Dell and Customer Service Support and IT Solutions - Research Paper Example

 Name of the company Dell Inc. Name and Description of Products Dell Computer Systems What are the key product attributes? Processors, Ram, Hard Disk, Keyboard, Battery, Operating system and Other Components such as mouse and webcam Type of research undertaken Primary research – interview, questionnaire, observation Purpose of Research To identify customer values for dell computers and how it impacts Dells processes Post Research Review Highest Value Factors were Reliability (32%), After Sales Service (21%), Convenience to Purchase (14%) and Flexibility in Configuration (23%) Lowest Value Factors were Basic Use and Features (46%), Delivery Time (33%), and Brand Image (10%) Conclusions Drawn from Research Reliability, after sales service, convenience to purchase and flexibility in configuration were the values that mattered most to the customers List of Customer Values Basic uses and features High quality Low price – compared to competitors. Convenience of purchase Reliability After sales service Flexibility in payment options (online, on delivery payment, pay pal, debit/credit) Flexibility in configuration Delivery time Brand value Prioritizing Customer Values 1. Reliability 2. Flexibility in configuration 3. After sales service 4. Convenience to purchase 5. Low price as compared to the competitors’ 6. High Quality 7. Flexibility in payment options 8. Basic uses and features 9. Delivery time 10. Brand image See Appendix A for Details on Pro-forma A PRO-FORMA B How customer value is understood and met by Dell Are basic customer requirements noticed by Dell? Yes. All processes are aligned to not just meet the customer needs, but to exceed them. Is customer value considered in product material? Yes. Every component is chosen based on demand and needs of the customer. Is customer value considered in Dells computer packaging? Yes. Through high quality packaging and shipping additional products with a purchase Does Dell have any mechanism to measure customer satisfaction? Yes. Questionnaires, Feedback and Customer Satisfaction Score are used to measure customer satisfaction. Discuss any other aspect of customer value which is not considered by product/service provider The touch and feel factor must be incorporated by dell in the sales process. See Appendix B for Details on Pro-forma B PRO-FORMA C The Impact on Value Chain Activities Sales activities Direct Selling decreases lead time Accounts, billing and receivables Disturbs the accounts and billings because the payment from customer is received later than the payment to suppliers Customer information and Material information processing operation Streamlined processes make information flow extremely efficient throughout the supply chain Procurement of goods/services and distribution of the same Technological solutions are used to instantly transmit order details to procure the necessary components Retail stock and stores management No retail is kept because the business is online. Engineers and customer service representatives manage the website Recruitment of additional/temporary resources Some inventory is kept in store to keep the flow of processes as efficient as possible Design Product design and all processes are chosen so as to add value to the product for the customer Order fulfillment Order fulfillment is automated and all processes are streamlined Customer service support Technological solutions, questionnaires and feedback are used to satisfy the customer See Appendix C for Details on Pro-forma C APPENDIX A Name of Company Dell Inc. Name and Description of Product Dell Inc is a leading multinational company in computer manufacturing. The product that I have chosen analysis is Dell’s computer products. There is a long list of brand names under the computer product category that is offered by the company to either businesses, or consumers. Some of the brands for business customers are: Vostro – for small and medium businesses Latitude – for general businesses Precision – high-performance systems N Series – desktop and notebook computers with Linux OS or DOS installed Dell also has a wide variety of brand names for home consumers that have excellent performance and reliability. Some of the brands are: Inspiron – for lower budgets Studio – for middle level budgets XPS – high end performance based computers Aleinware – high performance system focused on graphics and gaming capabilities Adamo – high end laptops for the luxury market Dell also sells other, computer related devices such as LCD monitors, printers, USB drives and so on. However, the main focus of this paper will be towards the home consumer computers made by Dell What are the key, product attributes? The product under analysis is personal, general purpose computers such as desktops, laptop notebooks, and net books made by Dell. The main attributes of computers are: Processors – the main component that is responsible for manipulating and executing commands given by consumers RAM – Random Access Memory stores data temporarily Hard Disk – long term memory storage device Keyboard – the common input device for textual input Battery – the source