This is the second post in a two-part blog series discussing Dell’s strategy to help SMBs better capitalize on technology. The first, A New Cloud Formation: Dell Cloud Marketplace, provides perspectives from Dell World 2014. This second post, which is excerpted from SMB Group’s April 2014 report, Guiding Stars: Vendor Strategies to Bring Game-Changing Technology Trends to SMBs, offers additional insights into Dell’s approach to help SMBs capitalize on technology trends.
The writing is on the wall for any business: With customers and prospects racing into the digital, mobile, and social future at breakneck speed, SMBs must proactively deploy technology to improve both business processes and the customer experience. SMBs that figure out how to use technology to stay ahead of their customers’ demands will thrive, while those that don’t face extinction.
But there are lots of vendors and solutions out there ready to help you on your journey, and one-size-fit all doesn’t apply in SMB. Is Dell a good fit for you? Read on for information and insights to help you decide.
Dell’s Strategy to Bring Game Changing Technologies to SMBs
Dell sees cloud, mobile, social, analytics and other technologies converging towards the next pivotal tipping point, where IT will change the lives and experiences of nearly every industry, country and person on the planet.
Dell articulates its view on top technology trends somewhat differently than other vendors interviewed for this report. However, the same technology trends—cloud, analytics, social, mobile and security—are core to Dell’s top picks. Dell sees the following trends ushering in new wave of business transformation, similar or greater in scope to how the Internet and web affected businesses:
- People will increasingly rely on technology to connect, collaborate and accomplish tasks and goals. Embedded in user-friendly solutions, cloud, social and mobile technologies enable SMBs to connect, collaborate and engage anytime, anywhere to better serve their customers and to work more efficiently.
- IT is changing from a support function to becoming core most business operations, and business decision-makers are increasingly involved in IT decisions to ensure the business gets the value it needs from IT.
- Amidst the growing volumes of structured unstructured data, SMBs that have the rights tools to find the needles in the haystack and uncover useful, actionable information and insights will gain competitive and market advantages.
- As SMBs rely more on technology to run their businesses and engage with customers, partners, suppliers and others, taking measures to secure and protect data, information and access are increasingly essential to business viability.
Some of the tangible ways that Dell is helping SMBs capitalize on these changes include:
- Becoming an über-cloud provider: Dell has been steadily expanding the Dell Cloud Partner Program to provide access and end-to-end support for offerings from multiple cloud vendors.
- Offering open, private-cloud solutions, which should help give SMBs more confidence in using OpenStack as an alternative to proprietary IaaS and PaaS (infrastructure and platform as-a-service) alternatives.
- Expanding portfolio of mobile management solutions, such as Enterprise Mobility Management, a unified mobile management solution to managed devices, apps, and content, and Secure Remote Access Gateway to protect endpoints.
- New intellectual property gained from acquisitions such as SonicWALL, Quest, Boomi, Compellent and Force10 is skewed towards the SMB world. In fact, Dell views SMB and midmarket as an ideal focal point for development and acquisitions since it believes large organizations also want scalable solutions that are easier to deploy and use too.
Changes in SMB Technology Expectations and Behavior
Fueled by the web, mobile and social access, Dell sees changes in how SMBs evaluate and shop for solutions. Today, SMBs are more prone to have done their homework before they come to the sales table. Armed with a greater understanding upfront, they are looking for vendors and partners that will listen to what they are trying to do and offer authentic, objective and knowledgeable guidance. In addition, Dell believes that simply doing the right things for people works. To that end, Dell prefers having its customers tell its story rather than Dell telling it. For example, Dell cites the tornado damage in Oklahoma City last spring, where Dell served as a first responder, as exemplifying its commitment to doing the right thing to earn customers’ faith in Dell.
Dell sees both the role of SMB IT and business decision-makers morphing. More frequently, line-of-business (LoB) managers are not only customers of IT departments, but also co-owners of IT. This means that IT staff must work harder to meet increasing demands, and become more educated and engaged in business operations and strategy than in the past. SMB IT personnel need more practical and actionable advice and support from vendors and their channel partners to juggle ongoing IT management with innovation.
SMBs are also scrutinizing “calculated risks” much more carefully. For instance, SMBs are interested in the cloud because of affordability and ease of access/use advantages, but want to ensure that cloud solutions are secure and reliable. SMBs are also more likely to factor business disruption into the cost/benefit analysis for any given solution. They are getting wiser about the perils of bad decisions and implementations, so the bar keeps getting higher to deliver solutions with less business disruption and faster time to value.
Finally, SMBs increasingly recognize that the technology-performance connection is real, and can be used to accelerate growth disrupt industry icons with innovation and agility. The perspective is summed up in Dell’s latest ad campaign. SMBs can use new technologies not only to reshape their existing businesses, but also to redefine the economics of an industry and expectation of the market.
However, one constant remains. Most SMBs need capitalize on these opportunities without putting themselves in financial or operational jeopardy. SMB budgets, IT staff and expertise aren’t often able to both maintain what they have and innovate within the window of opportunity. So Dell is focusing on designing, delivering, supporting and financing solutions that take these constraints into account.
