This article is more than 1 year old
Dell: 60% of our people won't be going back into an office regularly after COVID-19
Please don't wax philosophical, please don't... Argh: 'Work is something you do, an outcome, not a place or a time'
In and amongst Dell Technologies workplace existentialism and talk of "human transformation" in a pandemic, chief operating officer Jeff Clarke last night claimed the majority of his 165,000-strong workforce will not return to the office again on a regular basis.
During a Q2 earnings conference call, the exec said the business had completed Day 171 of working remotely and "the novelty of the new normal has worn off", before waxing lyrical about the work-from-home trend in a way that only US execs can.
"COVID-19 has made one thing clear to us: work is something you do, an outcome, not a place or a time," said Clarke. "And it takes teamwork and a culture that prioritises outcomes and results over effort.
"Though we have team members juggling many challenges: parenting, caregiving, citizens and countries still grappling with surges of the pandemic, our employee engagement and productivity is at an all-time high. We are seeing a human transformation right before our eyes."
'We will never go back to the way things were before'
The current crisis didn't start the WFH trend but obviously the various lockdowns imposed by governments around the world accelerated it, he said, and businesses are spending money on tech to cope.
Clarke, who is also vice chairman, added: "After all of this investment to enable remote everything, we will never go back to the way things were before. Here at Dell, we expect, on an ongoing basis, that 60 per cent of our workforce will stay remote or have a hybrid schedule where they work from home mostly and come into the office one or two days a week."
Infrastructure rival Fujitsu has said it will close 50 per cent of its Japanese office space by 2022 and give staff options to use the office, work from home or from regional hubs. There is no word yet on how this will translate for staff outside of Japan.
According to AlphaWise, the research unit of US bank Morgan Stanley, just 52 per cent of white-collar workers in the UK have gone back into the office compared to 82 per cent in France and 72 per cent, on average, across other major European economies.
In McKinsey research, four in five people questioned said they liked working from home, 41 per cent reckoned they are more productive, and 28 per cent they were as productive.
Clarke said research indicated that 20 per cent more employees will work from home across all company sizes and industries in the longer term. "I think that is understated. And it will take more technology to ensure productivity and collaboration from anywhere."
As for Dell Technologies' Q2 results for the period ended 31 July, it is clear that the crisis took a toll: revenues fell 3 per cent year-on-year to $22.733bn, with the bright spots at a divisional level being consumer PCs and VMware.
Client Solutions Group fell 5 per cent to $11.203bn, with commercial PC down 11 per cent to $8.039bn due to sliding demand. Consumer was up a healthy 18 per cent to $3.164bn on the back of a hike in sales of XPS and Alienware lines.
The Infrastructure Solutions Group saw turnover drop 5 per cent to $8.207bn as servers and networking fell by the same percentage to $4.196bn. Storage was also down 5 per cent to $4.011bn.
"Overall, servers were still challenged with some improvement in orders for mainstream servers," said CFO Tom Sweet. "Our high-value servers built for artificial intelligence and machine learning workloads saw mid-single digit orders growth, though this is still a small piece of the overall server revenue mix."
VMware grew 10 per cent to $2.9bn. "The largest revenue contributors included the VMware Cloud Provider Program, Modern Applications, End User Computing, and Carbon Black. VMware Cloud on AWS once again had a triple-digit revenue growth rate," the CFO added.
Dell managed its cost base in the quarter, taking action including redundancies to "prepare for uncertain times". Total operating expenses for Q2 were down 12 per cent to $6bn – R&D went up 2 per cent but sales, general, and admin costs were down 15 per cent.
Accounting for interest expenses and a tax benefit of $599m, Dell was left with a net profit of $1.099bn. This was way down on the prior year's Q2 when Dell received a tax benefit of $4.343bn that papered over pre-tax losses of $111m to leave $4.232bn.
Dell paid down $3.5bn in debt during the quarter and now has debt of $54.5bn, including DFS-related debt of $10bn and subsidiary debt of $6.3bn in addition to its core debt and margin loan. ®