that gives power to the computer (laptop) Operating System – the software that acts as a layer between the hardware and the user Other components – mouse, web cam, Bluetooth device, wireless LAN, modem, etc. Type of research undertaken In order to analyze the values for the product that the consumers have in mind, I carried out three types of research involved; one to one interviews with customers, questionnaires (see Appendix D), and observation. For the process of interviewing, I walked in towards the laptop section into the store and randomly interviewed customer’s that were interested in purchasing computers. For example, some of the questions I asked included what exactly they were looking for in a computer and what they value the most in a Dell’s computer. Out of the fifty people I interviewed, about 65% of them said that Dell’s computers have the best quality and are highly reliable, most of these people added that Dell’s after-sales service is very effective. 20% of the customer’s said that felt very strongly about Dell’s flexibility in payment and 75% of the customer’s felt that Dell computer’s have user friendly configuration options. Only 14% of the customers, however, said they buy Dell because of its brand image. For the second type of research that included questionnaires, I randomly handed out questionnaires to a 100 people who were college going and in the target market of Dell. The questionnaire was designed to find out what characteristics of Dell computers are of value to the customers. The way I designed the questionnaire was that I gave a list of options that the customers could choose from so it was easier for them to fill it out. I asked them for the value they thought was most important to them, followed by another question as to why it was so important to them. The purpose of the third question was to find the value that the customers were least bothered about, it was followed by a fourth question that asked them for an explanation that could help me analyze the reasons customers did not care too much for that value. The next part of the questionnaire further asked the customer’s to rate the values, on a scale of 1 to 10. Additionally, the questionnaire asked the customers if they felt there were any other values they perceived from Dell computers that may not be on the list, and whether they have had issues with Dell computers that may affect their decision of buying their next product. Finally, the questionnaires last question asked the customer the reason they would prefer to purchase a Dell computer over any other brand. Purpose of research The sole purpose of the research was to understand the values that the customers perceive Dell to offer. We could then compare those values with the values Dell identifies and aims to deliver to the customers. Also we would see how those values impact the processes in Dell. Post research review Reviewing the results of the questionnaire showed that 32% of the people answered Reliability as the value they hold for Dell computers. The reason most of them chose this option was that they had a satisfying experience with Dell on previous purchases or they had heard about experiences from people they knew. 21% of the people answered After-sales Service for the same question. The reason they added was because of a strong and effective team of customer service who were ready to help the customers anywhere and anytime. Furthermore, 14% of the people chose convenience to purchase and 23% people chose flexibility in configuration. The characteristic they thought that was least significant was basic uses and features at 46% because every competitor offers them that value. Also Delivery time at 33% and Brand image at 10% were also the least significant factors. For the question that asked for a value that was not listed, 93% of the customers left it blank while the rest of the 3% wrote Personal image for it. The reason they gave for choosing Dell computers over other competitors, majority of customers said that besides being highly reliable, they are always good value for money. While some customers say their after-sales service is better than any other of its competitors. Conclusions drawn from research Therefore, research shows that reliability, after-sales services and flexibility in configuration, convenience to purchase, along with good value for money are the values that customers perceive to get when they buy Dell computers. List of Customer Values Based on the research and analysis, following is the list of values and benefits that consumers perceive from the Dell computers Product value Basic uses and features – these refer to the basic functionality that the user expects from any computer. Dell computers must also give that value to the customers High quality product – Dell, compared to brands like Compaq, positions itself as a high quality computer manufacturer. When customers buy Dell, they expect to experience the high quality in terms of product build quality, design, and features. Low price – compared to competition offering similar specifications on a particular mode, Dell offers a lower price. Convenience of purchase – customers perceive it as high value