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Dell computer founder tells LFM alumni to take frequent vacations

Michael S. Dell felt right at home surrounded by MIT graduates at the Leaders for Manufacturing (LFM) Alumni Conference at his alma mater, the University of Texas in Austin.

Twelve of the conference organizers were Dell employees who are LFM graduates or student interns, among them Shafali Rastogi (LFM 1999), global alliance manager at the Dell Computer Corp. In the past three years, Dell has hired 25 MIT alumni.

Mr. Dell, founder and CEO of Dell Computer, was a featured speaker at the two-day conference October 2-3. The theme was "Big M E-Commerce and the Enterprise."

Big M refers to manufacturing issues that go beyond the factory floor and extend throughout the enterprise -- along the supply chain, into information technology, finance, marketing and human resources, then out to customers, suppliers and the community at large. Big M embraces both engineering and management sciences. MIT's two-year LFM program, founded in 1988, allows students to earn dual degrees from the Sloan School of Management (SM or MBA) and the School of Engineering (SM).

Mr. Dell, who started out selling computers from his dormitory room at the University of Texas in 1984, has built a Fortune 500 business by stressing direct marketing and customer support services. The company does more than $40 million in sales daily, half of them web-related.

Mr. Dell advised budding entrepreneurs in the audience to "look for a very big, inefficient market that could be radically transformed." He said he believes Dell's biggest challenge now is to expand its market. "It may involve more high end servers, storage devices, or new geographical areas," he said. "Our greatest competitive threat could be a company that has a business model or product that could do to us what we did to others. The Internet had the potential, which is why we were all over it. Wireless could hold that threat now."

Mr. Dell urged the audience to take frequent vacations to help deal with the stress of the highly competitive marketplace. "You need to work hard and play hard in order to be successful over the long term," he said. "Most places will allow you to have a life and a vacation."'s senior vice president of operations Jeff Wilke (LFM 1993), told the conference that LFM's focus on operational excellence could be applied to the world of e-commerce. "Most suppliers are set up to serve traditional retailers who focus on the masses, not to serve our business, which focuses on mass customization on many unpredictable, individual, customized orders," Mr. Wilke said. "LFM's emphasis on data and statistical rigor helps us get the information we need to show our suppliers why and how they have to change."

Besides Ms. Rastogi, the conference organizers included these LFM graduates who work for Dell: Stephen Cook, Kevin Farrelly, Mark Graban, James Griffith, Greg Kandare, Carey Mar, Miguel Miciano and Tom Wala. LFM student interns at Dell who helped organize the conference were Chad Gray, Aviv Cohen, and Rajesh Srinivasan.

Other speakers included Kenneth P. Morse, managing director of the MIT Entrepreneurship Center, and Lester C. Thurow, the Jerome and Dorothy Lemelson Professor of Management and Economics at the Sloan School of Management.

A version of this article appeared in MIT Tech Talk on October 18, 2000.

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