Unleash the Beast

Unleash the Beast

What’s that coming over the hill? Is it a monster?

EMC and Dell, really? You could have knocked me down with a feather. I know it makes sense - hardware is diminishing and EMC has such a wide portfolio of products that this offers the perfect vehicle for Michael Dell to enter into the lucrative world of software and services. Opportunities exist galore inside and outside the business. At a time when IBM are increasingly focused on reducing their mammoth portfolio this strategy by Dell appears at a complete opposite. Only time will tell but how much time does it take to decide if it is a success or failure?

One thinks of previous acquisitions and mergers that on paper looked good or even great but in reality the nightmare was just underneath the surface waiting to appear when people least expected it, sometimes even before the honeymoon began.

The most obvious one in recent times was the HP purchase of the UK search company Autonomy. After weeks of due diligence, customer visits, pipeline qualification and technology evaluation HP said yes and signed on the dotted line. Within days the deal turned sour and clearly HP felt they did not get value for the several billions of dollars spent acquiring Autonomy. It got me thinking about competence and just what were people thinking and doing.

Not all deals go bad and some appear better than they are - after all perception is reality is it not? HP again and this time the purchase of services giant EDS. It was expedient for HP as they were actively looking to move into the Global Services model so successful for IBM and using such a strategy would encourage the seeding of HP technology and the cross fertilization of big ticket hardware and software. Whilst many people have differing opinions regarding the level of success, almost all agree it has been a success. Not a smooth or obvious success but a success none the less and HP continues to grow revenues and profits where once it stood still.

Handled poorly change creates uncertainty and friction, visions get blurred, people get confused and focus is lost. Handled correctly and opportunity knocks, efficiencies are unleashed and corporates rise again.

Which will you choose? Let us know your thoughts on this mega-merger. http://bit.ly/1ODyu6I 

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