that Dell offers online booking and configuration options on their computers. This enables the customers to easily order their computer systems from the comfort of their home. Reliability – Dell has an exceptional ranking when it comes to reliability of products. This is also of great perceived value for the customer these days that differentiates Dell products from its competitors and gives it an edge over them. Services value After sales service – Dell is known to be a pioneer in delivering highly satisfying after sales service and customers value the fact that they are not forgotten after the purchase is made. Flexibility – Dell offers high degree of flexibility in terms of configuration options for the computers, as well as a wide array of payment options. Delivery time – It is of great concern for the customers that how much time it takes for their order to get delivered to them. And Dell also has the potential to surprise customers by delivering their products before deadline. Image value This value is related to the brand image of dell. An individual who has a high brand value of the company in his or her mind is likely to have a higher image value for the product. Prioritizing Customer Values According to the ratings of survey, following are the customer perceived value of Dell computers, starting from the most important. 1. Reliability 2. Flexibility in configuration 3. After sales service 4. Convenience to purchase 5. Low price as compared to the competitors’ 6. High Quality 7. Flexibility in payment options 8. Basic uses and features 9. Delivery time 10. Brand image APPENDIX B Are basic customer requirements noticed by Dell? Dell does not only notice the basic customer requirements, but also meets, and often exceeds them (Treacy & Wiersema, 1993). In the olden days, the parameters by which the customer would judge and evaluate a product were price and quality. However, the fierce competition present in today’s world has increased the demands and expectations of the customers. Customers today, apart from price and quality, consider convenience of purchase, reliability, and after sales service as basic values for the products as well (Treacy & Wiersema, 1993). Dell does not only meet these requirements of the customers, but also surpasses them. With pioneers of cutting costs and streamlining processes, Dell manages to pass on the lower costs onto the customers and give them the highest quality, in the least possible price. Moreover, through technological solutions, Dell manages to eradicate the boundaries between the supply chain members, enabling the entire supply chain to work towards the common goal of delivering maximum value to the customer according to his or her needs (Joan, 1998). In fact, every strategy and methodology adopted by Dell focuses on the customer’s perceived value and Dell integrates them together to deliver that value. This is the reason why Dell incorporates a fully streamlined supply chain, direct online business model, Just-in-Time manufacturing, build to order approach, and many other strategies that are integrated together to achieve operational excellence i.e. delivering the best possible computer systems, at the least possible prices and minimal level of inconvenience.(Treacy & Wiersema, 1993) Is customer value considered in product material? As explained by Michael Dell himself, Dell gives customer relationship management a great deal of importance (Joan, 1998). He says that it is only through maintaining a relationship with the customers and communicating with them that Dell is able to produce computers that suit the needs of the customers. Every component and material used in the manufacturing of the product is aimed to deliver value to the customer. Dell carefully evaluates and monitors its suppliers and the component they deliver in order to make sure that they match the quality standards that are expected by the customers. Also, through communication and feedback from the customers, Dell can find out the brand of component that are performing well and are demanded by the customers. For instance, Dell mostly uses Intel microprocessors in its computer systems because it knows that the demand for Intel is higher than AMD and that Intel is more valued by the customers. Even though Dell purchases most of its computer systems’ components from other suppliers, it does the final assembly of the system itself (Kraemer & Dedrick, n.d.). There are two reasons for this. Firstly, Dell wants to ensure the quality standards of the finished goods for its customers. And secondly, it enables the customers to configure their computers systems themselves so that the customer can sit on the driving seat and add the optimal level of value in the product for himself. Moreoever, Dell also incorporates Just-in-Time inventory and Just-in-Time manufacturing (Kraemer & Dedrick, n.d.). As technology decays and gets obsolete at a very rapid pace, this strategy ensures that the customers get only the newest and freshest of the material and components installed in their computer system so that they get the highest quality product every time. Is customer value considered in Dells computer packaging? Dell does use