Dell Computers - Case Study Example

Table of contents Sl. Page Introduction 2 2. Review of Literature 4 3. Dell in the United Kingdom 6 4. Preview of Survey 7 5. Methodology of Research study 10 6. Letter of referral ( for Respondents ) 14 7. Questionnaire A 15 8. Questionnaire B 17 9. Questionnaire C 18 10. Reference 19 Understanding UK customers satisfaction when purchasing Dell Computers Introduction: Background of study: Dell, Inc. is a multinational company in the field of computer. It manufactures, develops, sells and supports business in computers and computer related products. Its Head Office is at Round Rock, Texas in United States of America. While it initially started as a small company in 1984 by Michael Dell, it now employs more than 82,700 employees globally, at the service of millions of customers. During 2008, Dell became the second largest seller of personal computers in the world. First and foremost, "Dell was founded in 1984 by Michael Dell on a simple concept: by selling computer systems directly to customers, we could best understand their needs and efficiently provide the most effective computing solutions to meet those needs." (History: company timeline n.d.). Michael started his company when he was a student in University of Texas at Austin with a capital of $1,000. At that time he named his Company as PC's Limited. He dropped out of school in order to concentrate fulltime on his business. Next, during 1985, his company developed a personal computer with its own design. It was termed as Turbo PC and it was sold for less than $800.The company started providing custom assembled ordered units on the customers' selection with lower prices than of the other branded PCs. Thirdly, post 1980's Dell became a pioneer in the tailor made configuration approach to manufacturing and delivering PCs. During 1988, the company changed its name to Dell Computer Corporation. In 1989, the company started its first on-site-service programs. By 2008, the company became one of the leading companies in the world, and in the area of PC manufacturing, it is second only to Hewlett Packard. Finally, Dell manufactures and sells personal computers, servers, data storage devices, network switches, software, computer peripherals. It also sells HDTVs made by other companies. According to Technical Business Research (TBR) Quarter 2, 2007 Corporate IT Buying Behavior & Customer Satisfaction Study: x86-based Servers, Dell rank first in customer satisfaction for standards based servers, beating even HP and IBM. According to TBR, "Dell's overall weighted score improved 1.1 percent sequentially, while HP and IBM declined by 1.5 and 0.8 percent, respectively. Dell was the only systems provider to show an improvement in TBR's latest study, with customer satisfaction scores increasing in eight of the nine attributes measured, including server management, phone support, delivery time, value and ease of doing business." (Dell Named No. 1 in Server Customer Satisfaction 2007). Literature Review Customer contentment and Dell: Customers are the ultimate judges and creators of success or failure of a company. They are the veritable force behind flourishing enterprises. In the area of selling computer and related products, they exert importance in areas of quality and service of product lines. Dell is a company which produces good quality products for millions of customers all over the world. In the words of the founder of Dell, Michael Dell - "Our business is about technology, yes. But it's also about operations and customer relationships." (Michael Dell quotes 2009). From the beginning he had a bright view about the customers' needs. He kept the price of the products to an affordable range and started giving choices to select the product parts of their interest. Customer contentment is always related to the quality of the product and the affordability. In case of consumer electronic goods, especially in computer and related products, support and after-sales service is of huge importance. It is indeed a challenging task to balance these three factors in selling with a higher customer contentment. In case of Dell, it has succeeded in manufacturing a large assortment of products that have ready acceptability and marketability in the PC market, since Dell understands customers well. Since its inception Dell is interested in developing and marketing products that customers need to buy, and not products that Dell needs to sell. And this has been the major cause for its continued success, despite the onslaught of many rivals and competing firms, big and small. Customer attitudes: Whenever the aspect of product selling is considered, the customer holds the future of the product as well as the company. Creating positive attitudes in the minds of customers are the hallmark of good products being sold successfully. To get the attention of the customer is not easy, especially, in case of global products, marketed all over the world. The company has to fulfil the tastes and needs of various people in different culture and society. In case of global products, even a small misjudgement of the customer attitude will