Leadership Styles of Microsoft Corporation and Dell - Case Study Example

Executive Summary This paper is on leadership. It intends to learn from the leadership styles of Bill Gates and Michael Dell – the founders and leaders of Microsoft Corporation and Dell, Inc., the two top ICT companies in the world. Concise information on who these leaders are and on their companies is provided. Succinct discussion on their leadership styles is then made. Finally, common threads of ideas on leadership from the two great leaders in the computing industry are brought to the fore. Gates and Dell have borne witness to an aspect of leadership that is relative to bringing about and managing or sustaining change. Leaders – they also have shown – are capable to foreseeing what is to come. Likewise, they are confident of themselves but are never limited to attending only to their personal interest. Introduction This paper is about leadership styles by two renown CEO’s of the two most respected ICT companies in the world. William H. Gates of the Microsoft Corporation and Michael S. Dell of Dell, Inc. are phenomenal in themselves. They are computer geniuses, managers par excellence, and leaders in their own right. As they provide the world with breakthroughs in the industry of computing and manage “hands-on” their global companies, they exude the confidence and manifest the resilience that leaders possess. For sure, they have a lot to offer to the present as well as the up-and-coming generation on the subject matter of leadership. The task of this paper is to analyze the management and leadership styles of Gates and Dell. It is going to detail the strong points and weak points of each leadership’s ways of exercising their leadership role particularly over their respective companies. To accomplish this end, these two leaders as well as their companies will be briefly introduced. Then, their overriding leadership styles will be discussed and their impact on today’s business practice would be ascertained. A critical analysis of their styles by way of juxtaposing their respective approaches to leadership will be made. Finally, this process ends by bringing to the fore significant common threads of ideas on leading and leadership that may be culled from Gates and Dell. Bill Gates: the leader William “Bill” H. Gates is the chairman of the Microsoft Corporation. A global leader in software services, Microsoft employs more than 90,000 people (Microsoft, 2010) in 105 countries and regions (Microsoft News Center, 2010). Best known for its Microsoft Windows operating system and the Microsoft Office suite of productivity software, Gates’ company has also ventured into hardware with consumer products such as the Zune and the Xbox. It has also made a presence on the Web with the MSN Internet portal and the Bing Search Engine (Microsoft, 2010). Born in 1955, Gates and his two sisters were raised by their lawyer father and educator mother. He discovered his interest in software as he was in primary school, and started to program computers at age 13. In 1973, while studying at Harvard University, he developed a version of the programming language BASIC for the first microcomputer – the MITS Altair. He eventually dropped out from the school to devote his energies to Microsoft – the company he had begun, along with his childhood friend, in 1975. He rightly anticipated that the computer would be valuable tool on every office desktop and in every home. With this belief and his vision for personal computing, Gates was instrumental in the bringing Microsoft to an unprecedented success and in revolutionizing the software industry. Since 2008, he has transitioned out of his day-to-day role in the company to spend more time on his global health and education work at the Bill & Melinda Gates Foundation (Microsoft News Center, 2010; Dearlove, 2010). Bill Gates’ leadership style Bill Gates is famous on numerous accounts: he founded Microsoft; he’s among the richest men in the world (Ravi, 2010) for thirteen continuous long years (Praveen, 2008); he is a computer genius; he’s a generous philanthropist (Ravi, 2010) – among others. His leadership qualities are similarly known. He is seen as great leader because of his ability to inspire Microsoft. Considered to a certain extent by the continued performance of his company, Gates cannot be just one of the conventional business managers in any sense of the word (Best, 2004). His remarkable business vision and obsessive desire to win tell of his leadership style that is radically different from anything the business world has seen before (Dearlove, 1999). His leadership style is generally described as visionary and controlling. He rightly envisioned that every business and household must have a computer (and must run Microsoft software) already at the time when no one in the world was even aware of the software industry’s future. He who could write software code better than everyone in the planet could do decided not to belong to a great institute to be successful. He dropped out from Harvard University and pursued his dream of writing software programs for every computer in the world. He was just passionate about software, coding and technology; and, he clearly anticipated the future where every single household has a computer. To him, the shelf life of intellectual property is akin to that of banana. He’s being a visionary propels him to be innovative (Praveen, 2008). His controlling leadership style, on the other hand, is evidenced by the Microsoft’s being ruled by predictability and understanding. While Gates acknowledged that technology has a mind of its own, his success is built on controlling the technology. He worked to make MS-DOS and Windows the universal. Consequently, he’s able to create a degree of market control that has given Microsoft’s business a very high degree of predictability and profit (De Bono & Heller, 2008). His controlling style manifests in his management practice, too. He is known to have an obsession with detail and with checking up. For instance, he even used to sign expenses for his right-hand man, Steve Ballmer. This explains why a lot of people who knew him raised their eyebrows when Gates mentioned that he hadn’t