After spending several billion dollars on software and services firm Dell is trying to get its staff and partners to push solutions rather than hardware. An executive explains the strategy
Ever since it bought Perot Systems in 2009 for almost US$4 billion, Dell Inc. has been trying to diversify away from hardware sales, like IBM and Hewlett-Packard have done.
Since then it has broadened its reach into software, picking up companies that make application management, infrastructure automation and backup and recovery solutions.
However, a senior company official admits it still has a way to go to convince enterprises and mid-sized organizations to think of it in those terms – and to get its sales staff and system integrators to start offering end-to-end solutions.
“This is a big change for Dell. It’s going to take some time,” Joanne Moretti, Dell’s Canadian-born vice-president of marketing, said in an interview. “This is not for the faint of heart. This is a hard, long piece of work we have to do to transform.”
Moretti, who was hired away from HP a year ago, was in Toronto last week for a family wedding and to talk strategy with Dell Canada president Kevin Peesker – what products sales staff to emphasize, and the kind of support he’ll need to increase software sales.
Next month she’ll be in Australian, Japan and China doing the same thing
Part of her job is merging the marketing divisions of seven recent acquisitions
It’s a little hard to get a handle on Dell’s software business since one of its major divisions, Quest Software (acquired in 2012), reported separately until the first quarter of this year.
There’s a long list of software companies Dell bought in the last couple of years: Quest, probably the biggest at US$2.4 billion, came with the Foglight application, network and service management applications, the Quest One identity and access management family, a cloud automation platform, a VMware backup solution, Toad database management tools for structured and unstructured data, and Windows migration tools.
The 2010 purchase of Kace Networks brought appliance-based systems management and security software. The same year Dell picked up Boomi, a software-as-a-service data integration provider that can connect data between on premise and cloud applications.
Most recently Dell picked up Enstratius, a small company that makes multi-cloud infrastructure management solutions.
All of this feeds into Dell’s focus on cloud, big data, mobility and security, Moretti said.
She’s trying to get Dell to go beyond pitching hardware to customers and make more considered approaches. For example, at her invitation last week executives of an unnamed Canadian financial services company came to Dell’s Texas headquarters to see what it can offer.
The staff was well-prepared, she said, having studied beforehand the company’s annual report to understand its key goals. After hearing from company officials about its IT strategy and problems, Dell staff outlined their capabilities. By Moretti’s account, the customer was impressed and agreed to work with Dell’s services division on nine projects, including developing an end user strategy. There’s no assurance, but the work may lead to business.
That’s the way Dell has to work in the future, Moretti says: Do a workshop with a customer, draft an assessment, then a business case development and then design a solution.
“We have tons of proof points but we have to do a better job of marketing information and case studies out there.”
As for the ongoing effort to privatize Dell, she said it’s not proving to be a distraction for customers. “I haven’t heard any instance where we lost a big deal because of it, because we’re a big company and we’re going to be here.”Related Download
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