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INTRODUCTION This presentation show my case study that cover a strategic management overview of Dell, one of the leading PC vendors of the world with a unique operations model focusing on built to order and direct to consumer frameworks.

I preferred to go through the main components for understanding it’s vision, mission and objectives which allow Dell too do it’s strategic analysis to be put into context and perspective

One of the references I went through they clarify SWOT analyses for Dell very nicely I copy it as it is to be the first strategic analysis tool, then followed by an internal and external factor analysis.

Finally TOWS matrix included in this case study to put SWOT analyses into action

OVERVIEW OF PRODUCT AND SIZEDell became the leading PC Vendor of the world in 2001. One of the most unique proposition of Dell is the by passing of reseller through a direct to final buyer strategy. This accounts for 90 percent of its sales leading to the reporting of higher profitability and revenues for the company. This direct to buyer results in a consumer intensive strategy is called by many as the key to the success of Dell’s The direct relationship with consumers not allows for reduced costs, better inventory decisions and increased revenues but also allows for a better understanding of what the customer requires. The PCs are therefore built to the exact specifications as required by the customer.This built to order strategy helps Dell in multiple fronts, reducing overheads and increasing return on investments at the same time as allowing for a better understanding of the market and consumer needs. The requirements of such an operations means there is an interesting structure of logistics. Partnership with software providers such as Office also allows it to further increase the value of final product. Outside partners are also used for installation, repairs on the site and integration of the overall systems.

LOCATIONSThe headquarters originally was in Austin Texas, where the company was formed.The European, Middle Eastern and African market are combined as one sector; the headquarters of which is based in the UK. Ireland is used for a production unit because of the tax incentives available over there.Manufacturing units are placed strategically in the Asia-Pacific region as well. Malaysia because of its appropriate labor rates, political incentives and closeness to suppliers were chosen as the central location. Production units are placed around the continent including one in China with close suppliers in Taiwan.

VISION, MISSION, GOALS AND OBJECTIVESVision“It’s the way we do business. It’s the way we interact with the

community. It’s the way we interpret the world around us—our customers’ needs, the future of technology, and the global business climate. Whatever changes the future may bring, our vision—Dell Vision—will be our guiding force”

MISSION STATEMENT“Dell’s mission is to be the most successful Computer Company

in the world at delivering the best customer experience in markets we serve. In doing so, Dell will meet customer expectations of:

Highest qualityLeading technologyCompetitive pricingIndividual and company accountabilityBest-in-class service and supportFlexible customization capabilitySuperior corporate citizenshipFinancial stability”

CULTURE, VALUES AND HISTORYDell has a highly customer centric culture. Founded by Michael Dell in 1984, the company was founded to serve the customers directly with PCs that were able to meet specific needs. The company was named PC’s limited at that time. There has been one belief that has always driven the organization right from the beginning which is to be completely consumer focused to the point that they are able to incorporate customized requirements during ordering processes. The company was able to go public within 4 years. Dell made its entry into the laptop market in 1991 marking an aggressive growth rate in the following years becoming one of the top 5 computer companies of the world. Dell believes in high turnover solutions which are also available on their website.

Another driving factor for Dell has been delivering the computers directly to consumers. This build to order strategy has removed the middle man, increasing turnovers and decreasing costs for all parties involved. This allows Dell to sell at a highly competitive rate as compared to the competition. It is this consumer driven culture, innovative values and cost optimization that sets Dell apart (Dell, 1999).Company Culture as cited by the company’s website (www.dell.com) includes

Meritocracy: Making sure that employees are rewarded for doing a good job in order to enforce better performance and motivate the human resource in meeting measurable objectives

Direct Relationships: Focuses on a relationship intensive strategy internally and externally making sure that the environment is based on two way communication

Empowerment: One of the most crucial factors of an innovative company is empowerment. Highly employee participation culture is seen at Dell.