even read the complaint in the Microsoft anti-trust trial. But, even after the anti-trust case and the very fast development of ICT, when Microsoft is supposed to have reformed its organizational structure by continually forming deliberately kept small groups to carry out specific tasks, Gates remains the organizational cement. Still, decisions large and small are funneled to the top (De Bono & Heller, 2008). Maccoby (2000) has a singular description of leaders with visionary and controlling styles – i.e., they are narcissistic leaders with incredible positive side and inevitable shadows. Gates’ leadership style in today’s business environment Krishna et al (2009) write on visionary leadership: it is responsible for series of scenarios that support the creation of and planning for an ideal end state; it is capable of proposing inspiring goals for the future; it goes against all odds to sell customer their ideas and win market place acceptance; and, it brings about organizational and societal transformation with their higher value system (pp. 391-392). Not surprisingly, visionary leadership has been considered a holy grail; and, business leaders have placed considerable value on it for organizational change (Cameron & Green, 2004, pp. 125). Bill Gates is said to have difficulty treating his subordinates as equals, or as grown-ups who are understand the business. His propensity to control tells that he cannot trust his people with anything – i.e., basically from accounting honestly for their expenses to thinking about succession. The issue of trust negatively describes Gates’ leadership style. Arguably, if the Microsoft’s performance is any gauge, its top man’s leadership style is beneficial – albeit it won’t be lasting as its monopoly over the software industry is unlikely to last (De Bono & Heller, 2008). Michael Dell: the leader Born in 1965, Michael S. Dell is the founder and chairman of the MSD Capital L.P. He is also the founder, chairman and CEO at Dell, Inc. In 1992, Dell became the youngest CEO of a company ever to earn a ranking on the Fortune 500 (Businessweek, 2010). He started a company called PC’s Limited from a room with just $1,000 capital (see About Dell, 2010), while he was still studying at the University of Texas. The said company later became Dell Computer Corporation, followed by Dell, Inc. in 2003. He also formed MSD Capital in 1998; and, with his wife, he instituted Michael & Susan Dell Foundation to manage the investment and philanthropic efforts by their own family (Ravi, 2010). Dell, Inc. is the world’s second largest PC company (Ravi, 2010). Employing more than 96,000 people worldwide, it develops, sells and supports computers and related products and services such as personal computers, servers, data storage devices, network switches, software and computer peripherals (see About Dell, 2010). It has grown by both organic and inorganic means since its start. Notably, it merged and acquired Alienware in 2006 (Hachman, 2006) and Perot Systems in 2009 (Pepitone, 2009). Over-all, Dell, Inc. is well known for its innovation in supply chain management and electronic commerce (About Dell, 2010). Dell’s leadership style Dell describes his leadership style as being built on collaboration. This must be the reason why to his employees Dell is a person with warmth and good instincts for making people feel like part of the team. He acknowledges that his belief on rules and order, but his natural proclivity is not to control everything by himself. He is contented in macro leadership – contented in providing frameworks and guidelines (Woodward, 2009). There is also a consensus among various observers that Dell’s leadership style is transformational. For one, he has a good track record, knew the business and is recognized as an expert by those who are seeking to influence – elements that are, according to Rowe & Guerrro (2010, pp. 309), provide powerful transformational leadership when allied with the right content and context. He started with nothing, but he has managed to build an empire, take hold of commercial opportunities ahead, and lead his team to create a lot of pioneering activities in the computer industry field. He created a low-cost mail order model to sell computers (see Woodward, 2009) and helped people realize the power of computing and the Internet. He keeps a strong morality responsibility for his business and family – explaining his foundation for philanthropy; and, he created a new image of a young entrepreneur. In all of these, Dell has shown his strong desire to break up laws and conventions and to effect complete change. He has shown, too, his ability to create something new in order to benefit others. Generally, Dell’s leadership is about coping with changes (Shavinina, 2003, pp. 828). The computer industry is understandably very competitive and volatile. And, by any measure, Dell, Inc. under Dell’s leadership has so far more than endured the developments in the industry. It has even kept on improving its spot.   Dell’s leadership style in today’s business environment Dell’s style of collaborative leadership brings forth a management style that is inclusive. This is among the very notable change that people observed in him when he reassumed in 2009 the over-all leadership of Dell, Inc. after two and a half years of laying off as the company’s CEO. Commissioned by the board of the company to arrest its slide, Dell assembled a leadership board and did a very good job of delegating decisions and responsibility to his executive team. In fact, his inclusive leadership spills over to how he deals with customers. He goes direct to them and gets real-time feedback (Woodward, 2009). The company even has a community website – http://www.ideastorm.com – that allows customers to identify and vote on Dell’s new product lines. This tells of his inclusive management style, as primarily substantiated by his willingness to listen not only to his subordinates but also to the customers. If there is anything that Dell’s transformational leadership may teach today’s business players, it is going to be his ability to fire up people at all levels with his enthusiasm. Especially when he returned from two and a half year of hiatus as