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The University of Newcastle GSBS 6060 Strategic Management
Presented byPresented by
Outline
Company Background Strategic Analysis Strategic Objectives Key Current Strategies Strategic Implementation: General Perspective Key Strategic Implementation Issues Leadership Organisation Structure Innovation Evaluation of Strategy Recommendations Conclusion
Company Background
Dell Inc. established in 1984 by Michael Dell Operational regions : Americas; Europe, Middle
East and Africa (EMEA); Asia-Pacific and Japan (APJ)
Today the number one supplier of computer systems in the United States and second worldwide
Strategic Analysis
General Environment General Environment
•Demand shifting towards emerging markets
•Cloud computing
•Demand shifting towards emerging markets
•Cloud computing
Specific Environment
Specific Environment
Strategic Analysis
Today
Strategic Objectives
Currently Long term value creation by driving
revenue, operating income and cash flow
To succeed
Shareholders
Suppliers Customers
Definitive Dominant Dominant
Customers Employees
Definitive Dominant
Key Current Strategies
Ansoff’s Matrix
Currently: Market Development (PC)
Penetration (Enterprise IT)
Diversification (Enterprise IT) Porter’s Competitive Strategy
Currently: Cost Leadership & Differentiation Miles & Snow’s Adaptive Strategies
1st CurvePC
2nd CurveEnterprise solution
Prospector Analyser
Analyser
Defender/Reactor
Strategic Implementation: General Perspective
Strategic Drift & Flux
Strategic Implementation: General Perspective
Enterprise IT Solution - LATEPC
Enterprise
PC CashCash
BCG Matrix:
•PC Business – Cash Cow
•Enterprise Solution – Question Mark
Second Curve Activity
Leadership
“Two-in-a-box” Management & Cost Leadership Leader’s Market Acumen Corporate Culture & Leadership Style Executive’s Core Competence & Organisational
Needs
Leadership Style of Michael Dell & Diversification Strategy
Radical change in Dell’s structure to flat organisation
Dell: ‘Efficiency’ to ‘Decentralisation and Delegation’ Less directive and more supportive in leadership
style
Organisational Structure
Decentralised since inception Bureaucratic & Autocratic: late 1990s – mid 2000s Hierarchical & Structurally Bulky: mid 2000s till
now Implications
Strategic implementation
Innovation
Dell less innovative
Strategic implementation Diversification Innovative in the three
types
Evaluation of Strategy
Strategic objective: Creating value for shareholders Key Strategies: Cost Leadership, Differentiation
Market Development, Penetration, Diversification
Implementation: Leadership, Structure, Innovation
Evaluation Criteria: (Viljoen & Dann, 2003)
Assessing Strategic Performance
(Viljoen & Dann, 2003)
Recommendations
Less directive and more supportive in leadership –Supporting style
Reducing geographic division of middle management
Explicit strategic objectives to address and improve employees’ motivation and skills
Conclusion
Dell has lost its game in the global market.
Dell shows no indication of significant change in implementing its strategies.
Dell stands to lose its competitive advantage in the next 3-4 years, unless significant change is brought about in leadership style, organisational structure, and innovation.
Appendix
http://www.theofficialboard.com/org-chart/dell