Dell Lays Out 4-Point Plan For Post-Buyout Road Map


Initiative No. 3: R&D And Acquisitions

Dell CFO Gladden also said the company would grow its enterprise and solutions business via continued investments, research and development, and additional acquisitions.

"We continue to make large investments in R&D and sales capacity around the enterprise solutions and business services," Gladden said. He said past investments have helped Dell accelerate its growth in key markets such as cloud and business services.

According to Bloomberg, Dell is ready to crack open its wallet to acquire companies in the $500 million to $1 billion range.

But, there is some question as to whether Dell can heavily invest in research and development and acquisitions as a private company that no is longer able to raise capital from the public markets. Gladden tamped down those concerns Thursday and said Dell is anticipating generating strong cash flow for investments and can turn to minority investor Silver Lake should the need arise.

In fact, Dell counted its privatization as a plus for its ability to make additional investments. "We will have the flexibility to accelerate our strategy and pursue organic and inorganic investments without the scrutiny of quarterly targets and other limitations as a public company," Gladden said.

Since 2006, 451 Group's Daly wrote, Dell has averaged five acquisitions a year. "It's also relevant to note for the soon-to-be-private Dell that shareholders footed the bill for that shopping spree," he wrote.

Initiative No. 4: End-To-End Business Solutions Provider

"Dell's expansion as an enterprise and solutions provider is critical to our future success," Gladden said.

For its part, Dell's ability to leverage the 20-plus acquisitions it's made since 2009 into its enterprise services has seen little success. Returns on the nearly $13 billion spent on acquisitions has been lackluster, experts say. Gladden Thursday, however, countered that Dell was still "digesting" those companies.

"We've done a pretty broad reset of the Dell strategy over the past four years. We've acquired significant assets and built new platforms and end-to-end solutions. We've built what is a $21 billion business that's related to enterprise solutions and software business. The important pieces of the puzzle are in place; now it's about execution," Gladden said.

Dell is counting on growth in IT spending as a key to push into enterprise markets. "Exposure to the data center, exposure to the key drivers in spending today in IT, such as like virtualization, I think, give us a chance to get more than our fair share of a $3 trillion opportunity," Gladden said.

But, Dell's challenges, Pund-IT's King said, are just beginning.

PUBLISHED SEPT. 13, 2013