You are on page 1of 36

STARTEGIC MANAGEMENT PROCESS OF DELL COMPANY

The word strategy comes from a Greek word strateos means general thing. In business the term strategy is used to describe how an organization is going to achieve its overall objectives. Mostly it is concerned with decided alternatives are to be adopted for accomplishment of overall objectives of the organization. Strategy is a plan of action or policy designed to achieve major or overall aims. Mission statement describes what the organization is now, what it wants to become and how you are going to achieve it. Vision statement states what do we want to be. Strategic Management is a process involving number of stages from strategy formulation of strategy is not enough it has to implemented properly as well as evaluated to implemented properly as well as evaluated to review the performance. Direct Business Model is the foundation for Dells business. Dell maintains a consistent focus on offering the best value and customer. Dell is a trusted technology innovator with a diversified, comprehensive IT portfolio. Dell is a global company committed to its customers and employees. In January 2009, Dell announced that they will withdraw all manufacturing from Limerick and move it to its new plant in the Polish city of Lodz by January 2010. Raised their cost-reduction target to $4 billion. Dell also announced that it aimed to become a "one percent company," giving away 1 % of pre tax profits to education and digital inclusion projects mainly in emerging markets, by February 2010. Mission statement of Dell company is To provide customers with superb value, high quality, relevant technology, systems, superior service and support and products and services that are easy to purchase and use. Vision statement of Dell company is The direct relationship continues throughout the customer experience Dell company thinking that strategic provides the foundation of the strategic management. By providing an insight into the forces behind the intense competition, by
S.I.E.S COLLEGE OF COMMERCE AND ECONOMICS, SION 1

STARTEGIC MANAGEMENT PROCESS OF DELL COMPANY developing a sustaining competitive advantage based on organization core competency. It can be broadly divided into three phases:

Phase 1: Strategic Formulation Phase 2: Strategic Implementation Phase 3 : Strategic Evaluation And Control

The first step adopted by Dell Corporation was to frame the mission and objectives for the organization. After setting the mission and objectives the next step is to analyses the internal environment. The management conducts the analyses of the external environment and also conducts gap analyses. Then they frame alternative strategies and accomplish the objectives of the firm. Once the strategies are formulated by the Dell company the next stage is strategic implementation. The stages are Formulation of plans, programs and projects, Project implementation, Procedural implementation, Resources and allocation, Structural

implementation, Functional implementation, Behavioral implementation. In next phase the manager tries to assume that the strategic choice is properly implemented and is meeting the objective of the organization. The company designs and customizes products and services to the requirements of the organizations and individuals, and sells an extensive selection of peripheral hardware and computing software.

S.I.E.S COLLEGE OF COMMERCE AND ECONOMICS, SION

STARTEGIC MANAGEMENT PROCESS OF DELL COMPANY

PURPOSE OF THE STUDY:The basic purpose behind the study was to get detailed knowledge about the Strategic Management of Dell Company. The study was basically aimed to know more about the Introduction, History, Key towards strategic planning, Strategic Formulation, Strategic Implementation and Strategic Evaluation And Control of Dell Company.

OBJECTIVES OF THE STUDY: To study about Strategic Management of Dell Company. To study about process of Dell Company. To study about Key towards strategic planning Dell Company. To study about Tools of strategy evaluation. To study about challenges and importance of strategic management. To study about the various stages of strategic management.

S.I.E.S COLLEGE OF COMMERCE AND ECONOMICS, SION

STARTEGIC MANAGEMENT PROCESS OF DELL COMPANY

RESEARCH METHODOLOGY:-

SECONDARY DATA

LIMITATIONS:-

Primary data is not collected.


Find very difficult to collect information on strategic management process of particular firm.

