Michael Dell Steps Down As CEO

After building his company from a shoestring college dorm-room operation into one the largest and most successful computer companies in the world, Michael Dell will hand over the title of CEO of Dell Inc. to Kevin Rollins effective in July.

Dell will remain as chairman. Rollins currently serves as president and chief operating officer.

Having established Dell as arguably "the most successful company in the x86 Wintel commoditization wave," it's appropriate that Michael Dell now step back and spend more time to determine the strategic direction the company will take going forward, says Gordon Haff, an analyst with Illuminata.

Dell is faced with two major strategic-direction decisions, Haff says: Its role in the world of digital entertainment and the digital home, and how and if it will address the trend toward automated enterprise networks.

The company has been successful at being one of the leaders in providing low-cost systems, but how that strategy will transfer in the years ahead is unclear.

While enterprise competitors Hewlett-Packard, IBM, and Sun Microsystems, have all launched companywide automation and virtualization platforms, Dell to date has relied heavily on third-party vendors and kept its R&D costs at a minimum, Haff says.

"Dell has made some noise that they could do that as well," he says, "but there's a legitimate question going forward of what will be the best approach for someone who wants to be a tier one vendor."

In a statement, Dell says the promotion of Rollins will enable the company to keep intact its "two-in-a-box" senior management strategy. It also says the move is consistent with the two men's current roles: Dell emphasizing trends in technology and customer preference, and Rollins leading company strategy and operations.