Dell Computer is cutting the number of stock options it grants to employees, but does not expect to have to offer staff members more cash compensation as a result, Chief Executive Michael Dell said Monday.

Dell is not the only company that has cut back on using stock options, and it is that change in the job market that makes it unnecessary to sweeten compensation for employees in other ways, Dell said in an interview with Reuters.

The issue is potentially crucial for Dell, a company that is famous for running a leaner cost structure than its competitors and that has also pledged to continue to drive down expenses as a share of sales.

"The use of stock options at a lot of companies rose very, very quickly during the whole dot-com era, and now it's coming down," Dell said. "We're reducing ours and others are reducing theirs."

However, Dell is not turning to restricted stock options or more cash compensation instead, he said. "We think our operating expenses will continue to come down as a percentage of revenues," he said.

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