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Dell evolution Dell strategy past to present

Dell evolution Dell strategy past to present. Marián Háčik , Alexandra Vančová. About the P resenters. Mari á n H áč ik Education: Masters in Business A dministration , Vienna University of Economics and Business Administration, 2008 6 Sigma Yellow Belt Certified

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Dell evolution Dell strategy past to present

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  1. Dell evolutionDell strategy past to present Marián Háčik, Alexandra Vančová

  2. About the Presenters • Marián • Háčik • Education: • Masters in Business Administration, Vienna University of Economics and Business Administration, 2008 • 6 Sigma Yellow Belt Certified • Work experience Dell: • FP&A EMEA, Senior Analyst • Competitive & Market Analysis, Analyst • FP&A Public EMEA, Analyst • Finance Graduate Program • Alexandra • Vančová • Education: • Masters in Maths & Mgmt, Comenius University, 2002 • PhD in Mathematics, Comenius University • Work experience Dell: • Services FP&A manager • MLP Western FP&A team member • PLE EMEA RUM Forecast Coordinator • LE EMEA OPEX controlling • EMEA Fin Systems Training Coordinator • OPEX controlling - Central OPEX team

  3. Agenda Dell strategy past to present • Strategy • Dell direct model • Dell.com • Dell embracing the channel • Creating global business units • The new Dell business model

  4. What is Strategy? “The determination of the basic long-term goals and the objectives of an enterprise, and the adoption of courses of action and the allocation of resources necessary for carrying out these goals." Chandler, 1962, Strategy and Structures: Chapters in the History of the Industrial Enterprise, MIT Press, Cambridge, Mass) 1) However, “You learn the most when you make mistakes. There is no such thing as a perfect plan. Talk about what is not working and move quickly to fix it as soon as you find it,” Michael Dell 2) 1)http://www.ifm.eng.cam.ac.uk/csp/summaries/ms.html2)http://en.community.dell.com/dell-blogs/direct2dell/b/direct2dell/archive/2011/11/10/michael-dell-opens-e-amp-y-strategic-growth-forum-2011-a-conversation-with-charlie-rose.aspx

  5. Strategy to execution Vision Mission Values ELT Strategy Objective Change Initiatives Planning Sales Front Office Manufacturing Customer Support Back Office Demand Supply IT Finance Marketing & Product Development HR Information & Communication Flow

  6. Dell Direct

  7. Dell direct model

  8. Build to order cost benefits Components Purchase Cost Product Assembly Cost to Competitors Customer Places Order Shipment to Distributor Manufacturer's Inventory Shipment to Reseller Cost advantage Dell Procures Components, Assemblesand Ships Channel Inventory Dell Cost 8 Weeks Ago 6 Weeks Ago 4 Weeks Ago 3 Weeks Ago Today Time Customer Benefits ConsistentSupplyGlobally Immediate Response to Customer Needs LowestCost Consistently

  9. Dell.com

  10. 2008 Dell.com - a brief history • 2001: Online technical staff moved into IT • 2002-3: New content publishing system • 2003: Code re-written to .Net, consolidation onto global code base • 2005: Widespread AJAX implementation • 2009: Completed widespread globalization • 2010+: Radically improve Customer Experience • 1994: Launched as internal tech support site • 1996: Became commercial site with limited product set • 1997: Reached $1M/day in revenue • 1999: 1st Content Publishing capability • 1999: Accounted for 50% of Dell Revenue • 2000: Re-platform to VB and J++ 2001 1996 2003 2007 2006 2011 2012 1999

  11. Dell online today Online: Dell.com + Premier Pages + Global Portal + B2B 7.3 M online transper year, e-pen = 42.2% 34supported languages 25M visits on PP and GP pages per year 1.8M B2B transper year 1B visits per year to Dell.com 124K Premier and Global Portal pages 86% of trans are Client and SnP products 11B online revenueper year An online orderis placedevery4 seconds 2B online marginper year

