Strama 1-4

Question1: What is your evaluation of Michael Dell’s performance first as Dell’s CEO and more recently as its Chairman? How well has he performed the five tasks of crafting and executing strategy that were discussed in Chapter 2? Part 1: Same roles and responsibilities both as Dell’s CEO and its Chairman. * A young and learning manager. * A charismatic leader. * Motivated, loyal, and respectful followers. Part 2: * Vision: Directional, strategic vision * Objects: Crafting strategy: moves to achieve diversification, cross – business synergies 1+1=3 * Implementing strategy: * Evaluating strategy: Adapt to customer need changes, actively search for new opportunities, have corrective actions when not going well. Question 2: What are the elements of Dell’s strategy? Which one of five generic competitive strategies is Dell employing? How well do the different pieces of Dell’s strategy fit together? Is Dell’s strategy evolving? * The elements of Dell’s strategy: Cost- efficient build- to –order manufacturing( C-95) * Partnership with suppliers: partnering with reputable suppliers of PC >leadership in technology, performance, quality and cost. (C97) * Direct sales to customer (C-99) * Award winning customer service and technical support (C-101) * Customer- Driven R&D : focus on tracking and testing new developments >most useful and cost-efficient for customers (C-103) * Using standardized technology: using industrywide standards ( C-103) * Product-line expansion: data storage hardware, switches, handheld PCs, printers, printer cartridges. C103) From these elements, especially, “Direct sales to customer”, Dell is employing “Low-cost strategy”. Dell’s strategy is evolving. Question 3: Does Dell’s expansion into other IT products and services make good strategic sense? Why or Why not? Yes, it made good sense, because of the following reasons: Have opportunities to expand into industries whose technologies and products complement its present business (related diversification: from PC to data shortage, printers, etc) * Reduce costs by diversifying into closely related businesses * Have powerful brand name “Dell”: Customers would try other products * Good long-term profit opportunities ($800 billion market) => Industry attractiveness test * Low cost of entry to other related businesses => Cost of entry test * The company’s different businesses performed better together than as stand-alone enter prices (from 2% market share in 1995 to 30% market share in 2005, Pc attached with switch made easy sales) => Better-off test Question 4: What does a SWOT analysis reveal about the attractiveness of Dell Computer’s situation? From SWOT: * Dell hold very strong competitive position * “Direct business model” and “closed relationship with customers and suppliers” > Dell’s success * Company entered to the “ Fortune Global 500” >proved Dell’s efficiency and attractiveness * Dell Inc can profit from all different opportunities of expansion and growth to make it business more profitable.