its packaging to deliver value to the customers. It packs the computers into strong, attractive looking cartons with detailed information about the individual product on it. Also, upon purchase of the computer, users get accessories and extra free products shipped with the computer. These packaging features add to the values of high value for money and reliability for the products. Does Dell have any mechanism to measure customer satisfaction? Dell has many ways of measuring customer satisfaction. Dell has extremely efficient customer relationship management practices implemented. It communicates with the customers through many channels and manages to survey around 24,000 customers every month. (Whitson, 2006) This communication can be done through questionnaires that are filled online on Dell’s official website, through email, or physically on stores where Dell computer systems are available for sale. In order to measure customer satisfaction, the questions encompass the following areas: Loyalty – the customers can be asked about how likely they are going to recommend the Dell products to others. The reply to this question would depict the level of satisfaction and loyalty that the customers have with the brand. Rating – questionnaires can include questions that ask the customers to rate the price, styling, reliability, warranty, etc. of the dell computers. This rating could be done according to a scale, say 1 to 10. Also, the customers can be asked of how they expected the product to perform under the above mentioned criteria before they purchased. The more the difference between the expected rating and current rating, the less satisfied is the customer. Dell also uses customer feedback through their website to assess the level of satisfaction of the customers. For instance, after every online chat with Dell’s customer service representative, the customer is asked to fill out a short close ended questionnaire to evaluate how satisfying the experience was and if the customer’s problem had been resolved. Furthermore, Dell also analyses historical data of a customer’s purchases to find out the satisfaction level. If the pattern indicates an increase in the purchases, it will depict that the customer is satisfied. Another recent addition to the Dell’s customer satisfaction scorecard includes a question asking the customer if the customer service representative stays with the customer until the customer’s problems have not been solved (Customer Satisfaction Scores, n.d.) The response of the customer will show if the customer’s problem has been solved or not and if he is satisfied or not. Discuss any other aspect of customer value which is not considered by product/service provider Although from the questions asked in my primary research, the customers did not specify any particular value that is not catered to by Dell. However, there is an aspect in Dell’s business model that fails to cater a very important factor that customers use, subconsciously if not consciously, to evaluate the computer products. This value concerns the accessibility of the computers to the customers so they could get a good feel of the product. Dell focuses more on direct online selling and that model does not give the customers the touch and feel of the computers they subconsciously use in their decision making cycle in order to see and feel if the computers suit their needs. Dell however, is making quick changes to cater to those values as well. Initially, Dell aimed to sell computers only through their websites. But this requirement of the customers made them install 10 by 12 feet kiosks in shopping malls to let the customers experience how it feels to use the different models of Dell (The Value Chain of Dell Computers, 2006). Moreover, Dell has also started making their laptops available in retail outlets, but most of the selling is still done directly through the website. Dell must consider this growing need of the customers just as other computer manufacturers realized the need of online selling and compete with Dell in that department as well. APPENDIX C Sales activities Dell follows a direct model of sales to its customers (Manataki, 2007). It avoids including wholesalers and retailers into its supply chain. This would reduce the costs in terms of extra profit margins that the wholesalers and retailers would keep before the product reaches the end consumer. This cost cutting advantage translates into lower prices for the customers and adds value for them in terms of higher value for money and lesser costs as compared to the competitors. Accounts, billing and receivables The JIT system that Dell results in purchase of components after the purchase is made by the customer. This affects the accounts and billings of Dell because the payment takes around 5 days to reach Dell, while Dell has to pay the suppliers at the time of purchasing the components. This means that the risk of payment frauds or defaults have to be undergone by Dell which would further affect its accounts and billing. Customer information and Material information processing operation Dell has an extremely efficient supply chain implemented. Dell is always connected with its upstream