Understanding Dell: Pragmatism Beats Revolution

from the focused-on-the-right-things dept

I no longer buy Dell computers after the absolutely horrific customer service experience I had with them in 2000 (that involved a brand new broken laptop which they alternately insulted me about and then lied to me about fixing). However, I do respect what they’ve done as a business, outside of their customer service department. News.com is running a great interview with Michael Dell where he explains how they innovate. Clearly, it’s a press interview, and so he’s trying to get specific things across, but he says all the right things, and basically explains how they’ve taken what is essentially a commodity for every other company in their market and turned it into a hugely profitable business. While other companies try to innovate on new products, Dell’s R&D efforts are focused on making the process better. They’re taking standard components and making it so they can sell them to customers at a cheaper price. Their goal, according to Dell, needs to be to build products that consumers want – and not come up with products that are better for Dell to sell. They figure if they’re selling the right products, while innovating the process they can remain profitable. So far, it’s working. In the interview he trashes HP, Sun and IBM for their focus on utility computing as the exact opposite of that goal. He suggests those moves are more about forcing customers into a locked-in solution that offers them no real benefit.

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Comments on “Understanding Dell: Pragmatism Beats Revolution”

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Mark says:

Pragmatism vs. Revolution

Pragmatism is an excellent way to capitalize on someone else’s innovation. But before we pull a muscle shaking Michael Dell’s hand too vigorously, we might consider what would happen if every company embraced his “vision”: we’d end up with a world crammed top-to-bottom with me-too players. Dell would be lost if it weren’t for some of the companies he criticizes; they push the envelope and, in the process, discover new opportunities that he can exploit. His company is analogous to those creatures that attach themselves to the bottom of a shark, in the hopes of grabbing a few scraps from someone else’s kill.

Anonymous Coward says:

here's what I care about...

…within a week of calling Dell to provide on-site support, a support technician arrives with replacment parts (keep in mind that I’m using overseas federal support).

Second instance: a drive in one of my arrays fails. Call dell and within 1 day a replacment arrives.

In an area where ComHPac or IBM support is completely non-existant, that is what makes or breaks our decision to do business with Dell.

I hate their customer support line as well and I routinely spend 40 minutes on hold and hang up 50% of the time out of frustation; however, I have learned what times to call in order to get their “follow the sun” support calls to land in Texas. As far as I am concerned, their Indian support staff is wacked and on-drugs. Occassionally you run into the good Indian tech guy, but more often than not, I get lied to about on-site support availability, get told that there is no problem or whatever hangs up the call in 2 minutes or less.

I also like the fact that they tend to go where others wouldn’t, witness the Axim, PowerConnect switches, Veo Web Cams, etc. Where is HP or IBM when it comes to channeling best of a breed equipment to the consumer? With HP/IBM if it’s not invented by them, then it shouldn’t get sold to the customer.

Yeah, sure, they’re just a middle man between you microsoft and the Tiawanees PC manufactuer, but they tie it all together and usually at the lowest cost with the highest value support options.

…and that’s why their revenue is up 20%. The market is always right, in one way or another.

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