The History of Dell Computers

The most critical shifts in Dell’s contextual factors, including industry dynamics, trends, technology changes and shift of the competitive landscape are following: The industry has changed significantly over the last 20 years. The traditional business model in the PC industry was inside-out, supplying machines based on orders from distribution, resell and retail channels, thus following the indirect selling concept. Dell’s direct model was at this time a new, challenging concept, taking orders directly from the end-consumer, and thereby, eliminating the middleman, costs and time. This was the initial crucial shift away from the traditional schema, allowing Dell’s quick

Dell was faced with this decision when they began receiving calls from notebook computer owners regarding the overheating of the batteries in particular laptops. “Dell said it received more than 10,000 phone calls, 23 million website hits and took 77,000 orders by late in the day”(Dell customers flock to replace notebook). Given the amount of consumers calling regarding the issue, it was easy for the company to know that there was a manufacturing issue regarding the laptop batteries.

It’s difficult to explain when the first computer was introduced because of the many different classifications of them. Dating back to the early 1800’s, (1822) Charles Babbage created the “Difference Engine,” a device that computed sets of numbers and came to be the first mechanical calculator. However, millennials wouldn’t consider this to be a computer because it doesn’t function as a modern computer does.

Dell used the customer to create products based on the user need. Each approached their core values of business and what works for them to create value and sustainability. Dell had the market share by using the internet to generate sales through machine to machine based sales and conserved his manpower to keep the cost of his product low. Intel spent many hours of research and product development to create new and innovative ground breaking products that led the industry standards.

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.

The first ever computer was invented in the 1820s by Charlse Babbage. However the first electronic digital computer were developed between 1940 and 1945 in the United States and in the United Kingdom. They were gigantic, originally the size of a large room, and also need to be supply a large amount of power source which is equivalent as several hundred modern personal computers. The history of computer hardware covers the developments from simple devices to aid calculation, to mechanical calculators, punched card data processing and on to modern stored program computers. The tools or mechanical tool used to help in calculation are called calculators while the machine operator that help in calculations is called computer. At first the

REF OF GROUP MEMBERS’: TABLE 1 : 5 C’s SITUATION ANALYSIS Factors Dell Company: Resources 1.4 Licensing, Distribution channel, Supply • Intellectual property, Human resources, Patent, Competences Brand acuity1 chain management 24 25 Techno structure • Just-in-Time; CRM; Engineer R&D, Acquisition

The first computer was invented in 1939 by Hewlett-Packard in a garage in Palo Alto, California. It was mostly used in military/government and universities/science lab. It took 40+ years for the first personal computer to be created by IBM (1981). The first personal computer (PC) ran on a 4.77 Mhz Intel 8088 microprocessor [1]. After that computer world has advanced

Established in 1984, Dell Inc. has been a multinational corporation focused on computers and related services. Dell is a leader in the computer industry due to their two core competencies: a direct-sales model and its 'build-to-order' manufacturing process. The outcome of these two combined strategies has lead to a firm specific strategy of combining at the same time low-cost and differentiation. However, due to a changing market environment and internal issues, Dell's market share started to decline gradually during 2005, resulting in lower growth rates and a decrease in stock value. The question started to arise: "Should Dell stick to their objectives and strategy or adapt to a changing environment?" As being a market leader for a long time,

A noted misstep in their revised process was that they continued to build systems based on forecasts, rather than based on customer orders. As a result, inventory was still a significant cost factor, and IBM incurred big losses in their PC division from 1996-1998 from this and other initiatives. Meanwhile, Compaq effectively surpassed IBM in the mid 1990s, mainly through large acquisitions of firms like DEC, and followed with attempts to mimic Dell’s build-to-order and direct-to-consumer approach. Continued use of retailers and resellers likely prevented further cost savings, and in 1998 Compaq went from profitable to merely breaking even. Gateway seemed the most well positioned to closely follow in Dell’s footsteps since they were already largely a direct-to-customer business, but difficulties with inventory, IT systems, and a product recall restricted growth. Apparent focus on small business & home sales may have also been a limitation, as the majority of Dell’s sustainable revenue and growth came from sales & relationships with large corporations. While Dell’s competitors may have attempted to mimic their successful approaches, difficulties in fully executing and realizing the benefits have prevented any significant responses.

Dell’s strategy constitutes of four tenets to delivering superior customer value by selling direct to customers eliminating wholesale and retail dealer, allowing customer to built custom built product to meet the consumer’s need, highly efficient supply chain and manufacturing organization, and by delivering added value to customers. Dell Inc follows resource based view (RBV) strategy as it tries to achieve a competitive advantage over its rivals by using the

consumer, put dell at a sales margin of $7.7 billion by the year 1998. Even though the industry was only growing at a rate of 5 percent during this time, Dell would be growing at an unbelievable rate of more than 50 percent! In the year 1999, Dell made his dream of competing with IBM come true by outselling not only IBM but also Hewlett-Packard with a whopping $12.3 billion in sales bringing internet sales to $30 million a day.

Strengths: Dell's dynamic organizational structure allows it to achieve diversified targets. By allowing the components to directly become integrated in the manufacturing process of Dell, it has been able to reduce middle channel costs. These components, such as OEMs, CMs, logistics, system integrators, repair and support companies, component suppliers, third party HW and SW suppliers and distributors have become each of the company's manufacturing processes so that ease of provision to the customers is possible. This reverse organizational process structure differ from other industry leaders.(Kraemer and Dedrick 2004)

Dell is considered doing well in the market segmentation in order to avoid unnecessary loss. The management carry out analysis and report to find out which part or area can let them make the most profit. They position themselves as a strategic vendor, which is important in the business. From this, they have the competitive advantage in order to compete with other IT big business. Dell is also trying to sell affordable or more cheaper product to the customer. Apple is the top IT business in the world nowadays. As a result, Dell can not compete with them at the moment. Therefore, Dell’s product strategy is more focus on developing one specific product that can satisfy the customer. Dell also provides variety of services to

The first electronic computers were developed in the mid-20th century (1940–1945). Originally, they were the size of a large room, consuming as much power as several hundred modern personal computers (PCs).[1]