HolidayBuyer's Guide

Dell is swell, customers say

After a dip, the PC maker is getting higher satisfaction ratings for customer support among businesses.

Reversing a recent slide in satisfaction rankings among its business customers, Dell beat out Hewlett-Packard and IBM in a measure that's closely watched for potential insights into future PC sales trends.

Dell scored 83.61 out of a possible 100 points in Technology Business Research's third-quarter report, up from 82.27 in the second quarter and 80.32 in the first quarter.

The third-quarter result gave Dell the highest satisfaction rating among the world's top three PC manufacturers. HP scored 81.95 for the period, while IBM came in third with 81.66.

News.context

What's new:
Reversing a yearlong slide, PC maker Dell topped competitors HP and IBM in an influential customer service ranking.

Bottom line:
TBR's report, which offers a rare glimpse into the thinking of hundreds of corporate-technology buyers, is good news for Dell. But rankings could shift in the wake of the Lenovo-IBM deal.

More stories on the top PC makers

Dell's showing reverses a yearlong slide in ratings from business customers, as measured by TBR. During the first quarter of this year, Dell's overall customer satisfaction rating fell behind that of HP for the first time since 2000, when TBR began the survey. Dell improved slightly during the second quarter, but only enough to tie with HP and IBM.

Customer complaints lobbed at Dell mainly centered around phone and on-site support, gripes readily acknowledged by the company. "We have a pretty fast-growing business, and unfortunately, we had staffing plans that didn't meet that" in areas such as phone support, said Bob Riazzi, director of services marketing for Dell. "We needed to grab hold of that, and we did."

TBR's influential reports offer a rare glimpse into the thinking of hundreds of corporate-technology buyers who participate in its quarterly surveys. A difference of 1 percent or more between two scores represents a significant advantage, according to the Hampton, N.H.-based researcher.

The rankings could face another shake-up following Lenovo Group's purchase of IBM's PC division, expected to be completed during the second quarter of 2005. Although IBM has taken measures to ensure that the transition is as painless as possible, and several customers have said they expect no reason to change brands, the deal could still help Dell or HP gain if Lenovo and IBM drop the ball during the hand-over.

TBR compiles the report by surveying several hundred IT executives at North American companies each quarter. It focuses on eight factors, including phone support, on-site technical expertise, pricing and value and overall satisfaction. The third-quarter report included 640 interviews and was completed between April 1 and Sept. 30.

"Phone support was having kind of a domino effect on some of the other areas."
--Julie Perron, TBR researcher

TBR's third-quarter report shows that Dell--whose fast-growing PC business was putting a strain on its customer support capabilities--has taken action to improve customer satisfaction among businesses, decreasing the likelihood of an exodus of customers due to service and support concerns.

Although TBR's third-quarter customer service and support satisfaction report reflects the opinions of a small sample of Dell's overall corporate customer base--and it only queries businesses with less than 1,000 employees--it provides insight into how customers at large businesses feel about the company's service and how those feelings have changed over time.

Dell executives have long said they consider large businesses to be the company's most important customer base.

This time around, customers felt better, experiencing at least some effect from measures Dell took in late 2003 and early 2004 to beef up its telephone and on-site support groups through staffing, training and the launch of its Enterprise Command Center. The center serves to track service personnel and follow replacement parts on the way to customers, as well as monitor weather and news reports so Dell can predict where its services might be needed most.

"Phone support was the area that was keeping Dell from doing better," said Julie Perron, manager of primary research at TBR. "Phone support was having kind of a domino effect on some of the other areas."

Indeed, TBR's report shows that Dell scored higher customer-satisfaction ratings for its telephone technical support and on-site service. Those improvements also boosted customers' views of the overall value of Dell's service and support, she said. Customer satisfaction for HP and IBM, meanwhile, has been much more stable over the last year.

