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Michael Dell On VMware Spin-Off, Supply Shortages And Channel Commitment

“We’ve never been more optimistic about our ability to innovate, delight customers and deliver growth, and create value for all of our shareholders in the coming years,” said Dell in an exclusive interview with CRN.

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Despite industry supply shortages, Dell shipped a record number of PCs and displays in the second quarter, while also shipping more servers than any other company. Talk about Dell’s supply chain and any advantages you have?

First of all, our buying power is a lot larger than many of the competitors, including [Hewlett Packard Enterprise], and we have strong relationships. At the end of the day, business is at some level about relationships, and these folks have known us for a long time. They’ve known me for 37 years. They’ve known [Vice Chairman] Jeff [Clarke] for almost just as long. We’re kind of like the permanent customer–and that matters.

Think about it from a perspective of: every time you build a new plant, it’s $8 billion dollars in the semiconductor business. Yeah, you want to know where the parts are going to go in the next three months or six months. But what you really want to know is where are they going to go in the next five to 10 years? So you go back to relationships. We have those relationships, but I still wish we had more supply.

I would say we have record demand, we have record supply and we have record shipments, but we don’t have enough supply. Our supply chain is functioning well. But certainly, I think everybody sees the challenges that are out there.

We’ve been at this a long time. We’ve put in place a series of strategies that have served us well, and when we make commitments to our partners around delivery, we were able to meet those commitments the vast majority of the time. The shortages that everyone in the industry are seeing around integrated circuits are going to continue for some time. It’s also leading to some component cost inflation. We’re working proactively with the strong relationships we have to minimize the impact to our customers.

 
 
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