Dell's Strategies

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WEB BASE ASSIGNMENT
Question: Do research on the web to find an example of a major IT-related project in which the actions of the business managers made a major difference (either favorable or unfavorable) in the outcome. Document what you think were the key actions taken by managers, and the key missed opportunities to take action. DELL is a really interesting company to study, especially since Michael Dell started the company out of his dorm room and grew Dell to become 51 on the Fortune 500 list (as of 2013- Fortune Magazine) & the No. 3 computer maker in the world, employs 14,000 workers in Central Texas. The idea of a value-chain created by Dell gives the company a unique presence in the PC/IT market. I would like to go with the favorable actions Business Managers in the company took and hence expanded the outcome. Dell's computers are cheaper than the competition. Dell “can beat competitor prices by 10-15%”. You might ask: How does Dell do that? ~ By eliminating the middle man and selling directly to the customer. Dell doesn't have a retail store presence, which keeps their operating costs low. Managers at Dell are innovative by keeping a close eye to the bottom-line, while still keeping the customer in focus. Metrics like Days in Inventory are managed strategically.
Even though Dell did not have a tight control on quality, they were able to easily remove defective motherboards from their supply chain. This was due to lower days in inventory metric. According to the HBR article, “.Inventory can actually be a pretty massive risk, because if the cost of materials goes down 50% a year and you have two or three months of inventory versus 11 days, you've got a big cost disadvantage. And you're vulnerable to product transitions, when you can get stuck with obsolete inventory. “Dell’s Business managers are focused on delivering the cutting-edge technology at a better price than the competitor. Managers at Dell work to make each of their customers a



References: : THE POWER OF VIRTUAL INTEGRATION:AN INTERVIEW WITH DELL COMPUTER 'S MICHAEL DELL BY JOAN MAGRETTA ~~HARVARD BUSINESS REVIEW March-April 1998 http://cloisters.hubpages.com/hub/Dells-Competitive-Advantage http://fortune.com/2014/06/02/dell-departs-fortune-500/ http://www.bizjournals.com/austin/news/2013/03/31/dell-advised-to- scuttle-build-to-order.html http://www.infoworld.com/article/2625629/malware/dell-warns-ofmalware-on-server-motherboards.html

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