I pointed out a number of disconcerting observations about Dell in the first part of this series. It is difficult for me to disparage a company with which I have had a long and generally positive experience, but Dell seems intent on fundamentally changing elements of its business model which can certainly alienate some of its most devout fans. Take this quote which I read several weeks ago on:Slashdot:
linuxwrangler writes “Infoworld’s “Notes From The Field column this week includes a comment from a reader who found that Dell listed several different prices for the same part. Intrigued, I grabbed the first part number I found (a 512MB memory module #A0193405) and found that the list price is $289.99 which the price offered to “large businesses”. Meanwhile, the GSA/DOD contract price is $266.21 while “home users” find the list-price discounted to $275.49 and “small businesses” fare even better with a $246.49 price. InfoWorld contacted Dell who responded, “Each segment sets its own pricing, and consumers are free to pick the one that’s cheapest.” Buyer beware.” (Posted by timothy on Monday February 07, @04:50PM from the guess-which-way-they’d-go-if-equal dept.)
While every business has a right to develop different pricing structures based on different target audiences, Dell has muddied the water so blatently that even those of us who price multiple systems a week, cannot confidently feel we are getting the best price at the particular moment of purchase. Detailed review of the variously available channels will unearth price variations which can be significant. Dell also now makes extensive use of online couponing and rebates which further muddies the pricing picture.
Note in the example cited above, the government/DOD price for this part was not the lowest (which you naively might believe should be the case given this customer’s undeniable leverage). Small busiiness wins this pricing “war.” Since this would be my classification, I suppose I should feel good that Dell sees fit to discount more heavily to those of us in the capital trenches. My concern is the next part number, the next system I need to purchase for myself or a client, may be on the losing end of the price spectrum.....
If you explore Dell’s affiliate program, with its myriad discounts, rules and regulations, you will find another layer of pricing considerations available to those willing and able to find a valid coupon code and make use of it under the company’s guidelines. Viewers of Dell’s web site will also find systems in various channels which are “almost” identical. You may find a PC which has certain hard drive options; video card alternatives; or “free upgrades;” which make direct comparison between channels difficult or impossible. This is of course by design, but further frustrates an informed buying process. There’s more. Radio and TV specials also allow for special promotion of systems which may be unique to these channels and therefore offer systems which are difficult to compare.
I still believe the Dell offers generally good “value.” This is an at times nebulous and overused term, but the company’s equipment does seem to perform reliable with as much “bang for the buck” as its primary competitors (particularly in the low to mid end PC systems market). I suppose in the final analysis, some buyer’s “value” is better than others......
I have been an unabashed fan of Dell for over twenty years. I have believed in the company’s business model since first hearing about Michael Dell’s vision. I have preached in big corporations, small business offices, and individual homes the merits of purchasing this company’s equipment above any competitors for many, many, years. Sadly, in the past several months I have heard and personally experienced events which lead me to conclude this company is shifting directions, leaving some of its staunchest supporters behind.....
Perhaps the first warning sign came last summer. A client with an admitted propensity for ignoring issues until they become “critical,” called early one morning. Many of you know the story already.
“Nobody can get their email. We can’t even get on the web and we have an even bigger problem!” Remaining calm, I purposely paused a few seconds before responding hoping my agitated client might catch his breath. “Besides not having email and web surfing, what else is going on?”
“We can’t pull up our case information and we have several briefs due and a big case going to court at the end of the week!” At this point, I could envision a small but decidedly angry group of staff peering down at the telephone over my client’s shoulder. Before I had time to ask a few questions to diagnose the severity of the issues, the final “confession” was breathed into the receiver, “I’ve already looked at the server. The screen was black and I tried turning it back on. I heard a ‘whining sound’ followed by some clicks. Nothing came up on the screen, not even an error message.”
I had warned this client that his aging Windows NT 4.0 Server was experiencing read/write issues on both RAID Volumes for nearly a year. The Event Viewer would show that certain disk stripes were unreadable during periodic system reboots. While the system continued to perform, unmistakable warning signs of impending hardware failure were being broadcast to anyone willing to listen. I listened, but despite my begging, pleading, and cajoling, my client insisted on waiting for the shoe to literally drop.
Compounding the challenge now facing them, and by extension me, was lax (putting it kindly) follow through keeping the tape backup system properly rotated and running. One obvious moral to this story is, backup, backup, backup. This task is without doubt the most difficult to get commitment on in small business settings (and I won’t even discuss SOHO and individual settings because the problem is worse). Backing up isn’t “sexy,” it isn’t “fun,” and it doesn’t seem to add any productive “value” to the enterprise (until it is needed). Then good back ups are a value because productivity can come to an utter stand still!
You may be asking how this lengthy preamble relates to my perception that Dell is losing touch. Please read on for the rest of the story.....