KEY EXTERNAL FACTORSOpportunities There is a continuing demand for personal computers There is a strong and evolving market for notebooks and tablets There are strong opportunities of partnership in the market including one

potentially with Microsoft There is a strong margin of expansion in consumer electronics Consumer spending on technology is relatively untouched compared to other

products Strong growth in the market of color printers

KEY EXTERNAL FACTORSThreats Strong competition continues to act as a threat Strong fluctuation in price The market has widened There are more mergers and acquisitions happening in the industry – a threat of

strong consolidation trend in the PC industry The influence and dependency on outside suppliers means increasing oil prices

are crippling the spending of the consumers on PCs The demand of commercial usage of PCs are not increasing at the same pace The growth of the market has slowed down Computing power fees has reduced The fluctuating value and devaluation of currency continues to happen in the

international market

KEY INTERNAL FACTORStrengths The business model of dell which focuses on a built to order framework where the

middleman is removed and PCs are sold directly to the end buyer Significant margins over costs of production because of the direct sales to the end buyer A highly relationship intensive strategy starting from the consumer sector and extending to

the corporate and government sectors Strong strength of sales strategy through a variety of mediums ranging from conventional

to e-commerce Elimination of the mark ups added by the reselling party through the direct sales to end

buyer resulting in lower costs to consumer without cutting down margins for Dell Reliability that comes out of a built to order model – reduction of over-heads related to

large inventories and finished goods. One of the industry leads in the Personal Computer market Considerable number of manufacturing units across the world Strong brand value and power in B2B as well as B2C

KEY INTERNAL FACTORWeaknesses There is a strong dependency on outside suppliers from foreign lands which leads

to a strong dependency on fuel supply and their prices leading to fluctuation There are not a lot of production units and regional offices in the west – including

the United States The size of the company comes in the way of faster growth For some consumers it is an inconvenience that Dell PCs cannot be purchased

through retail outlets It has not been able to penetrate into several international segments as a

leading supplier even though the number of locations in the international market are great

In the printer market it does not produce its own products – rather purchases it from Lexmark

TOWS STRATEGIC ALTERNATIVES MATRIX

External Opportunities(O)1.2.3.4.

External Threats (T)1.2.3.4.

Internal Strengths(S)1.2.3.4.

SO"Maxi-Maxi" Strategy

Strategies that use strengths to maximize

opportunities.

ST"Maxi-Mini" Strategy

Strategies that use strengths to minimize

threats.

Internal Weaknesses (W)1.2.3.4.

WO"Mini-Maxi" Strategy

Strategies that minimize weaknesses by taking

advantage of opportunities.

WT "Mini-Mini" Strategy

Strategies that minimize weaknesses and avoid

threats.

TOWS analysis helps you get a better understanding of the strategic choices that you face. (Remember that "strategy" is the art of determining how you'll "win" in business and life.) It helps you ask, and answer, the following questions: How do you:

1. Make the most of your strengths?2. Circumvent your weaknesses?3. Capitalize on your opportunities?4. Manage your threats?

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Strengths Weaknesses 1. The business model of dell which focuses on a built to order framework

where the middleman is removed and PCs are sold directly to the end buyer 2. Strong strength of sales strategy through a variety of mediums ranging from

conventional to e-commerce 3. . 4. . 5. One of the industry leads in the Personal Computer market 6. Considerable number of manufacturing units across the world 7. Strong brand value and power in B2B as well as B2C 8. Significant margins over costs of production because of the direct sales to

the end buyer 9. A highly relationship intensive strategy starting from the consumer sector

and extending to the corporate and government sectors 10. . 11. . 12. High level of quality assurance through extensive testing in the production

process 13. . 14. Top ranked Server on Intel technology by the publication Technology

Business 15. . 16. .

1. There are not a lot of production units and regional offices in the west – including the United States

2. For some consumers it is an inconvenience that Dell PCs cannot be purchased through retail outlets

3. It has not been able to penetrate into several international segments as a leading supplier even though the number of locations in the international market are great

4. In the printer market it does not produce its own products – rather purchases it from Lexmark

5. . 6. The size of the company comes in the way of faster

growth

Opportunities S-O Strategies W-O Strategies

1. There is a continuing demand for personal computers

2. There is a strong and evolving market for notebooks and tablets

3. . 4. . 5. Consumer spending on technology is relatively

untouched compared to other products 6. Strong growth in the market of color printers

Expansion intensive strategy into the personal computer as well as laptop Market [Combination of Strength 1, Strength 5, Opportunity 1]

Strategize such that all future developments are in line with the evolving technology and focus on a corporate social responsibility agenda (Strength number 14 and Opportunity number 1)

The development of further production units as well as retail units in the United States [A combination of Weakness 1, Weakness 3 and Opportunity 5]

