Tech news and analyst channels are a-twitter after the news that HP Chairman Ray Lane is stepping down, along with two other directors. Meanwhile, Dell’s efforts to take itself private have spawned a series of “he-said/they-said” exchanges via news outlets regarding company value, strategy and direction. And Microsoft is, once again, being considered irrelevant by media outlets because of the decline in sales growth for traditional PCs and its perceived lack of significant growth with Win8, Windows Phone and the Surface hardware line.
It’s gotten to the point where, over coffee this morning, one otherwise-sane CIO asked me if his firm should stop buying anything from any of these Master Brands. He doesn’t want to commit significant money to firms that, as he understands it, “could be out of business in a few years.”
First off, let’s acknowledge something: Bad news travels fast, and the only thing that travels faster is bad news in a socially-networked marketplace. So the vast majority of what we see, hear and read about almost any IT provider – apart from their own news releases – is going to be negative. And given the potential fame available, and the number of contributors to the information chain via analysts, news outlets, web, social media, TV, and so on, there will never be a shortage of individuals willing to pile on.
Secondly: Yes, it is always possible that even the largest, major, market-leading providers – in Saugatuck parlance, Master Brands – can and do go out of business. A series of poor decisions mixed with inadequate management can do negative wonders for any firm. But they almost never disappear completely, and even more rarely disappear quickly. Dell, HP and Microsoft aren’t going away overnight, if they go away at all. Frankly, we would have to have a series of significant nightmare scenarios for any of them to disappear. All have massive assets and revenue streams; all are significant influencers and leaders in a range of IT and business technologies and services; all likewise have partner and customer ecosystems with presence in every important marketplace today.
Are they going through difficult, and very public, challenges and changes? Certainly.
Is this affecting their abilities to do business? Of course it is.
Should we stop investing in them, or including them in our IT strategy, as a result? Only if you can find another provider that can replace them adequately, at less cost, while enabling at least the same scale of future business enablement, and with minimal-to-no disruption.
What about the future? Should we look elsewhere for alternative providers and solutions? Of course. Any IT or business leader should always be looking for alternatives, especially when there are so many available from so many new sources. Always consider future, optional routes while maintaining a steady course. It keeps you involved and aware, and it keeps your existing providers competitive. And it enables you to make long-term, strategic IT decisions based on business need, not on the latest news cycle.
Pay attention to the news about your Master Brands. Be concerned – and investigate – if and when you hear a series of negative reports. Communicate with your providers at every level possible, from tech support through field sales and on up the food chain. Talking to one sales team leader won’t get you the insights you need. Meanwhile, maintain dialogue with trusted investor and IT industry analysts – don’t just read research notes, reports and blog posts. Call them and talk to someone who knows what’s up.
Finally, consistently and constantly keep a series of alternative IT scenarios in discussion. The alternatives available are likely to surprise you. In a Cloud-enabled universe, what you think you know about IT today is probably what was true 6 or 12 months ago.
Your existing Master Brands are all investing heavily in these alternatives - activity which, frankly, is enabling a lot of the negative coverage that we see. It’s easier (and more concrete) to look at what mistakes have been made, rather than what opportunities are being pursued. And since Master Brands tend to make master-sized investments, their mistakes tend to be exceptionally noticeable. Hindsight really isn’t 20/20, it’s just a little clearer than foresight because it’s based on evidence.
Master Brands really are run by knowledgeable people. They make good decisions and bad decisions. Even good decisions can have significantly bad effects on the company. But due to their presence, cash flows, channels and other resources, Master Brands like Dell, HP and Microsoft are extremely unlikely to ever go out of business - and if they do, it won’t happen quickly.
As Winston Churchill was fond of saying during the early days of World War II: Keep calm, and carry on. This is not the IT apocalypse. If you need to make any significant decisions, you will know, and you will have time to do it carefully and effectively.
This blog originally appeared at Saugatuck Lens360.
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