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EMC: Rewriting Customer Service Rules
In 1999 EMC became the world's first company to earn the prestigious Support Center
Practices (SCP) Certification in both North America and Europe. Further, EMC received the
1999 Services Marketing Excellence Award from the Information Technology Services
Marketing Association, a leading professional association dedicated to advancing services
marketing practices in the information technology industry.1 In 1995 and 1996, EMC was ranked
No. 1 in customer satisfaction in 13 independent surveys among all information storage and
retrieval companies.2 In the 1998 first and third quarter survey releases by SoundView, EMC
was rated overall No. 1 in the storage industry.3
EMC had set a new standard for quality in the data storage industry by providing a
remarkable level of customer service. EMC had used customer service as a strategic competitive
weapon and backing this strategic weapon was a strong Customer Support and Service
Organization (CSSO) whose operations were key to customer satisfaction.
However, in 1999 EMC was embarking on a new journey with powerful competitors
entering the storage arena. EMC had set itself an ambitious revenue goal of $10 billion in the
year 2001 from a base of $4 billion in 1998. EMC’s software business was growing even faster
and EMC was a novice to software business and software support. Further, 1998-1999’s
explosive growth in Internet businesses and e-commerce was changing EMC’s customer base.
Traditionally EMC courted the top global 2000 firms. This fueled EMC’s growth in the late
1990s and its investments into customer service. While EMC was now mining a market that had
even more potential and storage needs no less than the global 2000 businesses, these internet
firms were often very small and cash-strapped.
1
EMC Appoints Joseph F. Walton to Lead Award-Winning Customer Services Organization; Former Unisys Executive To Head 2,500-Person
Global Customer Support Infrastructure, Business Wire, Oct. 21, 1999
2
Verespej, M. (1996), “Give ‘em what they want”, Industry Week, Nov. 4
3
Rocco, E. (1999), “EMC: Breaking Customer Service Industry Rules”, Dataquest, Jan. 18
Prof. Jay Rao of Babson College and Walter Reitz, VP EMC Customer Service Marketing, prepared this case as a basis
for class discussion rather than to illustrate either effective or ineffective handling of a management situation.
Copyright © by Jay Rao 1999, all rights reserved and licensed for publication at Babson College to the Babson College
Case Development Center. To order copies or request permission to reproduce materials, call (781) 239-6181 or write
Case Development Center, Olin Hall, Babson College, Wellesley, MA 02457. No part of this publication may be
reproduced, stored in a retrieval system, used in a spreadsheet, or transmitted in any form or by any means – electronic,
mechanical, photocopying, recording, or otherwise – without the permission of copyright holders.
EMC: Rewriting Customer Service Rules
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In late 1999, as EMC’s CSSO executives outlined the role of customer service on “the
road to $10 billion,” they viewed change and challenge in three dimensions:



Growth and global expansion of territories, customers and business segments
Depth, breadth and complexity of EMC products and solutions and their operating
environments
Increased competition -- everyone wanted to defeat the defending champion.
EMC and the Storage Industry
In the late 1990s, data storage was exploding as businesses “warehoused” vast amounts
of sales, financial, and operational data from every part of their business. Businesses like airlines,
telephone companies, and credit card companies and banks record and accessed millions of
transactions every week.
EMC, head quartered in Hopkington, MA, designed, manufactured, marketed and
supported high performance storage products and provided related services for mainframe and
midrange computer systems. In 1999 EMC had the leading market share (35% by 1998, a 13point lead over the nearest competitor, according to Dataquest) of the worldwide external storage
market.4 The $10 billion storage market in 1997 was expected to surge to $25 billion by 2002. In
August 1998, EMC CEO Mike Ruettgers was more ebullient and put this number at $40 billion
and predicted that EMC’s revenues would exceed $10 billion. Along with EMC, IBM, Hitachi,
StorageTek, Compaq, Sun Microsystems, HP, and Dell were just a few firms trying to capitalize
on this lucrative market.