S.I.E.S COLLEGE OF COMMERCE AND ECONOMICS, SION

STARTEGIC MANAGEMENT PROCESS OF DELL COMPANY

CHAPTER 1: STRATEGIC MANAGEMENT 1.1 INTRODUCTION TO STRATEGY


Meaning:The word strategy comes from a Greek word strateos means general thing. In business the term strategy is used to describe how an organization is going to achieve its overall objectives. Mostly it is concerned with decided alternatives are to be adopted for accomplishment of overall objectives of the organization.

Definition:Strategy is a plan of action or policy designed to achieve major or overall aims Strategy is a unified, comprehensive and integrated plan that relates strategic advantages of the business to the challenges of the environment. It is designed to ensure that basic objective of the organization are achieved through proper execution.

1.2 mission, vision and objectives


Mission:A every organization has to defined the basic reason for its existence in terms of mission statement. It is the statement which states the basic purpose of the organizational philosophy means the value, beliefs and the guidelines under which the organization would conduct its business. Mission statement describes what the organization is now, what it wants to become and how you are going to achieve it. It is the first indicator of how an organization look at its stakeholders. All strategic decisions flow from corporate mission statement. Typically mission
S.I.E.S COLLEGE OF COMMERCE AND ECONOMICS, SION 5

STARTEGIC MANAGEMENT PROCESS OF DELL COMPANY statement defines the business of the organization, states the vision and also specifies important organizational values.

Vision:Some business prepare only the mission statement but some develop mission as well as vision statement. Experts say that there are difference between mission and vision statements. Some experts and authors are of the opinion that mission statement states what is our business (present or current position). On the other had vision statement states what do we want to be (future status or position). Many organisation frame mission as well as vision statement saying that there are difference in them.

Objectives:Objectives are the end which the organization intends to achieve through its existence and operations. Organizational objectives vary from organization to organization. Generally objectives and goals are

considered to be same but there are slight difference between them. The objectives are broad aims where as goals are more specific in nature. In other words when objectives are divided in to sub objectives they are called as goals. Ex, The objectives they are called as goals but the goal may be to increase market share but the goal may be to increase a market share of a brand by 10% during the current year.

S.I.E.S COLLEGE OF COMMERCE AND ECONOMICS, SION

STARTEGIC MANAGEMENT PROCESS OF DELL COMPANY

1.3 introduction to strategic management

Meaning:Strategic Management is a process involving number of stages from strategy formulation of strategy is not enough it has to implemented properly as well as evaluated to implemented properly as well as evaluated to review the performance.

Definitions:Strategic management can be defined as:1. Strategic Management is a continous process of formulating, implementing and evaluating the strategies that are framed to enable the organization to achieve its objectives. 2. Strategic management is a stream of decisions and action that lead to development of effective strategies to help, achieve, corporate objectives. It is the way in which strategist determines the objectives and take strategic decisions. 3. Strategic Management focuses on integrating various functions like production, finance, marketing to achieve organizational objectives.

S.I.E.S COLLEGE OF COMMERCE AND ECONOMICS, SION

STARTEGIC MANAGEMENT PROCESS OF DELL COMPANY

1.4 CHARACTERISTICS/FEATURES OF STRATEGIC MANAGEMENT

Systematic Process Multiple decision Making


Relates to the Environment

Universal Applicability

Features Of Strategic Management

Focus on objectives

Long term Planning

Top Manageme nt Function

1) Systematic Process:- Strategic management is a systematic process of framing,


implementing and evaluating. This process is to be followed in all areas of the business.

2) Relates to the Environment :- Strategies are framed after taking in to consideration


the internal and external environment of the business. It is to be considered not only while framing but also while implementing the strategies. Strategies may be modified according to the changes in the environment.

3) Focus on objectives: The main focus of strategic management is to achieve


organizational objectives. The whole process is carried on for achievement of these objective only.

S.I.E.S COLLEGE OF COMMERCE AND ECONOMICS, SION

STARTEGIC MANAGEMENT PROCESS OF DELL COMPANY

4) Top Management Function :- Decision regarding strategic management are taken


by top management only. Lower level management may be given a chance to give their opinions but the final decision is taken by top management only.

