama wants it.

Curious about product lines (1)

DoofusOfDeath (636671) | about 3 months ago | (#46149219)

I'm considering buying an M6800 workstation-class laptop from them. But it's only worthwhile if they'll be able to honor a 3-year warranty.

This uncertainty might cost them my business. Their only saving grace is that their primary competitor for my business, HP, is also causing me to doubt.

To make an omelette... (3, Interesting)

The123king (2395060) | about 3 months ago | (#46149227)

you have to break a few eggs. Dell is one of the american computing greats, and it would be a very sad day to see it taken over or file for bankruptcy. So in order to turn a company with more money leaks than a welsh allotment, you have to fire people and rearrange departments. Apple did it in 1997, Microsoft will do it in the next few years (hopefully), IBM's been doing it since IBM made computers. If Dell wants to become more than just a hardware manufacturer and OEM for Windows, they need to cut back and re-evolve. I have great expectations of Dell since it's gone private. I hope my expectations are realised...

Re:To make an omelette... (0)

Anonymous Coward | about 3 months ago | (#46149261)

OR you could try to re-evolve by using that work force you have.

We are ALL Temporary employees (4, Insightful)

Moof123 (1292134) | about 3 months ago | (#46149229)

The head of engineering at a former job told the crowd after a nasty layoff "We are ALL temporary employees" several times over.

Get used to it. In most jobs your loyalty is purchased in 2 week increments. Check your contract, or rather your lack thereof.

Re:We are ALL Temporary employees (0)

Anonymous Coward | about 3 months ago | (#46149339)

That is so true, at some point, we all die.

Re:We are ALL Temporary employees (5, Insightful)

ubersoldat2k7 (1557119) | about 3 months ago | (#46149381)

That's one of the reasons I cannot feel any sort of loyalty to any company I've worked for ever and I laugh at those who do.

I'm a "soldier of fortune" (yes, I've been called that in pre-job/post-job interviews) but it's all business at the end of the day and your beloved company won't feel any regret of firing my or your ass when the gods of the spreadsheets declare their thirst for blood. Hell, even Steve Jobs was fired from Apple, which the guy founded.

Also, all that crap about corporate values: I don't give a fuck! The only way I'm staying somewhere is because I'm either better paid or because I have better conditions, if that's not the case, I'm gone. And so do you.

Re:We are ALL Temporary employees (2)

some old guy (674482) | about 3 months ago | (#46149399)

That's probably the best piece of advice you could ever give any kid embarking on his/her career. My son is still in middle school, and he's free of any delusions about employer-employee relationships.

In a sense we're all just prostitutes peddling our time and assets to sleazy, uncaring creeps.

This is in no way meant to be insulting to prostitutes. I can respect a good honest hooker.

Re:We are ALL Temporary employees (3, Insightful)

ebno-10db (1459097) | about 3 months ago | (#46149425)

Get used to it.

Fuck getting used to it. You should deal with the reality of it, but "getting used to it" means thinking of it as something that's reasonable. That's bull. A few decades ago this was not the norm. Large successful companies didn't do it. IBM started a "no layoffs" policy during the Great Depression and IIRC they did okay afterwards. This "we are all temporary employees" has nothing to do with any essential new business requirements, and everything to do with politics and a shift back towards the Gilded Age.

Re:We are ALL Temporary employees (2)

floobedy (3470583) | about 3 months ago | (#46149905)

Fuck getting used to it. You should deal with the reality of it, but "getting used to it" means thinking of it as something that's reasonable. That's bull.

It certainly is reasonable. A company which sees its business decline, needs to lay off employees, or it will go out of business and everyone will get laid off.

Unless you as a consumer (and many other consumers besides) are willing to commit to buying Dells every few years no matter what, Dell may undergo a decline in sales and may need to lay off employees.

Large successful companies didn't do it.

Dell is not a successful company, or it wouldn't be in these circumstances. The question is what the large unsuccessful companies must do.

