Dell Final Group 4
This document was uploaded by user and they confirmed that they have the permission to share it. If you are author or own the copyright of this book, please report to us by using this DMCA report form. Report DMCA
Overview
Download & View Dell Final Group 4 as PDF for free.
More details
- Words: 1,584
- Pages: 27
By : GROUP 4 Abhita Garg Ankit Agarwal Devinder Singh Fatehbir Singh Kunal Garg Mayank Jaiswal
50701005 50701013 50701019 50701021 50701029 50701030
1984 : At the age of 19 with $ 1,000 in start up capital Micheal Dell founded Dell Computer with simple vision and business concept – that Personal computer could built to order and sold directly to customer. He believed that: 1. Bypassing distributors and retail dealers eliminated the markups of reseller. 2. Building to order greatly reduced the costs and risks associated with carrying large stock of parts, components and finished goods. 1985-86: Dell build and design the first computer system $70 million sales; focus on assembling own line of PC’s 1988 : Dell had raised $ 30 Million in it’s IPO. At this time his capital is $ 85 Million. 1998 : Dell had a 12% share of PC market in US and became one of market leader in computer business with Compaq and IBM until now. 2005 : $49.2B in sales
A Fortune 200 company in just 15 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 2008 it employs more than 70,500 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 2007 list, Dell ranks as the 21thlargest 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.
Overview
We Make Computing Easy. Like it should be
Focus
Our Direct Connection
Leadership
Why We’re the Industry Leader – Our Product & Service
Result
We Know Enterprise Computing Firsthand
Global
We’re Close to Customers Around the World
Strategy
Statement: “To do business with its consumers one-on-one, through the phone or internet.”
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 Superior corporate citizenship Financial stability
Business to Consumer Strengths Customization
Opportunities
Strengths Customization
Customer
Market International strategy Product extensions
Tangibility
Competition
Technology
Price
Focused Technical Knowledge Market Diversification Strong Brand/Positioning Media Savvy Direct Marketing Model Non-myopic strategy
Technology
Market Commoditization Inventory
Weaknesses
Server
Business to Business
across
markets Commodity pricing (shrinking margins) Complexity of Mgmt. Growth exceeding productivity
Threats
Price Customer
Focused Technical Knowledge Market Diversification Strong Brand/Positioning Media Savvy Direct Marketing Model
Market
Inventory
Weaknesses
Opportunities Server
Market International strategy Additional markets Product extensions Strategic partnerships
Competition
across
markets Commodity pricing (shrinking margins) Complexity of Mgmt. Growth exceeding productivity
Threats
Suppliers
Customers
of the value Dell Direct ModelOwnership : chain
Competitor Model :
Loss of control over product & information flow & customer relationships
Suppliers Outsourcing CompetitorChannel Customers
Dell - Inventory Model Results:
3 days of inventory - Inventory turns of 122 per year
Suppliers Logistics Hubs
Dell Factory
Delivery
Local Suppliers
Supplier Owned
Dell Owned
Customer
With 90+ Day’s Manufacturer and Reseller Inventory, Channel Manufacturer Buys Here
120 115
Relative 110 Component 105 Cost 100
10-12% Cost Advantage With 3 Days Inventory, Dell Buys Here
95
Typical Dell 0
-2
-4
-6
-8
-1 0
-1 2
-1 4
90
Weeks Relative to Delivery
Logistics companies
Component suppliers
System integrators and resellers
Order management Operations and supply chain
Component Manufacturer
Third party HW and SW suppliers
Customer relations
Distributors
Customer
Repair and support providers
Direct relationship with customer is strategic; rich information flows.
Outsource non-strategic functions.
Information flows substitute for physical flows.
Coordinate value network thru IT-enabled information processes
Better
understand customer needs Customers receive exactly what they want: not standard solution Minimized inventory New technology delivered immediately
Build-to-Order Manufacturing and Mass Customization
2.
Dell built its computers, workstations and servers to order, none were produced for inventory. Dell customers could order custom built server and workstation based on their needs of their applications. This sell-direct strategy meant that Dell had no in-house stock of finished goods inventories and that unlike competitor using traditional value of chain model, it didn’t have to wait for resellers to clear out their own inventories before it could push new models into market place.
3.
4.