5) Long term Planning :- Strategic Management is concerned with long term planning.
It aims at achievement of long term objectives. Therefore short term objectives are automatically taken care of.

6) Universal Applicability :- Strategic management is applicable to all types of


business. This is because all organizations need to frame and implement strategies for their survival and growth.

7) Multiple decision Making:- The process of strategic management involves taking a


number of decisions like i) ii) iii) iv) v) vi) Study of internal and external environment Setting of objectives Formulation of strategies Organization and allocation of resources Implementation of strategies Strategy evaluation and control

S.I.E.S COLLEGE OF COMMERCE AND ECONOMICS, SION

STARTEGIC MANAGEMENT PROCESS OF DELL COMPANY

1.5 IMPORTANCE OF STRATEGIC MANAGEMENT


A well-formulated strategy can bring various benefits to the organization in present as well as in future. 1. Strategic management takes into account the future and anticipates for it. 2. A strategy is made on rational and logical manner, thus its efficiency and its success are ensured. 3. Strategic management reduces frustration because it has been planned in such a way that it follows a procedure. 4. It brings growth in the organization because it seeks opportunities. 5. With strategic management organizations can avoid helter & skelter and they can work directionally. 6. Strategic management also adds to the reputation of the organization because of consistency that results from organizations success. 7. Often companies draw to a close because of lack of proper strategy to run it. With strategic management companies can foresee the events in future and thats why they can remain stable in the market. 8. Strategic management looks at the threats present in the external environment and thus companies can either work to get rid of them or else neutralizes the threats in such a way that they become an opportunity for their success. 9. Strategic management focuses on proactive approach which enables organization to grasp every opportunity that is available in the market.

S.I.E.S COLLEGE OF COMMERCE AND ECONOMICS, SION

10

STARTEGIC MANAGEMENT PROCESS OF DELL COMPANY

1.6 challenges to strategic management


Through the general introduction, we know that strategic management includes three aspects which are strategic planning, strategic implementation and control of the 20 strategy in an organization. Almost all the modern organizations have tried strategic management to make sure that they can reach the expected level of performance. However, there are still many challenges for strategic management in the modern business society.

Orientation For Globalization

Motive For CSR And Ethics

Emerging Ecommerce And Internet Culture

Challenges To Strategic Management


Active Pressure Group Cut Throat Competition

Diversification

1. Orientation for globalization:Now nearly every business organizations begin to get globalised, step in to global operations with the multi-national corporations or use other foreign business operations methods. Because of the globalization of operations of in business world there are many new orientations coming out, such as international human resource management (IHRM) and
S.I.E.S COLLEGE OF COMMERCE AND ECONOMICS, SION 11

STARTEGIC MANAGEMENT PROCESS OF DELL COMPANY international finance. The process of companys strategic management has to be renovated all the time to deal with these new orientations.

2. Emerging e-commerce and internet culture:With the increasing expansion of internet and the technology, some companies have turned attention to e-commerce where they conduct business with electronic means such as online purchasing, online selling and online advertising. Strategic management process of the business should succeed to change e-commerce motivation into the business process.

3. Cut throat competition:When the globalization, e-commerce and many other changes emerged in the business society, business has become hyper competitive. If you are not using proper competitive strategy, the organization cannot survive any longer. The process of strategic management can help to generate competitive intelligence, foresee the next moves of rivals and build the competitive strategy to defeat competitors in the tough battle.

4. Diversification:With increased uncertainty and the rapid changes in business environment, the business risk has grown up substantially. Companies now engage in diversified operations must diversify the business risk where they focus on more than one business area or industry rather than specializing in one area. The strategic management should be capable of identifying diversification of business opportunities and manage them well.

5. Active pressure group:Under the modern society, there are active pressure groups operating such as environmental activism and consumer protectionism. Therefore strategic management must identify these external pressure groups and understand their concerns.

