Dell Computer Corporation Analysis

Topics: Dell, Personal computer, Michael Dell Pages: 9 (3173 words) Published: May 2, 2006
Dell Computer Corporation
Dell Computer is maintained and increased their competitive advantage. They want to maintain a low cost position to maximize the value passed on to customers, while driving costs lower and lower. They also want to drive aggressive pricing and profitability gain share. Dell wants to always put customers first and remain aggressive about driving improved customer value across all Dell business. Employee support of Product Leadership, Customer Experience, and Globalization is also important to the company. They want to have the best product in the marketplace and gain as much share in the market as possible. One way of achieving this would be to drive more than two-thirds of their sales and service transactions online. Dell Computer's strategies are built around several key elements: build-to-order manufacturing, mass customization, partnerships with suppliers, just-in-time inventories, direct sales, market segmentation, customer service, and extensive information sharing with both supply partners and customers. With build-to-order manufacturing, Dell built its computers, workstations, and servers to order based on the needs of their customers. The orders were directed to the nearest factory. They reorganized plants and shifted to "cell manufacturing" whereby a team of workers assemble one PC rather than typical assembly line production. The result of this change was that there was no-in-house stock of finished goods inventories and they did not have to wait for resellers to clear inventories before new models could be pushed into the marketplace. The next strategy I'll discuss is Dell's partnerships with its suppliers. They partnered with reputable suppliers of PC parts and components rather than to integrate backward and get into parts and components manufacturing on their own. They decided that they would partner with as few outside vendors as possible and that they would stay with those vendors as long as they maintained their leadership in technology, performance, and quality. This laid the basis for just-in-time delivery of suppliers' products to assembly plants. Direct sales were another attempt to achieve Dell's desired objectives. They gave Dell firsthand intelligence about customer preferences and needs, as well as immediate feedback on design problems and quality glitches. By doing this they could quickly detect shifts in sales trends and getting prompt feedback on any problems with products. This gave Dell a significant advantage over rivals. Dell also made a special effort to segment its buyers into relevant groups and to place managers in charge of each group. Dell focused on customer service in order to maintain close customer relationships. This allowed Dell to become quite knowledgeable about its customers' needs and how their PC network functioned. Many corporate customers paid Dell fees to provide support and service. Their strategy was to use the information that came from customer service activities to improve product quality and speed execution. Another way Dell saved time and money was through "virtual integration." This was a way for Dell to communicate with its supply partners and customers in real time through an Intranet system. All three groups appeared that they were part of the same organizational team. Recently, Dell has decided to focus much energy to Internet technology. For example, Dell technology Consulting is a program where customers can tell then what would improve their overall experience though the Internet. Dell is also designing web pages that are tailored for corporate customers to order online. The speed associated with the Internet has allowed dell to slash inventories and keep costs down so low it can under price rivals by 10% to 15%. Michael Dell is a charismatic leader who has led a company to great success. However, all of his competitors see him as the man to beat and they are constantly looking for ways to do it. They are copying his direct sales...
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