SAN FRANCISCO (Reuters) –
Computer maker Dell Inc has asked employees to consider taking up to five days of unpaid vacation as it struggles to cut costs in the face of weak global demand.

The No. 2 computer maker, which is near the end of a program of 8,900 job cuts, is also offering voluntary severance packages and has instituted a global hiring freeze.

Chief Executive Michael Dell announced the moves in an email to employees on Monday. On Tuesday he said he expects further consolidation in the technology industry, and encouraged companies to ride out financial turbulence by focusing on hard returns, rethinking businesses and investing.

"Being stunned into inaction is exactly the wrong thing to do right now," he told a conference in San Francisco, adding that the company is investing in so-called cloud computing to deliver services over the Web.

At the same time, Dell aims to cut operating expenses in its fourth quarter, said company spokesman Jess Blackburn.

"The intent is to better position Dell for long-term competitiveness," said Blackburn.

"We are asking employees on a voluntary basis to consider taking off (up to) five days ... as unpaid time off as a flexible way to reduce costs for the company." Employees are being asked to take the time off in the next three months.

Dell wrapped up its third quarter on October 31. Its fourth quarter began Monday and ends on January 30, 2009.

Dell, the world's second-biggest computer maker behind Hewlett-Packard Co, has seen soft global demand for personal computers because of the economic downturn. The company reported a steep dip in second-quarter profit in August and said it would sharpen its focus on increasing market share in emerging markets such as India.

The Austin, Texas-based company said in August it cut 8,500 jobs out of a planned 8,900 headcount reduction to adjust its business for sluggish global demand.

Dell announced earlier this year it plans to reach annual savings of $3 billion in three years.

Michael Dell in San Francisco argued that the future of the technology industry is in cloud computing, generally seen as services and programs that are delivered over a network, rather than fixed on local computer hardware.

Speaking at Salesforce.com Inc's developers conference, Dell said he expects 80 percent of Fortune 1000 companies to be using cloud services within the next few years.

He said Dell is creating a cloud of its own around IT services, and he predicted the company's efforts will ultimately help bring IT service costs down.

Dell shares closed up 32 cents, or 2.5 percent, at $12.93 on Nasdaq.

(Reporting by Jennifer Martinez; Editing by Nichola Groom, Richard Chang)

Several companies already have announced plans to reduce or suspend the 401(k) company match:

Company: Dollar Thrifty Automotive Group Inc.

Ticker: DTG

Business: Car rentals

Home base: Tulsa, Okla.

Action: Reported in documents filed with the Securities and Exchange Commission on Aug. 5 that it had saved about $1.8 million in the first six months of 2008 by suspending the matching contributions in the first quarter of the year. Company matched employee contribution up to 6 percent of salary, said spokesman Fred Fleischner.

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Company: General Motors Corp.

Ticker: GM

Business: Car manufacturing

Home base: Detroit, Mich.

Action: Spokesman Dan Flores confirms that GM suspended company matches to 401(k) plans for its 32,000 eligible salaried workers. GM matched up to 4 percent of worker pay.

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Company: Frontier Airlines Holdings Inc.

Ticker: FRNT

Business: Commercial airline

Home Base: Denver

Action: Spokeswoman Lindsey Purves said the company discontinued its match June 1 as part of its effort to cut costs as it works its way through Chapter 11 bankruptcy protection. Company put in 50 cents for each dollar employee contributed up to 10 percent of pay.

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Company: Lee Enterprises Inc.

Ticker: LEE

Business: Newspapers and Web sites.

Home base: Davenport, Iowa

Action: Chief Financial Officer Carl Schmidt said the company is reducing its 401(k) match but it varies from newspaper to newspaper, so details were not released. "It's an important element of our overall cost reduction program for 2009," he said. Lee, which publishes 49 daily newspapers and 300 weeklies in 23 states and operates Web sites, has 7,600 full-time equivalent employees. Schmidt said the move would affect a vast majority of workers.

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Company name: A.H. Belo Corp.

Ticker AHC

Business: Newspapers, including The Dallas Morning News, The Providence (Rhode Island) Journal, The Press-Enterprise in Riverside, Calif., Denton (Texas) Record-Chronicle.

Home base: Dallas

Action: Spokeswoman Maribell Correa said the company is maintaining its 6 percent match on employee base salaries in the 401(k) plan, but is suspending a 2 percent profit-sharing contribution it makes on top of the initial company match until the company returns to profitability.

It may not be one of the burning social issues of our time -- neither presidential candidate made it part of their stump speech -- but Internet retailer Amazon.com has announced that it is taking a stand on "wrap rage."

Amazon is launching "Frustration-Free Packaging" (FFP), an initiative to reduce the use of plastic "clamshell" packaging and plastic-coated wire ties that are often used to secure unopened toys and electronics.

"I think we've all experienced the frustration that sometimes occurs when you try to get a new toy or electronics product out of its package," said Jeff Bezos, founder and CEO of Amazon.com. "It will take many years, but our vision is to offer our entire catalog of products in Frustration-Free Packaging. We'd like to thank Fisher-Price, Mattel, Microsoft and Transcend for working with us in this effort -- we truly appreciate it."

The comments posted on Amazon about the new packaging initiative were overwhelmingly positive. "Amen Amazon!! It's about time some of the leading providers of consumer products start actually listening to their frustrated customers," wrote Atlanta resident Pamela East. "I HATE all that ridiculous packaging! I'm so glad to see the simple and intelligent designs you guys have come up with, and I hope it spreads like wildfire."

Austin, Texas resident Kathy Grace went even further: "If Amazon can get [manufacturers]to get rid of clamshell plastic packaging (you know, the kind guaranteed to drive you to tears and then slash your hand open when you finally wrest it open), I will just give up my bank account completely and have my employer deposit my paycheck directly to Amazon."

Faster and Greener

The company is hoping that its new program will not only reduce consumer irritation, but also give Amazon a greener profile by reducing the amount of packaging used in its products.

To illustrate the benefits of the FFP initiative, Amazon created an amusing video of two people opening Fisher-Price Imaginext Adventures Pirate Ships, one packaged traditionally and the other with FFP. It took just over 11 minutes for the ship to emerge from the ties and molded plastic packaging; the other ship was ready to "shiver me timbers" in just 44 seconds.

The environmental benefits, Amazon says, are clear. "The new packaging eliminates 36 inches of plastic-coated wire ties, 1,576.5 square inches of printed corrugated package inserts and 36.1 square inches of printed folding carton materials," the company reported. "Also eliminated are 175.25 square inches of PVC blisters, 3.5 square inches of ABS molded styrene and two molded plastic fasteners."

Amazon is also taking a close look at the packaging of electronics. For instance, Transcend, a manufacturer of memory chips, has agreed to use recyclable cardboard sleeves to ship memory chips, instead of oversized plastic clamshells.

Slow Start

As Bezos pointed out, however, the packaging changes will not happen overnight. Right now, just 19 of Amazon's hundreds of thousands of items are included in the new program.

Nonetheless, the FFP initiative is part of a broad effort by Amazon to change its approach to packaging. The company has developed a software program to determine the "right size" box for shipping orders to customers, which Amazon says has significantly reduced packaging waste and transportation costs. The company has also committed to using shipping materials made at least in part of recycled materials, and which themselves are recyclable.

Increasingly, Amazon reports, these changes not only benefit the planet, but also benefit the company's bottom line.