Dell Inc. Company 's Strategy

Supply-Chain Management is the activities that procure materials and services, and transform them into intermediate goods and final products and deliver them, through a distribution system (Heizer & Render, 2011, p. 452). DELL is a computer technology corporation that develops sells, repairs and supports, computers and computer related products. DELL has realized that supply chain is becoming more and more important for the success of today’s business world and they work accordingly to keep a competitive advantage in the market. This study will examine to what extent Dell has used supply chain management to gain and retain a competitive advantage in the computer market.

“To understand what makes Dell so great, you need to understand the power of Dell's Mission Statement, as well as its history, growth, and entrepreneurial founder Michael Dell.” (Farfan, 2017) Today Dell forms partnerships with retailers on a global scale while adding online ordering and customization. With Dell’s variety of services coupled with its desktop, laptop, and other products, Dell has become a large company

Dell Inc. (Dell) is an American privately owned multinational computer technology company based in Round Rock, Texas, United States, that develops, sells, repairs, and supports computers and related products and services (Wikipedia, 2016). Dell founded in 1984 by Michael dell, is the world famous computer systems, computer products and service provider in the first place (Jones, 2013, P.388).

Dell’s strategies have different elements that have allowed the company to reach its current market position. The pieces of Dells strategy fit together just like all the elements of a clock, all the major pieces rely on one another in order for the company to succeed as a whole. This has permitted Dell’s strategy system to work so well because of its excellent logistics system. The system works so well it has enabled them to manage multiple pieces of the strategy simultaneously without glitches. Dells sales force management is able to interact with millions of customers worldwide through direct selling that is hands on and user friendly. They also have sales representatives for major clients such as governments, institutions and corporate clients who then customise their order.

The company was based on a simple concept: that Dell could best understand consumer needs and efficiently provide the most effective computing solutions to meet those needs by selling computer systems directly to customers. This direct business model eliminated retailers, who added unnecessary time and cost, and also allowed the company to build every system to order, offering customers powerful, richly configured systems at competitive prices. Dell introduced the latest relevant technology much more quickly than companies with slow-moving, indirect distribution channels, turning over inventory an average of every four days. In less than two decades, Dell became the number-one retailer of personal computers, outselling IBM, Hewlett-Packard, and Compaq (2002).

In 1994, Dell made the bold decision to remove their products from retail stores and focused on direct to customer sales. In 1996 Dell began selling through their website which is to this day their most successful sales channel. By eliminating their retail store presence Dell was able to reduce costs on multiple fronts, reduce inventory, and maximize profits. Dell created an order system which allowed customers to specify and select options, components and features they wanted on their Dell device. Dell 's just in time inventory system lowered inventory holdings to just 3 days from 9 days and storage costs were thus minimized significantly. In 1995, Dell entered the Chinese market where a population of 1.3 billion was a great opportunity to create a significant market presence; IBM, Compaq, and Hewlett-Packard had all penetrated the Chinese market prior to this date and had opened offices in China during the early 1990’s. It wasn’t long before Dell proved to be worthy competition with not only international companies but also with local companies like Toshiba, Samsung, NEC and Acer. With so

In a bid to capture the market share Dell deviated form its direct-only model to indirect selling using mass market retailers like Compa USA,Staples etc and using resellers in foreign market s where due to timing and infrastructure obstacles direct distribution was complicated.

Dell was founded by Michael Dell in 1984, while schooling at the University of Texas in Austin. Direct sales model was first adopted: Computers were first sold over the phone and they were built according to the customer specifications (Kraemer K. L, 2000). From a student’s personal company selling no more than 100 computers in its first years of existence, it became a big company of more than 35.000 employees and over 25.000 million dollars sales in 2000 (Koehn, 2001), competing “giants” such as IBM and HP. In 2010, Dell ranks fifth in the computer industry (World's Most Admired Companies, 2010).

Dell Computer Corporation was founded in 1984 by Michael Dell. From the early 1990s until the mid-2000s, Dell was ranked as a PC market leader relying on their distinctive marketing pattern “Direct Model” which undertook direct communication with customers and provided customized products. Recently, the PC industry is facing inconceivable worldwide competition, and Dell is gradually losing their competitive advantages by using its direct model in critical business segments. The company is facing shrinkage of growth, increasing competition, declining quality of customer service, and limitation of expansion. These issues have an enormous impact on Dell’s position as a technological giant in the PC industry.

Affordability of latest technology through Direct Sales Services - Dells uses direct customer relationship or as it calls it “customer intimacy” as its distribution strategy. This means meeting customer needs directly and cutting middleman interference as much as possible. This is done either through dedicated sales representatives, telephone based sales and online at www.dell.com. As a result, the purchase price would be lower than other competitors.

Dell. Dell’s products—computers, servers and printers—are commodities. Dell tends not to develop the technologies underlying these products. Instead, it purchases the components from firms that develop the technologies (semiconductors and computer software). Dell’s direct-to-customer marketing strategy is not unique, but the extent to which Dell performs this strategy better than anyone else in the industry gives it a competitive advantage. Its size, purchasing power, quality control, and efficiency permit it to operate as a low-cost provider.

Dell is a computer corporation recognized for manufacturing computer systems through parts assemble. In 1983, Michael Dell saw an opportunity in using IBM compatible computers for a new assembly line that can be sold to local businesses. The idea as explained by Michael Dell, in one of his interview, is that in the early days of computers' manufacturing, companies had to be able to produce every part of the system. As the industry matured, companies started to focus on single parts and to become specialized in creating items that can be assembled with other parts to prepare a computer. As a result, Dell understood that to have a competitive edge in the market, they needed to

In 1988, Dell brought its technology to the public. After four years of business the company began introducing its products to the general public worldwide. By 1991, the company’s international sales had doubled for the third year in a row. Dell began tapping into other aspects of the computer market in 2003 with the introduction of Dell printers. Twenty-one years after being founded, in 2005, Dell tops Fortunes “America’s Most Admired Companies” list. (Company Heritage)

Dell hold and maintain its business model on integrating five key strategies: rapid time to volume, products built to order, elimination of reseller markups, superior service and support, and low inventory and capital investment.1 They designed project and the resulting tools to support Dell’s low-inventory and low-capital-investment strategy and to widen its impact further than the plant floor into the foregoing stage of its supply chain. Tom Meredith, at the time chief financial officer, said in the May 18, 1999 earnings conference call: “Customers see no advantage in a manufacturer low-ering inventory to six days if there are still 90 days in the supply

Historically, Dell has been known as an industry leader in supply chain management. They have been credited with developing supply chain processes that have come to be recognized as some of the most innovative not only in their industry but throughout all business sectors. All of these accolades made Dell an unlikely choice since there didn’t appear to be much room for improvement, at least from a supply chain standpoint. However, over the past few