  12. Dell embracing the channel

  13. Group exercise & discussion:Why did Dell enter the indirect business model?

  14. Direct vs. Indirect model

  15. Direct model

  16. Indirect model

  17. Dell approach • 1984-2006 • Pioneered direct model • Extreme growth, 2003 No.1 in PC market • Indirect business not addressed specifically • Changes on IT market in 2005/6 • June 2007 • 2008 - Now • “Direct model has been a revolution but it is not a religion” Michael Dell • Expansion into Indirect (Channel) business • Global Commercial Channel • Consumer Retail • New Dell : E-Dell, BVS, Client Reinvention

  18. Dell approach – Global commercial channel Level of cooperation

  19. Creating global business units

  20. Dell organization based on the customer World-wide view Dell strategic business units (SBU’s) aligned to customer segments

  21. Regional structure to global SBUs “We have laid the foundation for the transition from a global business that's run regionally to businesses that are really globally organized.” Michael Dell 1) 1) http://www.itexaminer.com/dell-implements-restructuring-plan.aspx

  22. Dell organization based on customers Consumer SMB Large Enterprise Public End User Computing Solutions Overlay solution groups to drive strategy Enterprise Solutions Services Corporate/Shared (Supporting Functions) Dell strategic business units (SBU’s) aligned to customer segments

  23. Dell reflecting current IT trends

  24. Major IT trends Rapidly increasing storage requirements, services instead of in-house solutions Rise of Smartphones, Tablets, Ultra-books and Cloud Services • Global industry trends • BRIC country IT market growth • Consumerization of IT – change of traditional work/life patterns

  25. Dell’s growth strategy • Solutions that drive efficiency and flexibility for the virtual era Efficient IT Solutions End-User Computing Enterprise • Next Gen Computing Solutions & Intelligent Data Management • Virtualization • vStart • AIM Systems Management • Modular Data Centers • Networking Fluid Data Architecture • SAN & Scale-out NAS • De-duplication • Services, Security • & Cloud • Multi-vendor support • BPO & applications • IT infrastructure outsourcing • Security & cloud • ITaaS, SaaS, PaaS • End-User Computing • Flexible & optimized value chain • Mobility solutions • Tablets & smartphones • Desktop Virtualization 25

  26. Dell’s leadership in the virtual era Key designtenets Open Create Manage Capable Affordable Services, Security, Cloud End-user computing Next generation computing solutions and intelligent data management Deliver 26

  27. Dell customer perception evolving… • Technology • Enterprise Services • Data center Followers • Efficient • Reliable Low quality Bad service Crap • Meets my needs • Customers PC provider customization • Mobility Laptops • Thought leader • Solutions Good Computers Dude Innovation • Best customer service Reliable Desktops • High quality • Innovative • Virtualization Poor quality Service • Outcomes Affordable OK Old Services Quality Good • Cloud • Services Followers Great Home • Infrastructure Inexpensive Value • IT leader Manufacturer • Smartphones • Trustworthy • PCs Cheap • Tablets Present Future

  28. Financial reporting changes to reflect strategy Support functions http://en.community.dell.com/dell-blogs/dell-shares/b/dell-shares/archive/2013/01/10/financial-reporting-change-product-and-service-based-p-amp-l.aspx

  29. How does Michael Dell describe the Dell evolution? • http://www.youtube.com/watch?v=N3VOR31Hrn4

  30. Key takeaways • Dell has adapted its strategy to better serve customers several times throughout its history • Examples presented in this session include: • the Direct Model on which the company was founded • Leadership and pioneering in E-Commerce (Dell.com) • Embracing the channel – revisiting the direct model • Creation of global SBU’s aligned to customer segments • Dell New model (The strategic shift happening now is the transformation of Dell into an end-to-end solutions provider)

  31. Dell’s commitment to customers • http://www.youtube.com/watch?v=-5-3t4RAaio

  32. Thank You

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