Large unsuccessful companies have always laid off employees in the face of declines. There is no way around it. For example, GM had one million employees in the 1960s and has 1/4th that number now. The railroad industry was shedding massive numbers of employees in the 1970s. The shipping industry was shedding massive numbers of employees after containerization arrived. IBM was shedding massive numbers of jobs during the 1990s, as mainframes did poorly. This has always been a part of capitalism.

I'm not a young man, and I knew an old guy who was a telegraph operator for much of his life. Unless you, as a consumer, are willing to pay about $1 for 10 bytes of data transmitted, it was necessary to lay him off, and for him to get a different job. Unless you as a consumer are willing to pay far more than is necessary to support redundant jobs, layoffs will be necessary. It isn't even up to the company. It's a matter of accounting. No business can take large losses and survive for very long. If layoffs are disallowed then the business will just go under more quickly.

Re:We are ALL Temporary employees (1)

bzipitidoo (647217) | about 3 months ago | (#46149729)

It doesn't have to be that way. You talk like companies must have absolute freedom to hire and fire instantly, for any reason at all, because staying competitive demands it. Even if a massive layoff is the equivalent of hacking off their left arm to lose weight, they deserve and need the option to do that. If a person did that for a reason like that, the rest of us would commit them to a mental institution. But before things reached that point, friends would likely notice that something is very wrong, and try to help.

I don't know whether this move by Dell is the equivalent of liposuction or maiming, but I suspect the latter. They've gone to all the trouble of screening and training these 15,000 people, and now they're going to throw that all away. If this is part of a plan to change their areas of business, why not spin off those sections of the company instead of destroy them? Or are they saying their hiring and planning decisions really were that poor and corrupt, and now they have to clean house? Blame is very likely to be laid at the door of shrinking desktop sales, of course, but that only raises more questions. Why didn't they see this coming? Or, what did they do wrong to cause desktop sales to shrink? I rather think people are finding the classic desktop PC simply too bulky, noisy, and possibly power hungry. Peek inside a case, and you see a large volume of unused and wasted space. Cabling is another mess. Can't some of these cables be consolidated? At the least merge the mouse and keyboard cables, like on MacIntoshes? Power the display and computer from the same power supply, instead of having separate power supplies for PC and monitor? The tower configuration saves on footprint, but that little innovation is over 20 years old. Where are the mini ATX, Nano-ITX and smaller size PCs? Or, why haven't they moved more aggresively into tablets?

Whatever the reason, this rumbling about massive layoffs doesn't inspire confidence from customers. How many people, right here on Slashdot, have already said this move makes them less likely to buy a Dell? I recall at least 2. Dude, you shouldn't have bought from a suicidally shrinking company that's lost its way?

Glad I didn't buy from them. (0)

substance2003 (665358) | about 3 months ago | (#46149259)

I was considering the Venue 8 Pro for a while before going with a Lenovo Yoga 2 Pro after changing my view on what I wanted/needed for on the go (yeah I'm bucking again't the trend).

Now with this happening I'm glad I didn't purchase from them. No way I'd appreciate this sorta stuff after plucking down my hard earned cash for their products.

So is there still no truth to the rumour? (1)

ackthpt (218170) | about 3 months ago | (#46149273)

The rumor of the PC's impending demise as people's primary computing/communicating/wossname device?

Re:So is there still no truth to the rumour? (0)

Anonymous Coward | about 3 months ago | (#46149491)

I guess since Saab, Maybach, Saturn and Pontiac are out of the industry people must not be buying cars anymore either....

Maybe computing was losing it's steam when Commodore, Atari and Packard Bell went broke too?

Great market analysis there, skippy.

North? (1)

garryknight (1190179) | about 3 months ago | (#46149277)

numbers will be north of 15,000

Has the writer never seen an Australian map?

Re:North? (0)

Anonymous Coward | about 3 months ago | (#46149429)

New Guinea is north of Australia, and north is still north.

Ex stockholders should sue Dell (0)

Anonymous Coward | about 3 months ago | (#46149289)

Ex stockholders should sue Dell

    15,000 salaries x $30,000 per year = $450 million a year savings!

    If these cuts had been made before the buyout, the stock would have rocketed UP!