Diversification strategy towards the printer

market into the color printers – including development of internal capabilities [Weakness 4 and Opportunity 6]

Threats S-T Strategies W-T Strategies

1. There are more mergers and acquisitions happening in the industry – a threat of strong consolidation trend in the PC industry

2. The influence and dependency on outside suppliers means increasing oil prices are crippling the spending of the consumers on PCs

3. . 4. Strong competition continues to act as a threat

Provide attractive pricing and discounting packages on specific products to the B2C market [A combination of strength 9 and Threat 4]

Counter competition and increasing market share by penetrating into the Asian and European market for leading supplier position in maximum locations [A combination of weakness 3 and threat 1]

Strengths Weaknesses 1. The business model of dell which focuses on a built to order framework

where the middleman is removed and PCs are sold directly to the end buyer 2. Strong strength of sales strategy through a variety of mediums ranging from

conventional to e-commerce 3. . 4. . 5. One of the industry leads in the Personal Computer market 6. Considerable number of manufacturing units across the world 7. Strong brand value and power in B2B as well as B2C 8. Significant margins over costs of production because of the direct sales to

the end buyer 9. A highly relationship intensive strategy starting from the consumer sector

and extending to the corporate and government sectors 10. . 11. . 12. High level of quality assurance through extensive testing in the production

process 13. . 14. Top ranked Server on Intel technology by the publication Technology

Business 15. . 16. .

1. There are not a lot of production units and regional offices in the west – including the United States

2. For some consumers it is an inconvenience that Dell PCs cannot be purchased through retail outlets

3. It has not been able to penetrate into several international segments as a leading supplier even though the number of locations in the international market are great

4. In the printer market it does not produce its own products – rather purchases it from Lexmark

5. . 6. The size of the company comes in the way of faster

growth

Opportunities S-O Strategies W-O Strategies

1. There is a continuing demand for personal computers

2. There is a strong and evolving market for notebooks and tablets

3. . 4. . 5. Consumer spending on technology is relatively

untouched compared to other products 6. Strong growth in the market of color printers

Expansion intensive strategy into the personal computer as well as laptop Market [Combination of Strength 1, Strength 5, Opportunity 1]

Strategize such that all future developments are in line with the evolving technology and focus on a corporate social responsibility agenda (Strength number 14 and Opportunity number 1)

The development of further production units as well as retail units in the United States [A combination of Weakness 1, Weakness 3 and Opportunity 5]

Diversification strategy towards the printer

market into the color printers – including development of internal capabilities [Weakness 4 and Opportunity 6]

Threats S-T Strategies W-T Strategies

1. There are more mergers and acquisitions happening in the industry – a threat of strong consolidation trend in the PC industry

2. The influence and dependency on outside suppliers means increasing oil prices are crippling the spending of the consumers on PCs

3. . 4. Strong competition continues to act as a threat

Provide attractive pricing and discounting packages on specific products to the B2C market [A combination of strength 9 and Threat 4]

Counter competition and increasing market share by penetrating into the Asian and European market for leading supplier position in maximum locations [A combination of weakness 3 and threat 1]

REFERENCES

- Kharif, O. (2005). “Dell, Time for a New Model?” BusinessWeek- Schmid, N. and Kelber, A. (2005). The Dell Company – A Strategic Analysis. Management Seminar. Hochschule- www.dell.com- www.volunteerhub.com

SUMMERY؟ العالي إنجازها دل حققت كيف

المباشر البيع التكلفة هيكل لتقليل التوريد سلسلة إدارة) أيام ) خمسة المخزون تخفيض

؟ الشركة ربحية يفسر الذي ما( تتمتع التي التنافسية عام( Competitive Advantageالميزة من متوفق أداء حققت وقد دل بها

إلى 1996 .2001م باألخرين مقارنة تنافسية ميزة لها وضعت لذلك م؟ األخرى تفشل بينما الشركات بعض تنجح لماذا

والديناميكية السليمة االستراتيجيات اختيارلم بينما المنافسة شديد الشخصي الحاسب صناعة سوق في جيدا العمل دل استطاعت لماذا

؟ التجزئة صناعة في النجاح نفس وآبل واي وجيت كومباك مثل اخرى شركات تحقق العلمية الخبرة ذوي المديرين من عدد توظيف المنافسين من أفضل العمالء احتياجات إشباع الصناعة في األقل تكلفة بهيكل التمتع

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