EMC provided storage solutions for applications such as online reservation systems,
transaction processing, customer billing, year 2000 compliance, the Internet and corporate
intranets, business continuance/disaster recovery, data mining, and data warehousing. EMC’s
customers included banks, financial services firms, telecommunications providers, airlines,
governments, scientific institutions, universities and manufacturers and retailers. EMC buys disk
drives and packages them into a “storage server.” Along with its software, this server enabled
businesses to store and retrieve data to and off disk drives in an efficient manner.
Richard Egan and Roger Marino (the E and M in EMC) set up EMC in 1979 to build addon memory for minicomputers made by companies such as Digital, IBM, Wang and Data
General. When this market was dying in the late 1980s, EMC quickly moved to build disk
storage systems for IBM’s big mainframe computers, where IBM commanded an 80% market
share. However, EMC had adapted a new technology called RAID (redundant arrays of
independent disks) that involved algorithms to handle data among a wide assortment of hard
disks. Within 3 years EMC was outselling IBM in mainframe storage systems. In 5 years EMC
had captured 41% of the mainframe storage market and IBM’s share had shrunk to 35%.
In 1998, EMC’s flagship Symmetrix storage system, the size of a refrigerator, could store
up to a terabyte (1012) of data, roughly the equivalent of a million novels.5 These storage boxes
going for about $2-3 million, were more than just giant disk drives. Termed an “open computer
4
5
Judge, P. (1999), “High Tech Star”, Business Week, March 15, p72
McHugh, J. (1997), “When it will be smart to be dumb”, Forbes, Vol. 157 No.9, p118
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storage system,” EMC was the first to develop and market this new technology. It allowed a
company to centralize storage for all its disparate computing systems -- mainframes, UNIX, and
Windows NT computers. Most businesses had data on a variety of platforms and it had become
increasingly difficult for them to manage and share data effectively.
EMC’s products (approximately 60% faster than most competitors’ products) could store
and fetch massive amounts of data, at speeds approaching 3,000 transactions per second.6 EMC
devised a key feature called “caching” that allowed most-used data to be stored in a short-term
staging area, so the computer did not have to make lengthy trips to retrieve information from
remote disks.7 By 1999, EMC had 35,000+ storage units installed worldwide and its storage units
were the most expensive in the market place. They were deployed at 90 of the Fortune 100
companies and at the 10 largest Internet Service Providers.8
In 1997, 1998 the EMC stock was up over 900% and a staggering 33,600% in the period
between 1988 and 1998. Please see Exhibit 1 for an overview of its financial performance from
1994-1999. In 1998, EMC was named to Fortune magazine’s annual list of the World’s Most
Admired Companies. Business Week listed it in the top 10 among its Info Tech 100 list of the
best-performing technology companies. Industry Week recognized it as one of World’s 100
Best-Managed companies.
EMC executives attributed its sustaining leadership in the enterprise storage market for
excelling in three key areas: products, distribution, and customer service.9 10
Customer Service at EMC
One of the key differences in EMC’s approach to customer service was its treatment of
the EMC CSSO. Together, they were treated as an Investment Center -- not as a cost center, or a
profit center or a revenue center. This was in stark contrast to what the industry did in general.
Customer service departments at most hardware and software companies were profit/loss centers.
In fact, the gross profit margins for services at most IT (information technology) product
companies were very healthy: Silicon Graphics at 43.5%, HP at 34.1%. At 1.5% of total
revenues (mainly from warranties), service revenues at EMC were far below industry
standards.11
When you get here [EMC], what you are told is [by EMC], just worry about the
customer, don’t worry about anything else. That is so radical and so appreciated
by customers and by the managers because they only have one focus. Do what
ever it takes to get the customer back up and straightened out. I have been here
[EMC] for 9 years. The customer service mentality was already here. Mike
Ruettgers, Dick Egan they were the ones who really promoted this mentality and
6
ibid.
