Strategic Ppt
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Transcript of Strategic Ppt
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8/3/2019 Strategic Ppt
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STRATEGIC ANALYSIS
ON
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INTRODUCTION
Founded in 1984 by Michael Dell
No.1 PC provider in the U.S. and No.2 worldwide
Based in Round Rock, Texas
Employs more than 82,700 people worldwide
Grew during the 1980s and 1990s to become a brand
Direct Business Model is the foundation for Dells business
Dell maintains a consistent focus on offering the best value
and customer experience
Dell is a global company committed to its customers and
employees
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MISSION
To provide customers with superb value, high
quality, relevant technology, customized systems,
superior service, support ,products and services thatare easy to purchase and use.
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Through effective and strategic community
partnership, dell supports educationalservices programs that address the critical
and most basic technology access needs of its
neighbours in Dell communities prerequisite
to success in digital world.
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Dell's success is built on a foundation of personal and professional integrity.
We hold ourselves to standards of ethical behavior that go well beyond legal
minimums.
We never compromise these standards and we will never ask any member of the
Dell team to do so either.
We owe this to our customers, suppliers, shareholders and other stakeholders.
We owe it to ourselves because success without integrity is essentially
meaningless
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VALUE CHAIN ANALYSIS
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FIRM INFRASTRUCTURE:
The main strength of Dell is in its inventory management.
It sells through direct model
It then places orders with vendors & proceeds on the assembly.
It pays to the suppliers only after 36 days
Thus its cash conversion ratio is negative
OPERATIONS:
Outsources all its component manufacturing like motherboards & entire production
chain for notebook PCs
Does not outsource the final configuration & keeps control over
the production supply chains.
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INBOUND LOGISTICS:
Dell follows build to order and just in time policies
Thus the inventory remains in the suppliers books till Dell puts the order.
Dells direct selling model depends critically on lead time management
Therefore would not leave the company with overage and underage of components.
MARKETING SALES:
Dell has eliminated from its value chain the intermediaries, who would have
charged a 20 -30 margin.
Even though the company assembles 80000 PCs a day, it does not have any
warehouse
The assembly factories hold inventories for maximum of two days while the entire
operation inventory is a maximum of 72days.
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STRENGTH
No inventory buildup Quality product and service
Whole world focus
Customer service
Cost efficiency
Direct sell model=customization + fast+ delivery
+ low cost
First mover advantage E-commerce capabilities: www.dell.com
Build to order manufacturing process
Product design + after sales service
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WEAKNESS
No proprietary technology
High dependency on component suppliers
Occasional product recall.
Unable to switch supply dues to the lack of large suppliers in the World High attrition rates among visitors to Dell.com
No physical presence.
Slow in introducing fancy features
Lack of innovation
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PPURTUNITIES
Network-internet, intranet and extranet
Developing nations market
Low costs and growing advanced technology
Growth in business, education and government markets
global wide access to customers and market.
Expansion
Increasing income of consumers
Globalization
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THREATS
Competition
Currency fluctuation in countries outside the US
Political instability
Tariff trade barriers
Recession
Declining sales
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P E S T
Dell being an integral part of U.S economy has also been greatly affected by
changes and has not been able to counter them.
Dell came under significant pressure from environmental groups across the USto assume responsibility for its old products
This experience sensitized company officials to the risks and opportunities of
state and federal e-waste regulations and the need to take proactive steps against
them.
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P E S THigh tariffs on IT products makes Dell
difficult to enter other markets apart from
USA
Since most of the population of the world is
young and adaptive to change in technology,dell aimed to manufacture its products which
are more user friendly and can be afforded
by young professionals
Purchasing power of working populationsaw an increase over the past few decades.
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P E S TIncrease of younger population and working population have led to the increase
of the use of computers.
A technological revolution has been around the corner, people have become
techsavy.
This have resulted in the increase in the demand for computers .
These days people have time constrains and as a result of it they prefer to buy
the product online ,which has given Dell an advantage over others because of
dell.com
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P E S T By increasing product line, Dell is able to provide advanced technology
products to the customers due to technological advancement.
One of the most important affects of technological changes that have led to the
increase of the demand is their Direct Business Model
They have excellent ecommerce capabilities, which can be seen with the success
of the dell.com .
Their recent products like New Power Edge Servers, New Enterprise
Computing Portfolio, Innovation Aids Recovery, Ultra-Thin Laptop, Adamo.
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PORTERS 5 FORCES MODEL
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Threat of New Entrants: MODERATE Buyer loyalty
Brand name
Low price
Award winning customer service
Customization
Rivalry: HIGH Price War
Decreasing profitability
Low differentiation
Threat of Substitutes: LOW Strong presence of PCs throughout society
One computer for every three people in the U.S.
Customer service
Direct Business Model
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Bargaining Power of Buyer: High Highly price sensitive
The cost leader has high market share which leads to high bargaining power
relative to its suppliers
Reliability and customer service become important factors.
Dells products are very reliable and customer service is outstanding.
Bargaining power of supplier: HighHighly dependent on suppliers
Switching them will be costly
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Corporate strategy:
Dells corporate strategy is to provide high technology quality products andservices through customization including cost cutting.
Business strategy:
Dell's business strategy combines its direct customer model with a highly
efficient manufacturing and supply chain management organization and anemphasis on standards based technologies.
Functional strategy:
Cost leader ship through direct sell model. In direct sales model it sells directly
to customers
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Should look for Alliance-mergers and
acquisitions that would bring synergic
benefits for the company
Reduce the attrition rate by Converting
visitors into customers(people who visit
the Dell site)
Focus on developing nations
Physical presence of Service centers
would add value to their customer service
AS A MANAGER
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THANK YOU.
KARAN PODDAR-283099
SHOBNA PATEL-283100
TORAL PATEL-283101PAWAN PUNJABI-283102