Setting expectations
TBR's report also sheds light on customer expectations. Many report expecting more from Dell than they do from the other PC makers, Perron said. Thus, existing customers believe their service should remain the same or improve, while many new customers probably expect to get better service based on Dell's reputation. Either set of Dell customers is therefore more likely to be disappointed by Dell's service, Perron noted.

Aaron Lockey, a software developer and former network manager who works for a large company that purchases Dell PCs, said he recently had to call Dell tech support three times in order to get the motherboard on his work-issue Latitude D600 replaced. Lockey says he was made to troubleshoot the problem with tech support and then asked twice to leave his contact information to schedule an on-site service. Dell reps told him their server was down before Lockey made a third call; Dell then dispatched a technician to fix the machine.

"I was really disappointed because in the past I'd had so much better service," he said. "So I guess my expectations were a little bit higher...because I really expect more than that from Dell."

If Lockey were buying himself a computer in the future, "I think I'd probably still go with Dell," he said. "But (the latest experience) certainly levels the playing field with the other guys."

Indeed, Dell's lower customer satisfaction among businesses and consumers represents a misstep for a company that rarely makes mistakes. The root cause of the business problem, and likely for consumers as well, was Dell's rapid unit shipment growth in recent years and the resulting rapid influx of new business customers, Perron said.

Dell executives, who acknowledged problems earlier this year, don't dispute Perron's diagnosis. But they say the company has been working to rectify the situation for some time and is also seeing better results in its own internal surveys.

Dell has begun calling customers who place multiple calls to tech support for the same concern.

Aside from launching its Enterprise Command Center, which primarily serves large server and storage system customers, Dell's enterprise group, which serves the same type of large customers as TBR surveys for its reports, has taken a new approach that refocuses the efforts of its support technicians on lowering the time it takes to resolve problems.

Some of the measures Dell took included hiring more phone support technicians and giving them more advanced case-management software tools to let them track problems as opposed to having to start over with each call. On-site techs now stay with a customer until that customer says a problem is solved, instead of installing a part and leaving, Riazzi said.

Dell's goal is to solve each problem within a 12-hour period. Right now it meets that goal about 96 percent of the time, globally, for its server and storage products, Riazzi said.

Dell, whose first Enterprise Command Center is near its headquarters in Round Rock, Texas, has added new centers in China and Ireland to serve customers in those geographic regions. It plans to add another branch in Japan in the near future, and to expand the command center's role from servers and storage products to PCs for large customers.

Dell rerouted some of its support calls from businesses, sending calls from corporations that own its Optiplex desktop and Latitude notebook PCs to technicians in the United States instead of technicians at its call center in Bangalore, India, after complaints about service. TBR's Perron said she thinks the move helped Dell's satisfaction rates improve.

Tackling trouble on the home front
Though Dell says about 85 percent of its business comes from corporations, the company still maintains a thriving consumer PC business. Home users made some of the same complaints about service as large businesses did during the last year, but Dell says it has made progress on the home front as well.

Bobbi Dangerfield, director of customer experience for Dell's U.S. Consumer business, said the company has also beefed up phone support for consumers with the aim of solving problems more quickly. To that end, it has added more staff, increasing, for example, the number of more senior, "level two" technicians available to help resolve problems.

The company has also trained its support technicians to handle so-called customer care issues, such as helping to resolve problems with orders instead of transferring calls. Furthermore, it has begun calling customers who place multiple calls to tech support for the same concern, in an effort to resolve the issue.

"We got some pretty loud feedback from our customers. (They) told us that the No. 1 thing they want us to do is fix their issue when they contact us. They say, 'Solve my problem the first time,'" Dangerfield said.

Dell has also begun an educational program to help customers avoid spyware and computer viruses. About 20 percent of the support calls it gets concern spyware, executives have said.

According to Dell's own surveys, the efforts have helped increase customer satisfaction, Dangerfield said.

Still, Dell's India-based phone support technicians, one source of consumer complaints, are staying put, although Dell says it has increased training there.

"I'm happy to report that our India contact centers today are leading the way in customer satisfaction" at Dell, Dangerfield said.

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