Dell Strategic Managemen

Dell has very user friendly web site and half of Dell’s sale, half of tech support and three quarter of order status takes place online. • The supply chain and data integration with suppliers has made Dell one of the most efficient computer manufacturers.

• The continuous advancement in technology and innovative approach to manufacturing and assembly keeps Dell the low price leader in the PC industry. ?Relevant Issues • The Core Issues at Dell Corp: • 1. The Price War is going on between PC Makers. • 2. Revenues Down in 2002 compare to 2001 (31.

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9 to 31. 1 billion) • 3. Worldwide sales of PC’s Down 11% in 2001, Dell’s Sales Up • 4.

Leadership at Dell Corporation • 5. Service Contracts • 6.

Maintaining the Market Share General Environment Analysis • Continuous increase in PC, server and storage equipment sales. • Emergence of specialized mass component suppliers. • Experiment with retailers and intermediaries were failed due to low profit margins. • Foreign-currency hedging strategy was risky and generated huge losses. • Quality difficulties appeared due to company’s contract manufacturers. • Write off of Dell’s laptop line and suspended sales of laptops till Dell redesigned models got into the marketplace • Supplier Alliances • High competition in industry

Technological Changes • Rapid improvements in PC technology due to continues R ; D • Specialized component suppliers Demographic trends • Growing customer interest in having PCs of their choices • Increased consumer awareness • Demands for customization by Technological savvy user Economic condition • Sharp decline in component prices • Low inventory and high sales turnover to better facilitate customer needs at lowest possible price with most modern technology.

• In house versus outsource decision due to emergence of specialized component suppliers. • Direct selling to get maximum benefit of customer feedback and for highest profit margin. Demand from Corporate and government sector. • Alliance with Data General Corporation (supplier) to enter the market for data storage equipment. Industry Environment Analysis Industry Definition • Dell belongs to PC Industry and has expanded its services to all computer related products