History of Dell

• Dell computer was founded by Michael Dell. Dell traces origins to 1984 when Michael dell created PCs limited. The company changed its name to “Dell computer corporation” in 1988 and began expanding globally as a multi national company first in Ireland.

• In 1992 Fortune magazine included Dell computer corporation in its list of the world’s 500 largest companies. Michael Dell is the youngest CEO of the fortune 500 ever. Dell Inc. is now the 41st among the fortune 500 companies.

Future Plan• Dell Inc. is planning a major expansion of its retail

presence in China, one of the company’s largest and fastest growing markets.

• Dell is planning six new tablets and three new Smartphones.

• In recent times Dell is planning for more powerful gaming laptops and desktops named “Alienware”.

• Dell’s supply chain optimization team has targeted forecasting for process improvement. Each group used its own judgment and biases to modify the forecasts of demand.

Products Of Dell Inc.

Products•Desktops•Servers•Notebooks•Netbooks•Peripherals•Printers•Televisions•Scanners•Pen Drives •Smart Phones

The corporation markets specific brand names to different market segments.

•Its Business/Corporate class represent brands where the company advertises emphasizes long life-cycles, reliability, and serviceability. Such brands include: Optiplex, Vostro, Latitude and others.•Dell's Home Office/Consumer class emphasizes value, performance, and expandability. These brands include: Insprion, XPS, Adamo and others.•Dell's Peripherals class includes USB Pendrives and Printers; Dell monitors includes LCD TVs, plasma TVs and projectors for HDTV and monitors. Dell UltraSharp is further a high-end brand of monitors.

Dell's major

competitors

Dell As An Multi-National Company

• Dell is an American multi national technology based company centered in Round rock, Texas, United states.

• Dell has a big market share in China and India.

• In 2006, Dell cut its price in an effort to maintain its 19.2% market share

International market of Dell

• Dell International started in India about seven or eight years back by opening a customer contact center at Bangalore in 2001. In 2003, the second contact center was opened at Hyderabad.

• After the U.S., Dell India is the second biggest centre with 13,000 employees.

• About 90% of dell computers are manufactured in China.

SWOT Analysisof Dell Inc.

Grand Strategy Matrix

Competitors in PC industry:

• U.S. top five players:

U.S. PC market Share

DELL25%

COMPAQ13%

HP9%

GATEWAY7%

IBM6%

OTHERS40%

Competitors in PC industry (cont.):

Worldwide PC market share

DELL14%

COMPAQ10%

IBM7%

HP6%

NEC3%

OTHERS60%

Growth strategy• Process streamlining: Dell built a significant

advantage in the marketplace by focusing on innovations in the supply chain. Dell focused on enabling "just in time" delivery of parts and components.

• Product diversification: Dell has used a diversification strategy to enable business growth.

• Market penetration: Dell has achieved market penetration internationally with various segmentation strategies

Innovation Approach

•Dell helps drive the course of future industry innovation through a time-tested process that puts customer needs first.

Global Product Development

•Dell’s global presence gives the company an innovation edge in important ways

Value Bubble

• Attraction– Dell uses many different areas to attract people to

there site.• Dell uses television adds and magazines to get the

word out on how easy it is to customize your own computer on the dell website.• Uses B2B customers to attract B2C customers and vice

versa.• Customers are also attracted to the site via the

numerous links that get you there from different places on the web.

Value Bubble

• Learn– This is a very important phase for dell because they are

constantly changing based on customer wants and needs and if they did not gather the proper information from there customers they would fail.

– They are very good at this phase due to the direct sales model, which gives them direct access to there customers.• Information is constantly gathered from the site.

– account information– Click streams– Blog information– Suggestion forms– Customer service representatives.

Value Bubble

• Relating– Dell puts the information that they collect from

various sources into use.• My Account

– Allows customers to totally customize there shopping experience and give Dell the chance to show the customer things they might be interested in.

• Usability information is constantly being checked and updates are constantly being added to the site.– With the only presence being an online one the attention paid

to the actual site is crucial.

Diversity & Inclusion

• Dell is committed to building a diverse environment that is reflective of a diverse global marketplace. They are striving to ensure they are engage with key marketplace segments to advance their global diversity and inclusion activities.

• Dell believes that to be a successful company and a great place to work, our business must be able to leverage the similarities and differences of all team members.

• Dell creates mutually beneficial partnerships with national civic organizations, professional development organizations, and multicultural business and community groups in advancing their marketplace and workplace diversity and inclusion activities.

Cultures And Values

• Dell actively foster a culture where employees can be confident and proud that they act legally and ethically.

• Dell’s Code of Conduct, entitled “Winning with Integrity,” encompasses a globally consistent set of guidelines articulating our standard of ethical behavior.

• The culture of integrity at Dell encourages the courage of the individual. The Global Ethics and Compliance Office receives an average of 350 inquiries per quarter.

• Dell uses both organizational structure and culture to have a direct bearing to their companies’ profit.

• Dell has a highly collaboration and informative process

• Dell uses development designs to maximize networking technology.

• Dell plans to gain additional benefits from its integrated identity environment by leveraging.