and downstream channel members through inter-company technological solutions. The flow of information due to this is very efficient and all information about the customer and the materials is available throughout the supply chain in real time. Also, because there is no wholesaler or retailer in the supply chain, it reduces the effort in collaboration and information sharing in the supply chain. As soon as the customer places the order, the information becomes visible on the network. Dell, in real time, gets the up to date statuses of the components it has in store and the amount of material required is sent to the suppliers. This entire process is carried out instantly. Suppliers then deliver the required products through third party logistics to Dell. This efficiency in information sharing and collaboration between the supply chain members results in optimum performance of the production process and hence, on time delivery for the customers. Procurement of goods/services and distribution of the same Procurement of components needed for final assembly is done through an inter company network that connects all channel members of the supply chain. This is done instantly as the order is placed by the customer so that minimum lead time occurs and on time delivery can be done. Retail stock and stores management There is no retail store managed by Dell because it sells almost all of its products through its website, Dell.com. The online store, however, is managed by IT professionals and web developers, as well as customer service representatives who ensure smooth running of the system. Recruitment of additional/temporary resources Although the aim of Dell is to maintain Just-in-Time inventory procedures, in which over stocking of parts is to be avoided (Crystal, 2003), it chooses to keep some levels of inventory in stock in order to deal with the irregular variations in demand. It also does that to ensure minimum lead time for the customers and to ensure a smooth running of the processes. In fact, in certain cases, truck loads of components from suppliers are kept in reserve and are used if need be. Even though doing so would marginally increase the inventory holding and inventory carrying costs for Dell, it sees the higher value delivered to the customers as more important than a slight increase in its costs. Design Every process is focused to add value to the customer. The streamlined processes, the Just-in-Time Inventory procedures, the direct online selling model, flexible production process, and the effective customer relationship management are all integrated and focused towards only one goal: enhancing the value for the customer. The product is packed with innovative technology and pleasing aesthetics to give the customer a performance computer system that does not compromise in styling. This results in an overall high satisfaction for the customer. Moreover, the Just-in-Time mechanism ensures that new and fresh components are installed into the computer systems, ensuring high quality and reliability of the products as well. Order fulfillment As discussed, order fulfillment is done through IT solutions that minimize lead time and ensures on time deliveries to the customers. Customer service support Dell has excellent customer service support, as seen through the survey as well. With well trained, helpful staff online, as well as on field, the customer is ensured that no matter what kind of problem related to his/her computer that he/she has, it will be solved by the experts at Dell. Also, to ensure that the staff performs well, they are evaluated through the customer satisfaction scores and their compensation is tied to the scores that customers give them (Customer Satisfaction Scores, n.d.) APPENDIX D REFERNCES Manataki, A.(2007). A Knowledge Based Analysis and Modelling of Dell’s Supply Chain Strategies. School of Informatics. University of Edinburgh. Treacy, M. & Wiersema, F.(1993). Customer Intimacy and Other Value Disciplines. Harvard Business Review. v. 71. 1993. p. 84 - issn: 0017-8012 Joan, M.(1998). The Power of Virtual Integration: An Interview with Dell Computer’s Michael Dell. Harvard Business Review. 00178012, Mar/Apr98, Vol. 76, Issue 2 Kraemer, K. & Dedrick, J.(n.d.) Dell Computer: Organization of a Global Production Network. Center for Research on Information Technology and Organizations. University of California, Irvine. Chopra, Sunil & Peter Meindl.(2004). Supply Chain Management. 2 ed. Upper Saddle River: Pearson Prentice Hall. (2006). The Value Chain of Dell Computers. Private Writing. Available from http://img.privatewriting.com/1/samples/term_paper_bachelor_IT_16s.pdf [Accessed on 26 April 2010] Whitson, R.(2006). Dell: A Brand in Flux. Ezine Articles. Available from http://ezinearticles.com/?Dell:-A-Brand-in-Flux?&id=126816 [Accessed on 25th April 2010] (n.d.) Customer Satisfaction Scores. Survey Methods. Available from http://www.surveymethods.com/glossary/article_cust_satis_l.aspx [Accessed on 25th April 2010] Koegel, L.(2007). Measuring Customer Satisfaction. Free Article: Tutorial. Available from http://e-articles.info/e/a/title/Measuring-Customer-Satisfaction/ [Accessed on 25th April 2010] Read More