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Dell: Enterpise IT leaders will face serious choices

Mike Simons | Feb. 7, 2013
Michael Dell’s move to take private the company he founded has received cautious thumbs up from industry analysts.

"Dell is in the midst of a wrenching transition from a supplier of commodity hardware, mainly traditional PCs, to being a supplier of enterprise-grade IT infrastructure. Dell's ambition is nothing less than offering the entire IT stack with supporting services. A significant risk likely to face Dell during this transition is that enterprises and public sector organisations cut back on their purchases 'until the dust settles'.

"While the company might come out of this transition stronger with a product line-up that better meets the needs of businesses and public sector organisations, there will be uncertainty as to what products and services stay, get strengthen, or get eliminated.

"Ovum sees effective communication to prospects and customers about its strategy and product roadmap as a, if not the, critical success factor to get through the transition. While this might sound simple it is not. Compounding Dell's challenge is the deep seated brand identity as a 'PC company'. Another communications challenge will be how Dell Services (built on the Perot acquisition) shares its financials for the due diligence phase on large, multi-year IT services deals."

Lusher urged CIOs with close ties to Dell "to asset the risk to their infrastructure and put into place plans should Dell's radical hardware, software, and services shifts require changes to procurement plans."

 

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