cause loss of millions of dollars to the company. UK is one of the leading customers of IT brands. The attitude of customers in UK will reflect in the selling of IT goods in Europe. Most of the multinational companies have branches in UK. So the IT market in UK is highly competitive. The three main factors for selling a product successfully are the quality, affordability and awareness of the product. In case of IT brands, there is an important fourth factor -The service and support after selling a product. All these factors should be in balance so that the company can aim its best profit. Quality can be achieved by careful selection of inputs and parts, careful assembling or development. While doing this, the manufacturer should keep the product affordable to the customer, because many customers are bound by the budget limitations. Thirdly, the customer should be aware of the product. In case of IT products, most of the customers in UK are well educated and hence they will look all the details of the product before buying it. So the product details should be published through classifieds in different media. IT industry include various kind of products like PCs, Laptops, Servers, Storage devices, Networking devices, Software and other Computer peripheral devices. These products are meant for different types of customers. The above mentioned factors are weighed differently in case of customer choice in different products. For example, a customer in UK, who buys a PC will pre- consider the product's price. But in case of server systems, the main customers are corporates who value quality and performance, rather than price. Thus perceptive attitudes differ widely and influentially in customers' choice and preferences. Customer contentment is always related to the quality of the product and the affordability. In case of consumer electronic goods, especially in computer and related products, support and after sales service is of huge importance. It is indeed a challenging task to balance these three factors in selling with a higher customer approval. In case of Dell, it has succeeds in manufacturing a large assortment of products that have ready acceptability and marketability in the PC market, since Dell understands customers well. Since its inception Dell is interested in developing and marketing products that customers need to buy, and not products that Dell needs to sell. And this has been the major cause for their continued success, despite the onslaught of many rivals and competing firms, big and small. Dell in the UK. Dell, Inc. has a strong market share in UK. The head office of Dell in UK is at Bracknell, Berkshire. All the ranges of their products are sold in the UK market. Main products sold in UK are PCs, Laptops, Servers, Network Equipments and other peripheral devices. From the starting of Dell in UK, it gave wide publicity to its products in media. Affordability is the leading aspect it implements in marketing. All the customers are well educated and hence, the technical details are mentioned in the classifieds. As UK is a developed country, the customers have special interests in high end technology and design. As the time goes, the customers' attention goes more towards the quality and performance, rather than its price. With this changing attitude of the UK customers, the company started to sell products of customers' interest. For this, the company conducts surveys and product reviews periodically. The age of the customer and the type of use are two influencing factors to choose a product. For personal or home use UK youth prefer high performance, stylish PCs, Laptops and other computer related devices. Computers they look for must be capable of handling various multimedia activities which need high speed and high performance. Network facilities need to have more speed. Most of the families in UK have a PC or Laptop. For older people they search for classic looking high performance devices. In case of office work and business work, the companies or persons look for high performance. One of Dell's greatest assets has been its positioning. However, rapid growth and business success has put a strong premium on its positioning and many detractors are also questioning whether its strategies could be continued in future too. "Analysts have pointed to pricing pressure from competitors, poor customer service and stale product offerings as the main reasons for Dell's decline." (Katz 2006). To achieve this end, it is necessary that its liaison with vendors is reinforced, especially with chip manufacturer, Intel. Presently, the strategy of Dell is to bring only few products and using the technology of others. It is believed that since Dell's pricing policies are higher compared to competitors, it may be unable to compete successfully in world markets. Therefore, the strategy to be adopted would be to market more customized products by increasing its prevailing contacts with key suppliers. This would ensure that the customers are well satisfied and their complaints and queries are well attended to. "For large business and institutional customers, Dell maintains a field sales