Conclusion

• Dell started as a market leader and still retains that trait in some areas. With there slipping sales in the U.S. they are being forced to look at alternative ways of brining revenue to the company, which is a process that they are used to. I think that they will continue to gain market share and continue to be a large player in the personal computer industry for years to come.

Advantages of Dell Strategies• Dell’s business structure of “virtual integration” allowed it to excel in an

incredibly competitive industry. It's competitiveness in the industry resulted from a highly efficient business model that sought out every opportunity to work more productively without compromising the quality of their product. Production efficiency lowered cost which in turn provided Dell with larger profit margins.

• Dell further expanded its ability to meet customers needs by classify customers into specific categories. Customers were categorized into Relationship buyers, large businesses and institutions, and Transaction buyers, small business and home PC users. The Relational buyers made up a significantly larger portion of Dell’s business but also had different needs than Transaction buyers. Every relational buyer was assigned a representative who guided the business and institution through each stage of the buying experience. By integrating both Relational and Transaction buyers into their business system repeat purchases were quick and easy, purchasing history could be consulted, and follow up customer service was able to be more effective.

Virtual Integration• Dell did something else other PC companies were not doing; strategically

targeting only the customers they wanted. By defining their customer as a ‘knowledgeable PC user’ Dell made their task of providing a PC easier. Their customers did not need to go to a retail store to gain knowledge about their product. This enabled the ‘Direct Model’ for purchasing PC’s to work

• From this concept three key integrations formed: 1. A symbiotic relationship between Dell and its suppliers; 2. Customers linked directly to manufacturer; and 3. End user were linked to proper customer service assistance. Each one of these measures enabled costs cuts; quicker deliver time, and a more reliable finished product.

• Tailoring manufacturing to a customer's specific needs allowed Dell to integrate production schedules with sales flows, assemble all parts of the PC on site, and install the specific software that the customer requested. These manufacturing interactions sped up the final products completion time to thirty-six hours. The swiftness of the manufacturing process added value to the customer by quickening the delivery time.

Advantages of HP Strategies• Among the biggest advantages is HP's ability to hide the

price of many strategic commodities. Neither contract manufacturers nor HP's competition know what the company paid for a given part. As a result, they can't put pressure on suppliers to match the price for other OEMs.

• Like many high-tech leaders, HP has embraced the doctrine of outsourcing. It relies on multiple contract manufacturers to turn out sub-assemblies and branded product, including personal computers and printers, at sites around the world.

• Certain commodities, such as memory devices, have high price volatility and are subject to frequent renegotiations. HP can lessen the impact of price changes through direct management. It also ensures that new prices are implemented in a timely fashion.

The Disadvantages of Dell & HP Strategies

• Competitive advantage, the way companies differentiate themselves from their competitors, is what it takes to survive and thrive in a competitive market environment. The trouble is that some companies give this advantage away, piece-by-piece, through outsourcing.

• Outsourcing, the transfer to third parties of activities that used to be performed in-house, provides certain competitive advantages to early-movers – that is, to companies that adopt it first — but it isn’t proprietary. It cannot be patented, thereby preventing others from ad0pting it. Once this happens, outsourcing is no longer a source of competitive advantage. Worse, outsourcing nurtures corporate complacency whereby leadership fails to address competitive threats from alternative products.

• Outsourcing of manufacturing is feasible only if it can be separated from other supply chain activities: product development, branding, marketing, distribution, and after sales services.

• The same is true for outsourcing marketing or distribution, and R&D. For instance, Dell decided to expand its ties in the Indian outsourcing market, building on the contact center and R&D operations it already has established; and a customer contact facility in Gurgaon to complement its existing operations in Bangalore, Hyderabad and Mohali.

• This means that as additional activities are outsourced, the supply chain turns from a single integrated process, performed within the boundaries of traditional corporations, to a fragmented and disintegrated process, a collection of separate and disjointed activities performed across several independent subcontractors. And although such a fragmentation and disintegration of the value chain offers companies a number of well publicized advantages, it has an unintended consequence: It eases the entry of new competitors to the industry easier, intensifying competition, shortening product cycles, and squeezing return on invested capital.

• That could explain why successful consumer electronics companies like Apple and Google limit outsourcing to manufacturing, keeping product design, branding and marketing, and after-sales service in-house.

• The ultimate source of Dell’s great historical success has been its direct sales model. By cutting out the middlemen, Dell benefits in many ways. Since it doesn’t have to fill traditional sales channels, it doesn’t have a lot of PCs sitting in inventory all over the place. So on the production/distribution side of the PC business, Dell’s direct model has given it a big cost advantage, which in the past enabled it to make lots of money selling machines at prices that competitors could match only by taking a loss.

• But there’s another side to the PC business: the support side. And here, the direct model looks less attractive. If, after all, you’re selling directly to customers, you have to shoulder all the related support costs, from handling information requests before the sale to taking and tracking orders to handling service inquiries after the sale. You can’t offload any of those costs onto resellers or retailers or other distribution partners – because you don’t have any distribution partners.

• The direct sales model provides a cost advantage on the production side, in other words, but brings a cost disadvantage on the support side.

• Now, as long as most of the costs (for you and your competitors) lie on the production side, you’re golden. If, however, the balance of costs shifts toward the support side, you’re in trouble.