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Technology Stocks : Dell Technologies Inc.

DELL 133.78

-0.1%

Nov 14 9:30 AM EST

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To: D. Swiss who wrote (67632)	9/26/1998 10:32:00 AM
From: rudedog	Read Replies (1) of 176387

Drew - Thanks for an interesting discussion on the CPQ thread. It got me thinking, and an article posted by Eddie Kim also highlighted it for me. There are some interesting issues which came into focus for me, reflecting both where Dell is at now and also some of the ideas chuz and others have been discussing about how Dell will sustain growth. I don't think it will be by growing the enterprise business the way some on this thread are suggesting. An excerpt from my CPQ post on this topic - ************************************************* A great article - techweb.com which sums up what I was trying to say to Drew. Mike Lambert was VP Marketing for Compaq's systems division in 1994 and early 95. He had exactly the same agenda then. Dell is where Compaq was in 1995 in terms of size, rapid growth and relative maturity in their key markets, and they are facing the same problems Compaq faced. In 1995 CPQ had just gone through a 5X increase in stock price in 2 years (much like Dell), had just become #1 in PC sales (as Dell may do next year), and had figured out that the market they needed to move into to sustain growth (the high end) was a much harder target than the disorganized PC market. Mike Lambert is a smart guy and Dell did themselves a great service by hiring him, but the job will be harder at Dell. Although Dell is similar to Compaq in 1994 - a PC maker who wants to get into the enterprise - Dell lacks the technology infrastructure that Compaq had, and also, the plums are no longer hanging on the tree in terms of acquisitions. There are simply no companies left with the technology base of Tandem and DEC (unless Dell plans on buying IBM!). So if Lambert executes his strategy as well as he did at Compaq, he will get a foothold in the enterprise for Dell sometime in the next 18 months. But then they have the hard question of where to go next. I think this article places the relative positions of the two companies in perspective with regard to enterprise strategy. I very much doubt that Dell will do as well at solving this particular problem as Compaq has done.

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