Perspective: Dell as SMB Technology Catalyst
Dell’s journey to transform itself has been in progress for a few years. While on Wall Street’s watch, it wasn’t easy for Dell to recast its image from a transaction-oriented hardware company to an end-to-end solutions provider and trusted advisor.
However, Dell’s entrepreneurial heritage is once again alive and well. Michael Dell not only started the company in his dorm room when he was a 19-year old student at the University of Texas, but took it private in 2013 to gain control over its destiny again. With genuine DNA at the heart of Dell’s commitment to SMBs and entrepreneurs, Dell can take a longer-term view on return on investment in new technologies. This should enable it to launch more innovative and affordable cloud computing, mobile, social, analytics and security technologies geared to SMB requirements.
In addition, Dell prides itself on listening to its customers and creating a mutually beneficial dialogue. Dell’s Social Media Command Center is one of the best in the industry, and Dell’s SMB and partner outreach programs are extensive.
While Dell is still in the midst of its own transformation journey, its attitudes and actions when it comes to SMBs should help it to significantly broaden its status as a trusted advisor in this market.
This is part one of a two-part blog series discussing Dell’s strategy to help SMBs better capitalize on technology. This first post provides perspectives from Dell World 2014. The second post, Dell’s Strategy to Provide Game Changing Technologies to SMBs, provides a detailed glimpse into Dell’s approach in the SMB market.
How has Dell changed since Michael Dell took Dell private a year ago? A couple of weeks ago, I had the opportunity to attend Dell World 2014 in Austin and find out. As I’ve written in past posts about prior Dell Worlds, the transformation has been underway for several years, since Michael Dell embarked on his strategy to transition Dell from a hardware-centric company to an end-to-end solutions provider.
As a private company, Dell is no longer obliged to disclose financial metrics. But, unleashed from Wall Street’s quarterly pressures, Dell appears to be making excellent progress on its goals. For instance, Dell has broadened its software and service portfolios, and claims significant growth in both areas. According to IDC, Dell is also increasing hardware market share no doubt aided in part by competitors HP and IBM. With IBM exiting the x86 server market, and HP’s recent decision to split itself into two companies (one focused on PCs and printers, the other on servers, software and services) Dell is the only vendor left that supplies an end-to-end desktop to data center portfolio. Meanwhile, Dell has evolved to become a significant force in the channel, with 40% of its sales now going through channel partners.
Dell’s New Cloud Marketplace
One of the most interesting announcements at the event was the beta launch of the Dell Cloud Marketplace, which distinguishes itself from many other cloud vendors by offering customers choice. In Dell’s brokerage model, the vendor provides customers with a one-stop shop from which they can select and manage cloud services from multiple vendors, including Amazon, Google, Joyent and Microsoft. The marketplace is built on technologies from Dell’s Cloud Manager, which Dell acquired from Enstratius in 2013. Key technology partners include Delphix, which supplies data migration services; Pertino, for cloud networking; and Docker, for container and portability services. Dell is also partnering with Foglight to provide developers with tools to improve cloud-based application performance.
Dell Cloud Marketplace is tuned to the different needs of IT managers and developers. IT managers get a single console from which they can provision, manage and integrate private, public and hybrid could services. Meanwhile, developers can get instant, self-service access to cloud services. The concept appealed to conference attendees, with over 400 signing up for the beta the day Dell announced it.
Dell’s vision for its Cloud Marketplace is similar to that of Priceline or Kayak in the travel business. Dell will aggregate, simplify and streamline shopping, selection, purchase and management across many cloud service options. Cloud offerings will initially be sold through Dell.com, Dell’s established, high volume direct sales channel. Over time, Dell is likely to implement reseller programs and possibly even white-label programs for channel partners.
Perception is the hardest thing to change. With deep, successful roots in the hardware business, they company has been primarily regarded as a hardware vendor, even though its journey to become an end-to-end solutions provider has been underway for quite a while.
Dell’s move to become a broker of cloud services, highlight the acquisitions, research, development and determination that Dell has been investing in this quest. And, with cloud adoption now mainstream (Figure 1), Dell’s timing for the marketplace is on target as well. The cloud makes it easy for people to buy new services, and more difficult for IT to manage the wide variety of different services that are in play. Providing a solution that gives IT managers more visibility and governance capabilities, while at the same time offering users more choice, promises to help address this challenge.
Figure 1: SMB Cloud Adoption
Source: SMB Group
However, due in part to the uniqueness of the model, Dell will need to invest in market education to articulate the capabilities and benefits of this new brokerage approach more clearly.
In addition, Dell must create a clear roadmap for what and when it will add to the marketplace to properly set market expectations. For instance, one of the customers I spoke to at the beta would like to use the marketplace to help him manage the wide range of file sharing and collaboration solutions that his users are buying.
Finally with Dell partners accounting for an increasing percentage of Dell sales, Dell will need to come up with an attractive approach to lure partners to resell Dell Cloud Marketplace services.
Disclosure: Dell paid for most of my travel expenses to attend Dell World.
This video interview was originally posted on SMB Group Spotlight.
