Wait a second!
More handpicked essays just for you.
More handpicked essays just for you.
Economic importance of entrepreneurship
Overview of dell
Economic importance of entrepreneurship
Don’t take our word for it - see why 10 million students trust us with their essay needs.
Recommended: Economic importance of entrepreneurship
Brief Background Summary
How would you like to take a $1,000 investment to start a company and turn it into 41 billion dollars revenue producing enterprise in just twenty years? I’m sure everyone would, but it became a reality for one man, Michael Dell. Michael Dell is the current CEO of Dell, Inc, one of the largest companies in the world. He started this company back in 1984 with just $1,000 at the age of 19 and now at the age of 39 he is the fourth richest man in America. (DuBrin 313) “Mr. Dell became the youngest CEO of a company to have their company ranked in Fortune 500. (Dell Annual Report) Today, Dell Inc. is ranked incredibly number 125.
Dell Inc., which is located at Building 2 One Dell Way, Round Rock, Texas, is one of the premier companies in computer products and services. The company current employs approximately 46,000 people and is the “biggest online seller of computers. Dell’s primary products include enterprise systems, household PCs and notebook computers. They are also currently trying to expand their way into the printer market even further.
He started with the idea of taking plain computers and adding parts to it to make it a more appealing to computers buyers. “Dell hired a small staff and began selling his machines over the phone and through the mail. Several years later he created the industry’s first on-site service program, in which the repair technician visits your office or home.” (DuBrin 313)
Problem Identification
In creating a multi-billion dollar company there were issues and problems that had to be identified and made. In being such a rapid growing company, Mr. Dell had to fill up his company with top professionals and visionaries that could continue the success. The company needed to find ways to stay competitive and stay focused on their vision. For a company to stay growing at the pace they were, which was about 50 percent a year in the 90’s, it needed to continue to add strong employees and keep the motivation going.
In the computer market there are a lot of competitors, just waiting for someone to make a mistake. The fight over market share is very competitive. Dell needs to stay very aware of their business competition and what they are doing. I think that Dell has done very well picking up most of the trends and consumer needs to come out with new ideas, to stay on top.
Sir Steve Jobs, the almighty co-founder of Apple started apple dreaming big. The Harvard College dropout carried through with that dream. According to Leander Kahney, author of “Inside Steve’s Brain,” “apple went public 1980 with the biggest public offering since 1958” (2008), this offer proved successful as apple soon became a super power. Apple suffered a fall out though, but Steve Jobs came back and rescued them, reviving them to their previous stature.
Why has Dell been so successful despite the low average profitability in the PC industry?
These targets put pressure on the executives of these large companies, who in turn put pressure on their employees and cause a “trickle down effect” where the motivation for the company is to meet these obscure targets (huge earnings numbers), because then their public company will stack up higher when compared to other companies like their own. One thing that Stephen Richards emphasized in his letter was how Computer Associates International “was among the most aggressive in its pursuit of goals,” therefore exerting immense pressure to excel on the employees, especially the executives. While CA was one of the first computer software companies of its time, in the 1980s and
1. How and why did the personal computer industry come to have such low average profitability?
In 1984, Michael Dell invested $1,000 in start-up capital to register his business as Dell Computer Corporation, which was known as PC's Limited. The company becomes the first in the industry to sell directly to end-users by passing the dominant system of using computers resellers to sell mass-produced computers. Dell Computer also pioneers the industry first thirty-day money back guarantee. It became the cornerstone of Dell's commitment to expand its service offerings, superior customer satisfaction, and the industries first on site service program. It also established its first international subsidiary in the United Kingdom, and raised $30 million in its initial public offering.
Speaking about the business model of Dell, it has ability to remain on the higher end of the scale for a particular time period. Dell has business model, which primarily focuses on direct selling line of attack. It in a straight line supplies the PCs to the regulars. It does not believe in intermediary, retailers for the business practices. Undeniably, this gives them an edge to serve customer well. Nevertheless, it understood the importance of retailers and start offering products on the premises of retailers, such as Wal-Mart, Sam’s Club and so on. Next, Dell administration is certain of the exclusive business of PCs. As time goes on, however, observing the
My report is on the company Hewlett – Packard (HP) which was founded in 1939. I mainly focused on the Personal Systems Group (PSG): business and consumers PCs mobile computing devices and workstations which is one of the major industries of HP. In order to succeed in the business industry a company needs to understand its customer’s needs and create wants for them. HP found out that the customer needed light weight, useful notebook PCs through its Research & Development (R&D) centre. Hence, it created a want; a New Commercial Notebook PC Compaq Evo Notebook N1015v which packs the power and performance necessary for mobility into a stylish design for only $899(US $). HP also finds out about its customer needs through online feedback forms and survey. Via that, HP was also able to understand that not everyone are able to use their products hence it has created this HP accessibility products which can be accessed by anyone including people with disabilities and age – limitations. Example of such product under the PSG industry is the Mobile Speak Pocket which was specially made for the visually impaired people. ( Refer To Exhibit 1a – 1c )
Dell Inc, was founded as “PC’s Limited” in 1984 by Michael Dell, while still a student at the University of Texas at Austin, with just $1000. From Michael Dell's off-campus dorm room at Dobie Center, the startup aimed to sell IBM-compatible computers built from stock components. Michael Dell started trading in the belief that by selling personal computer systems directly to customers, PC's Limited could better understand customers' needs and provide the most effective computing solutions to meet those needs. In that year, the company became the first in the industry to sell custom-built computers directly to end-users, bypassing the dominant system of using computer resellers to sell mass-produced computers.
