5 Key Lessons From Michael Dell's "Play Nice But Win"

I'll be speaking with Michael Dell at a Village Global event later this week. The event is private, but since I was impressed by Michael's latest book, Play Nice But Win, I want to share some of my thoughts about it with a wider audience. So here are five key takeaways that resonated with me from Michael's highly entertaining and instructive book, in which he recounts the growth of Dell Technologies from its start in his college dorm room in Texas into the world's largest IT infrastructure company.

1. ABS

You're probably familiar with the acronym ABC -- Always Be Closing. But how about ABS -- Always Be Scaling? When Michael was a high school student, he took a job selling newspaper subscriptions to the Houston Post through telephone cold-calling. When he realized that newlyweds tended to subscribe at higher rates than others, he figured out how to simultaneously focus and scale his sales efforts. Via information available at local courthouses, he created lists of everyone in a given county who'd recently applied for a marriage license. Then, he sent out direct-mail letters to these prospects. This helped him reach more people than he could through cold-calling, and also convert at higher rates.

2. TO SCALE, FIRST DO THINGS THAT DON'T SCALE

When Michael started the company that would one day become Dell Technologies, he sold desktop PCs that he customized to his customers' exact specifications. In part, he pursued this highly hands-on approach because as an 18-year-old founder funding his start-up entirely on his own, he had very little capital -- only $1000 to start. So he couldn't afford to carry much inventory. Through this approach, however, he was able to provide his customers with machines that were faster and more powerful than what his larger, mass-market competitors were selling through retail channels. As Airbnb co-founder Brian Chesky once told me on Masters of Scale, "There's really two stages of a startup's product. The first is design a perfect experience and then you scale that experience." And that's what Michael did in those early days. Once he'd proven there was an untapped market for highly customized PCs, sold directly to customers rather than through retail channels, he started focusing on how to scale that new approach.  

3. BE PLEASED BUT NEVER SATISFIED

In the appendix to Play Nice But Win, Michael includes a compilation of "principles, traits, ideals, and lessons" that have guided him and his company over the course of his career. One of them is the aphorism "Success is a horrible teacher," a pithy evocation of how good outcomes can lull an individual or company in complacence, and thus make them blind or indifferent to changing conditions that should in fact prompt new perspectives and approaches.  To counteract this dynamic, Michael pursues a path of continuous improvement, and encapsulates that mindset in another phrase he includes in the appendix, "Be pleased but never satisfied." What I love about this construct is how it makes room for a sense of accomplishment within the greater drive for improvement. Because while both individuals and companies should always be striving for learning, evolution, and progress, a sense of fulfillment is also key for fueling growth over the long haul. If you're never pleased with what you've accomplished -- if you only focus on what you still need to achieve -- then you'll probably burn out before you accomplish all you can accomplish.

4. SMALL BUT THOUGHTFUL GESTURES CAN HAVE A BIG IMPACT

In 2015, Michael architected a deal that enabled Dell Technologies to buy EMC and its subsidiary VMware for $67 billion. It was the largest pure tech deal in history, a merger that meant two very large and successful companies, with their own long-standing cultures and legacies, had to start functioning as a smoothly integrated entity. To accelerate that process, Michael writes that he made sure over the next year "to give as many of EMC's people as possible the biggest hug imaginable." That included meeting in person when he could, and also reaching out virtually in a very proactive way. "I went on LinkedIn and connected with everybody who had a reasonably important title at EMC and VMware and Pivotal," he writes. "Nobody expected that: 'You have a LinkedIn request from Michael Dell." Not to puff up my personal importance, but people are excited to hear directly from the CEO, whoever he or she is. When someone would write me back, I'd say, 'Welcome to the team! We're so excited, heard great things about you' -- assuming I had. And 'Can't wait to work with you!'"

5. PLAY NICE BUT WIN

When Michael and his brothers played street ball as kids in Houston, his parents used to tell them, "Play nice but win." The message stuck, and became a guiding force in Dell's career as an entrepreneur and business leader. Because entrepreneurship is such a fast-moving, high-stakes game, with catastrophic failure always a possibility, it can be easy to de-prioritize ethics and adopt an "It's just business" mantra that ostensibly rationalizes all kinds of otherwise unacceptable behaviors in the name of survival. What "Play nice but win" conveys so succinctly is how important it is to always incorporate a commitment to ethics in your business efforts, and yet also never lose sight of the fact that businesses are in fact in a competition to become the most innovative, the most efficient, the biggest, the most profitable. If you put all your energy into playing nice, and end up losing, then it doesn't matter how committed to ethics or various aspirational behaviors your company was -- because your company no longer exists. To have the greatest positive impact on the world, a company must become sustainable and self-perpetuating -- i.e., it has to win. And then it needs to keep winning over time -- to essentially focus even more on adaptation and finding new competitive edges, even as it experiences greater and greater success. You can see this play out as Michael expanded and re-invented his namesake company over the last four decades. As the high-tech industry's focus shifted from desktop and laptop PCs to mobile, the cloud, Big Data, and other new technologies, he used the "Play nice but win" ethos to keep his company's focus on looking for new markets to compete in and win. As a consequence, Dell Technologies, which started out focused solely on desktop PCs, is now the world's largest IT infrastructure company.