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Dell says it is open to layoffs as rumors swirl

Dell on Thursday declined to confirm a report of employee layoffs, but said it could make decisions related to the workforce if necessary in order to maintain company stability.

The company will cut 20 percent of sales employees in the U.S., and 30 percent of sales and marketing jobs in Europe, Middle East and Africa, according to a news report in The Register.

”When necessary, we’ll continue to make tough decisions to help ensure our long-term success—some of these decisions may affect our workforce,” said Dell spokesman David Frink in an email, adding that the company did not comment on rumor and speculation.

The reports come after CEO Michael Dell and equity firm Silver Lake Partners took the company private in a US$24.9 billion deal in October last year.

While Pund-IT analyst Charles King was not aware of the layoffs, he said going private may not have influenced the decision.

”Being a public company wouldn’t preclude them from making a move like that,” King said.

The sales staff could be targeted as the company unites product lines and sells more products through the channel. Dell has acquired many companies in the last five years, and as they unite product lines, the number of salespeople could decline.

”With a holistic approach to sales and marketing, there will be some redundancies,” King said.

At the company’s Dell World conference in December, King also noticed an increasingly large percentage of sales being driven through channel partners.

”As that channel gets larger and robust, it’s going to have an impact on [direct] sales,” King said. “I’m not saying that’s the reason, but that’ll be a logical extension.”

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