How Dell Product Managers Stole Christmas

by drjim on November 14, 2008

Dell Consumer Product Managers Are Having Problems Creating Christmas Gifts

Dell Consumer Product Managers Are Having Problems Creating Christmas Gifts

Q: How can you tell when a Product Manager drops the ball?

A: When there is an article in the Wall Street Journal with the title “As Holidays Approach, Dell Lags In New Products”

Man, talk about having your failures broadcast to the whole world! In the consumer space in which Dell sells some of its PC and notebook computers, the end of the year Christmas holidays are the key to a company’s survival. The sales that occur during this time generally account for 30% – 50% of Dell’s annual consumer PC revenue. Miss this revenue train and you’re going to be standing around waiting for the next opportunity for quite some time!

Where did product managers let Dell down? One place is in an ambitious mini MP3 player that Dell was planning on introducing. Way back in 2007, Dell bought a company called Zing in order to get access to their entertainment software. However, now Dell has decided not to launch this product before the holidays. Ouch! What this means is that the folks who would have bought this product will now go out and buy iPods and, maybe, Zunes. Once they do that, Dell is probably flat out of luck – once you’ve loaded your iPod up with $200 worth of songs, you sure don’t want to change players.

Interestingly enough, Dell product managers are not just falling down in the cutting edge new product area, they also seem to be dropping the ball in their bread & butter areas such as notebooks. So far this season, Dell has only released two netbooks (low end laptops, good for web surfing and emails) and some new paint schemes for some existing notebooks. Remember, they are playing in a highly competitive market – Apple just cranked out that very cool all aluminum Macbook and even Acer has released a bunch of new notebooks computers that have fancy styling and built-in access to 3G networks. What’s going on with those Dell product managers?

Michael Tatelman is Dell’s retail chief. He has been forced to tell the press that “You’ll see some very sexy products coming out of Dell”, though they may come out after the holidays. Double ouch!

Way back in the Fall, Michael Dell had told investors that Dell would “focus on killer products…” and they they would have a “shorter development cycle” that would allow them to get products out “40% to 50% faster”. Hmm, missing the Christmas season sure makes it seem like that is not going to happen.

This isn’t the first time that the Consumer products division of Dell has missed a great opportunity. Back at the start of the school year they had to hold back on introducing their first netbook because of keyboard problems and so they missed most of the back-to-school selling window. That probably explains why the consumer products division failed to make a profit in the last quarter and why Dell just got done laying off 9,000 of its workers.

What’s going on here? As product managers we are all probably quite familiar with the problems that Dell is facing. It sure looks like their new product pipeline, which is the lifeblood of Dell’s consumer division, has a friction problem – products are not traveling through it quickly enough. A product manager can’t fix a problem like this by his / herself. However, it is our responsibility to get the various folks who can fix it together and knock some heads in order to get it solved. Since this problem has existed since the start of the school year, clearly there is a lingering sense of a lack of momentum at Dell.

What should the Dell product managers be doing? They need to start with a calendar and determine when they need to have new products in order to match up with their customer’s buying cycles. Once they have this, then they need to start with a with the finished product and work back. What should the next product look like and what features will it have? Once this is nailed down, they need to determine how that product can be available by that date. Very basic stuff, but it sure looks like this is not happening. If a product can’t meet a date, then you need to determine what functionally can be dropped to still meet the date. If too much would have to be dropped, then and only then should you start to move dates around.

Dell can recover from these blunders, but it’s going to require that their Product Managers step up and take responsibility for fixing the system.

What do you think that Dell’s product managers should do next? Why do you think that they are having their current problems? Do you think that they should try to be more like Apple? Leave a comment and let me know what you are thinking.

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{ 2 comments… read them below or add one }

jayatdell November 14, 2008 at 10:58 am

While it might shock the conscience to even consider the notion, Wall Street Journal articles can be wrong, and even a casual survey of the broader media landscape tells quite a different story about Dell’s momentum heading into the holiday season.

Time magazine just cited the Dell Inspiron Mini 9 as one of the best inventions of 2008, and both CNET and Women’s Health named the Mini 9 one of their top picks for the holidays. Modern Weekly, one of China’s leading lifestyle publications, this week features the Dell Studio Hybrid as one of the best home entertainment systems in style and performance.

So our product managers are doing very well indeed, developing great products that excite and inspire.

As for the timing of product launches, one of the unique strengths of the direct model is that Dell can and will introduce important new products and personalizatoin options throughout the holiday season. My blog post earlier this week previews some of those upcoming launches http://yourblog.direct2dell.com/2008/11/10/bright-and-bountiful-dell-adds-color-and-surprise-to-the-holiday-mix/

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Dr. Jim Anderson November 15, 2008 at 2:25 pm

So in all fairness, Jay does make a good point – Dell does have a number of products that will be rolling out prior to the holidays. This has the possibility of getting into a he-said-he-said sort of discussion, so to cut that off at the base let me say that the holidays will show who is correct: Dell or the Wall Street Journal. However, in taking a look at Jay’s very detailed list of new Dell products for the holidays, I was struck by the fact that most of the updates were product line extensions to existing products (new colors, new processors, etc.) I didn’t see anything that stood out and said WOW. Something like a netbook with a big screen, big keyboard and a long battery life or something like that. Once again, Santa is making a list and he’ll let us know which Product Managers have been naughty and which ones have been nice…!

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