Dell Technologies is undergoing significant changes, cutting some sales positions while creating others as part of its effort to reorganize the AI era.
Through this process, the company aims to become leaner and more growth-focused. On Monday, Dell stated that it is reorganizing its go-to-market teams and prioritizing investments to enhance innovation, value, and service for its customers and partners.
Impact of layoffs and financial performance
The company did not disclose the number of employees affected by the latest layoffs. However, Dell reduced its workforce by 13,000 jobs in two rounds last year, bringing its total headcount down from 133,000 to about 120,000.
The Round Rock, Texas-based tech giant reported annual sales of $88.4 billion for the 2024 fiscal year, a 14 percent decline from the previous year and $13.5 billion less than its record of $101.9 billion in 2022.
Dell’s second round of layoffs last year coincided with introducing the “Partner First for Storage” initiative, which incentivizes core sellers to route storage deals through the channel. CEO Michael Dell and other leaders have praised this move to strengthen relationships with channel partners.
The layoffs have led to various reactions within the industry. Gary McConnell, CEO of Dell Platinum partner VirtuIT Systems, sees the layoffs as a sign of Dell’s increased reliance on channel partners.
McConnell encourages those affected by the layoffs to seek opportunities within the channel. He believes the restructuring demonstrates Dell’s commitment to working more closely with partners despite the uncertainty accompanying such changes.
Strategic changes
Bob Venero, CEO of Future Tech, views the cutbacks as Dell’s strategy to leverage AI for increased productivity. He believes relying more on the channel will benefit Dell as the company focuses on innovative products and solutions. Venero emphasized Dell’s exponential growth in channel presence over the past two decades and its continued strength in the market.
Denise Millard, Dell’s Chief Partner Officer, discussed the reorganization’s benefits for the company and its partners. She noted that Dell is streamlining various departments to promote better collaboration and capitalize on a $2 trillion-plus market opportunity. Millard highlighted the substantial changes brought by GenAI and the evolving technology landscape, emphasizing the importance of partners in unlocking value for modern IT and AI.
Overall, Dell Technologies’ restructuring aims to position the company for success in the AI era by making it leaner and more focused on growth while continuing to strengthen its relationships with channel partners.
