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Perspectives on Organisational Transformation - Essay Example

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Dell (formerly Dell computers) had emerged as one of the leading players in the personal computers (PC) industry through its direct selling model. Founded in 1984 by Michael Dell, the longest tenured executive to lead a company in the computer industry. Dell could best understand customer's needs and efficiently provide the most retailers that add unnecessary time and cost, or can diminish Dell understanding of customers expectations…
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Perspectives on Organisational Transformation
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Download file to see previous pages In 2004, Dell made a profit of $2645 million on revenues of $41440 million. During the period 1997-2002, Dell's global market share of PC's went up from 5% to 15%. In the US, Dell had a market share of 27%. (Forbes, 28 october2002). The clear cost leader in the industry, Dell had concentrated on activities where it could add most value and on market segments where profits were highest. Dell had taken care to ensure that customer service was not diluted in the process of cutting costs. For example, the industry average downtime for a PC was 16 hours, but only 8 hours for a Dell PC (Kasturi& Bell,2002). For servers, the industry average downtime was 5 hours compared to 1 hour for a Dell server. A March-2001 fortune and trilogy survey of senior officers of fortune 1000 companies ranked Dell first in managing customer relations. Dell believed it could achieve a turnover of $60 billion, a target beyond the wildest imagination of most other players in the industry by 2006.
Change is a necessary way of life. We are perhaps aware of the axiom that the certainty in the world is that these will be change. If an organization is to survive, grow and remain prosperous, it must ad aft to the demands of the environment, since these demands are constantly changing, organizations must also change.
The pace of change is now so fast that business face constant market change and must respond very rapidly if they are to survive. Many don't make it. Evidence suggests that the average corporate life styles may be shrinking because of a mobility to change and adopt fast enough. For this reason managing change has now become a crucial part of competitive edge (Clarke, 2002).
Newstrom and Davis (1997) have explained the impact of a change in any part of the organization of the total organization. They have illustrated it by comparing an organization to an air filled balloon. They have concluded that the whole organisation tends to be affected by the change in any part of it (Newstrom & Davis, 1997).
Factors in Organizational Change :
Organizational changes are required to maintain equilibrium between various external and internal forces to achieve Organizational goals. Therefore, various factors/triggers, which may be important for necessitating Organizational changes, may be grouped into two categories external & internal.
External Factors: Changes affected by external factors i.e. social, political, economic, technological and legal, which force the Organizations to change themselves. Such changes may result change in major functions, nature of competition, economic constrains, organization methods etc. In order to survive in the changing environment, organization must change.
Internal Factors: Change occurs because of two internal factors i.e. Change in managerial personnel and deficiency in existing organization.
Initially Dell bought stripped down computers, added disk drivers and memory, upgraded and sold them. In 1989, Dell suffered its first major setback. To meet the growing demand Dell bought more microprocessors than it actually needed at the peak of a cyclical market. Then, prices plunged and microprocessor of higher capacity (1 megabyte up from 256 kb) came into the ...Download file to see next pagesRead More
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