This week, I’m at Dell’s annual analyst conference and it is hard not to contrast the efforts with HP’s. The large conference room is packed with analysts and Dell’s CMO, Karen Quintos, is doing the opening introduction and the lead-in for Michael Dell. At Dell, marketing is strategic and, like most of its peers, this group takes the analyst community seriously and heavily resources it. Dell is showcasing its independence from the motivations of being a public company, which allows it to focus on long-term strategic initiatives over short-term tactics to increase short-term valuations like divestitures and layoffs. In the end, this allows Dell to build the company rather than layer on layoffs and divestitures, making the company stronger rather than weaker over time. This is night and day different from HP, which appears to be on a death spiral.
Much of the content of the opening talk is on what makes Dell different not just from HP but from every other IT vendor.
Sustainability was one of the areas in which HP at one time had leadership. For years, one of the most impressive presentations was how HP was finding ways to build technology sustainably. Under Meg Whitman, HP’s embattled CEO, there is no evidence this effort even exists. At Dell, sustainability was a major component of the opening talk: how solar power is being used to power classrooms, the efforts the company has to go paperless and reduce the reliance on paper, and overall efforts to conserve energy.
Five years ago, I remember meeting with Dell and pointing out that it wasn’t even on the same planet as HP, which was far more advanced and far more aggressively investing. Five years later, the two companies have swapped places. HP, in an effort to sustain profits during times of falling revenues, has been cutting to the bone and it appears sustainability efforts are now on the cutting room floor. Dell, which is now private, has been able to instead double down on sustainability efforts and now appears to lead HP and likely lead most of its public IT company peers.
One of the areas where Dell has consistently led over the last five years is in funding innovation. It has been outspoken in this effort and now is on its second entrepreneur in residence. Michael Dell has personally been lobbying the United Nations to put innovation in emerging countries higher on the priority list so these countries can develop their own industries and move from being liabilities in the world to being contributing assets.
Innovation is alive and well in Dell as well, and it showcased award after award in the opening. Typically, much of the focus during the opening of an analyst event is on financial performance; this one has sustainability and innovation in their place. Financial performance is tactical and historical. Sustainability and innovation are forward looking and speak to long-term growth and increased capability, and in this instance, not just for Dell but for the U.S. and the world.
While Dell isn’t talking about financial performance, it is showcasing its volume growth in key areas like servers, storage, PCs and infrastructure. Part of what makes Dell different is that Michael Dell actually built this company from scratch. I’ve had a chance to chat with him over the years and this year we not only chatted cars, a personal passion/hobby/addiction of mine, but how Dell started. He talked the early days at Dell. Apparently, going into the PC business broadly was kind of an accident as, in the beginning, what he sold was a kit to add hard drives to Apple computers. It is fascinating to realize that Dell exists largely because Apple missed an accessory opportunity.
From the smallest seeds, amazing things can grow.
Wrapping Up: Dell vs. Whitman
Looking back at the last five years, HP started in trouble and in need of a turnaround. Dell was being strangled by a need to focus on financial analysts and activist investors, and was facing an impossible path of going private. Now Dell is private, doing well and leading in areas where HP once led, while HP is in trouble and in desperate need of a turnaround, partially because it’s being strangled by an excess focus on financial analysts and activist investors. I see a fascinating contrast, which I think showcases a massive difference in the skills of those leading both firms.
The obvious overarching contrast is that Dell is busting its hump to get ready for tomorrow, while HP is busting its hump to get through today.
Rob Enderle is President and Principal Analyst of the Enderle Group, a forward-looking emerging technology advisory firm. With over 30 years’ experience in emerging technologies, he has provided regional and global companies with guidance in how to better target customer needs; create new business opportunities; anticipate technology changes; select vendors and products; and present their products in the best possible light. Rob covers the technology industry broadly. Before founding the Enderle Group, Rob was the Senior Research Fellow for Forrester Research and the Giga Information Group, and held senior positions at IBM and ROLM. Follow Rob on Twitter @enderle, on Facebook and on Google+