Traditional PC’s Industry Value Chain (Utilized by Compaq, IBM, HP and Most Other) Manufactured of PC’s Component By Suppliers
Assembly of PC by PC Makers (to Fill order from Suppliers and Keep distribution Channel stock)
Sales and Marketing Activities of Reseller to self Inventories of PC’s on hand
Purchase By PC Users
Service and support activities Provided to PC Users by reseller (or some PC Makers – IBM to PC users)
Build-to-Order/Direct Sales Value Chain (Employed by: Dell, Gateway, Micron Electronics) Manufactured of PC’s Component By Suppliers
Customized Assembly of PC’s By PC Makers as Orders from PC Buyers come in
Purchase By PC users
Service and Support activities Provided to PC Users by PC Makers (via Telephone, fax, Email) etc.
Partnerships with Supplier
Dell believed it made much better sense for Dell Computer to partner with reputable suppliers of PC parts and components rather than to integrate backward and get into parts and component manufacturing on its own. The advantages: 5. Using name-brand component enhanced the quality and performance of Dell PC’s. 6. Getting the volume of components it needed the overall market supply. 7. It feasible to have some of supplier engineers assigned to Dell product design team and for them to be treated as part of Dell. 8. Dell’s long-run commitment to its suppliers laid the basis for just-in-time delivery suppliers product to Dell assembly in Texas, Ireland, Penang.
Committed to Just-in-Time Inventory Practices
3.
Dell's just-in-time inventory emphasis yielded major cost advantages and shortened the time it took for Dell to get new generations of its computer models into the marketplace.
5.
Having a couple of months of component inventories meant getting caught in the transition from one generation of components to the next. Moreover, there were rapid-fire reductions in the prices of components —most recently, component prices had been falling as much as 50 percent annually (an average of 1 percent a week).
Direct Selling
3.
Selling direct to customers.
5.
Ability to respond quickly.
7.
Dell saw its direct sales approach as a totally customer-driven system that allowed quick transitions to new generations of components and PC models.
Virtual Integration and Information Sharing
3.
Dell is using technology and information-sharing with both supply partners and customers.
5.
On-line communications technology.
7.
On-site teams of Dell employees.
9.
Dell gave its large customers access to Dell's own on-line internal technical support tools, allowing them to go to www.dell.com .
Demand Forecasting
3.
Sales forecasts are key to keeping costs down and minimizing inventories.
The company's market segmentation strategy paved the way for in-depth understanding of its customers.
Research and Development
3.
The company talked to its customers frequently about "relevant technology," listening carefully to customers' needs and problems and endeavoring to identify the most cost-effective solutions.
5.
Dell had about 1,600 engineers working on product development and spent about $250 million annually to improve users' experience with its products—including incorporating the latest and best technologies, making its products easy to use, and devising ways to keep costs down. The company's R&D unit also studied and implemented ways to control quality and to streamline the assembly process.
Listen 5.
7.
9.
Solve
Impact
Listen Gather requirements directly through tens of thousands of customer interaction daily, organized events, and customer panels. Solve Many Innovations begin in-house, led by global team of top engineers, product designers and technical experts. Impact Maintain strong internal development capabilities. We partner, rather than compete, with top industry technology suppliers and original development manufacturers.
Internet
based customer services: Online ordering, asset tracking, product road maps, technical support, highly tailored information, all provided online. Diversification into non-PC businesses for “one-vendor solution” Dell sells PCs, servers, printers, storage, networking, software services Sells add-on software, peripherals, PDAs, cases, cameras, TVs Promote Dell as company that “knows how ‘E’ works” Results: Dell now #1 PC vendor with Market Share 34.4% in US and 18% globally.
Speed Order-driven processes linked by internal IT and external networks allow only 7 hours of inventory in factory and orders to be filled in 5 days or less Entire value network linked by EDI, Internet, extranets Quality Bar coding allows components to be tracked to suppliers when problems occur, stop production and notify suppliers Cell assembly allows problems to be fixed on the spot without shutting down production Cost Online sales and support saves on call center costs Supply chain coordination substitutes information for inventory
Results Overhead 8% compared to 15% for others
• 122 inventory turns annually minimizes depreciation • New technologies can be introduced immediately
The secret to Dell’s success is the synergy between all of its competencies.
The direct sales system both enables and relies on the build-to-order system.
