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INTRODUCTION
This presentation show my case study that cover a strategic management
overview of Dell, one of the leading PC vendors of the world with a unique
operations model focusing on built to order and direct to consumer
frameworks.
I preferred to go through the main components for understanding its vision,
mission and objectives which allow Dell too do its strategic analysis to be put
into context and perspective
One of the references I went through they clarify SWOT analyses for Dell very
nicely I copy it as it is to be the first strategic analysis tool, then followed by an
internal and external factor analysis.
Finally TOWS matrix included in this case study to put SWOT analyses into action

OVERVIEW OF PRODUCT AND SIZE

Dell became the leading PC Vendor of the world in 2001. One of the most unique
proposition of Dell is the by passing of reseller through a direct to final buyer
strategy. This accounts for 90 percent of its sales leading to the reporting of
higher profitability and revenues for the company. This direct to buyer results in
a consumer intensive strategy is called by many as the key to the success of
Dells
The direct relationship with consumers not allows for reduced costs, better
inventory decisions and increased revenues but also allows for a better
understanding of what the customer requires. The PCs are therefore built to the
exact specifications as required by the customer.
This built to order strategy helps Dell in multiple fronts, reducing overheads and
increasing return on investments at the same time as allowing for a better
understanding of the market and consumer needs.
The requirements of such an operations means there is an interesting structure
of logistics. Partnership with software providers such as Office also allows it to
further increase the value of final product. Outside partners are also used for
installation, repairs on the site and integration of the overall systems.

LOCATIONS
The headquarters originally was in Austin Texas, where the company
was formed.
The European, Middle Eastern and African market are combined as one
sector; the headquarters of which is based in the UK. Ireland is used for
a production unit because of the tax incentives available over there.
Manufacturing units are placed strategically in the Asia-Pacific region as
well. Malaysia because of its appropriate labor rates, political incentives
and closeness to suppliers were chosen as the central location.
Production units are placed around the continent including one in China
with close suppliers in Taiwan.

VISION, MISSION, GOALS AND

OBJECTIVES
Vision
Its the way we do business. Its the way we interact with the
community. Its the way we interpret the world around usour
customers needs, the future of technology, and the global business
climate. Whatever changes the future may bring, our visionDell
Visionwill be our guiding force

MISSION STATEMENT
Dells mission is to be the most successful Computer Company
in the world at delivering the best customer experience in
markets we serve. 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

CULTURE, VALUES AND HISTORY

Dell has a highly customer centric culture. Founded by Michael Dell in 1984, the company was founded to
serve the customers directly with PCs that were able to meet specific needs. The company was named
PCs limited at that time.
There has been one belief that has always driven the organization right from the beginning which is to be
completely consumer focused to the point that they are able to incorporate customized requirements
during ordering processes. The company was able to go public within 4 years. Dell made its entry into the
laptop market in 1991 marking an aggressive growth rate in the following years becoming one of the top 5
computer companies of the world. Dell believes in high turnover solutions which are also available on their
website.
Another driving factor for Dell has been delivering the computers directly to consumers. This build to
order strategy has removed the middle man, increasing turnovers and decreasing costs for all parties
involved. This allows Dell to sell at a highly competitive rate as compared to the competition. It is this
consumer driven culture, innovative values and cost optimization that sets Dell apart (Dell, 1999).
Company Culture as cited by the companys website (www.dell.com) includes
Meritocracy: Making sure that employees are rewarded for doing a good job in order to enforce better
performance and motivate the human resource in meeting measurable objectives
Direct Relationships: Focuses on a relationship intensive strategy internally and externally making sure
that the environment is based on two way communication
Empowerment: One of the most crucial factors of an innovative company is empowerment. Highly
employee participation culture is seen at Dell.

KEY EXTERNAL FACTORS

Opportunities

There is a continuing demand for personal computers

There is a strong and evolving market for notebooks and tablets

There are strong opportunities of partnership in the market including one

potentially with Microsoft

There is a strong margin of expansion in consumer electronics

Consumer spending on technology is relatively untouched compared to other

products

Strong growth in the market of color printers

KEY EXTERNAL FACTORS

Threats

Strong competition continues to act as a threat

Strong fluctuation in price

The market has widened

There are more mergers and acquisitions happening in the industry a threat of
strong consolidation trend in the PC industry

The influence and dependency on outside suppliers means increasing oil prices
are crippling the spending of the consumers on PCs

The demand of commercial usage of PCs are not increasing at the same pace

The growth of the market has slowed down

Computing power fees has reduced

The fluctuating value and devaluation of currency continues to happen in the

international market

KEY INTERNAL FACTOR

Strengths

The business model of dell which focuses on a built to order framework where the
middleman is removed and PCs are sold directly to the end buyer

Significant margins over costs of production because of the direct sales to the end buyer

A highly relationship intensive strategy starting from the consumer sector and extending
to the corporate and government sectors

Strong strength of sales strategy through a variety of mediums ranging from conventional
to e-commerce

Elimination of the mark ups added by the reselling party through the direct sales to end
buyer resulting in lower costs to consumer without cutting down margins for Dell

Reliability that comes out of a built to order model reduction of over-heads related to
large inventories and finished goods.

One of the industry leads in the Personal Computer market

Considerable number of manufacturing units across the world

Strong brand value and power in B2B as well as B2C

KEY INTERNAL FACTOR

Weaknesses

There is a strong dependency on outside suppliers from foreign lands which leads
to a strong dependency on fuel supply and their prices leading to fluctuation

There are not a lot of production units and regional offices in the west including
the United States

The size of the company comes in the way of faster growth

For some consumers it is an inconvenience that Dell PCs cannot be purchased

through retail outlets

It has not been able to penetrate into several international segments as a

leading supplier even though the number of locations in the international market
are great

In the printer market it does not produce its own products rather purchases it
from Lexmark

TOWS STRATEGIC ALTERNATIVES

MATRIX
TOWS analysis helps you get a better understanding of the strategic
choices that you face. (Remember that "strategy" is the art of
determining how you'll "win" in business and life.) It helps you ask, and
answer, the following questions: How do you:
External Opportunities
1.
2.
3.
4.

Make the most of your strengths?

Circumvent your weaknesses?
Capitalize on your opportunities?
Manage your threats?
Internal Strengths
(S)
1.
2.
3.
4.
Internal
Weaknesses (W)
1.
2.
3.
4.

(O)
1.
2.
3.
4.

External Threats
(T)
1.
2.
3.
4.

SO
"Maxi-Maxi" Strategy

ST
"Maxi-Mini" Strategy

Strategies that use

strengths to maximize
opportunities.

Strategies that use

strengths to minimize
threats.

WO
"Mini-Maxi" Strategy
Strategies that minimize
weaknesses by taking
advantage of
opportunities.

WT
"Mini-Mini" Strategy
Strategies that minimize
weaknesses and avoid
threats.

http://www.volunteerhub.com/blog/the-tows-matrix-putting-a-swot-

REFERENCES
- Kharif, O. (2005). Dell, Time for a New Model?
BusinessWeek
- Schmid, N. and Kelber, A. (2005). The Dell Company A
Strategic
Analysis. Management Seminar. Hochschule
- www.dell.com
- www.volunteerhub.com

SUMMERY



) (

) (Competitive Advantage
1996 2001 .

http://www.socialmediaexplorer.com/so
cial-media-marketing/why-dell-is-a-gr
eat-case-study/