Value Chain Analysis of Dell

Topics: Personal computer, Management, Computer Pages: 5 (563 words) Published: July 16, 2012
Value Chain

The value chain also chain as value chain analysis is a concept from business management that was first described and populated by Michael Porter in 1985.

A value chain is a chain of activities for activities for a firm operating in a specific industry. The chain of activities gives the products more added values then the sum of added values of all activities and also said that, value chain is an interrelated series of process that produce a service on product to the satisfaction of customer. The concept of value chain also focuses attention on the types of processes in the value chain.

History of DELL: [pic]

➢ Founded by Michael Dell in 1984

➢ The single concept: Selling computer systems directly to customers

➢ Designed and built the first computer system of its own design in 1985

➢ Was one of the first computer companies to send a technician to homes to service personal computers in 1985

➢ Introduced the 316LT, the company’s first notebook computer in 1989

➢ Joined the top-five computer system makers worldwide in 1993

➢ Earning appr. $1 million per day 7 months after the launch of in 1996

➢ Introduced E-Support, an online tool to provide technical support to customers in 1999

➢ For the first time, Dell achieves No. 1 ranking in global market share in 2001

Activities of DELL:

Primary Activities:

Inbound logistics:

1. All those activities concerned with receiving and strong externally sourced materials.

2. Just in time ordering.

3. Close to suppliers.


1. The manufacture of products and services- the way in which resources inputs are converted to outputs.

2. Build-to-order.

3. Customizations options.

Outbound logistics:

1. All those activities associated with getting finished goods and services buyers.

2. Close to customers.

3. The monitor example.

4. Room for improvement.

5. Evening delivery.

Marketing and sales:

1. Essentially an information activity-informing buyers and customers about products and services.

2. China/ credit cards/shops essential.

3. What about people who don’t computers.

4. Improve a lifestyle brand.


1. All those activities associated with maintaining product performance after the product has been sold.

2. Service a poor.

3. People don’t like offshore support, usually stressed when they call and this adds to their stress.

4. If something goes wrong then pc has to return in the past.

Supporting Activities:


1. Sourcing and negotiating with materials suppliers.

2. Lowering the bargaining power of Intel and Microsoft.

Human resource management:

1. Those activities concerned with recruiting, developing, motivating and rewarding the work force of a business.

2. Potential for spinning it off as a separate business unit.

3. Hosted payroll.

Technology development:

1. Activities concerned with managing information processing and the development and protection of knowledge in a business.

2. Lagging behind in technology research and development.


1. Concerned with a wide range of support systems and functions such as finance, planning, quality control and general senior management.

2. Reacting to problems by change in senior management.

Steps of DELL:

DELL is approaching some steps in operation to meet adding value, improve quality, add efficiency & increase profit.

➢ Receiving & distributing raw material.

➢ Converting raw material into a finished product.

➢ Identifying customers & distributing the product.

➢ Providing customer support. [pic]

Supplier relationship process:

o Sharing Data with suppliers

▪ Flexibility

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