Muller, J. (1998), “EMC2: Hardware times software equals success”, Boston Globe, Tenth Annual Globe 100
Nobel, C. (1998), “EMC faces interoperability hurdles”, PC Week, Nov. 9
9
EMC Annual Report 1998
10
This case summarizes EMC’s customer service in the late 1990s. For an in depth look at EMC’s technology, products and distribution
strategies please refer to the following Babson Cases:
EMC Corporation (A): From Inception through 1998, The Rise to Market Dominance
EMC Corporation (B): 1999 and Beyond, Charting the Future.
11
Rocco, E. (1999), “EMC: Breaking Customer Service Industry Rules”, Dataquest, Jan. 18
7
8
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when I got here there were just 600 people through out the company and every
one knew everybody and it kind of just permeated through the whole
organization. It [investment center] made sense to me. Once I got here, I got my
head turned around [I always worked in a P&L environment]. When I came to
this company, I once said P&L and service in the same breath and he [Mike
Ruettgers] threw me out of his office. That is how serious it is.
-- Richard Petzold, VP Field Operations, EMC
The bonuses (at least 20% of their salary) of the service managers at EMC were based on
one measure -- customer satisfaction. The goal was to hit 95%, i.e., 95% of the customers should
be very satisfied or satisfied on a five-point scale. EMC had determined that the key drivers of
customer satisfaction were availability of the customer’s system and availability of EMC’s
support personnel. Hence, EMC CSSO was designed and operated to manage these two
variables.
The EMC CSSO was a complex division consisting of 2500 people spread in 63 countries
and in over 164 offices.
EMC technology enabled it to deliver remote, pro-active and pre-emptive services. All
EMC storage products were equipped with on-board processors that monitored the status of the
EMC equipment around-the-clock. These processors were isolated from the equipment to ensure
its operation in the event of a complete system failure. The processor could detect anomalies and
“phone-home” automatically to the EMC Customer Support Center and communicated with the
support center’s main computer. Since the tolerances were set to be extremely sensitive, the
majority of the dial-homes did not require on-site service. For example, EMC was able to advise
a customer that its air-conditioning unit was failing because a storage system had sent a message
home that it was unusually warm.12
In addition to the dial-home capability, the onboard diagnostics were self-monitoring,
self-detecting and even self-healing. EMC got up to 90,000 dial-homes a month. If necessary, a
Product Support Engineer in the Customer Support Center could dial back into the system and
perform diagnostics and often remotely resolve an issue before it became a problem. In fact, 80%
of all dial-homes were resolved remotely on the first call. If a pattern of errors was noticed, preemptive adjustments and corrections were made to the system and a Customer Engineer (CE)
could be dispatched to preemptively replace a part before it failed.
EMC had also invested millions in state-of-the-art technology labs -- Product Verification
Lab ($7 million), Enterprise Technology Center ($2 million) and Knowledge Management lab
($2 million). These labs helped in customized demo capabilities and solve and prevent customer
problems. Any product issue -- hardware, software, microcode related -- could be replicated,
analyzed, and resolved there under simulated customer environment conditions. The problem
cause was then entered into a knowledge database and the solution was integrated into the
product or process to eliminate future recurrences.
The dial-home initiated a support call (incident) at the two Customer Support Centers -one at corporate headquarters in Hopkinton, MA and another in Cork, Ireland -- operating 24
12
Verespej, M. (1996), “Give ‘em what they want”, Industry Week, Nov. 4
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hours, 365 days a year. The systems support centers were exact mirror images and both centers
shared a common call tracking and problem/solution database. About 125 Product Support
Engineers handled the dial-homes at the Customer Support Centers. In addition, there were 320
hardware and software support people in Hopkinton. Level 1 support took telephone calls
directly from the customers. If Level 1 support could not solve the customer problem, it was
escalated to the more experienced Level 2 personnel who each had a specialty in a particular
systems environment. Level 2 personnel were more specialized as opposed to the Level 1
generalists. The highest level (Level 3) of support came from engineering -- the people who
designed, built and tested EMC products -- and they were available 24 hours a day 7 days a week
(on call). This resulted in one of the key differentiating factors for EMC.