The build to order system both enables and relies on the supplier integration system .
Dell focuses on collaboration at every level enables it all.
50701005 50701013 50701019 50701021 50701029 50701030
1984 : At the age of 19 with $ 1,000 in start up capital Micheal Dell founded Dell Computer with simple vision and business concept – that Personal computer could built to order and sold directly to customer. He believed that: 1. Bypassing distributors and retail dealers eliminated the markups of reseller. 2. Building to order greatly reduced the costs and risks associated with carrying large stock of parts, components and finished goods. 1985-86: Dell build and design the first computer system $70 million sales; focus on assembling own line of PC’s 1988 : Dell had raised $ 30 Million in it’s IPO. At this time his capital is $ 85 Million. 1998 : Dell had a 12% share of PC market in US and became one of market leader in computer business with Compaq and IBM until now. 2005 : $49.2B in sales
A Fortune 200 company in just 15 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 2008 it employs more than 70,500 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 2007 list, Dell ranks as the 21thlargest 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.
Overview
We Make Computing Easy. Like it should be
Focus
Our Direct Connection
Leadership
Why We’re the Industry Leader – Our Product & Service
Result
We Know Enterprise Computing Firsthand
Global
We’re Close to Customers Around the World
Strategy
Statement: “To do business with its consumers one-on-one, through the phone or internet.”
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 Superior corporate citizenship Financial stability
Business to Consumer Strengths Customization
Opportunities
Strengths Customization
Customer
Market International strategy Product extensions
Tangibility
Competition
Technology
Price
Focused Technical Knowledge Market Diversification Strong Brand/Positioning Media Savvy Direct Marketing Model Non-myopic strategy
Technology
Market Commoditization Inventory
Weaknesses
Server
Business to Business
across
markets Commodity pricing (shrinking margins) Complexity of Mgmt. Growth exceeding productivity
Threats
Price Customer
Focused Technical Knowledge Market Diversification Strong Brand/Positioning Media Savvy Direct Marketing Model
Market
Inventory
Weaknesses
Opportunities Server
Market International strategy Additional markets Product extensions Strategic partnerships
Competition
across
markets Commodity pricing (shrinking margins) Complexity of Mgmt. Growth exceeding productivity
Threats
Suppliers
Customers
of the value Dell Direct ModelOwnership : chain
Competitor Model :
Loss of control over product & information flow & customer relationships
Suppliers Outsourcing CompetitorChannel Customers
Dell - Inventory Model Results:
3 days of inventory - Inventory turns of 122 per year
Suppliers Logistics Hubs
Dell Factory
Delivery
Local Suppliers
Supplier Owned
Dell Owned
Customer
With 90+ Day’s Manufacturer and Reseller Inventory, Channel Manufacturer Buys Here
120 115
Relative 110 Component 105 Cost 100
10-12% Cost Advantage With 3 Days Inventory, Dell Buys Here
95
Typical Dell 0
-2
-4
-6
-8
-1 0
-1 2
-1 4
90
Weeks Relative to Delivery
Logistics companies
Component suppliers
System integrators and resellers
Order management Operations and supply chain
Component Manufacturer
Third party HW and SW suppliers
Customer relations
Distributors
Customer
Repair and support providers
Direct relationship with customer is strategic; rich information flows.
Outsource non-strategic functions.
Information flows substitute for physical flows.
Coordinate value network thru IT-enabled information processes
Better
understand customer needs Customers receive exactly what they want: not standard solution Minimized inventory New technology delivered immediately
Build-to-Order Manufacturing and Mass Customization
2.
Dell built its computers, workstations and servers to order, none were produced for inventory. Dell customers could order custom built server and workstation based on their needs of their applications. This sell-direct strategy meant that Dell had no in-house stock of finished goods inventories and that unlike competitor using traditional value of chain model, it didn’t have to wait for resellers to clear out their own inventories before it could push new models into market place.
3.
4.
