Dell Computers (A): Field Service for Corporate Clients

Dell emerged as the market leader in US for Intel based PCs and small servers. In 2001, Dell
started offering larger servers for its customers. Sreeja, Chief Technology Officer of a large
corporate Dell customer was sceptical if required level of service would be provided by Dell
for its new larger products. She was also contemplating of buying the equipment from one of
Dell’s competitors.

Dell’s biggest competitor for large server market would be IBM. IBM has around 35.9%
worldwide market share in High end server market and 28.7% share in midrange server
market. According to Sreeja, for a larger server, reliability was crucial and on-site support
was essential. Dell’s competitors offered these services (on-site support) within four hours of
registering a complaint. 90% of Dell sales come from Business Clients. Therefore, there is a
pressure on Dell to live up to that and provide similar level of services.

Whenever on-site service was required for smaller servers, Dell employs a network of third-
party providers. Dell used various measures to capture the customer experience since it
believed that superior service and low-cost products inspires loyalty and paves way for
greater customer base. Even though Dell proposed to provide on-site services to business
customers within four hours it necessitated substantial inventory which is against Dell’s
culture and philosophy. Moreover, Dell’s competitors are going after this on-site service
more aggressively. It would be wiser for Dell to outsource its on-site service for larger
servers.

IBM offered to provide services to other computer manufacturers as well in addition to its
own customers. Since IBM is also the market leader in High end and mid-range servers it
would be an ideal candidate. IBM has gained extensive service experience and had access
to knowledgeable and flexible staff. Also, they have more than 135000 consultants, industry
experts in IT building and support. Therefore, there wouldn’t be any issue regarding the
quality of service being provided. Dell can employ its operational measures and survey
techniques to capture the quality of service being provided on a regular basis. Similar to
Premier pages, they can come up with a shared portal with IBM so that the data base can be
used to link tech support to product development. Dell’s current customers are being taken
care of by the outsourced services. There hasn’t been any issue till now, so handling
outsourcing wouldn’t be problem for Dell.

Sreeja Kapoor can go for Dell larger servers and Dell should outsource its on-site services to
IBM.