More than 1,500 customer engineers (CE), hardware and software support specialists
were scattered in more than 164 offices in 63 countries throughout the world. The primary
charter of the CE was to be an account manager. The job in the field was to be there for the
customer, to make sure that the rest of the corporation [EMC] obeyed the rules of the customer,
because every customer had different rules -- change control rules, rules of engagement, data
access authorizations and security procedures. They were ultimately responsible for protecting
the integrity of the customer’s data.
EMC had set up specific processes to deal with customer problems and regular periodic
services -- Management Escalation, Problem Resolution, Change Management etc. Some of
these processes went by “catchy” phrases.
“It’s not the big that eat the little, it’s the fast that eat the slow.”
When problems went beyond Level 1, there was an automatic notification to appropriate
individuals at the customer site, the local and regional field service offices and the corporate
headquarters to ensure the rapid and efficient escalation of problem resolution. Support
personnel at EMC were acutely aware that “minutes [of system down time] could cost millions”
to the customer. Hence, EMC boasted of a 2-hour response time for on-site technical support and
the quickest management escalation in the industry.
If we have a problem at 2 o’ clock Sunday morning and it turns out to be a code
bug or design bug, engineering is fixing it at 2 o’ clock Sunday morning. We
don’t wait till Monday morning. This is a part of the organization [engineering]
that is not even contained in service, but it is service.
-- Richard Petzold, VP Field Operations, EMC
Vice Presidents of Customer Service, Field Services, Tech Support and Engineering were
all notified when there is a problem escalation and one of them would stay on top of the
escalation to see through to its successful resolution. The VPs beepers were on all the time. If a
problem was not resolved within 24 hours, CEO Mike Ruettgers was notified. The escalation
process also resulted in the interaction between customer support personnel and engineering
(design). If not on a hourly basis, these two groups were involved in discussion a couple of times
a day.
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It goes back to the culture of EMC actually. In other companies if you are VP,
you are doing a lot of strategizing during the day. Here at EMC we are very
reactive. It does not matter if it is a small account in Tuscaloosa or Morgan
Stanley in NYC, they are all treated the same. So, if I need to get a phone call, I
do. There are several levels that are informed about the escalation. However, I do
get informed, the data is made available and I want to know about it. The worst
thing that can happen to me is to get blind-sided. I don’t want a sales rep to call
me and say, hey what is going on with XYZ account. I don’t want to sit here and
say, I don’t know. I want to be able to understand what we are doing.
-- Leo Colborne, VP, Worldwide Tech Support, EMC
The same sense of urgency throughout the company was high. If there was an event at a
customer site that caused an impact, then the event was reviewed in the everyday 10 o’clock
customer action committee meeting where there were representatives from every group -- tech
support, field support, problem management, and product and information management. There
was incredible peer pressure in these meetings to keep-up.
You discuss an action item one-day and if you need a status update the next day;
these guys do not want to come in to that meeting and say, “haven’t had a chance
to make a phone call, really not sure what is going on.” The other thing with
EMC, service or otherwise, once you get into that dog-house, it is awful hard to
get out, probably to an extent that is unfair sometimes. People try awfully hard to
stay out of it.
-- Leo Coleborne, VP Worldwide Tech Support, EMC
“Guilty till proven innocent.”
It’s our problem till the customer tells us that it is not our problem. Early on in an
engagement we might find that it is not our problem and that in fact it is an
operating system issues. However, we do not leave them at that stage. We engage
the other vendor, through the customer or directly till the issue is resolved. But the
problem is still ours till the final post-mortem when the customer will tell EMC,
“EMC the problem wasn’t yours and thank you very much.” We have case study
after case study where the other vendor walked away from the problem and we
just stuck it out.
