. Using the published information about Dell Computers, write a brief case study showing the strategic development and its current strategic position. DELL'S SALES REVENUE
1992----------$2 BILL US
1996----------$16 BILL US
2004----------$41 BILL US
2008----------$61 BILL US
2009----------$61 BILL US
DELL'S STRATEGY IS AN UNCONVENTIONAL APPROACH.
• 1984 The company becomes the first in the industry to sell custom-built computers directly to end-users, bypassing the dominant system of using computer resellers to sell mass-produced computers. • 1986 Dell unveils the industry's fastest-performing computer, pioneers the industry's first thirty-day money back guarantee, and offers the industry's first onsite service program. • 1996 The company's quiet bid to sell custom-built computers over the Internet quickly becomes a public revolution when the company announces that sales over www.dell.com have exceeded $1 million per day. Dell introduces also its first custom custom-made web links for customers. Called "Premier Pages", the links allow customers to tap directly into the company's own service and support databases. 1998 Dell establishes web-based connections with its suppliers to speed the flow of inventory and quality information ================================
THE THREE GOLDEN DELL RULES
Always listen to the customer
Never sell indirect
DELL COMPETITIVE STRATEGIES
• Speed to market
• Superior customer service
• A fierce commitment to producing consistently high quality, custom-made computer systems that provide the highest performance and the latest relevant technology to the customers An early exploitation of the INTERNET.
DEVELOPING THE FAST PACED FLEXIBLE CULTURE
Set a Common Goal.
- Mobilize your people around a common goal.
-Help them feel a part of something genuine, special, and important, and you'll inspire real passion and loyalty.
DELL'S TIGHTLY ALIGNED BUSINESS STRATEGY.
THIS STRATEGY HAS SEVERAL KEY ELEMENTS
Profitability management, coordinating a company's day-to-day activities through careful forethought and great management, was at the core of Dell's transformation in this critical period. Dell created a tightly aligned business model that enabled it to manage away the need for its component inventories. Not only was capital not needed, but the change generated enormous amounts of cash that Dell used to fuel its growth. How did Dell do it? At the heart of Dell's profitability management was a seemingly impossible dilemma: the company had adopted a build-to-order system, yet it had to commit to purchase key components sixty days in advance. How did Dell manage this?
1.Account selection. Dell purposely selected customers with relatively predictable purchasing patterns and low service costs. The company developed a core competence in targeting customers, and kept a massive database for this purpose. A large portion of Dell's business stemmed from long-term corporate relationship accounts—customers having predictable needs closely tied to their budget cycles. For these, Dell developed powerful customer-specific intranet Web sites with predetermined custom specifications and budgets. The remainder of Dell's business involved individual consumers. To obtain stable demand in this segment, Dell used higher price-points and the latest technology products to target second-time buyers who had regular upgrade purchase patterns, required little technical support, and paid by credit card. 2.Demand management. "Sell what you have" was the phrase that Dell developed for the crucial function of matching incoming demand to predetermined supply. This occurred at several levels. At a monthly MSP/MPP (master...
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