Traditional PC’s Industry Value Chain (Utilized by Compaq, IBM, HP and Most Other) Manufactured of PC’s Component By Suppliers
Assembly of PC by PC Makers (to Fill order from Suppliers and Keep distribution Channel stock)
Sales and Marketing Activities of Reseller to self Inventories of PC’s on hand
Purchase By PC Users
Service and support activities Provided to PC Users by reseller (or some PC Makers – IBM to PC users)
Build-to-Order/Direct Sales Value Chain (Employed by: Dell, Gateway, Micron Electronics) Manufactured of PC’s Component By Suppliers
Customized Assembly of PC’s By PC Makers as Orders from PC Buyers come in
Purchase By PC users
Service and Support activities Provided to PC Users by PC Makers (via Telephone, fax, Email) etc.
Partnerships with Supplier
Dell believed it made much better sense for Dell Computer to partner with reputable suppliers of PC parts and components rather than to integrate backward and get into parts and component manufacturing on its own. The advantages: 5. Using name-brand component enhanced the quality and performance of Dell PC’s. 6. Getting the volume of components it needed the overall market supply. 7. It feasible to have some of supplier engineers assigned to Dell product design team and for them to be treated as part of Dell. 8. Dell’s long-run commitment to its suppliers laid the basis for just-in-time delivery suppliers product to Dell assembly in Texas, Ireland, Penang.
Committed to Just-in-Time Inventory Practices
3.
Dell's just-in-time inventory emphasis yielded major cost advantages and shortened the time it took for Dell to get new generations of its computer models into the marketplace.
5.
Having a couple of months of component inventories meant getting caught in the transition from one generation of components to the next. Moreover, there were rapid-fire reductions in the prices of components —most recently, component prices had been falling as much as 50 percent annually (an average of 1 percent a week).
Direct Selling
3.
Selling direct to customers.
5.
Ability to respond quickly.
7.
Dell saw its direct sales approach as a totally customer-driven system that allowed quick transitions to new generations of components and PC models.
Virtual Integration and Information Sharing
3.
Dell is using technology and information-sharing with both supply partners and customers.
5.
On-line communications technology.
7.
On-site teams of Dell employees.
9.
Dell gave its large customers access to Dell's own on-line internal technical support tools, allowing them to go to www.dell.com .
Demand Forecasting
3.
Sales forecasts are key to keeping costs down and minimizing inventories.
The company's market segmentation strategy paved the way for in-depth understanding of its customers.
Research and Development
3.
The company talked to its customers frequently about "relevant technology," listening carefully to customers' needs and problems and endeavoring to identify the most cost-effective solutions.
5.
Dell had about 1,600 engineers working on product development and spent about $250 million annually to improve users' experience with its products—including incorporating the latest and best technologies, making its products easy to use, and devising ways to keep costs down. The company's R&D unit also studied and implemented ways to control quality and to streamline the assembly process.
Listen 5.
7.
9.
Solve
Impact
Listen Gather requirements directly through tens of thousands of customer interaction daily, organized events, and customer panels. Solve Many Innovations begin in-house, led by global team of top engineers, product designers and technical experts. Impact Maintain strong internal development capabilities. We partner, rather than compete, with top industry technology suppliers and original development manufacturers.
Internet
based customer services: Online ordering, asset tracking, product road maps, technical support, highly tailored information, all provided online. Diversification into non-PC businesses for “one-vendor solution” Dell sells PCs, servers, printers, storage, networking, software services Sells add-on software, peripherals, PDAs, cases, cameras, TVs Promote Dell as company that “knows how ‘E’ works” Results: Dell now #1 PC vendor with Market Share 34.4% in US and 18% globally.
Speed Order-driven processes linked by internal IT and external networks allow only 7 hours of inventory in factory and orders to be filled in 5 days or less Entire value network linked by EDI, Internet, extranets Quality Bar coding allows components to be tracked to suppliers when problems occur, stop production and notify suppliers Cell assembly allows problems to be fixed on the spot without shutting down production Cost Online sales and support saves on call center costs Supply chain coordination substitutes information for inventory
Results Overhead 8% compared to 15% for others
• 122 inventory turns annually minimizes depreciation • New technologies can be introduced immediately
The secret to Dell’s success is the synergy between all of its competencies.
The direct sales system both enables and relies on the build-to-order system.
The build to order system both enables and relies on the supplier integration system .
Dell focuses on collaboration at every level enables it all.
Related Documents
Dell Final Group 4
April 2020 20
Mechtronics Final Report Group 4
May 2020 29
Pom Dell Final
June 2020 7
Dell
May 2020 27
Dell
October 2019 41