EMC’s Well Crafted Strategy

Dave Dewalt, the president of EMC’s software division was repeatedly referred to by MR as representative of the second line leadership in the industry that is getting ready to become CEO. Dave was the CEO of Documentum before getting acquired by EMC and he now runs EMC’s software division, now a multibillion dollar business by itself. Dave Dewalt’s session threw a lot insights – he first highlighted that EMC has changed a lot – so much that its software business alone showed a billion dollar run rate last quarter. EMC is heavily focused on building a software strategy to complement and leverage its storage network strength. EMC spends more than a billion dollar on R &D every year and Dave made a honest admission that it is leveraging global talent in a big way. Pointing to Tom Friedman’s work & further to Hagel & Brown’s work on sustainable edge – he highlighted bringing innovation from the edges into the core is a key approach that EMC wants to bank upon and towards this pursuit, EMC has several development centers around the world and increasingly investing lot more in India. Read my related note on offshoring product development. He identified key issues in adopting to the revised global model of working together Viz Timezone difference, cultural issues, bootstrapping innovation, go-to-support model. The cornerstone of EMC’s strategy is what he called A&D (acquire & develop) integrated as part of their overall R&D strategy.He saw the advantages in being able to reach to the market faster and EMC is benefiting out of it.

Some key points that he brought out deserves special mention. He thinks that in his twenty years of software and valley association, he has not seen the level of change felt in the last 2/3 years – a clear recognition of sweeping changes that are taking place. Some key trends that he identified include: The death of the perpetuity sale model, software as appliances , shrinkwrapping, SaaS offering ( multi tenancy models supported by multiple data sets running on a single instance – EMC’s software have been rearchitected accordingly). In pursuing an approach of best-of-breed Vs best of suite competition against IBM, Oracle, Microsoft, SAP in orchestrating the stack, Dave says that EMC’s acquisition strategy is a key element. With several billion in cash, EMC is now acquiring at the rate of 2 companies/ quarter and integrating their software (obviously their india and rest of the world presence helps here in a substantial way) to stand up to the competition in stack war. Geoffrey Moore sometime back called EMC as a dark horse in the game to win the stack over and he saw that their approach is
- leverage data center experience to enter systems management software and non-relational content management
- position information rather than applications as focus of systems management
(Note :All views expressed in this blog are completely personal).Now with Dave at the helm of the software division, EMC is executing brilliantly and clearly positioning to win the game. Results are showing up impressively – 13 quarters of double digit growth is what the company has witnessed in these challenging times. He emphasized that companies needs to change from within and question established models, respond super fast to remain successful. No doubt EMC’s software growth is impressive and Dave wants a supersonic flight built so that he can travel to India more often with less time – this demand will find good support from most other top executives in software companies. Dave's message - EMC is executing well, has big plans, is profitable, growing well and is a trusted partner for customers. Coming back to MR's introduction of Dave as a future industry leader - All I can say is that he definitely is performing wll and most of its strategic pursuits are well thought out and getting executed very well. So MR may be making the right call here - particularly on Dave.