Analysis: What does Dell’s changing shape mean to the channel?

Dell (NASDAQ:DELL) has long been in a unique position within the channel. It built its reputation on the strength of its direct relationship with customers, but when that reached saturation point it switched its attention to the UK’s trusted network of system integrators.
Now it’s reached another interesting crossroads. It no longer wants to be seen as the world’s most efficient shifter of boxes but as something more akin to IBM (NYSE:IBM).
“We want to be a solutions provider,” says Griffin. “We have a legacy, for which we’re known, [but] we’re trying to be a much more end to end provider of IT solutions rather than just hardware.”
Big spender
To this end, Dell has spent the past two years acquiring companies such as Boomi, KACE and SecureWorks, all geared towards turning the company into far more than a PC retailer.
Take Boomi. Bought by Dell in November 2010, Boomi is a cloud-based integrator that aims to simplify software roll-outs and upgrades.
“They allow us to integrate pieces of software that may exist in the cloud or on-premise for our customers,” says Griffin. “This allows you to move to [a] single log-on between software, avoid duplication of entry and so on, and to do this in a matter of days and weeks rather than months and months of software integration and coding.”
Specifically, Griffin claims that Boomi helped to drastically reduce the time taken for a complicated project that needed to work across a dozen airlines: they wanted a loyalty scheme to span them all, and hook into each booking system, yet the work was completed in two months.
And it’s not just the software Dell has been working on: its own internal organisation has had a shake-up too. “We’ve been working hard on morphing our sales model,” says Griffin, with a focus on giving medium-sized businesses a “single point of entry who can sell the whole portfolio.
“Rather than a telephone-based model, you can now have an account executive with you in the field working on your end-to-end requirements. And behind them you’d have the specialist who’d be across everything from the hardware to the software and services and the integration in between.”
Comrade or competitor?
So what does this mean to the channel? Certainly Dell can’t be ignored as a competitor. It’s going to be spending a lot of money over the next few months and years repositioning itself as a direct supplier of solutions and services, not just hardware.
But there’s also a huge opportunity here. Through one partnership, you can offer your customers a suite of services they couldn’t have imagined even a year ago – from software integration in the cloud to sophisticated KACE management appliances.
“Really what we’re looking to try and do is provide customers with choice,” says Griffin. “If you [a business] want to use a local SI then we will enable that partner to secure Dell and leverage all our capabilities into your business environment. If you’d like to buy direct from us, you can.”
For the moment, at least, the partners have an advantage. Whereas Dell will have to spend the next few years building up trust – it’s only now starting to recover its reputation for customer service, for instance – you, hopefully, have it already.
 
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