A new gold rush is on. Who will strike it rich?
Big data is big news just about everywhere you go these days. Here in Texas, everything’s big, so we just call it data. But we’re all talking about the same thing — the universe of structured data, like transactional information in databases, and also the unstructured data, like social media, which exists in its natural form in the real world.
Organizations of all sizes are trying to figure out how to use all this data to deliver a better customer experience and build new business models. Consumers are struggling to balance a desire for automated, personalized services with the need for safety. Governments are pressured to use all available data in support of national security, but not at the expense of a citizen’s right to privacy. And underlying it all is the realization that data, if managed, secured and leveraged properly, is the pathway to progress and economic success.
Top thinkers are no longer the people who can tell you what happened in the past, but those who can predict the future. Who will strike it rich in this new, data-driven gold rush? It will invariably be those who are willing to accept the new realities of the data economy. Business instincts and intuition are being augmented and increasingly replaced by data analysis as the driver of success. We’ve seen it at Dell. Our marketing team uncovered more than US$310 million in additional revenue last year through the use of advanced analytics. This year, we expect that number to exceed half a billion dollars.
We believe that’s just the tip of the iceberg, and we’re accelerating our strategy. Recently we announced the acquisition of StatSoft, a leading provider of data mining, predictive analytics and data visualization solutions. It is yet another investment in our enterprise solutions, software and services portfolio specifically designed to help our customers turn data into action.
But contrary to popular opinion, the data economy isn’t just for global enterprises like Dell. A Dell-commissioned study that we announced in April found that midmarket companies are increasingly investing in data projects to drive better decision making and better business results. We have also found that start-ups that use technology effectively create twice as many jobs on average and are more productive and profitable than companies that don’t.
At their core, entrepreneurs are all about solving problems, and nothing provides a better window into problems than data. Consider the popularity of Global Positioning System (GPS) technologies. The simple act of connecting to and delivering data paved the way for many successful businesses that in turn created an entirely new segment of the economy.
The day is near when the use of data analytics will simply become the price of remaining viable and competitive in the global marketplace. There is still a lot of uncertainty about the data economy, but this much is clear: The opportunity for data-driven organizations is golden.
Michael Dell’s rules for winning start-ups
People ask me all the time, “How can I become a successful entrepreneur?” And I have to be honest: It’s one of my least favorite questions, because if you’re waiting for someone else’s advice to become an entrepreneur, chances are you’re not one.
If I’d listened to everyone who told me what I could and couldn’t do and why, I’d be writing this column on an IBM® PC. For the record, IBM doesn’t make PCs any more. I’m using a Dell XPS 15.
But there are a few things that distinguish real entrepreneurs, and if you have them, you’re starting in the right place.
Real entrepreneurs have what I call the three Ps (and trust me, none of them stands for permission). Real entrepreneurs have a passion for what they’re doing, a problem that needs to be solved and a purpose that drives them forward. Find your passion, your problem and your purpose, and you won’t need to ask anyone’s advice before pursuing your dream.
Step 1: Find a passion
No one works harder than an entrepreneur starting a business, but if you ask one about work/life balance, you won’t hear the usual gripes about long, grinding days. Why? Because real entrepreneurs have a passion for what they’re doing, so work doesn’t feel like work. It’s energizing and fun. It might seem like crazy hours to someone else, but there’s nothing else you’d rather be doing.
Certainly that’s been true for me. I’ve been fascinated with technology since I was a boy playing around with my father’s adding machine. Back then I’d type in an equation, the device made some noises and out came my answer. I was hooked. Today’s technology is way cooler and more powerful than my dad’s old adding machine, and I’m passionate about delivering the technology solutions our customers need and energized by all the great things this enables in the world. I always have been.
Step 2: Find a problem and fix it
Every breakthrough business idea begins with solving a common problem. The bigger the problem, the bigger the opportunity. I discovered a big one when I took apart an IBM PC. I made two interesting discoveries: The components were all manufactured by other companies, and the system that sold for US$3,000 cost about US$600 in parts. I knew there had to be a better way.
