Case Study #1
DELL INC. IN 2008: CAN IT OVERTAKE HEWLETT-PACKARD AS THE WORLDWIDE LEADER IN PERSONAL COMPUTERS QUESTIONS
What is your evaluation of Michael Dell’s performance in his roles as Dell’s CEO and Chairman? How well has he performed the five tasks of crafting and executing strategy that were discussed in Chapter 2? 2.
What are the elements of Dell’s strategy? Which one of the five generic competitive strategies is Dell employing? How well do the different pieces of Dell’s strategy fit together? In what ways is Dell’s strategy evolving? 3.
Does Dell’s expansion into other IT products and services make good strategic sense? Why or why not? 4.
Is Dell’s strategy working? What is your assessment of the financial performance that Dell’s strategy has delivered during fiscal years 2000-2008? Use the financial ratios presented in Table 4.1 of Chapter 4 (pages 104-105) as a basis for doing your calculations and drawing conclusions about Dell’s performance. 5.
What does a SWOT analysis reveal about the attractiveness of Dell’s situation in 2008? 6.
Which company is competitively stronger—Dell or Hewlett-Packard? Use the weighted competitive strength assessment methodology shown in Table 4.4 of Chapter 4 to support your answer. 7.
In what respects, if any, is Hewlett-Packard’s strategy in PCs more appealing or better than Dell’s strategy? 8.
What issues and problems does Michael Dell need to address? 9.
What actions and strategy changes would you recommend to Michael Dell to boost the company’s performance and its prospects for overtaking HP in global sales of PCs?
ranscript of Copy of Dell Inc. in 2008: Can It Overtake Hewlett-Packard as the Worldwide Leader in Personal Computers? Dell Inc. in 2008: Can It Overtake Hewlett-Packard as the Worldwide Leader in Personal Computers? Introduction Michael Dell, in 1984 founded Dell in order to directly serve their customers with computers that meet their needs. Mission We have provided below details of the content of the Dell Mission Statement, one of the most successful companies in the World. We hope that the Dell Mission Statement together with our definitions, hints and tips will provide you with inspiration to develop your own successful explanatory paragraph which will prove to be suitable for both your associates, customers and employees. Vision Analysis of Macro Environment Political factors include government regulations and legal issues determining the conditions under which companies have to operate. Political-Legal Economic Changing inflation rates Currency Fluctuation Socio-cultural Today, children already get familiar with the use of computers at a very young age, representing a generation that will hardly live and work without a computer in the future. Technological Increased Research & Development have caused permanent innovation processes which lead to short product life cycles resulting in a faster depreciation of the products. Analysis of Task Environmental Opportunities • Internet Marketing
• Changing consumer behaviour
• Changing trends
• Price wars
• Strong competitors
• Rapid changes in technology
Problem How could Dell company international operations restore share price appreciation for future growth with minimal strategies involved? Objectives Surpass its rival and gain higher market share Alternative Courses of Action Strategy A: Personal computers that are built should be sold directly to consumers Strategy B: Increase the company’s brand equity
1.) What if anything, strikes you as impressive about Dell? In reading and preparing the case, was there anything that you thought was particularly outstanding about this company? I was very impressed with the fact that Michael Dell started Dell, Inc. with only $1,000, at a young age of 19. The company was one of the first to build to order personal computers, and sell them directly to consumers. After two years of being in business, in 1986 Dell...
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