Dell Value Chain

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Dell has been one of the world’s biggest and most profitable PC company however, there has been little space for distinctive about Dell’s computers due to the change in the PC market. Dell has focused on efficient order processing and direct sales. The customers are able to customize their PCs during their direct order and the costs were relatively low in the PC market, however the change in PC market ( increasing lap-top sales instead of PCs ) , commoditization of PCs and increasing competition level and price wars damaged the Dell’s differentiation strategy.

Since the Dell system is built to order, the value chain starts with design and marketing&sales--order processes (payment processes)—inbound logistics (the receiving and warehousing of raw materials, and their distribution to manufacturing as they are required)—operations (the processes of transforming inputs into finished products and services according to customer orders)--- Outbound logistics (the warehousing and distribution of finished products , the inventory holding is very effective in Dell since the system is built-to-order )---Service (customer support) (see Figure 1) The customer value chain starts with the market research (exploring purchase options)---Hardware selection (product features and performance)---order process (order and payment processes )---software selection---setup&installation process---internet connection---service ( maintenance, repair,support ) (see Figure 2) A differentiation strategy would offer something unique to its target customers. The uniqueness can be concerned to products, the way it delivers its goods and services, the way it markets its products or anything that shapes a customer's perception in relation to differentiation. This could be the way products and services are branded or designed and the customers perceive such offerings as unique.So Dell can change the physical appearance and design of its products so that the company can offer uniqueness...
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