I. Analysis on Dell Computer's Strategy
1. Pieces of Dell's strategy
1.1 Cost-efficient build-to-order manufacturing
Dell built its computers, workstations, and servers to order; none were produced for inventory.
Dell's build-to-order strategy meant that it had no in-house stock of finished goods inventories and that, unlike competitors using the traditional value chain model, it did not have to wait for resellers to clear out their own inventories before it could push new models into the marketplace-resellers typically operated with 30 to 60 days inventory of prebuilt models.
Dell customers could order customer-equipped servers and workstations based on the needs of their applications. The orders were directed to the nearest factory. At all locations, the company had the capability to assemble PCs, workstations, and servers; typical orders were built and delivered in three to five days.
Its in-house manufacturing delivered about 6% cost advantage versus outsourcing.
1.2 Direct sales strategy
It can be illustrated in the following pictures.
Figure 1. Indirect PC value chain (traditional value chain)
Figure 2. Direct PC value chain: Dell's hardware delivery system
Dell offered competitive prices, high levels of support, and a focus on selling and supporting PCs without the distraction of offering a full line of hardware and services.
? Partnerships with suppliers
Dell partnered with reputable suppliers of PC parts and components in long-term rather than to integrate backward and get into parts and components manufacturing on its own.
? Customer service and technical support
This strategy includes value- ...