-- Dale Hoopingarner, Director, Product and Information Management, EMC
EMC went one step further. EMC was always in a multi-vendor environment, because it
did not make servers and processing units. So, when a customer experienced a problem, it was
not always clear where the problem was and whose responsibility (vendor) it was. So, the other
vendor was called in to help diagnose the situation. Hence, EMC was in environments where a
customer was not paying for an EMC representative to be there but the customer was paying
their other vendor for being there. However, if the other vendor came in and found that it was an
EMC problem, the other vendor would hand the customer a bill. On numerous occasions EMC
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paid the customer for that bill. EMC was taking ownership of problem resolution for its
customers.
What we try and do is tell our customers, if you have a problem, you should call
us and we will take ownership position from the get go. If we then find out that it
is a Sun, Veritas or an IBM issue then we engage them.
-- Frank Hauck, Senior Vice-President, Customer Service, EMC
Change Management
Due to the dynamic nature of IT, customer sites required frequent changes -- code
upgrades, data migration, data center relocation, etc. These changes at times had to be done
quickly and without excessive interruption to system availability. Changes had to be successful
the first time they were made. EMC treated every change as unique. Every change was well
researched, precise and choreographed. The field experts and the corporate team create detailed
and exacting change procedures that were double-checked and re-verified. The VP for
Worldwide Customer Service wouldn’t go home on Fridays till he got an email from all of his 70
service managers worldwide, summarizing the status of scheduled changes in their territories.
With these procedures, EMC claimed to have one of the highest change success rates in the
industry.
The difficulty we have is with training people, coming from other companies, is
how cautious you have to be here. You are not out there as a Mr. Hero any more.
You are out there to protect the customer. We keep driving that and driving that
into them. If you look at the latest employee satisfaction survey, the lowest score
we have from my organization is “are you encouraged to take risks?” It is a low
score and I am happy it is a low score. I don’t want anybody taking risks with the
customer’s data. We are very very very unforgiving if somebody has been callous
about customer’s data.
-- Richard Petzold, VP Field Operations, EMC
EMC maintenance agreement
EMC also had one of the simplest warranty and maintenance agreements in the industry - only one level. All EMC hardware carried a standard 2-year warranty and the post-warranty
service agreement was an extension of the initial one. There are no varying levels of service -- no
red carpets, no first class, no coach class. Every customer got the same level of service.
“Everyone Meets Customers”
EMC CEO Michael C. Ruettgers said, “Some have joked that EMC really stands for
'Everyone Meets Customers,' but that concept is a major reason for our success. By listening to
customers and developing long-term relationships, we have been able to develop technology that
helps our customers save money, make money and gain competitive advantage.”13
13
Hill, S. and Rifkin, G. (1999), Radical Marketing: From Harvard To Harley, Lessons From Ten That Broke The Rules And Made It Big, Harper
Business
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In-direct Customer Support personnel were encouraged to interact with the customer.
Level 2 and Level 3 (engineering) customer support groups got to interact directly with
customers when there were escalations. However, there were other groups within the CSSO that
did not have direct interactions with the customers. For instance, in Level 2 support there were
co-product support engineers. When a problem occurred they were not involved in fixing the
problem in real time. However, once the fix had been identified, they would take that and
ascertain to eliminate it -- whether it be a design change or a documentation change. These folks
were actually a step removed from the customer. So, in order to facilitate more direct interactions
with the customers, they were made to rotate, sent out to sites, called in on escalations, made to
get on the phone with customers, have scheduled site visits with the local Customer Engineer etc.
Technical writers, also a part of this group, were made to do similar things.
CEO Michael Ruettgers had led the company by setting an example. In 1998, he met with
over 500 customers.
Frequent migration of employees from technical support to engineering
Customer technical support was very stressful. In product support, it was even higher.
The larger the Symmetrix got, the more data one put in there and more mission critical it became
and more damaging a mistake became. A Company could be put out of business for a couple of
days. It took a special kind of person to stay and have a career in customer service. However,
employees often migrate from the reactive support side of the business to proactive support -design, engineering. So, the engineering department was full of very experienced ex-customer
support personnel.
Testing, Parts Inventory
When Mike Ruettgers arrived, EMC was beset with quality problems and was a $190
million manufacturer of add-on computer memory cards that was on the verge of bankruptcy.
