Dell Computers Strategy Global companies play an important role in the business environment, because they connect their business together around the world. A good example of a global company is Dell Inc., an American computer-hardware company, headquartered in Austin Texas, which develops, manufactures, sells and supports a wide range of personal computers, servers, data storage devices, network switches, personal digital assistants (PDAs), software, computer peripherals, and more. They design, build and customize products and services to satisfy a range of customer requirements: from the server, storage and Premier Services needs of the largest global corporations, to those of consumers at home. According to the Fortune 500 2006 list, Dell ranks as the 25th-largest company in the United States by revenue. Dell Inc. has realized that the most efficient path to the customer is through a direct relationship, with no intermediaries to add confusion and cost. With the power of their direct model and their team of talented people, they are able to provide to their customers high-quality, relevant technology, customized systems, superior service and support and products and services that are easy to buy and use. HISTORICAL REPORT Dell Inc, was founded as “PC’s Limited” in 1984 by Michael Dell, while still a student at the University of Texas at Austin, with just $1000. From Michael Dell's off-campus dorm room at Dobie Center, the startup aimed to sell IBM-compatible computers built from stock components. Michael Dell started trading in the belief that by selling personal computer systems directly to customers, PC's Limited could better understand customers' needs and provide the most effective computing solutions to meet those needs. In that year, the company became the first in the industry to sell custom-built computers directly to end-users, bypassing the dominant system of using computer resellers to sell mass-produced computers. In 1985 the company produced (in China) the first computer of its own design (the "Turbo PC"). In 1986, Dell unveiled the industry's fastest-performing computer, pioneers the industry's first thirty-day money back guarantee, and offers the industry's first onsite service program. In 1987, PC's Limited set up its first on-site-service programs in order to compensate for the lack of local retailers prepared to act as service centers. Also, the company set up its first operations in the United Kingdom; eleven more international operations followed within the next four years. In June 1988, Dell's market capitalization grew by $30 million to $80 million from its initial public offering of 3.
The PC industry has started to develop fast in the 80's when IBM launched its first PC series and later on when numerous small companies entered the market. PC is a new product and companies had to create the demand to it from the scratch.
(BIOS) in the IBM. In turn, they designed a BIOS of their own which could be
Historically the personal computer (PC) industry has sold its products at reasonably high prices yet garnered only small profit margins. One reason for this is the high competition in the PC industry which led to competitive pricing among producers. Analyzing the competitive environment of the PC industry, it is evident that there is very little barrier to entry in this market. PC's have very low physical uniqueness and are made of standard components that require very little expertise to assemble.
This was the same year when Bill Gates and Paul Allen co-founded Microsoft. In 1981, Bill Gates’ company was hired to develop an operating system but rather than creating a new operating system they decided to buy a preexisting operation system called QDOS (Quick and Dirty Operating System) for the amount of 50,000 dollars. After modifying the operating system they bought, they renamed the operating system to MS-DOS. After MS-DOS began selling it brought in a steady income for Gates due to the fact that the PC market was growing and there weren’t many competitors in the market for them to compete with. In 1986, when Microsoft Corporation went public, it made Gates into a millionaire overnight. The following year, Microsoft released their first ever version of
In 1984, Michael Dell invested $1,000 in start-up capital to register his business as Dell Computer Corporation, which was known as PC's Limited. The company becomes the first in the industry to sell directly to end-users by passing the dominant system of using computers resellers to sell mass-produced computers. Dell Computer also pioneers the industry first thirty-day money back guarantee. It became the cornerstone of Dell's commitment to expand its service offerings, superior customer satisfaction, and the industries first on site service program. It also established its first international subsidiary in the United Kingdom, and raised $30 million in its initial public offering.
was introduce in 1971. IBM then came out with more advance computers such as System/38 in 1978 and the AS / 400 in 1988.
Among the company’s first products is the Apple Macintosh, a computer that was introduced in 1984. According to its
Dell made the bold decision in 1994 to eliminate their products from retail stores and focused on mail order customers. In 1996 Dell began selling through their website as well. By eliminating the retail store presence Dell was able to reduce costs, reduce inventory, and maximize profit. Dell utilized a built to order system that allowed customers to specify exactly what they did and did not want on their Dell computer. Dell's just in time inventory system lowered inventory to 6 days and storage costs were saved.
Truly a global company, these suppliers are based out of China, Japan, Taiwan, the United Kingdom and the United States (Apple,
Unannounced to Jobs Hewlett admired his initiative and gave him a summer at HP assembling frequency counter. In 1975 the first apple computer was created and officially sold to the public. At the time Jobs and his business partners where...
Dell, Inc. pursued an aggressive growth strategy which was met with equally aggressive customer demand. Dell delivered a quality product for a reasonable price and this value that Dell created for their customers was initially unmatched by rival computer companies. In fact, Dell saw this as an opportunity to expand their product line to include items such as printers and software. The company’s sales increased from $389 million in 1989 to $2.9 billion in 1993 (McGraw, 1994). However, the management structure did not grow with the company (McGraw, 1994). Financial results were not analyzed properly and the company was not being strategically managed (Hunger, 2006). Dell’s management team decided to slow their growth initiatives in part by eliminating retails sales of their products (Hunger, 2006). This decision created three distinct problems for the company. First, customers were unhappy that t...
This strategy was carried out by selling via phone, fax and direct sales, instead of selling through retail stores. Not only this approach differentiated Dell from other competitors at the time, it also reduced its operating costs as it did not have to rent expensive retail space. In addition, Dell’s strategy of selling customised computers allowed it to hold only a small amount of inventory, which reduce...
Dell is a company leader in delivering the latest technology in computer systems to customers, and a broad range of products that enhance the service. The main concept is to sell directly to customers without intermediaries to better understand their needs and provide personalize assistance to take customers to the next level of service. (1)
computers to hit the market, but it was not IBM compatible, so it did not take
In 1953 it was estimated that there were 100 computers in the world. Computers built between 1959 and 1964 are often regarded as the "second generation" computers, based on transistors and printed circuits - resulting in much smaller computers. 1964 the programming language PL/1 released by IBM. 1964 the launch of IBM 360. These first series of compatible computers. In 1970 Intel introduced the first RAM chip. In 1975 IBM 5100 was released. In 1976 the Apple Computer Inc. was founded, to market Apple I Computer. Designed to Stephen Wozinak and Stephan Jobs. In 1979 the first compact disk was released around 1981 IBM announced PC, the standard model was sold for $2,880.00.