We have started looking at the business from an outside-in perspective

The policy announcements appear to be a step in the right direction, says Dell India President Alok Ohrie

August 03, 2014 10:44 pm | Updated 10:44 pm IST

Dell India President and Managing Director Alok Ohrie

Dell India President and Managing Director Alok Ohrie

Two quarters ago when Dell India announced its new go-to-market strategy for the Indian market, the global tech major had just gone private. Since then, Dell has overtaken PC market leader Hewlett Packard as the top PC vendor in India (according to International Data Corporation), and the company claims to be making strong strides on the enterprise business front. In a chat with The Hindu, Dell India President and Managing Director Alok Ohrie says that the Indian market has responded well to the new strategy. A strategic market for Dell, he says, India is being closely watched as the strategy is rolled out, here for the first time, and that the results so far have been encouraging all-round. Excerpts:

It’s almost a year since Dell chose to go private. How has that worked out for Dell, globally and here, in the Indian context? Are you today closer to some of the objectives you set out to achieve?

There’s a huge shifting coming in the industry. This is predominantly because major forces such as cloud, analytics, mobility and social, and also security in some form and shape, are changing consumption patterns at the individual level and also for businesses. Second, there’s massive consolidation taking place within the industry. You see corporations move, and some companies selling off, merging or even closing down. This is also an indication of the fact that scale will be a big factor in terms of their relevance and long-term existence in the market. Getting delisted in October last year and then looking at new strategies was a response to these factors. Dell saw this much earlier than others in the industry.

These changes then were a reaction to these massive changes in the technology landscape?

Yes. That was necessary to get the company to start doing things that will help it to be better prepared for the changing environment — it brought in the flexibility and nimbleness to responding to this paradigm shift that the industry is seeing.

To do this, and also bring in the all-important entrepreneurial spirit, you needed the freedom that publicly listed may not have.

So, what are some of these changes in direction or strategy that Dell has undertaken?

Our global strategy does not change. What we have seen is acceleration of the pace of execution. When it comes down to making changes, I would say we have started looking at the business from an outside-in perspective. We’ve looked at the changing environment in which customer businesses are operating, take a consultative approach, and start creating alternatives that will benefit them. This was a big shift in our engagement in the market.

It’s been two quarters since Dell announced its new go-to-market strategy for India. Are you already seeing the results?

It’s been a fantastic and exciting story. It has given us the much-needed momentum in the market. Our engagements with customers have become richer; we’ve seen good response from global and national system integrators, the entire channel network for IT products and services is responding positively.

We’ve said that we will bring in a leverage business model, where we define routes within the new go-to-market. Each route has its own engagements and within that we are saying that at the top-end, where customers are looking for new, untried solutions and innovation, we will engage with them consultatively. We’re calling this internally as Dell Lead.

On the consumer side, the recent IDC report shows that you have overtaken HP as the top PC vendor in India last quarter, capturing a 23 per cent market share. Is your new go-to- market strategy bearing fruit there, and what’s your road map for the next year?

Our consumer business has always been about selling our products through large format retail, mid-sized retail multi-brand outlets and general distribution. Most of what you see in the new GTM is the commercial side of the business.

We have huge plans for expanding our Dell exclusive stores. These are predominantly in metros, Tier-I and Tier-II (around 250 plus stores). We intend to take this to Tier-III and Tier-IV, and by the end of the year, we hope to take the number to 400. At this moment, we are not adding more distributors.

In what sectors are these ramp-ups in business happening?

We’re seeing a massive ramp-up coming up in the mid-market space for us. We’ve also seen good acquisition on accounts, especially in the larger corporates. We have better visibility today when it comes to the clients business. The story is similar in our enterprise and infrastructure business — we have gained 8.3 per cent market share on the servers, and 5.1 per cent in storage. This is because we are building solutions in that space that are future-ready, that bring in cost-efficiency because they are not locked-in and give the ability to scale up as the business grows.

What about public sector buys?

Obviously, in the last few years, buying in the public sector has been low for reasons we all know. We’re very bullish and optimistic about this segment going forward. We are already engaged with the sector in a big way, we hope to see some movement in a big way.

India is the first off the block when it comes to the new go-to-market strategy. So, is India seen as an incubator of sorts for this new approach?

I wouldn’t say it is an incubator, but we were the first. Yes,

we would be using the learning and insights that we gain from this new model, will be some sort of best practices that we hope to roll out elsewhere too.

You have a manufacturing facility in Chennai. In the wake of recent policy announcements, including incentives for hardware manufacturing, do you foresee a ramp-up?

Our facility is doing well, and we will go with the demand in the market. At this moment, I have enough capacity to serve the domestic market. The policy announcements - and we are waiting for the details on that- appear to be a step in the right direction. It’s early days to comment on that.

We’ve been hearing that Dell plans to step up hiring in India. But you recently shut down one of your centres in Mohali…

It shouldn’t be read as a shutdown. See, we are constantly looking for the best cost environment for our business; in the process if we find a better way of consolidation to get an advantage, we would do that.

This was about optimising the existing facilities you have. We have a huge facility in Delhi that has come up, and large capacities in Hyderabad and Bangalore where we are moving these resources, so we are not shutting down.

How important a market is India for Dell? Do you have a road map for investments or expansion?

Within the Dell world, India is a very strategic country; not just about the business or the new models, but it is about what we are doing to contribute to the global success of Dell. We have a large, over 27,000 employee, workforce here that is engaged in the global delivery of services.

There’s great excitement about India within Dell here and globally. So we are seeing expansion in our sales capabilities and in our capabilities related to technology and solutions.

These two areas are seeing additional investments coming in.

Have your R&D centres been able to contribute significantly in terms of products and innovation?

We have over 2,500 engineers and specialists in Bangalore, Hyderabad and Chennai. We have some real cutting-edge, end-to-end work happening in these places. Their innovations are futuristic and will have global roll-out; the R&D team has definitely climbed up the value chain.

On the IT services side, health and life sciences are your biggest vertical, what are the other areas you are making strong inroads into?

We started off with health and life sciences, but over a period we have diversified into other areas, including apps modernisations, which is a big thrust for us. Within that, we are seeing acceptance of our value proposition in our mobility solutions.

deepa.kurup@thehindu.co.in

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