Laurie: Hi, this is Laurie McCabe from SMB Group and today I’m here on the SMB Spotlight at Salesforce’s Dreamforce 2014 Conference. I’m talking to Aaron Harris, who is the Chief Technology Officer for Intacct. Aaron, thank you for sharing time with me today. Can you tell me a little bit about Intacct, who you are, what you do?
Aaron: Sure. Thanks Laurie. Intacct is a cloud accounting and finance solution that we have designed for small and medium-sized businesses. We’ve taken a best in class approach, so all of our resources are targeted at building just what the accounting and finance team needs, the general ledger, payables, receivables. We’ve got a strong relationship with Salesforce, so if you’re using Salesforce we’ve got a very nice native integration where Intacct and Salesforce synchronize data and processes and it’s a beautiful way to get your front office and your back office working together.
Laurie: So what are you highlighting here? I know you have an announcement about some new collaboration capabilities with Salesforce. What’s going on with that?
Aaron: That’s right. So at Dreamforce this year we are announcing Intacct Collaborate. What Intacct Collaborate does it takes Salesforce Chatter and extends it into Intacct so that your sales and your marketing and support people who are using Salesforce today and who are collaborating on Chatter are using now the same network that the accounting team, the finance team, project managers are using on the backend. So there’s one social network, there’s one collaborative network across the enterprise for the whole organization to work on.
Laurie: Good. It sounds like that makes it easier for everybody to feed information into the whole financial process.
Aaron: That’s right. There’s a lot pieces to it. Obviously there are some great stories, right? I’m a sales rep, I’ve got a deal that I want to get done, I need to get a 10% discount approved on that deal. In the old world I’d write an email to the CFO, the CFO doesn’t know anything about what I’m talking about so the CFO has got to go do some research. She responds to the email, there’s lots of back and forth, none of the communication is captured, right? So it slows down the sale, it adds frustration, there’s no log to what happened. So in this world that all happens via chatting and collaborating, and it’s all in real-time, it’s all captured, it’s all part of the record. We also see this being useful within the accounting and finance team, getting them to collaborate over some of the more tricky business processes. I was talking to a CFO the other day who said 20% of finance transactions are exceptional, they’re complex. And we spend 80% of our time on those 20% of the transactions, the exceptions. We have to find out what’s going on, what do we do? Having Collaborate allows them to not only more efficiently communicate about these transactions and these exceptions, but it generates a log that you keep the communication around the transaction.
Laurie: I know Intacct is really aimed at small and medium businesses, but that’s a very diverse audience, so what segments of the SNB market are really the sweet spot for Intacct?
Aaron: Sure, so there’s really two categories of customers who are choosing Intacct. The first is companies who have outgrown their first accounting product, usually it’s QuickBooks. They’ll outgrow it when they need to automate processes that are manual. Perhaps they’re now a multi-location business and it’s just too difficult to aggregate or consolidate data across the locations. It might be that the reporting tools available in QuickBooks don’t give them kind of insight that they need, which product lines are the most profitable, which of my professional services engagements are losing money and which are making money? This kind of insight is just not possible in some of the low-end products. Or it may just be that this is a growing company that expects to go public, they need to have proper controls in place, they need to have a certain way they’re going to get through their Sarbanes–Oxley audits, so they need a product that will help them…
Laurie: Even if you’re preparing to be acquired or something like that. If you sell the business you would need that.
Aaron: Exactly. You need a product that cannot just assure external auditors that you’re following these controls, but that allows you to provide the evidence that you’re doing it.
Laurie: And that’s about half of your customers are coming from that.
Aaron: About half. So the other half are people who have embraced the cloud. They love Salesforce, they love some of the other cloud products. They can see that with Salesforce they’re getting constant innovation, it embraces mobile technology. You know what I’m talking about.
Laurie: Yeah, they just want to be able to do things on the fly, they way they want, on the device of choice.
Aaron: And no more headaches about hosting the infrastructure, that’s security, right?
Laurie: No, they don’t want to mess with that.
Aaron: So they want to take their accounting and finance processes and modernize them to the same extent as they already have sales and marketing. So they’re choosing Intacct not just because it’s cloud and it gives them the same advantages they’re getting through Salesforce, they’re also choosing it because it’s fully integrated with Salesforce. They’ve got the full front office/back office integration, data synchronization, process integration.
Laurie: It takes the integration headache away too.
Aaron: That’s right. No more disconnect in the process.
Laurie: So how can a potential customer or prospect learn a little bit more or better evaluate whether this might be a good fit for them?
Aaron: The easiest way is to go to our website, go to www.intacct.com. There’s a number of things you can do there, but maybe the easiest is just to get a trial.
Laurie: So you do still offer a free trial? I think a lot of them don’t anymore
Aaron: We do. We’re very proud of our product, we think it’s very easy to use, so get a trial. We actually walk you through how to learn more. It’s actually a really nice way to learn about Intacct.
Laurie: That’s great. Well Aaron, thank you again for sharing that information with me about Intacct. I think it will be really valuable for a lot of small and medium businesses out there. Have a great rest of Dreamforce.
Aaron: Thanks Laurie.
Laurie: Thank you.