Imagining What's Possible

Dell is proud and protective of the business processes it uses to take advantage of technology

Chris Murphy, Editor, InformationWeek

September 5, 2003

4 Min Read

Mott sees custom, in-house software development as a business advantage. Dell always considers off-the-shelf tools, but choices are limited by the fact that not many businesses do such high-volume build-to-order manufacturing, especially of custom-built units, so software vendors don't cater to that market. Plus, Mott doesn't believe Dell gets a competitive advantage from a software suite that sacrifices best-of-breed performance for tighter integration. "We're ambitious enough to want both," he says.

Dell's manufacturing operation isn't the only one taking advantage of the company's development expertise. The company's sales efforts rely on a custom-built application called Symphony. As many as 3,000 salespeople use the Symphony portal to help customers build systems when they call in to buy. The system uses EDI links to suppliers to monitor inventory and estimate how a specific component might change the build time; that time information is updated in the Symphony system multiple times a day. That integration not only gives salespeople an estimate for how long it will take to build each machine but also how profitable each will be. With every change to a configuration--say, upgrading a laptop carrying case from standard issue to the $219.95 Kenneth Cole leather edition--the system shows how the profit margin changes.

The business case for building such a system was obvious: increased revenue and profit, lower call times, and reduced training time. "We view this as a strategic differentiator for us," says Susan Sheskey, VP of IT.

Strategic decisions at Dell tend not to get very far if they don't have data to back them up. That makes the company's data-warehouse system, called Dell Data Direct, or D3, a critical tool for IT to deliver to Dell managers. It's a 28-terabyte Teradata system, using Oracle databases, EMC Symmetrix storage, Dell servers, and custom-built middleware that provides Dell managers with their interface.

Most managers have 10 or 15 reports they've customized that they check regularly. These are essentially spreadsheets that feed information such as the sales and margins of certain customers or production performance. But D3 also provides a wizard for managers to create ad hoc queries and lets them share those reports, through only a few clicks, with colleagues who have similar security authorization. In a data-driven environment like Dell's, showing the numbers is often the best way to make a point. "That's a way we can really spread best practices," says Ken Gray, senior manager of global data management.

Along with contributing to the bottom line, Dell's IT organization is expected to showcase new technologies and strategies. The IT department acts not only as a "Dell-on-Dell" reference account by using the company's hardware but also as an informal consultant to Dell's customers. Mott and other IT executives met with the IT groups of 217 customers in the first half of this year, sometimes talking broad strategy but more often discussing how to tackle specific business initiatives.

Mott says his boss (that would be Michael Dell) is an avid early adopter of technology and expects him and his organization to be the same. That fits Mott's philosophy: Don't be afraid to experiment with technologies before all the technical problems are worked out, or you'll never find out all the possible applications and advantages. "It's tough to imagine fast enough," Mott says. "You have to experience it to imagine what's possible."

Mott puts technologies such as radio-frequency ID tags, wireless networking, and computer security in the critical-yet-still-emerging category. Already, RFID chips track individual PCs as they move on conveyor belts through the Topfer Center factory, reading chips on the plastic tubs full of parts needed to make a single unit. "History teaches you these [technical problems] are going to be resolved," he says. "You can work on the limits side or on the limitless side."

For Dell's IT staff, the challenge is executing on that visionary ambition within intensely practical performance goals. Their five-year objectives include reducing IT spending to less than 1% of revenue and cutting the application development cycle to nine months or less. And to do that while delivering 100% of projects on time with a measurable bottom-line improvement.

If Mott's IT team can figure out how to do all that, someone better buy them all a beer.

About the Author(s)

Chris Murphy

Editor, InformationWeek

Chris Murphy is editor of InformationWeek and co-chair of the InformationWeek Conference. He has been covering technology leadership and CIO strategy issues for InformationWeek since 1999. Before that, he was editor of the Budapest Business Journal, a business newspaper in Hungary; and a daily newspaper reporter in Michigan, where he covered everything from crime to the car industry. Murphy studied economics and journalism at Michigan State University, has an M.B.A. from the University of Virginia, and has passed the Chartered Financial Analyst (CFA) exams.

Never Miss a Beat: Get a snapshot of the issues affecting the IT industry straight to your inbox.

You May Also Like

More Insights