Vacuum Cleaners Discussions

James Dyson has voiced his feelings in regard to what it will take to save Britain's manufacturing industry in a report commissioned by the country's Conservative Party.  An interesting read and plenty of UK reader comments follow.

http://www.telegraph.co.uk/finance/financetopics/recession/7400742/Sir-James-Dyson-plan-to-fill-UKs-engineering-vacuum.html

M00seUK and vacmanuk, I'll be glad to learn what you think.

Venson

vacmanuk wrote:

No wonder Brown is catching Cameron in all the UK polls.  Brits realize that Cameron tapped the wrong man for the job because James/dyson outsourced his manufacturing production.

Carmine D.

CarmineD wrote:
Carmine,

I think it's admirable that James Dyson is willing to admit when he is wrong and to adapt to changing times.  Just because he thought bonuses were demeaning, doesn't mean that the employees did.    Perhaps the MAP policy has been adjusted as well due to the rough economy.  A 20% discount isn't really that extreme, particularly in comparison to some of the other big box brands. 

Severus wrote:

Hello Severus:

I agree with you.  It is admirable that James Dyson recognizes errors in judgment and corrects them.  Tho, 10 years is a bit long for the realization to sink in on his turnabout for bonuses. 

On dyson MAP, the higher than 10 percent "advertised" discounts are a factor of both the bad economy and also more importantly the need for dyson to be competitive pricewise with other bagless brands and models.  Even as a niche seller.

Since James and dyson have seen the "light" on these two issues, dyson/staff will become more realistic with their views on bagged vacuums.  Dyson and bagged vacuums are not mutually exclusive in the vacuum industry.  Both can increase and flourish simultaneously rather trhan at the expense of each other.  Even in bad economic times.  If I were a betting man, I'd bet dyson will have to lower prices even more than 20 percent to be competitive in the short. mid, and longterm.

Carmine D.

CarmineD wrote:
It's actually been a lot less than 10 years - I recall it being reported around 4 years ago that all Dyson employees were receiving a performance-related bonus for meeting growth targets.

I think it's positive for any business to offer a profit share / bonus scheme to all employees - I'm doing the same with my business.  When I was in previously in employement, only the sales team got bonuses, based on their sales  commisions. Unlike the people who actually had to do their badly spec'd projects... now that *was* demeaning :-)

M00seUK wrote:

Hi M00seUK:

I'm relying on the article you posted here dated March 14, 2010 with James Dyson interview.  I excerpted the verbage about bonuses from it.  "Now" is the operative word to me.  It doesn't mean 4 years ago.  With the realization that the article/interview misrepresented this issue on this point [intentionally or not], I beg kindly to revise my statement to read instead:  6 years is a long time to come to a realization of a turnaround on employee bonuses. 

For any business man in James' position to hold such an opinion at all, at any time regardless of length, is well to put it bluntly simply outrageous.  Worse still, it's even more shocking for James to say/print that the dyson bonus about face came as a direct result of the interviewer's suggestion 10 years ago.   Such outrageous statements by James Dyson, from a business perspective, cast doubts on him as a business leader.  It's as incredible as a decline from $2 Billion to multi-million in net worth in 3 years and saying during the same time periods that his company's profits and market shares are increasing year over year.  

Carmine D.

CarmineD wrote:
Hello Carmine,
As if often the case, we're discussing a series of unknowns. What we do know is that 10 years ago, Dyson didn't believe in offering bonuses. Here's a quote from an interview dated in 1999:-

"...likewise, he thinks an interest in money is rather vulgar. He is not a fan of paying people bonuses to hit targets. 'I think the whole principle of bonuses is demeaning. If someone needs a bonus to motivate them, they are not the sort of person who should be in business, in my view. Somebody is here because they believe in what we're doing and want to go with that and make a difference, and get great satisfaction themselves, and achieve things."

What we don't know is when exactly this policy was reversed - it might well have been two years later. Equally, while the interviewer at the time was likely one of a number of people to raise the question of performance-related bonuses, I very much doubt he was the only one.

It's worth bearing in mind is that the Dyson in 1999 is quite different to the company it is now. Back then, they would have been investing in R&D, trying to expand production (against local frustrations) to meet international distribution demands. With cashflow likely a big issue, it was about more about making people believe in a cause, than paying out speculative bonuses and drag down the bottom line.

In recent times, with cashflow demands more relaxed, it's now about getting new, reliable, exciting, well-marketed products out there. Everyone shares in that responsibility and they recognise that a bonuses structure gives a good return on investment. By all accounts, there's been a fair number of performance goals met over the years. Nothing 'outrageous' in that at all, in my view. You're blowing this far out of proportion.

Carmine,
It sounds like you are saying...  people in the UK should remove their faith in those who promote invention and innovation and instead put faith in the ideas of men like you.  Correct me if I’m wrong, I believe the bigger money is in inventiveness (Dyson’s universe) vice slaving to a ‘hole in the wall’ business (your universe).


Dyson Invents Big

M00seUK wrote:

M00seUK:  With all due respect, the interview in 1999 is not in question here.  It's the interview you posted dated March 14, 2010.  In particular the excerpt I posted for the reasons I posted. 

I put forth the following question:  What was dyson's vacuum market share by percentage in the UK in 2004?  What is it in the UK today? 

Carmine D.

DysonInventsBig wrote:

Dibster:  You're wrong, as usual, just as James was wrong in 1999 about bonuses and wrong with MAP of 10 percent.  Money is made with effective and wise business decisions and leadership.  It has nothing to do with faith and only a small amount to do with inventiveness.  500 dyson engineers is overkill and cost ineffective by all and any standards of business measures. 

A business leader who refuses to pay employee bonuses based on a misguided opinion that doing so is insulting and demeaning is in itself insulting and demeaning to employees.  James made his fortune largely through parlaying 2 large lawsuit payouts in a robust world/consumer economy.  He used slick bagless marketing and outsourcing manufacturing jobs from the UK to a contractor housed in Malaysia. 

It's been downhill for James in recent years [since 2006] in large part due to his own business decisions and product blunders/failures.  He alone is the blame.  2006: James' net worth was $2 Billion.  2009 James' net worth is multi-millions.  That's a big monetary fall and not due solely to the economic recession as the article that M00seUK posted here would have us believe. 

Carmine D.

It's possible that the vacuum business (other than handhelds) is doing well, but the hand dryers and bladeless fans are a drag on Dyson's bottom line.  Likely margins are down on vacuums.   The washer fiasco is likely still dragging down Dyson's net worth. 

It's possible that Dyson's net worth has dropped considerably due to charitable contributions.