8/7/2019 dell presentation1

http://slidepdf.com/reader/full/dell-presentation1 1/16

www.dell.com 1

Three golden rules at Dell :Three golden rules at Dell :

`Disdain inventory'`Disdain inventory'`Listen to the customer'`Listen to the customer'

`Never sell indirect'`Never sell indirect'

8/7/2019 dell presentation1

http://slidepdf.com/reader/full/dell-presentation1 2/16

$2.0B

Presented by:Alok Agarwal 

Parichit Shrestha

Saurab Agrawal 

´ Direct From DELL ´ Direct From DELL Strategies That Revolutionized an Industry µ Strategies That Revolutionized an Industry µ 

DELL CORP. : MASS CUSTOMIZATION

PROVIDES COMPETITIVE ADVANTAGE 

8/7/2019 dell presentation1

http://slidepdf.com/reader/full/dell-presentation1 3/16

$2.0B

In doing so, Dell will meet customer expectations of :

�Highest quality

� Leading technology

� Competitive pricing

� Individual and company accountability

� Best-in-class service and support

�Flexible customization capability

� Financial stability

Mission Statement: ³To provide customers with superb value,Mission Statement: ³To provide customers with superb value,

high quality, relevant technology, customized systems, superior high quality, relevant technology, customized systems, superior 

service and support, and products and services that are easy toservice and support, and products and services that are easy to

purchase and use.´purchase and use.´Strategy Statement: ³To do business with its consumers oneStrategy Statement: ³To do business with its consumers one--onon--

one, through the phone or internet.´one, through the phone or internet.´

8/7/2019 dell presentation1

http://slidepdf.com/reader/full/dell-presentation1 4/16

www.dell.com 4

Dell Computer CorporationDell Computer Corporation

A Fortune 200 company in just 14 years

Dell is the World's largest PC maker having Build To Order

model.

No.1 in profitability for the computer systems industry

As of 2009 it employs more than 83,700 people. Customers in 170+countries.

For the last couple of years it has held its position as market

leader (it took it from rivals Hewlett-Packard).

According to the Forbes 50 2005 list, Dell ranks as the 28th-

largest company in the United States by revenue.In 2006, Fortune magazine ranked Dell as No. 8 on its annual list

of the most-admired companies in the United States.

Major competitors are IBM, APPLE, HP.

8/7/2019 dell presentation1

http://slidepdf.com/reader/full/dell-presentation1 5/16

8/7/2019 dell presentation1

http://slidepdf.com/reader/full/dell-presentation1 6/16

www.dell.com 6

Dell¶s Competitive AdvantageDell¶s Competitive Advantage

Dells Direct Business Model

Commitment to Open Standards

Order Velocity/Build to Order

Supply Chain Optimisation 

Continuous Process Improvement

8/7/2019 dell presentation1

http://slidepdf.com/reader/full/dell-presentation1 7/16

8/7/2019 dell presentation1

http://slidepdf.com/reader/full/dell-presentation1 8/16

8/7/2019 dell presentation1

http://slidepdf.com/reader/full/dell-presentation1 9/16

www.dell.com 9

Open Innovation And Effective R&DOpen Innovation And Effective R&D

The traditional approach to innovation tends to produce proprietary

technologies and products that are often hard to migrate from as a customer.

Dell have a more open and effective approach to R&D.

Dell spends little on product research and development ² 

$440 million a year, vs. $4 billion a year atHewlett-Packard.

8/7/2019 dell presentation1

http://slidepdf.com/reader/full/dell-presentation1 10/16

www.dell.com 10

Porter¶s Five Forces Analysis: DELLPorter¶s Five Forces Analysis: DELL

Threat of New Entrants: MODERATE

Low capital investment for independent stores

Low product differentiation

� Brand name may be a barrier to entry

Low economies of scale

No legal or governmental barriers

Increasing profitability shows that there is a threat of new

entrants

8/7/2019 dell presentation1

http://slidepdf.com/reader/full/dell-presentation1 11/16

www.dell.com 11

High concentration

Price War: Low Margin

Decreasing profitability

Low differentiation

However, in the midst of sever competition, Dell can stillgain market share from other competitors. That proves

Dell¶s business strategies have been successful.

Rivalry:HIGHRivalry:HIGH

8/7/2019 dell presentation1

http://slidepdf.com/reader/full/dell-presentation1 12/16

www.dell.com 12

Strong presence of PC¶s throughout society

� One computer for every three people in the U.S.

Only substitute for PC: Apple Computer.

However, high price, and lack of software support preventpeople from switching to Apple system.

Threat of Substitutes: LOWThreat of Substitutes: LOW

8/7/2019 dell presentation1

http://slidepdf.com/reader/full/dell-presentation1 13/16

www.dell.com 13

Highly price sensitive

Reliability and customer service become important factors.

Dell¶s products are very reliable and customer service is

outstanding. These two factors help Dell to create certain brand

royalty. But that¶s given the fact that the Company set the

prices very low. If the prices are raised too high, customers will

not hesitate to switch.

Bargaining Power of Buyer: HighBargaining Power of Buyer: High

8/7/2019 dell presentation1

http://slidepdf.com/reader/full/dell-presentation1 14/16

www.dell.com 14

Bargaining Power of Suppliers: HIGHBargaining Power of Suppliers: HIGH

Large number of suppliers for components like

hardware, keyboards, etc.

But two major inputs are monopolized

� Microsoft standard for all PC¶s

� Intel standard for most PC¶s

High switching costs

8/7/2019 dell presentation1

http://slidepdf.com/reader/full/dell-presentation1 15/16

www.dell.com 15

Any queries

8/7/2019 dell presentation1

http://slidepdf.com/reader/full/dell-presentation1 16/16

www.dell.com 16

THANK

YOU