Four months into Ruettgers new job as head of operations and customer service, EMC’s product
quality problem reached crisis levels. Every piece of EMC’s equipment was crashing because of
faulty disk drives supplied by NEC Corp.14 What he learnt on his customer visits was
instrumental in making sweeping changes at EMC. When he became CEO is 1989 he insisted on
100% testing of all components and finished products, in an industry where testing of 10% of
final products was the norm. In fact, it took 2 days for EMC to assemble its products and 28 days
to test them, as it subjected each finished product to heat, cold, vibration and voltage
fluctuations. Components from suppliers were tested for more than 30 hours in 55 test chambers
located at its two assembly plants.15 Consequently, EMC’s products had the industry’s highest
system availability.
Winner’s Profile
EMC CSSO executives were also very obsessed with recruiting the very best. They had
very high expectations of its customer support personnel and had created a checklist describing
the “ideal” service support person (Exhibit 2).
14
15
Judge, P. (1999), “High Tech Star”, Business Week, March 15, p72
Verespej, M. (1996), “Give ‘em what they want”, Industry Week, Nov. 4
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The challenge the whole industry faces is finding good people. There are many
people out there who have the motivation, smart and may be have the right
attitude but do not have the right skills – service people, people people. Then we
have to make sure that they have a technical aptitude and hopefully skills in the
right areas – UNIX, MVS, NT. To me customer service skills, technical skills and
administrative skills in that order are the three most important things.
-- Al Colarusso, Director, Customer Service Center, EMC
We do get candidates easily. We are EMC. It is a good place to work. Conversely
we have a reputation for being a sweatshop. Good salaries, high stock prices and
good r-and-r can get around that.
-- Leo Colborne, VP Worldwide Tech Support, EMC
Developments in the late 1990s
EMC still had the upper hand in terms of its product technology. A 1998 study conducted
among 400 CIOs by Salomon Smith Barney indicated that customers overwhelmingly chose
EMC products for their features (Exhibit 3). This debunked the notion that EMC’s strength in the
storage industry was attributable primarily to its relationships with its customers (only 6.3% of
them chose EMC based on their relationship with EMC).16 However, in terms of using
technology for customer service and support, EMC did not really have any technological
proprietary advantage. Stratus Corp. first developed the remote diagnostic technology in the
early 80s. However, no competitor had yet to duplicate EMC’s remote diagnostic capability.
Storage prices were dropping at 60% annually. To protect itself from this decline and the
easy cloning of hardware, EMC stayed ahead of its competition by adding sophisticated software
to its hardware. The software side of EMC’s business grew 152% in 1998 reaching $445 million
for the year, making EMC one of the fastest growing software companies. Also, the company
expected to invest $1 billion in R&D over the years 1999-2001, of which about 80% was to go
toward software development. In mid 1999, 800 of EMC's 1200 engineers were focused on
software. EMC software was gradually sucking into its storage servers other functions, such as
network security, disaster recovery, workload compression and non-disruptive backups.
If we were only providing hardware, you’d run the risk of price wars, but there’s
so much value in the software we provide, the customer can’t do many of these
things without our software. If we hadn’t transformed ourselves into a software
company, we would be more vulnerable on price.17
-- Mike Ruettgers, CEO, EMC
The explosive growth in software posed some concerns for the tech support executives.
While EMC was a veteran at fixing hardware problems and set the industry standards for quick
problem resolutions it was a rookie in the software arena.
