By Charles King, Pund-IT, Inc. December 2, 2015
Resistance to change is the rule rather than the exception among enterprise IT executives and managers, and for very good reasons. As technology solutions percolate into every business process nook and cranny, companies come to value IT reliability and stability as essential virtues. When innovation arises, achieving its full value hinges on minimally disrupting what is already in place.
That is certainly the case with individual IT solutions and services, but it is doubly important when it comes to IT vendor mergers and acquisitions (M&A). Over two decades of industry consolidation, business technology buyers have become understandably wary of M&A activities that impact them, as have channel and other partners of involved vendors.
The situation is further complicated by vendors who stoke those anxieties in hopes of gleaning new clients and partners. Invoking fear, uncertainty and doubt (FUD) isn’t a terribly original or elegant strategy, but it typically inspires at least a few timid souls to bolt for the exits. For that reason, how and how well companies involved in M&A actions communicate with their customers is critically important.
EMC’s customer commitments
Those points are worth considering while reading the recent blog post from David Goulden, CEO of EMC’s Information Infrastructure organization, detailing the company’s commitments to customers and partners in light of EMC’s planned acquisition by Michael Dell, MSD Partners and Silver Lake.
Given various legal and regulatory restrictions, Goulden can’t address specific issues around the deal in enormous detail, but a close reading of his commentary suggests what EMC customers and partners can expect once the acquisition is completed.
Below is Goulden’s list of EMC commitments with my thoughts and analysis:
- Delivering the high quality customer experience you expect from EMC, including our customary commitment to support all current products as we always have. This qualifies as an essential assurance of continuity, particularly related to EMC’s existing product portfolio. That may seem simplistic, but it’s a critical issue for customers who have made substantial investments in EMC hardware and software solutions. It’s also important if one considers the numerous, all too common past IT industry M&A actions where the acquired company’s portfolios are gutted and/or discarded, leaving its clients holding the bag. Goulden certainly means to assure EMC customers that their investments are and will continue to be safe. But by doing so he is also emphasizing statements by Dell in respect to EMC’s accomplishments, and its plans for EMC to act as the focal point for the combined business’ enterprise-facing strategies, solutions and activities.
- Extending our technology leadership through investment in R&D, including enhancing existing products and roadmaps. This is another statement of assurance, but one focusing on the future of EMC’s existing product lines. The point here is that after the Dell deal is completed, EMC expects to have the means to continue developing and growing its existing product lines, and evolving its roadmap for future features and functionalities. The clear focus on R&D is a critical point to emphasize given the substantial, ongoing investments EMC has made in those areas for years. The subtext here is that Dell understands the value of those R&D efforts and will continue supporting them.
- Preserving our dedication to customer choice (free of lock-in). Some observers may consider this statement tongue in cheek since every vendor prefers customers to stick with its own solutions and technologies. But it’s important to consider in regard to EMC’s longstanding leadership in enterprise storage hardware and software. The company achieved and maintained that success by agnostically supporting other vendors’ solutions, as well as broader heterogeneous data center environments. The same can be said for EMC’s steady stewardship of VMware. But historically, when specialty technologies and firms are acquired by system vendors, the agnostic qualities that once helped them succeed are often subsumed in the acquiring company’s homogeneous go-to-market plans. This commitment suggests that EMC will continue its longstanding agnostic support of other vendors’ platforms, though it’s also likely that Dell will deeply integrate its systems and related solutions to take full advantage of EMC technologies.
- Continuing to enhance our partnerships & technology ecosystems. While simple on its face, parsing the implications of this statement requires understanding how enterprise IT vendors work. Publicly, many vendors like to portray themselves as largely or completely autonomous warriors in the IT market trenches. But in reality, achieving success requires vendors to nurture and maintain relationships with myriad individual partners, and manage complex manufacturing, supply and commercial ecosystems. In the best circumstances, it can be a walk in the park. In the worst, it’s more like walking a high wire in a thunderstorm. EMC fully understands how to negotiate and thrive in both extremes, and intends to continue doing so to its own and its partners’ benefit.
- Listening to customer feedback and communicating updates to you clearly — and often. This statement may seem a bit redundant, but by proactively reaching out – as David Goulden has done in this blog – EMC is acting as a central and responsive information resource for its customers and partners. That’s certainly an important point for those constituencies, but by doing so, the company is also aiming to pre-empt activities by third parties, including competitors and other mischief-makers, who hope to profit from spreading misinformation.
Successfully managing information is central to the success of IT, so it shouldn’t come as a surprise that EMC is moving forcefully to take control of the narrative around its acquisition by Dell. That differs from the vast majority of other IT industry deals in which the company being purchased occupies a position secondary to the acquirer and leaves communications to the primary party.
But along with being the largest-ever acquisition in IT industry history, Dell’s deal for EMC qualifies as a joining of companies of largely equal stature with notable individual strengths. To fully succeed, both will need the willing support of its respective customers and partners.
David Goulden’s blog underscores the important roles that those individuals and organizations will play in the deal’s long-term success. EMC’s five commitments provide assurance that they will not be forgotten or dismissed after the acquisition is done.
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