    By keeping the 'dead weight' on the books, Dell swindled the ex-stockholders out of BILLIONS. For example, 450 million a year in profits/savings at a ten percent cap rate = 4.5 BILLION of market value!

      Historical cap rates (how stocks are valued) are higher, so this analysis makes the crime look less damaging to the losers/former owners.

Company's soul is no longer owned by the Devil. (4, Insightful)

jageryager (189071) | about 3 months ago | (#46149293)

This is slanted wrong. Public companies have share holders to answer to. They've sold their soul to the devil, AKA: Share holders who almost always buy shares to make money.

A private holder, a guy who is already rich, he can do what he wants. Maybe try to make money. Maybe try a long term growth strategy that won't make money for a few years. Maybe keep people on the payroll who should be layed off now, just so they will be ready to go to work in 6 months. I'd be way more critical of what public companies do to make money than I would be critical of private companies.

There are quite a few examples of privately held companies going the extra mile for their employees at the expense of short term profits.

For Example (1)

jageryager (189071) | about 3 months ago | (#46149331)

http://en.wikipedia.org/wiki/Malden_Mills

"The Malden Mills factory burned down on December 11, 1995. CEO Aaron Feuerstein decided to continue paying the salaries of all the now-unemployed workers while the factory was being rebuilt. By going against common CEO business practices, especially at a time when most companies were downsizing and moving overseas, he achieved recognition for doing the right thing"

Re:For Example (3, Informative)

ShadyG (197269) | about 3 months ago | (#46149463)

"In November 2001, Malden Mills declared bankruptcy after the recession at the beginning of the new year left the company unable to pay creditors—related to its rebuilding and payroll commitments."

Go figure (0)

Anonymous Coward | about 3 months ago | (#46149295)

Does this surprise anyone? It really should not considering the dismal PC industry of the last couple years. What is happening is the PC industries believes the future in profits from hardware is gone. I think many PC makers already believe many consumers and even enterprise will look to inexpensive low impact hardware and that does not provide much profit margins for PC makers. I seriously look at cheap tablets and Chromebook like device and wonder if these become the go too device. Who exactly will make any money on them? The reason for lousy support and poor quality is that more and more buyers want cheap over anything else. The big loser in all this will eventually be Apple. The justification for a $1000 plus notebook is dwindling.

Nothing like a lame anti-corporation rant (-1)

Anonymous Coward | about 3 months ago | (#46149311)

Nothing like a lame anti-corporation rant from a lame basement-dweller who's led a sheltered existence.

What the fuck is Dell supposed to do, you fucking moron? They're in a business where they're simply not selling as many computers as they used to because the market for their product is shrinking. Should they keep every employee just to satisfy your mental masturbatory fantasies? Yeah, that'd be great when they eventually go broke when over 100,000 employees then lose their jobs.

Dumbass. Get your fingers out of your ass and stop with the fucking Kumbaya already. Stupid "progressive" hippy.

Re:Nothing like a lame anti-corporation rant (1)

Anonymous Coward | about 3 months ago | (#46149525)

Why don't you go lick the balls of you favorite CEO. Just because the market is shrinking, doesn't mean you have to fire people.

Have you seen the numbers? Do you understand the numbers? I can say i haven't seen them, but obviously neither have you, so this reply is more of a general nature.

Yeah, before you need to fire people, you can either do something about the bad market (is it the companys own fault, maybe it's just people don't want to buy from that company or is it a fluctuation that also conserns rivals), or do some R&D for the next wave or start doing something else than the core business also.

Mass firing people will not make the market better (people get pissed and now a lot of them can't afford to buy your stuff), it will not make you products better for the future, also if the market will be going down anyways (i.e. that product is really obsolete, like horse pulled wagons for personal transportation is today), just hanging on to that dead market will kill the company too.

So are you so sure, that mass firing is the right way to go in this particular case?

