Dell Corporation

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Dell Corporation

1. Introduction

A . Company History

In 1983, Michael Dell, an 18-year-old freshman at the University of Texas at Austin, Spent his evenings and weekends pre-formatting hard disks for IBM-compatible PC upgrades.

A year later, he dropped out of college to continue with his rapidly expanding business, which had grown from zero to $6 million in 1985, simply by upgrading IBM compatibles for local businesses. In 1985, Dell shifted its focus to assembling it own brand of computers which led to a dramatic growth of the business, with $70 million in sales at the end of 1985. By the year 1990 sales had grown to more than $500 million and Dell was able to supply a number of Fortune 500 Companies. The company now had a broad product line of desktop and portable computers with Intel processors and had earned a strong reputation for quality products and service. Throughout the company’s history, a big part of Dell’s success was due to its unique and distinctive “Dell Direct Model.” This model took efficiency to new heights by eliminating the intermediaries between maker and user of PC’s and lowered costs by eliminating inventory with the help of an efficient supply-chain management system and internet sales. Today, as the world’s largest PC manufacturer, Dell Computer Corporation offers a great variety of computing products directly to customers, with build-to-order systems and Comprehensive services that fulfill the needs of its customers. Dell’s customers range from Major corporations to individuals all over the world. Efficient cash management has enabled Dell to have both extremely high inventory returns and a “negative cash conversion cycle.” This cash flow system permits Dell to pass on cost savings to customers in the form of lower prices for the best technology available. These competitive advantages have helped the company achieve a solid cash position with outstanding liquidity

B.. In search of a company culture

The culture at Dell had always been driven by a continuous program to drive down costs And improve the “customer experience.” Facts were more important and more highly valued than emotions and personal feelings. As the company grew and succeeded, the company culture that pushed the drive to be number one and to make a personal fortune was based solely on economic terms. But in the year 2000, Dell’s margins in the hardware business began to decline due to a slowing demand for PC’s and a price war with competitors. Investors were disappointed, layoffs were frequent, and employees began to wonder why they worked in a high-tech industry, and why they worked for Dell.

Kevin Rollins was aware that all great companies have great cultures. They have a Purpose and a leadership model. Aware of an urgent need to define his company’s culture, he Looked for inspiration, reading books on Franklin, Jefferson, Monroe, and Washington. He soon discovered that what the founding fathers of the United States believed in went well beyond logic. They were passionate, very idealistic, and had a vision that exceeded their personal gain and involved the risk of losing their lives. Mr. Rollins found this remarkable, and it caused him to think about the country’s soul and its leaders. He believed this was an “interesting paradigm for a company to examine, as opposed to simply adopting the business paradigm.” With this foundation, he began to develop what became known as The Soul of Dell.

C. . Key Players

Michael Dell is the founder and CEO of Dell Computers. During the past 18 years, he Has grown the company’s sales from $6 Million to $33.7 Billion and opened sales offices Worldwide, employing more than 38,000 people around the world. In 1992, Michael Dell Became the youngest CEO of a company to be ranked as a Fortune 500 firm. He has been Honored in numerous occasions for his vision and leadership. One of the main goals for his Company is to double company...
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