Management Principles

Powerful Essays
Management Principles

1.1 Dell’s initial mistake was moving away from being customer-service orientated, to focusing on generating more profit by cutting costs. They did not consider the impact this move would have on their customers and their market share. It produced negative results. The Internal Environment was affected in the following ways:

Insufficient skills or training in the call centre, resulted in slower turn-around time to resolve or react to customer queries.
The uncertain internal environment created frustrations amongst the staff, which in turn converted to frustrations amongst the customers i.e. long hold times, too many transfers, etc.
This caused efficiency levels to drop.

The External Environment was affected in the following ways:

Dell, which should have been at the forefront of computer technology, started lagging behind. The company was not responding quickly enough to threats imposed by computer viruses. This frustrated Dell’s customers and therefore affected the company’s markets and its ability to compete in those markets. As a result, this created significant opportunities and threats for competitors.
The unstable state of the economy could have also been a factor in Dell deciding to cut costs. But, instead of bringing in more income it backfired negatively.
Call centre staff being employed on the basis of the Employment Equity Act could have limited Dell in not being able to employ staff with the necessary technical or customer service skills the company required.

1.2 Dell’s planning process would entail the following:

Dell’s first step in the planning process would have been to identify any changes that necessitate planning. These changes can occur either outside or inside the company.
Dell would need to establish goals that would give direction to all major plans. This would start with the vision, which would translate into a mission statement, which would translate into long-term goals for the company.



References: Smit, P.J., Cronje, G.J., Brevis, T. and Vrba, M.J. (2011) Management Principles: A Contemporary Edition for Africa. 5th Edition. South Africa: Juta and Company Ltd Botha, S., Cunningham, P., Musengi, S., Visser, K., Williams, O., Lots, J., Booysen, K., Stewart Smith, A., Bosch, A., & Banhegyi, S. (2007) Management: Fresh Perspectives. Cape Town: Pearson Education South Africa George, J.M. & Jones, G.R. (2006) Contemporary Management: Creating Value in Organizations. 4th Edition. Boston: McGraw Hill Hellriegel, D., Jackson, S.E., Slocum, J., Staude, G., Amos, T., Klopper, H.B., Louw, L. & Oosthuizen, T. (2005) Management. Second South African Edition. Cape Town: Oxford University Press Slocum, J.W. & Hellriegel, D. (2007) Fundamentals of Organizational Behaviour. China: Thompson South-Western

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