force throughout the world. Dedicated account teams, which include field-based system engineers and consultants, form long-term relationships to provide our largest customers with a single source of assistance and develop specific tailored solutions for these customers." (Dell case study/ dell.com case study 2009). Preview of survey: The use of both secondary data and primary data has been recommended for this research study. For one thing, secondary data would provide direction and impetus to the main focus area of research. For another, primary data would provide the premise for carrying out the research in correct mode. The secondary data has been gleaned from internet sources, journals and previous writings on the subject. Over its useful years as premier PC manufacturers and seller and its direct dealings with customers, it is also necessary to know how customers respond and react to customers interfacing and dealing with complaints, either of technical or commercial nature. The time and attitudes towards servicing is also a crucial aspect of Dell's performance. In order to assess how Dell performs in client servicing over period of time, it has become necessary to take up a research of this kind. This differs from previous research in that it provides a more pragmatic approach to researching facts and putting it across in research format. In the case of Dell's customer contentment and marketing competencies, the survey would need to collect data from professionals of business enterprises who are users and customers of Dell products and the methods envisaged would be through online responses gained from these respondents. With the permission of the respondents the proceedings of the interviews were recorded. "Dell acknowledges the fact that with rising figures in terms of growth in sales, profits and market share for their brand, maintaining high customer satisfaction ranking and persistent positive reviews is not as easy as it seems. However Dell hasn't denied acknowledging these shortcomings and commits to resolve the issues customers have with their machines in the near future." (Dell.com customer complaint n.d.). The main goals and objectives of this research are to add to the previous knowledge on the subject and also contribute data for future research on the subject. Research Questions: What are the current levels of user contentment, especially UK Computer customers who are investing in Dell Products Dell's top position in PC computer world, especially notebooks, may render it complacent when dealing with customers, especially smaller ones. Do you subscribe to this view Would Dell's competitive success hinge upon its ability to attain high degree of customer satisfaction How would you evaluate Dell's sustainability in posting increasing rates of profitability and growth in competitive global PC markets Methodology of research Objectives of this research: The main objectives of this study are: 1. To determine the current levels of satisfaction derived by customers investing in Dell systems; 2. To assess whether professed lowering of company's product standards and servicing performance is apparent in attitudes bore by customers and users of Dell products; 3. To establish whether Dell's present performance could reflect on the future of customers' attitudes toward Dell Company and its product range. Method followed: This Study was set in UK and closed-ended questionnaires were drafted and electronically mailed to individual respondents who formed the Core Study Group. The Study was conducted through Online Interviews and Structured Questionnaires. It is believed that online questionnaires are the best options since others would be too time consuming and would fail to obtain the necessary goals and objectives for a research study of this kind. Randomised Sampling: A Sample of 240 people were selected through random sampling in which 25% respondents (60 nos) had only limited knowledge and hands on experience in dealing with Dell products. The balance 180 was regular users of Dell products. 10% of the samples were set aside for rejected responses due to incomplete or technically disqualified entries. In this hypothetical study it is necessary to have a widely diversified and mixed genre of imagined respondents be presented to avoid bias, and present an authentic view of this survey. The samples are drawn from a cross section of students, businessmen and professionals from all walks of life, in the age group of 15-40, represented both male and female respondents (50:50), around 35% of them married, and the rest holding single status. All of them were in the high income group, and represented a cross holding of professional and technically competent individuals. Deficiencies in customer servicing could lower satisfaction levels: The methodology underpins the literature review undertaken on the acceptance of Dell products in the United Kingdom. It is necessary to consider secondary data since our research needs to add substantively to what has possibly been overlooked during earlier research and also throw fresh light on the current satisfaction levels of using Dell products