Dell, Inc.’s CEO, he has so far been able to raise his employees’ awareness of the significance of designated outcomes that he himself set and get them to transcend their self-interest for the good of the organization (Woodward, 2009). Ultimately, Dell’s leadership style debunks the practice of transactional leadership (Friedman, Langbert & Giladi, 2000). Critical Analysis Having discussed in general strokes the leadership styles by Gates and Dell, this paper is now going to make a critical analysis of the two techies’ approach to leading their respective organizations. The principal point that this paper raises is the fact that as exemplified by Gates and Dell’s cases there appears to be no single prescription for effective leadership performance (Dulewicz & Higgs, 2004, pp. 107). Gates is controlling. As mentioned in the preceding, he is known to assert that he personally signs the expenses of his second-in-command. He expects to know everything that happens in his company. He is everywhere – from marketing, to business development, to software development. Dell on the other hand is observably more trusting towards his employees. He is more respectful of the capacities of his subordinates. Like Gates, he wants to know how things are going on. But, unlike Gates, he is contented to simply draw the guidelines and provide the framework. By extension, Gates is known for his monopolistic tendency while Dell’s willingness to share power is very much known all throughout the industry. Theirs, on this account, are divergent leadership styles – but with similar result! That Microsoft Corporation is in higher place in the list of top ICT companies than Dell, Inc. is not so essential on this count. What matters is both are top performers in the software and computing industry. Further, there may be different descriptions of Gates and Dell’s leadership styles – that is, visionary for Gates and transformational for Dell – but it is interesting to realize that what ultimately shaped their leadership approaches are almost identical. Firstly, both have almost identical skill of envisioning or seeing a clear picture of the future. Gates’ vision was that every business establishment and every household would have computer and would have Microsoft software running on it. Dell dismantled his newly purchased Apple computer, and tried to find out for himself the discrepancy between what the customers really wanted and what was available. Eventually, with Dell’s cheaper and customized products, he is able to serve his customers better. The value of the skill to envision cannot be overlooked. It informs the way in which people direct their efforts and utilize their skills (Dulewicz & Higgs, 2004, pp. 106). Gates dropped out from Harvard University as he knew the school couldn’t provide him the direction in life that he had figured out for him. He was at his junior college when he called it quits, and devoted his focus and attention to Microsoft Corporation. Dell, too, defied conventional wisdom and education. He studied for only a year in the University of Texas, during which he built the precursor of Dell, Inc. inside his college dormitory bedroom. He may have developed his entrepreneurial spirit from his stockbroker mother, who is said to always raise discussions on business and economic affairs during family dinners. But, what is truly remarkable with Dell is his determination to proceed along the life direction that he himself charted – along the line of the future that he knew he would make. Besides the competence area of envisioning that Gates and Dell share, a common personal characteristic by the two seems to be their self-belief. Both Gates and Dell have tremendously self-confidence insofar as their computing is concerned. They realistically knew their individual capacities, and they are confident that they can achieve their goals. At an early age, Gates got hooked to computing and Dell to entrepreneurship. Both made for themselves a dream that is undoubtedly big – but which was well within their reach on account of their personal capacities. Finally, this paper won’t be complete without mentioning that in fact as leaders Gates and Dell have also shown that they are both capable of and willing to pursue callings that are bigger than themselves or larger than their personal interests. They both have foundations for their philanthropic causes. The Bill & Melinda Gates Foundation (http://www.gatesfoundation.org/) has consistently provided financial support to global efforts to curb malaria, cancer and AIDS (Krishnamurthy, 2008). The Michael & Susan Dell Foundation (see http://www.msdf.org) supports children’s causes – such as education and health of children living in urban poverty. This must be an extension of their marching order to their employees to fix their gaze beyond their personal agenda, and instead focus on what is good for their respective organizations. Conclusion By critically considering Bill Gates and Michael Dell’s leadership styles, this paper has come to bring to the fore significant threads of idea on leadership. A particular aspect of leadership is pertinent to change – that is, how to bring it about – and management of change. Gates and Dell were change agents par excellence. Gates broke the grounds of software industry; Dell broke the conventions and offered low-cost and customized computers and other electronic gadgets. Their impact on the industry is definitely far-reaching. They have affected not only their own times, but also the present and even the future. Being so required that they have competence in important areas. In this paper, only the specific area of envisioning is covered. They were standing on their ear – as it were – and were able to see across the boundaries of time. Actually, they didn’t only see what lies ahead; what is remarkable in them is that they in fact worked very hard to make themselves – and other people – be where tomorrow lies. Of course, they have personal characteristics that predisposed them as leaders we knew them to be. They have confidence in themselves, able to discern and willing to follow and serve higher callings. References: About Dell, 2010. 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