DELL TECHNOLOGIES INC.

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Consumption-as-a-Service: Maximizing IT Extensibility and Business Value

01/19/2022 | 09:02am EDT

Businesses have found it compelling to shift a portion of their on-premises digital infrastructure spending to Consumption-as-a-Service. Traditionally, CAPEX model requires organizations to invest heavily in upfront cost to purchase technology. This is not sustainable to meet the growing needs of the business units and to keep up with growth and innovation. The need for flexibility and agility to react to current and future IT challenges is critical to keep the business moving forward.

To deliver the greatest business value and performance, it is important to shed barriers that inhibit the IT operations advancement and digital transformation. The roadblocks arise from risks associated with capacity planning, staffing constraints to tackle priorities and initiatives, insufficient infrastructure sizing to achieve expected outcome and disparate agreements for software applications and IT infrastructure.

Success is dependent on foundational building blocks that facilitate IT extensibility and operational efficiencies. According to IDC PeerScapestudy, "Digital infrastructure Consumption-as-a-Service subscriptions are becoming an important option for sourcing and supporting complex dedicate compute, network and storage environments".¹ Consumption-as-a-Service redefines the IT asset and resourcing landscape.

Dell Technologies APEX Flex on Demand, a Consumption-as-a-Service solution, addresses the critical pieces needed for IT organizations to scale technology capacity, free up IT staffing resources, deliver business outcomes and to package applications with equipment in the early financial stages.**

Mitigate Business Operational Risks from Capacity Fluctuations

Risks can occur when there is a mismatch between business needs and actual capacity. Systems operating at extended capacity deteriorate in performance and are prone to failure. The impact of insufficient capacity sizing on business can be the throttling down of systems, disruption of data transfer and application downtime.

Capacity fluctuation is driven from workloads. Cyclical businesses demand the ability to scale up when there are periods of intense system resourcing and scale down when workload drops. High growth businesses, where new applications and enhanced technologies come into the portfolio, need agility to scale to match the changing business environment. These changes impact the technology sizing specification. Onboarding new business applications or upgrades places increase workload requirements on system resources such as memory, CPU and storage. Planning for digital transformation and initiatives becomes a rigorous task.

Due to the unpredictability of future needs and future proofing, oftentimes the protocol is to overprovision. This CAPEX financing model can get costly and limit business growth. On the opposite side of the spectrum, budget constraints place IT decision makers in a difficult position of having to function with inefficient legacy systems. APEX Flex on Demand helps mitigate risks by enabling organizations to scale up or down based on business needs, de-risking IT operations. For example, an IDC Study reports 64% lower cost of unplanned storage outage, resulting from loss of productivity and revenue.² Most importantly, APEX Flex on Demand helps avoid risks from locking in cash flow that could have gained greater returns on growth initiatives, risks from investing in sunk cost that could have been utilized for much needed operational expense and risks from the burden of carrying fixed cost for long periods reflecting negatively due to highly leveraged balance sheets.

Liberate Internal Staff to Work on High Value Projects

It is prudent to place highly skilled IT staff in positions where they can deliver most output and are most satisfied. IDC PeerScape research have found that by moving to as-a-Service model, IT staff save 20% of their time so they can be refocused on operational requirements that are higher priority and bring greater value for business.¹

According to an IDC study, lifecycle work such as updates, patching, repairs, troubleshooting and support services can be incorporated into Dell Technologies APEX Flex on Demand.² The responsibility of equipment sizing, storage provisioning, component replacement and technology refresh is all handled with knowledge and expertise from Dell Technologies. There is peace of mind knowing that organization resources can have the freedom to engage in strategic initiatives and infrastructure modernization rather than lifecycle maintenance work.

Deliver on KPIs and Business Outcomes

IT infrastructure requirements have become more complex, making it difficult to size capacity and predict future workloads. Traditional CAPEX procurement cannot adapt and scale to meet the new demands without risks of incorrectly sizing or overcompensating when acquiring technology. With APEX Flex on Demand, Dell Technologies can further fine tune and appropriately size and configure memory, processing speeds, operating systems, storages capacity and drive technologies, I/O, connectivity and other technology areas that are critical to delivering highly optimized business outcomes.

Dell Technologies works closely with customers to design and define SLAs and KPIs that align with the goals and objectives of customers. In agreed committed capacity, customers have elasticity to peak and burst capacity when needed. This allows organizations to strategically plan for the unexpected and protect against unpredictable challenges by leveraging the 85% buffer capacity and billing cap feature.*

Include Application Cost Discussions in Early Finance Process

Engaging application partners early in the financial process streamlines the acquisition of the solution. This alleviates the isolated procurement decisions across different applications and hardware which often cause delay in acquisition and the lack of cohesive deployment and integration, as well as the confusion, cost overruns, misaligned goals and inefficiencies that are often innately found in a CAPEX model.

Dell Technologies can package both the planning and the cost of application and hardware into APEX Flex on Demand, a single Consumption-as-a-Service to simplify and deliver agility for the IT organization. Organizations that adopted this model cited 25% lower acquisition cost and 23% lower average storage cost of operations per year.²

Dell Technologies APEX Flex on Demand offers Consumption-as-a-Service across Dell Technologies' infrastructure solutions, servers, storage, converged/hyperconverged infrastructure and data protection. Customers have gained efficiencies, cost control, operations agility and technology scalability.

We invite you to download the IDC PeerScapereport and learn more about Dell Technologies APEX Flex on Demand.

¹ Source: IDC PeerScape Study: "IDC PeerScape: Practices for Maximizing Business Value of Digital Infrastructure Consumption-as-a-Service Subscriptions", August 2021.

²Source: IDC Study commissioned by Dell Technologies: "APEX Custom Solutions: A Study of Usage-Based Consumption Models for Storage", April 2020

** Payment solutions provided to qualified commercial customers by Dell Financial Services (DFS) or through Dell Technologies group companies and/or through Dell's authorized business partners (together with DFS "Dell"). Offers may not be available or may vary by country. Offers may be changed without notice and are subject to product availability, eligibility, credit approval and execution of documentation provided by and acceptable to Dell or Dell's authorized business partners. In Spain, solutions are provided by Dell Bank International d.a.c branch in Spain and specific countries within the EU and EEA and in the UK and Switzerland by Dell Bank International d.a.c, trading as Dell Financial Services which is regulated by the Central Bank of Ireland. Dell Technologies, DellEMC and Dell logos are trademarks of Dell Inc.

* Available for eligible products only. Dark site, non-metered deployments, and customers non-compliant with their contract terms are not eligible.

Disclaimer

Dell Technologies Inc. published this content on 18 January 2022 and is solely responsible for the information contained therein. Distributed by Public, unedited and unaltered, on 19 January 2022 14:01:02 UTC.


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Financials (USD)
Sales 2023 106 B - -
Net income 2023 4 330 M - -
Net Debt 2023 16 741 M - -
P/E ratio 2023 10,00x
Yield 2023 2,68%
Capitalization 37 093 M 37 093 M -
EV / Sales 2023 0,51x
EV / Sales 2024 0,48x
Nbr of Employees 133 000
Free-Float 36,4%
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