Dell-Perot marriage focuses on common goals
Success of hardware/services merger relies on giving customers what they want
- By Nick Wakeman
- Jan 28, 2010
Few companies made as dramatic a move in 2009 as Dell Inc.’s acquisition of Perot Systems, which gave a boost to Dell’s services business.
Paul Bell, president of Dell’s public-sector business, is one of the executives charged with making Perot and Dell mesh.
Bell reviewed Dell’s goals during a round table discussion with Washington Technology Editor-in-Chief Nick Wakeman and other editors from 1105 Government Information Group.
Q: What makes you smile about Perot now being part of the Dell family?
Bell: We can sit down with a customer and have a conversation that says, “Let’s look at everything you are trying to accomplish. What are your relative strengths and weaknesses? What’s the budget?" We can talk about all of the things that go into the right solution.
We recognize that no one solution is right for everybody. For some, we might recommend a full outsourcing model so the customer can concentrate on strategic transformational things.
Others might be very good at the infrastructure, and we wouldn’t save them any money, but we can say, “OK, here’s the area that’s missing.”
Having that breadth is the most exciting thing for us, and it’s the main purpose of the combination.
Q: How is it going in terms of bringing hardware and services businesses together?
Bell: One thing that has made it easy is that we knew each other, and there are a lot of things that make us alike culturally.
Both are founder-led companies. Both are committed to the mission of the public sector. Dell’s marketing material has the line, “Here to serve.” If we ever forget that, our business is in trouble.
Ross Perot and his team are entirely about that. So the people cultures, the soft skills stuff, has been an unbelievable fit.
Q: As a manufacturer, Dell has focused on efficiency and measuring things, such as monitoring processes, time to delivery, etc. Perot is in a business that is relationship-intensive, which is hard to measure. How can those cultures blend?
Bell: That’s an external misperception. There are differences in what we focused on, but there is a big overlap. Perot was about a $3 billion services business; Dell, before the acquisition, had about a $5 billion services business, of which about a billion-and-a-half was the same kind of large managed services work as Perot. We’ve been doing global management service for Unilever, Honeywell, Boeing, for years.
So we were in the same business they were in, but it was $1.5 billion of a $60 billion company, so most people didn’t know about it.
We’ve been working with the federal government for 20 years. It’s all about relationships and understanding the mission and needs of the customer. We both do that.
Perot also was extremely tightly managed. Their metrics and process controls around how they delivered contracts is extremely tight. So it fits very well with Dell's culture.
Q: How does the acquisition affect Perot’s ability to be an independent adviser to its customers?
Bell: They absolutely have the flexibility to do whatever is right for customers; they absolutely will continue to do that.
The nice thing about it is that they are in the full range of technologies, including networking, where we have had a smaller presence, and systems integration and software.
Q: What about the traditional Dell partners?
Bell: We do a huge business with Lockheed, Northrop Grumman and General Dynamics. They compete with each other; we compete with them.
We pick our opportunities. Sometimes, one of us primes it; sometimes, it’s the other way around; and other times, we’re on opposite sides of the table.
That’s just the way this industry works.