16
17
Dean, J. and Watts, W. (1998), “The future of storage systems”, Salomon Smith Barney Industry Report, Nov. 19, p16
Muller, J. (1998), “EMC2: Hardware times software equals success”, Boston Globe, Tenth Annual Globe 100
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With software, it is “where the heck is the problem?” The compounding factor is
the inter-operability of software systems. This complexity is really straining my
software tech support because the length of time it takes to identify and solve a
problem is much longer than it is with hardware. Even with some of the
microcode you can write a patch to fix a microcode problem and quickly apply it
to the particular box and it will be solved. But what you don’t want to have is a
patch patch patch software and soon you will have a bastardized version of the
code all over the place and you have a control problem. Also for EMC, this
problem has compounded itself because of its culture that has developed in the
field with customers, hardware quick-fix, and software what do you mean it is
taking two weeks to recreate this thing to figure out if it is working or not. The
phone calls continue to increase as we sell more, but how do I keep the people off
the phone lines so that they will be able to get into the labs and learn more and
keep them intelligent. Customers are using this software everyday, and so they are
getting to know more about the software than the people who are answering the
phones.
-- Leo Colborne, VP Worldwide Tech Support, EMC
Unlike the hardware side, EMC charged customers for software implementation,
maintenance and professional services. However EMC’s rate of investments into software
support was much faster and much higher than its revenue stream.
The Road to $10 Billion
EMC had set its sights on reaching $10 billion in sales in the year 2001, up from $4
billion in 1998. In alignment with the company’s sales goals the number of employees in CSSO
was to more than double, from 2500 to nearly 5500. This alone posed several challenges –
maintaining the service culture, consistency, exceeding customers’ expectations and the great
sense of urgency.
What keeps me awake at night, is that a lot of the phone calls come in at night are
being handled by what I think are very talented people. I want to be sure that they
are treating these calls the way I am expect them to be treated.
-- Frank Hauck, Senior Vice-President, Customer Service, EMC
Global expansion was also a concern. In a study involving 2000 global customers that
rated high tech support from vendors, all firms had fared very poorly in their oversees support
operations, specially in S-E Asia.18 Above all, could EMC maintain its service leadership? Oldtimers at EMC recalled with paranoia how IBM was upset from service leadership in the early
‘90s. IBM and service were long synonymous. But when things began to go sour for the
computer giant, IBM’s service faltered. IBM had tried to use its close customer relationships by
strong-arming long-term clients into sticking with its outdated systems.19
18
19
Source: Eng, T, et. al. (1998), “Global Tech Support 2000”, Data Communications, October
Peters, T. (1996), “The service edge”, Executive Excellence, March
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Exhibit 1
EMC Financial Performance
Revenues ($ in millions)
Software Revenues ($ in millions)
Net Income ($ in millions)
Market Capitalization ($ in billions)
1994
1,378
-251
4.4
1995
1,921
20
327
3.5
1996
2,274
76
386
7.9
1997
2,938
177
538
13.6
1998
3,974
445
793
43
Exhibit 2
Customer Service Winner’s Profile
Must have excellent communication skills (oral & written)
Must have good listening skills
Must eat problems for breakfast
Must possess the attitude “How can I help you”
Must be able to deal with unreasonable people
(when things break, the reasonable can become unreasonable)
Must demonstrate technical product knowledge
Must be able to discuss problems without being defensive or unpleasant
Must have a commitment to excellence
Must have a good attitude. Highly technical with a bad attitude doesn’t work.
Must be able to learn from experiences
(People make mistakes and products break)
Must deliver on commitments – without exception
Must be prepared. Must have back-up plans for the unforeseen
Must like people and visibly demonstrate it
Must have sincere customer empathy and quickly act to resolve their issue
11
1999
6,715
822
1,180
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Exhibit 3
Reasons for Choosing a Storage Vendor
Based on interviews with 400 CIOs of large firms
Vendor
Price
Features
Relationship
Price / Features
Compaq
EMC
HP
Hitachi
IBM
StorageTek
Sun
14.3%
0.0%
14.3%
0.0%
8.3%
18.2%
16.7%
0.0%
68.8%
14.3%
0.0%
0.0%
27.3%
0.0%
57.1%
6.3%
71.4%
0.0%
50.0%
27.3%
66.7%
28.6%
25.0%
0.0%
100.0%
41.7%
27.3%
16.7%
Source: Dean, J. and Watts, W., “The future of storage systems”, Salomon Smith Barney Industry Report, Nov. 19, 1998
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