My idea eventually became the Dell direct business model, which forever changed our industry and solved a big problem for the world: Previously accessible to relatively few, PCs — and soon after, servers — were now available to the masses.
We’re still at it, even as personal and business computing needs have radically changed. (Your industry will change, too, trust me.) Today we’re using our same approach to create modern data centers, commercial software, services and solutions. We’re addressing our customers’ most relevant opportunities and challenges by helping them analyze, secure and manage their valuable information with technologies that are open, affordable and accessible.
New and interesting business opportunities are all around us, and they almost always start with a problem. Find a problem you think you can fix, and you’re well on your way.
Step 3: Find a purpose
While a passion and a problem might be enough to start a business, it’s purpose that brings fulfillment.
To be honest, at Dell, I’m not entirely sure we found our purpose; I think it might’ve found us. But it became clear pretty early on. Our purpose is to enable human potential by accelerating the adoption of technology on a global scale, and in turn opening the door to growth, productivity and opportunity for people everywhere.
May marked Dell’s 30th birthday. I consider the first 29-and-a-half years as Act One of our story. Act Two began when we successfully took Dell private last year. By revenue, it was the largest company to ever go private in history, and for me, it was kind of like a rebirth of the company, going back to our entrepreneurial roots — but with a lot more capital, an expert global team, enormous scale and what I firmly believe is the best portfolio of solutions in the industry.
When I decided to start Dell, I never imagined the journey it would take me on, nor the changes we would see and experience along the way. But three things remain very much the same: the passion, the problem and the purpose that inspired me in the first place. And today they are inspiring me to make the next 30 years even better.
Entrepreneurs are the engine. Technology is the fuel.
I was recently among the masses at South by Southwest Interactive (SXSWi) in Austin, Texas. The energy of thousands of smart, creative and cool people converging on my hometown is pretty contagious. And it’s Austin, after all … we like to keep it a little weird.
I had the pleasure of hosting a SXSWi panel focused on entrepreneurism. Joining me on stage were some terrific entrepreneurs — Jeffrey Housenbold, CEO of Shutterfly; Stephen Kaufer, co-founder and CEO of TripAdvisor; and Carley Roney, co-founder of The Knot.
Entrepreneurism is such an important catalyst for the global economy, and it was evident listening to these business leaders tell their stories. These are all web-enabled businesses that were founded during the dot-com boom and grew up in the shadow of the bust. They more than survived; they thrived. With technology as their cornerstone, they invented new models and, in some cases, entirely new industries.
For my part, I spent some time talking about my own path and how I’ve seen the power of an idea change the world. I started Dell in my dorm room when I was a 19-year-old pre-med student at the University of Texas. We pioneered a business model that drastically drove down the price and increased the power and effectiveness of the PC and later, the server — accelerating the adoption of technology for people around the globe.
Thirty years later, the societal shift is remarkable. From 1985 to 2005 — the exact period of time that the PC/server model for technology spread worldwide — the number of people living in poverty was cut in half. Why? Because more power was available to more people than ever before.
A PC in the hands of a seamstress in South Africa became a thriving small business. A couple of workstations and a server enabled a manufacturer in Argentina to globalize. Affordable, accessible technology opened doors to one of the world’s most powerful forces for prosperity: entrepreneurs.
I was really pleased to share Dell’s story at SXSWi and to give a few of our customers a great platform for telling theirs. Hopefully it inspired some of the bright minds in the room to pursue their ideas, to break out of the dorm room or the garage or wherever.
By taking Dell private, I feel like we’ve come full circle and that I’m once again at the helm of a start-up. Our destiny is in our hands, and we’re laser-focused on our customers and driving innovation like only a private company can be. It’s liberating and exciting.
I am very proud of the role our industry has played and will continue to play in accelerating progress and prosperity on a global scale. Dell’s story, born in University of Texas dorm room #2713, has helped power the big ideas and dreams of many entrepreneurs around the world. And we’ve only just begun.
Michael Dell is chairman of the board of directors and chief executive officer at Dell, the company he founded in 1984 at age 19.
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