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Essay / Dell Inc. Case Analysis - 1028
Part I: Introduction/Background SummaryIn 1984, Michael Dell invested $1,000 in startup capital to register his company as Dell Computer Corporation, known as from PC's Limited. The company becomes the first in the industry to sell directly to end users, moving beyond the dominant system of using computer resellers to sell mass-produced computers. Dell Computer also pioneered the industry's first thirty-day money-back guarantee. It has become the cornerstone of Dell's commitment to expanding its service offerings, ensuring superior customer satisfaction and delivering the industry's first on-site service program. It also established its first international subsidiary in the United Kingdom and raised $30 million in its IPO. Part II: Identifying the Problem The problem with Dell Inc. was the rapid growth within the company in its early days. Part III: Internal Research and External Factors Dell's strengths centered on listening to customers, responding to their needs, and delivering what the customer wanted. The direct relationship was first through phone calls, then face-to-face interactions and now via the Internet. This allowed them to benefit from real-time feedback from real customers regarding the products and future products they would like to see developed. The company also does not use resellers or retail channels because each computer is made to order, which helps reduce inventory. The direct model allows them to take the pulse of any market and deliver the right technology to the right customers. Dell Inc.'s weakness was cell manufacturing, as their assembled computers shipped five to six days after the order was placed. It's an inconvenience for customers to always send their computer in for repair. First, they find themselves without access to the Internet. Second, it can take days for it to arrive in Austin, Texas, be repaired and returned. The company's opportunities were Dell UK which opened in 1987 and in this country there were many companies selling cheap computers. Dell Inc. strives to build customer and employee loyalty, and that can only come from the highest level of service and high-performance products. Segmentation within the company allows them to measure the efficiency of the company in terms of asset utilization. Dell Inc. evaluates their return on invested capital in each segment, compares it with other segments, and targets the performance of each. This became a great way to identify what needed to happen for them to reach their full potential in each company..