Michael Dell founded the company Dell to offer network servers, workstations, storage systems, Ethernet switches, desktops, and notebook PCs after successfully selling his computers to customers directly in Texas. Over the course of three years his sales volume warranted the opening of an international sales office in 1987. In 1988 he began selling to large customers including several government agencies and Dell became a publicly traded company.
To transform a good company to great company is all manages’ dream, but only few of them make it. To find out the core factors which lead to a good company became a great company is very difficult, because in different era, different industry companies face different opportunities and threats. To begin the research for the Good-to-Great study, Jim Collins and his research team searched for companies that: performed at or below the general stock market for at least fifteen years; then at a transition point began to pull away from the competition, and sustained returns of at least 3 times the general market for the next fifteen years. He started with a list of 1,435 companies and found eleven that met his criteria. These eleven companies produced, on average, a return of 6.9 times the general stock market during the 15 years following the transition points. Collins chose a 15-year span to avoid "one-hit wonders" and lucky breaks. In the book, Collins highlights some important factors which are the result of the research. They are level 5 leadership, fist who … then what, confront the brutal facts, the hedgehog concept, culture of discipline, and technology accelerators, (Collins, 2001, p.12).
"Before Silicon Graphics, Clark said a fortune of $10 million would make him happy; before Netscape, $100 million; before Healtheon, a billion; now, he told Lewis, 'Once I have more money than Larry Ellison, I'll be satisfied.' Ellison, the founder of the software company Oracle, is worth $13 billion."
Dell’s initial competitive strategy, when it was founded in 1984 by Michael Dell, was to focus mainly on differentiation. Its strategy was to sell customised personal computer systems directly to customers, which was a rapidly emerging market at that time (1). This was done by targeting second-time customers, those that already understand computers and know what they wanted. Meanwhile other companies at the time was selling “’plain brown wrapper’ computers” (2). By offering customisations, Dell gained a better understanding of customers’ needs and wants. This helped the organisation position itself differently against the more popular brands, such as Compaq and IBM.
Dell Inc had very effectively used the direct marketing channel for the sales of computers to the end consumer. When all the other pc makers were selling through retailers and distributors, Dell had started efficient use of the direct channels.
Management Efficiency: During the 80s, the company’s refocus to manufacturing quality and technical leadership and profits reinvestments in R&D, state-of-the-art manufacturing, and supply chain activities helped the company to grow in a great extend. This management vision was not only upgraded the company’s products to compete in the high-tech electronics industry but also gave foundations of its global brand awareness.
“The Dell Theory of Conflict Prevention,” is a theory that is approved by multiple famous authors. The theories main points are valuable and the theory should be looked upon more seriously. In Thomas Friedman’s essay, “The Dell Theory of Conflict Prevention,” he gives examples of how global supply chains would be constructive to promoting world peace. Friedman feels that if everyone is an ally to each other in some shape or form, then no one will want to engage in war. Madeline Albright would agree with Friedman’s theory according to her writings in “Faith and Diplomacy.” Albright felt that religion should play a factor in the diplomatic system of America, in order for us to maintain some kind of peace with other nations. Friedman and Albright both were looking for a solution to world peace. Albright would agree with this theory from the religious perspective. Appiah argued that an ideal global citizen would be essential to America, in his essays “Making conversation” and “The Primacy of Practice.” Appiah felt that people must have an understanding of each other in order to get along with each other. Both Appiah and Albright would agree with “The Dell Theory of Conflict Prevention.” “The Dell Theory stipulates: No two countries that are both part of a major global supply chain, like Dell’s, will ever fight a war against each other as long as they are both part of the same global supply chain”(Friedman 125).