- Sales and Promotions Mistakes – It Could Be An Opportunity…Yesterday
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Two things happened this week that made me think about customer service and lost opportunities. The first event had to do with paper. I find the best customer service stories in the most mundane situations. Anyway, I was at OfficeMax and saw a wonderful deal. There was a stack of five ream cases of inkjet paper. On top of them was a sign that said that the paper was $8.99. $8.99 for five reams of inkjet paper is a great price. The ten ream case was something like $35. Wow! While it was a great price, it wasn’t an outlandish one. Not too good to be true just pretty darn good. When I got to the counter, it rang up $30. Wait. What? Turns out it was $8.99 a ream not a case. Someone was supposed to have taken out the individual reams and stacked them outside the cases. Perhaps it said $8.99 a ream but I’m not so sure. Even if this was the case the type was so small as to not be obvious. Taking them out of the cases and stacking them up was supposed to be the obvious part. I declined to buy it and found a good deal elsewhere.
The second event was the arrival of a $15 Best Buy gift card from Napster. Napster had run a promotion on Facebook wherein you friend them and posted something (favorite song or album maybe) and they would send you a 1GB portable music player. Apparently, the response was so huge to the promotion that they ran out of music players and sent gift cards instead.
Both of these situations have two things in common. First, the company
- Hurd The News About HP? What Does The Oracle Tell Us?September 7
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So, first Michael Hurd resigns as HP CEO because of minor accounting snafus related to his totally not sexually harassing a B-movie actress (snicker!). Then, Oracle
hires him “allowing” one of the co-Presidents, Charles Phillips, to leave. Phillips apparently had his own public problems with a woman (snicker!) . Now, HP is
suing Hurd because – now get this – they have a non-disclosure. Not a non-compete. An NDA. So HP is suing Hurd after they effectively forced him to resign over something he didn’t do with a woman because of something he has yet to do.
I couldn’t make this stuff up if I tried. The mind reels with questions here. Let’s choose a few major ones.
- Are technology executives of such low moral fiber that they keep getting into trouble with women other than their wives?
- Is Hurd just so good that Oracle is willing to deal with the inevitable lawsuits?
- If so, was HP just that stupid for letting him go?
- Can you really sue someone for something they might do but haven’t yet done?
Let’s tackle these in order. First off, I know a lot of technology executives. While some are ethically and morally challenged, as a class they don’t seem any worse than anyone else. I don’t mean no worse than other business execut
- What the…?August 27
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Okay, the 3Par bidding has hit the $2B level. That’s nearly twice the opening bid of $1.1.5B. The first bid seemed high but the offers have now gone into the exosphere. For those who don’t remember their 8th grade science, that perilously close to being in orbit. It’s a place where there is practically no air. Get that? No air to breathe. Considering that 3Par had revenue of US$168M in fiscal 2010 (resulting in a net loss by the way), HP is bidding almost 12 times last year’s revenue! That’s insanely high. Even at an accelerated growth rate, HP won’t make that back before I’m a grandfather. Trust me, that is a long time from now (or better be – you kids listening?). This bidding war has generated a lot of analysis, including mine. Theories range from Dell and HP vying for the number 2 spot in storage behind EMC ( I like that one) to HP’s Dave Donatello being on a mission from god. Okay, not a mission from god per se but the storage business equivalent. At these numbers, none of the theories including mine make any sense. Look, 3Par is a great company with a lot going for i
- Computer Industry Goes Zoom ZoomAugust 23
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You would think that last week’s announcement that Dell was acquiring 3Par for US$1.15B was news enough. Ha! Intel then raised eyebrows by announcing the acquisition of McAfee for US$7.6B. Now, comes Monday morning and HP raises the stakes against Dell by sending in their own and bigger bid for 3Par. It’s nice to be loved. Somewhere in all this, Hitachi Data Systems announced that they had acquired the Intellectual Property and core engineering team of Parascale, a cloud software company. Too bad for them. What should have been a sweet announcement was lost in all the noise.
So, what the heck is going on here? On the one hand, this is actually not that surprising. Computer tech companies tend to throw off lots of cash so they have a lot sitting around for acquisitions. Most of these big companies can thus afford to buy expertise or market share. This is especially true when you are coming out from the bottom of the market. Best to build up the arsenal before the economy really picks up.
This is an industry with a tradition of letting smaller companies trail blaze new technology and markets then get their payoff from a big company. In the long run this is cheaper and less risky for big companies but profitable for small ones. More unusual are the Googles and Microsofts who start in a garage and end up a behemoth. That’s the myth of computer tech but not the reality. What is not a myth is
- Piling on the Dell/3Par NewsAugust 18
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Whenever some news comes out about an acquisition, everyone chimes in. It’s like kids playing little league football. Someone tackles the kid with the ball and all the other kids pile on. I promised myself I wouldn’t do that. I lied. Hey, if you can’t lie to yourself, who can you lie to?
But really, I follow the storage segment but don’t claim in-depth technical knowledge anymore. I’m too interested in technology and business strategy to dive into the deep technical details. I can make a thin provisioning joke but that doesn’t mean I have the kind of encyclopedic knowledge of the segment that folks like Marc Farley (of 3Par – ready to buy that boat?) or Chuck Hollis of EMC have. Sticking to what I know here are some thoughts.
Why it’s a good thing (in list form):
- 3Par would have eventually hit the wall. The hardware industry is a game of numbers. Big volume plus low cost equals great margins. You need market share and manufacturing prowess for that. A company the size of 3Par would have eventually gotten eaten alive by the big boys.Or faded into irrelevance. That would have been the slow death.
- The deal provides a nice Return on Investment for 3Par investors. I like it when people make money in startups. It provides fuel for more startups and gives hope to the rest of us entrepreneurs. Now, if you all want to swing some of that cash my way