Shortage! (0)

Anonymous Coward | about 3 months ago | (#46149337)

There's a shortage of workers in the technology sector! Pay no attention to these technology companies purging employees. I've been watching this since about 2010, and the list grows ... and grows ... and grows. There should be enough unemployed technology-sector workers to fill all available jobs. Oh, right, they won't get jobs because they're not trained in some niche technology, and if they learn it themselves they won't have experience. Isn't it great when the other team can move the goalposts and you can't?

no shortage of unemployed ordinary citizens to ask (0)

Anonymous Coward | about 3 months ago | (#46149353)

more than than we even guesstimated? http://rt.com/business/us-unemployment-economy-crisis-assistance-006/

Necessary evil of doing business (1)

Ngarrang (1023425) | about 3 months ago | (#46149409)

I feel sorry for the 15,000 workers about lose their job, Dell is walking a thin line and Michael wants to make sure that the company that bears his name stays around. Dell has become a bloated pig and unfocused. They are also not responding to customers demands where they should and expanding into markets that support their core strengths.

In other news Industrial Buggy and Implement (0)

belthize (990217) | about 3 months ago | (#46149451)

to lay off 100% of work force.

Yes it sucks for the 15,000 that are going to get laid off, it will also suck for the remaining 85,000 plus all of Dells partners if the company goes completely under. The past 20 years have seen numerous large and small PC companies go under. This is what Dell has to do to survive.

I'm probably considered left of center on quite a few fiscal issues but the slant in this article is pretty pathetic.

Dell went private for $25 billion (0)

Anonymous Coward | about 3 months ago | (#46149473)

IBM just sold off its x86 server business for $2.3 billion!

Looks like Mr. Dell and Silver Lake maybe overpaid by just a little...? Of course, they have some other stuff like Oracle utility software... I'm sure that makes up the difference.

Re:Dell went private for $25 billion (1)

EvilSS (557649) | about 3 months ago | (#46149677)

IBM just sold off its x86 server business for $2.3 billion!

Looks like Mr. Dell and Silver Lake maybe overpaid by just a little...? Of course, they have some other stuff like Oracle utility software... I'm sure that makes up the difference.

Yes, because that's totally apples to apples in this case.

Not only that (1)

smooth wombat (796938) | about 3 months ago | (#46149559)

We were notified that our support phone number was being changed. When I called it, I was sent to a call center in India where it took me half an hour to get a return label sent out. We had a replacement part shipped to us the previous week but there was no return label included so I was calling to get one.

Half an hour to get a label sent out. Pathetic.

I guess it's just another example of private industry doing it better than the government.

Reversed? (1)

Culture20 (968837) | about 3 months ago | (#46149699)

Of course, with a private sponsor in charge of the recently public company, the only thing that matters now is maximizing cash flows

Isn't this the reverse of the usual argument? That publicly traded companies have a duty to maximize cash flow but private companies can choose to maximize tinker toys per desk ratio.

Such a terrible summary (2)

tom229 (1640685) | about 3 months ago | (#46149715)

... with a private sponsor in charge of the recently public company, the only thing that matters now is maximizing cash flows. ..

I'm going to assume the author meant "recently private company", and "maximizing revenue" as this would be the only way that sentence would make sense. Of course, even after the corrections, the author is still wrong. The major problem with public companies is that shareholders only care about relatively short term profits. This usually narrows the focus of any business to doing whatever makes this quarter better than last quarter. Being private is a huge advantage precisely because it allows you to look at the bigger picture beyond short term profits. Terrible summary.

Laid off? Blame a Liberal (0)

Anonymous Coward | about 3 months ago | (#46149743)

Lose you job? Blame a democrat. Blame Obama.

This is Voluntary Separation people! (0)

Anonymous Coward | about 3 months ago | (#46149807)

This was announced a month ago and several of my colleagues took the package. The people who took the package already know they are getting laid off. That was their choice! They took the risk of having to look for another job. Some have already found other jobs and are making a lot more now. The severance package is very decent too. To call this a "bloodbath" is just horrible journalism.

Also, this isn't something new. Dell, as a company, did the same thing a few years ago. This time, there are a lot more employees who were eligible for the voluntary separation. It's a great opportunity for the employees who no longer like where the company is going, and would rather work somewhere else.

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