Dell CEO Michael Dell has repeatedly cited his company's "world-class supply chain" as one major synergy in for its pending mega-merger with EMC. As Constellation Research analyst Guy-Frederic Courtin notes, the combined entity's customers could benefit as well.
"Being able to service a bigger customer base under the same umbrella, you’d hope you get some economies of scale," Courtin says. While it's not clear whether cost savings would end up being passed on to customers directly, customers should see a higher quality of service thanks to a broader global footprint of spare parts depots and technical staff on the ground, he adds.
Dell offers service-level agreements for hardware customers of as low as two hours. That's two hours for a technician to be onsite with spare parts—if you're willing to pay for it, of course.
SLAs that robust put tremendous strain on a company's supply chain, from parts to labor, Courtin notes: "If a server goes down somewhere, you might have a spare server nearby but if there's no technical staff available, what's the point?"
A broader-based Dell-EMC supply chain could help out with thorny geographic issues. "We think about this from a fairly North American point of view, but going into Asia, Europe of Africa you have customs issues," Courtin says.
For example, it might be necessary to put a parts depot in the Czech Republic even when there's already one just over the border in Austria, Poland or Slovakia, simply because customs delays make it impossible to meet SLAs.
The Bottom Line
Customers no longer take reliability as a nice-to-have or luxury benefit, Courtin says. "If I buy a router from EMC or server from Dell, part of the expectation is not just piece of hardware but 365-27 uptime. The after-sales supply chain is becoming so much more important."
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