STANDARDIZATONCONSOLIDATION

SCALINGINTEROPERABILITY

DATA MANAGEMENTPORTFOLIO MANAGEMENT

IT’S WHO WE AREAND HOW WE WORK

Seems like every technology company is fond of saying they “eat their own dog food.”But what does it really mean? Usually just a

software application here or a piece of hardware there.

But at Dell, “eating our own dog food” isn’t just a tired industry cliché. Any way you

slice it—by processing power, by storage,by people, by budget—we run Dell’s

$50 billion high-growth businessmore than 95% “Dell on Dell.”

Here’s why.

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JUST LIKE OTHER COMPANIES

YET UNIQUEDell is a unique kind of company, but we

also face many of the same challenges as our customers. We are the leading

e-Business presence, with key supply-chain and logistics competencies. We

are a large-scale services provider. We are a consumer electronics channel, and

a market-leading worldwide brand—all rolled into one global company.

For our customers, this means that we are uniquely positioned to understand

their technology challenges, as we face many of these same challenges

ourselves every day.

Manufacturing / Supply Chain

Ship 150,000+systemsper day

Ship 150,000+systemsper day

* Based on FY2005 revenue data for pure Internet sales only; excludes Google advertising revenue.

Dell.com exceeds theInternet sales revenue of . . .

. . . combined!

*Direct choice of the consumer, versus:

Dell is a Large-Scale Services Provider to:

Total Managed Seats

2005

+97%

2004

#1

#2

#3

#4

#5

Market LeadershipHarris Poll: Best Brands 2005

IT’S ALL ABOUT

STANDARDSDriving toward standards-based platforms

has been key to our success within Dell IT—but there’s more to the story than just

lower operating costs. For us, another significant benefit has been the ability to

leverage our IT workforce in much more efficient ways than ever before.

Rather than spending time maintaining complex legacy systems, our IT

professionals can focus on delivering new and better solutions for our business

partners—and that helps us to maintainour competitive edge.

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THE VALUE OF STANDARDSAs proprietary systems and platforms have been eliminated from the environment over time, the ability of our IT organization to focus on delivering new projects and benefits has risen more than five fold. And our operating costs as a percent of revenue have declined year over year, even taking into account that we pay for our hardware just like our customers do. Dell leads the industry in cost effectiveness—and Dell IT is held to that same high standard. Leveraging standards-based technology enables us to respond at the speed of business, widening the gap as we continually create new competitive advantages for our business.

5% proprietarysystems

5% proprietarysystems

$1.8 billionannualized

benefits

$1.8 billionannualized

benefits

IT Project Delivery2000: <200 projects2005: 1,200+ projects

IT Project Delivery2000: <200 projects2005: 1,200+ projects

2000 2001 2002 2003 2004 20052000 2001 2002 2003 2004 2005Dell IT Environment: 2000–PresentDell IT Environment: 2000–Present

Cost of “keepingthe lights on”= 1.55% of revenue

Cost of “keepingthe lights on”= 1.55% of revenue

$350 millionannualizedbenefits

$350 millionannualizedbenefits

26% proprietarysystems26% proprietarysystems

Cost of “keepingthe lights on”

= 0.89% of revenue

Cost of “keepingthe lights on”

= 0.89% of revenue

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CONSOLIDATIONIS THE KEY

Server, storage and network consolidation have been a major part of our success in reducing complexity and

creating a technology environment that’s not only simple to scale, but simple to

manage, too. Moving from more than 20 data centers to just two, and from

hundreds of server farms to a few dozen, has helped ensure that we can restore any

of our 80+ mission-critical “Class I”applications in just four hours or less. In

an environment where an hour of downtime can cost millions in revenue,

that’s a crucial advantage.

ACTIVE

ACTIVE

CAPITALIZING ON THE CURVEThe modularity of standards-based platforms means that as assets depreciate off, they’re easily replaced with the latest technology, in effect giving us a “sliding scale” on Moore’s Law. By refreshing more than one fifth of our enterprise systems each year, we ensure that we are always optimally positioned on the price-performance curve—and when managing more than 5,000 servers and 1.75 petabytes of storage, we see significant benefits.

Workload BalancedAcross Data Centers

Full Real-Time ReplicationFull Disaster RecoverySecurity in the Data Center

Scalable Architecture =

THE RIGHT TOOLS, BUT NOT EVERY TOOLWe want our developers to have the right tools—but we’ve never believed that means they should have every tool that’s available. We focus on best-in-class solutions that have been demonstrated to be fast, effective, scalable, adaptable and interoperable. We ensure that our suppliers support these same principles, and we maximize value, buying power and availability through global enterprise license agreements. These strategies help to minimize development constraints, shorten project lifecycles, and reduce our total cost of ownership.

Just some of the tools we use every day to build our enterprise:

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A TOOLKITFOR THE ENTERPRISE

In a virtual forest of software marketing hype, we strive to identify and implement those tools that provide the best value—

ones that grow with industry-standard technologies and open architectures. But

beyond the inherently lower total costs associated with standards-based

toolsets, we’ve found another important competitive advantage: Standards

breathe flexibility into IT teams, enabling developers to move quickly from

technology to technology. As a result, we can more readily focus resources

wherever our business needs them most.

SOME EXAMPLESOF STANDARDS AT WORK

We’ve detailed many of the key strategies that help us run our global enterprise on

standards, but the proof is in the execution. Following are just four examples

of the many ways that Dell IT builds competitive advantage for our business

using a combination of our own hardware and our partners’ industry-standard tools.

Now, some people will try to tell you that “scale-out” is too expensive, too complex, too hard to manage—or just plain doesn’t work. But if that were true, there wouldn’t

be a Dell. And we’re definitely here.

