Fundamental Reasons for Dells Success - Case Study Example

Its first computer was produced in China under its own design in the year 1985, this was followed by unveiling of the world’s fastest performing computer in 1986 which was to be promoted by the setting up of the first onsite service to compensate for lack of retail in the year 1987. In 1988, the company changed its name to Dell Computer Corporation then tried to change its marketing strategy by selling to retailers in 1990 through warehouse clubs and superstores. However, this strategy did not last owing to dismal performance.

They then embarked again on selling custom-built computers online to the customers. In 2000, Dell became number one seller of computers in USA surpassing even the Compaq (123HelpMe.com, 2015).Fundamental Reasons for Dell’s Success. Dell computers corporations have the mission to be the most successful computer company in the world at delivering the best customer experience in markets we serve. It was created to operate on a direct selling model where customers are to order for their computers online and then the computer is custom-made according to the needs of the customer (Saunders, 2009).

Dell’s success is majorly attributed to the better management of its supply chain. Dell applies the best expertise to process customers’ orders and supply it at the fastest speed possible. Where the rivals take weeks, Dell takes only hours to supply the products to its customers. Dell has adopted as one of its strategies, the shortest supply chain. Dell purpose to minimize the involvement of middlemen as a way of minimizing time they take to get products to customers and as a way of getting directly in touch with the customers.

The company also ventured into customer relationship management (CRM) as a way of staying close to customers. They hire third-party logistics to supply their finished products instead of the middlemen. Supplier of Dell supply raw materials on a just in time basis directly to the production line at shortest time hence contributing to success of the company. Success is in terms reduced costs on setting up a warehouse for inbound raw materials something that Dell acknowledge by giving them awards for the work.

Then there is the use of standardization of production which also contributes to reduction of costs. Next StrategyThis business strategy is however, not very successful in today’s business environment. The model is not appropriate owing to the changing consumer demands. Most customers today prefer to buy computers from retail outlets rather than buying customized products. They prefer to sample different computers from the retail shops than set their preferred programs according to their preference.

In fact, this Dell formula will not be able to work elsewhere especially to foreign countries with no Dell’s subsidiaries. This is because even if the company wanted to supply such customized products to customers, it will still take days to reach them. In fact, most customers especially from the developing countries would rather buy readily available goods from shops than going through the process of online ordering and waiting (Chopra, 2006). Foreign countries will not only take longer time to supply the products but will also require middlemen.