in UK. Moreover, the present research could form the premises for future research on this subject. One the major aspects that this research needs to identify and assess are the present deficiencies in customer servicing and how it could impede satisfaction levels. Importance of primary research: The importance of primacy research is that it underpins and scaffolds research on this topic and forms the bulwark for research. However, certain aspects of research that has not been considered in detail in the primary needs to be literature reviewed, researched and brought within the purview of this study. This is necessary, since not-too-regular users would have different attitudes as compared to regular users, who would be more loyal and committed to the Dell products they use. Moreover the time, attention and efforts devoted by regular users would be higher than those provided by casual users, who may not even be interested in responding to the research questions posed to them. The justification for using this methodology as compared to others lies in the fact that online surveys are most appropriate when dealing with research of this kind. Moreover, the use of personal interviews, or fact-to-fact interviews would be as time-consuming, as would be unproductive for this kind of qualitative/attitudinal survey. The Question surveys were divided into two Sections: In the First Section, the current use of Dell products are taken up, whereas, in the Second Section, the respondents were required to comment on the perceived attitudinal issues posed by the growing popularity of rival and competitive products in the UK. Towards the end, they were also required to express their views on the future of customer's attitudes to Dell products in the United Kingdom. The selected respondents form the core of users, drawn from several strata of society including the business world, professionals and corporate intelligentsia. In a survey of this kind, it is necessary that the profiles and rejoinders of respondents be treated with absolute secrecy and confidence and used only for the purpose of research, either the current one, or to underpin future research on the subject. This has been the principal reason why this methodology has been chosen. The collection and assimilation of data would entail internet responses gained from the 240 respondents collected through online questionnaire system. This would be gathered and assimilated by a professional Online Research Consultant Group who would be primarily responsible for all aspects relating to this research study. The data would be fed into computers for collation and delivery of survey results using advanced sophisticated software tools and statistical methods. Thus it is proposed to make online visits to around 240 respondents located in different parts of the country. It is necessary to conduct direct online surveys since personal interviews, or postal questionnaires would not produce accurate and thus it would be necessary to establish direct nexus with respondents. Prior permission also needs to be sought from the top management by the respondents for entering this survey and the disclosures should not prejudice the interests of the company in any way. It is necessary that the proceedings, deliberations and data collections from respondents need to be ethical and should be handled only by authorized persons directly involved in it and used only for the purpose of research. The method that would be used is random sampling under which the attitudes of respondents to Dell products needs through be assessed by putting names of around 500 potential respondents in a box, mix them thoroughly, and select 240 though drawing of lots. Since each of the 500 potential Dell users has a fair chance of being draws out, this method could be seen to be a randomised and representative method for selecting respondents for the survey It is necessary to have a Letter of Referral addressed to each of the selected (through lots) respondents and inform them about the questionnaire and its usefulness and how it could possibly improve client servicing from Dell. A Sample of the letter of Referral sent to each respondent though email and copy of Questionnaire (Part 1 and II) are annexed to the end of this Paper. Electronic Letter of referral (for respondents) To: Mr/Ms/ (Email address ..) Dear Sir/Madam, We are a major global marketing research group whose services have been retained for conducting an Internet Questionnaire in the matter of customer attitudes in the United Kingdoms towards Dell. Products purchased by them. We would appreciate if you could fill in the attached Questionnaires and email it to our email address reseachgroup@gmail.org within seven days of reading this message. Thank you, With best wishes, Susanne McAllister Head - Research and Analysis Questionnaire A 1. How do you judge the Support Systems provided by Dell Computers (a) Excellent (b) Good (c) Fair 2. Do you find the on-time services delivery system provided by Dell (a) Excellent (b) Good (c) Fair 3. How do you view the Customer Care and Complaints Services installed by Dell (a) Excellent (b) Good (c) Fair 4. How do you judge Dell's perspective of their product servicing to customers (a) Genuine (b) Good (c) Much hyped 5. You feel that Dell is providing differentiation in service or product in different global market segments (a) Yes (b) No (c) Can't say 6. Does Dell's justification of its servicing systems seem convincing and competent (a) Excellent (b) Good (c) Fair 7. How do you perceive the use of access to Dell services, in your opinion, in terms of easy accessibility, user friendliness and private transaction assessment (a)Excellent (b) Good (c) Fair 8. In your opinion, does Dell support mass customization (a)Yes (b) No (c) Can't say 9. How do you think Dell customer servicing system responds to handling customers' complaints (a) Excellent (b) Good (c) Fair 10. How do you envisage on-line training that may be imparted to Dell customers for gaining better serviceability (a)Excellent (b) Good (c) Fair 11. How do you think Dell has strived to create better customer relationships (a)Excellent (b) Good (c) Fair 12.How do you perceive that Dell's customer relationship needs to be further improved in the light current PC scenario (a)Excellent (b) Good (c) Fair 13. If so, in which areas of the following (a) Responses to complaints (b) Better and faster facilities (c) enhancing quality of service (d) lowering cost of computers and better efficiencies. Questionnaire B 1. How do feel about the level of data security provided by Dell (a) Excellent (b) Good (c) Fair 2. How do you feel about the safety and privacy of Dell software usages (a). Excellent (b) Good (c) Fair 3. What do you feel about Dell's efforts to render maximum protection and security to your internet transactions (a) Excellent (b) Good (c) Fair 4. How do you feel about Dell's contingency plans for failure in products, or burning out (a)Excellent (b) Good (c) Fair 5. How do you feel about Dell's alacrity and capability to cope and redress crisis for customers' security and protections during use of Dell products (a)Excellent (b) Good (c) Fair 6. Do you, as a Dell customer have reasons to believe that the performance standards of Dell products are lowering over the years (a) Yes (b) No (c)can't say 7. If yes, could you attribute it to brand leadership in PC markets (a) Yes (b) No (c) Can't say 8. If you had an option to buy another PC for yourself, would you buy a Dell Product (a) Yes (b) No (c) Can't say 9. Why yes or why not 10. Do you feel that Dell's uninhibited success has hurt small customers like you (a) Yes (b) No (c) Can't say 11. Do you feel customer care would better in future and how (a) Yes (b) No (c) Can't say Questionnaire C The basic purpose of the above Questionnaires have been to assess your views, as valued respondents and professional users of Dell products, regarding the present standards of Dell products available in the United Kingdom As an independent researching agency, would also request you to comment about the future trends of Dell Products marketing and success rating in the country. 1. How much growth in terms of Business Volumes, do you perceive for Dell Computers, say in the next 5 years (a) Over 20% (b) 15-20% (c) 10-15% (d) below 10% (e) Can't say. 2. How much contribution do you envisage Dell Corpn. Could make to global computer business in the next 5 years (a) Over 20% (b) 15-20% (c) 10-15% (d) below 10% (e) Can't say. 3. What ranking do you visualize for Dell Computers in the World Computer Rankings 10 years from now (a) First to Third (b) Fourth to Seventh (c) Eighth to tenth (e) Can't say. 4. In which areas of PC marketing does Dell need to concentrate and improve (a) Security, Encryption and Protection (b) Risk Management (d) Brand building (c) others (specify) References Dell.com customer complaint n.d., PrintCountry.com, viewed 25 April 2009, http://printerinkcartridges.printcountry.com/dell-printer-ink-cartridge-articles/dell-com-customer-complaints/ Dell case study/ dell.com case study: Dell's sales and marketing 2009, DaveChaffey.com: Your Guide to Digital Business, viewed 25 April 2009, http://www.davechaffey.com/E-commerce-Internet-marketing-case-studies/Dell-E-commerce-case-study/ History: company timeline n.d., DELL, viewed 25 April 2009, http://www.dell.com/content/topics/global.aspx/about_dell/company/history/historyc=us&l=en&s=corp Katz, Jonathan 2006, Dell Inc.: struggling to stay on top: no.1 computer maker reworks its pricing structure and customer-service centres to win back consumers, Industries Week: IW, viewed 25 April 2009, http://www.industryweek.com/articles/dell_inc-_struggling_to_stay_on_top_12389.aspxSectionID=5 Michael Dell quotes: Michael Dell 2009, Brainy Quote, viewed 25 April 2009, http://www.brainyquote.com/quotes/authors/m/michael_dell.html Dell Named No. 1 in Server Customer Satisfaction 2007, Dell, viewed 25 April 2009, http://www.dell.com/content/topics/global.aspx/corp/pressoffice/en/2007/2007_08_16_rr_001c=us&l=en&s=corp Dell case study/Dell.com case study 2009, DaveChaffey.com: Your Guide to Digital Business viewed 25 April 2009, http://www.davechaffey.com/E-commerce-Internet-marketing-case-studies/Dell-E-commerce-case-study/ Read More