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DELL.COMWe built the world’s highest revenue consumer e-Business presence from the ground up using standards-based hardware and software. Any doubts about whether a standards-based scale-out architecture is really viable for the highest-volume transactional systems? Dell.com easily supports2.2 billion page requests every quarter at up to 65,000 requests per minute, in 81 countries using 24 languages, serving 100 million users per quarter.* Stats: Dell PE6650 servers, Dell/EMC storage, Windows Server 2003, Microsoft .NET framework, Microsoft SQL Server.

EMEA ORDER-MANAGEMENT SYSTEM Exceptional sales growth in Dell’s European operations demonstrated that our EMEA order-management system, previously a proprietary Unix-based application running

on Sun servers, simply couldn’t scale to meet growing demand. The solution? The power of Dell servers running Oracle 10g RAC in a grid configuration. The result?

A system that’s up to 300% faster, supports twice as many users, could save nearly $5 million over five

years—and is so scalable that we’ve already tested it on up to 16 nodes in our labs. Stats: 12,000

concurrent sessions, Dell PE6650 servers (6 nodes), Dell/EMC storage, Oracle 10g RAC, Red Hat Linux.

* Data current as of August 2005

MORE EXAMPLESOF LEVERAGING STANDARDS

As we meet with our IT peers from many other industries around the world to share

best practices, one theme that we hear time and time again is the nightmare of

costly legacy systems that can’t scale to meet the demands of the growing

enterprise. At Dell, one of our core beliefs is that all systems must be architected from the ground up to be scalable and global. We can add capacity simply by

adding nodes, and of course we’re always adding the latest technology instead of

“buying backward” to prop up legacy platforms with old technology.

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INTEGRATED DELL DESKTOP (IDD)Built on the Microsoft .NET development framework, IDD leverages the Smart Client architecture and Web services to significantly improve the ability of Dell call-center agents to assist our customers. IDD integrates all of our key call-center applicationsinto a unified interface that makes our agents more productive, helping to reduce call times by more than 10% and training time by more than 45%. Stats: 11,000 users, Dell PE6650 servers, Dell/ EMC storage, Microsoft .NET framework, Oracle 9i/10g, Microsoft SQL server.

DELL DATA WAREHOUSEIf there’s one thing no business has a shortage of, it’s data. But data doesn’t

become information until you have the right view. We’ve eliminated data marts and scaled our data warehouse on Dell hardware from 8 to more than 300 terabytes,

processing more than 2,000 data feeds daily, all with the goal of enabling our internal and external

customers to answer “any question, any time.”Stats: 20,000 internal users, Dell PE2850 (100+

nodes), Windows 2000, EMC DMX 1000storage totaling over 300 terabytes.

SEE THE RESTOF WHAT WE DO

Dell IT supports over 61,000 employees in more than 30 countries and we touch every

aspect of the business.

For the systems that enable and manage our supply chain, to our global email

services, to worldwide network access and security, and much more, we ensure Dell

employees have stable and reliable access to the services and tools that they need to

be successful.

These are just a few examples highlighting the rest of what we do.

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PORTFOLIO MANAGEMENTBy globally utilizing a single tool, a thorough modeling process, and a sensible

planning and management strategy, we have been able to increase our benefit to the entire organization while reducing our budget as a percentage of company revenue.

Fiscal Year 2006:• >1,000 completed projects

• >65% of IT resources dedicated to development• More than 150 global projects completed

WIRELESSDell IT manages an extensive system of wireless access points for ouremployees worldwide.

• More than 800 wireless access points• Over 15,000 notebooks in use

GLOBAL NETWORKDell operates in multiple countries throughout the world. We manage thousandsof systems and servers delivering dependable access to important data.

• 80,000 client systems worldwide• Over 100 global WAN sites• 31,000 VoIP users

REACH OUTTO YOUR PEERS AT DELL IT

Lots of technology companies are eager to talk to you when they’re trying to sell you

something. But how many of them want to have an IT-to-IT discussion about common

challenges and best practices? At Dell, our IT professionals are waiting to share Dell’s key learnings with our customers

and partners. Here are three ways you can start an IT-to-IT dialogue with us through

our global IT events and one-on-one customer briefings. Remember, it takes

time to build your way out . . .

For more information on

Dell IT events and customer briefings, ask your Dell account executive, or visit

www.dell.com/it

Customized briefing or conference call presented by Dell IT leadersOften focused on a specific topic or technology, such as server management, data warehouse, imaging and patch management, data center best practices, and many moreArranged through your Dell account executive

Why not be your industry’s leader?

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Half-day seminar presented by Dell IT executives3–6 events per year in each of EMEA, APJ and AmericasCovers relevant IT best practices, experiences and insightsIncludes one or more “deep-dive” presentations on topics such as e-Business, data management, and supply chain“Summit” events conducted once or twice yearly in each region, featuring an expanded program of sessions focusing on topics such as IT security, open-source computing, managed services, and portfolio management

THERE’S REALLY NO

SECRET RECIPEWe’ve told you what’s in our dog food—but what about our competitors? Here are some key questions we think you should be asking them:

We bet their answers will surprise you . . . if you get any answers at all, that is.

What is your IT spend as a percent of revenue? (For 2004, ours was 1.4%, including all telecom.)What percentage of your business runs on standards-based technology? (We’re at 95%.)What is the dollar benefit your IT organization delivers to the business? (For us, $1.6 billion last year alone.)

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Successdemands

results,not clichés.

We’re ready—let’s grow.

Visit www.dell.com/it

Copyright © 2005 Dell Inc. All rights reserved. (Rev. August 2005)