S.I.E.S COLLEGE OF COMMERCE AND ECONOMICS, SION

12

STARTEGIC MANAGEMENT PROCESS OF DELL COMPANY

6. Motive for Corporate Social Responsibility (CSR) and ethics:Also, the modern business organizations have to possess corporate social responsibility and ethics to attain their corporate reputation so that it can be more competitive in the environment. Strategic management should do researches for possible corporate social responsibility activities and implement those to be in step with expectations of the society.

S.I.E.S COLLEGE OF COMMERCE AND ECONOMICS, SION

13

STARTEGIC MANAGEMENT PROCESS OF DELL COMPANY

CHAPTER 2: ELEMENTS/PROCESS OF STRATEGIC MANAGEMENT

Strategy formulation framing

Strategy implementation

Strategy evaluation and control

The process of strategic management can be divided in to three stages 1) Strategy formulation framing 2) Strategy implementation 3) Strategy evaluation and control

I) STAGE 1: STRATEGY FORMULATION OR FRAMING


Strategy formulation is also referred to as strategic planning. It involves following steps.

Framing mission and objectives Analysis of Internal environment

Analysis of external environment


Framing of alternative strategies Choice of the strategy
S.I.E.S COLLEGE OF COMMERCE AND ECONOMICS, SION 14

STARTEGIC MANAGEMENT PROCESS OF DELL COMPANY 1. Framing mission and objectives:The first step in strategy formulation is to decide mission and objectives of the organization. Mission states the basic purpose and management philosophy. The

objectives are short term goals which the organization wants the achieve through its strategies.

2. Analysis of Internal environment:The internal environment includes physical, financial and human resources,. Before framing the strategies analysis of these resources has to made to know strength and weakness of the organization.

3. Analysis of external environment:External environment includes demand, government policies, competition, availability of technology, suppliers, lenders, etc. Analysis of external environment is to be made to know opportunities and threats.

4. Framing of alternative strategies:After making SWOT analysis management frames strategic alternatives. Every alternative will have some advantages and some disadvantages. Out of these alternatives one or some alternatives may be selected.

5. Choice of the strategy:Organization cannot implement all alternative strategies. It should select the best alternative out of several alternatives. analysis. The organization may undergo cost benefits

S.I.E.S COLLEGE OF COMMERCE AND ECONOMICS, SION

15

STARTEGIC MANAGEMENT PROCESS OF DELL COMPANY

II) STAGE 2: STRATEGY IMPLEMENTATION


Once strategies are formulated the next important step is to implement them properly. This stage generally involves following elements

Formulation of Plans and Programs

Behavioural Implementation

Procedural implementation

Functional Implementation

Resource Allocation

Structural Implementation

1) Formulation of Plans and Programs:After framing strategies small plans are prepared for its implementation. A plan for carrying out the required activities as to be prepared most importantly the time schedule has to be decided.

2) Procedural implementation:The organization must be aware about regulatory framework applicable to it. The regulatory elements that may be applicable are i) Obtaining licenses ii) Capital issue guidelines iii) FEMA regulation iv) Foreign collaboration Regulation
S.I.E.S COLLEGE OF COMMERCE AND ECONOMICS, SION 16

STARTEGIC MANAGEMENT PROCESS OF DELL COMPANY v) Regulation relating to import of technology

3) Resource Allocation:Resource allocation deals with arrangement and allotment of financial, physical and human resources to various activities. The resources have to be allocated depending on importance of activities in which department or division.

4) Structural Implementation :Organization structure is the frame work through which the organization operates. IT involves delegation of authority and work among employees. implement the strategies properly. It is needed to

5) Functional Implementation:It deals with implementation of plans and policies of different functions of business. The top management may communicate the strategy to the functional heads. The functional heads may in turn, frame, plans and policies for their function. Ex, Marketing manger, finance manager, HR manager may frame their own plans consistent with overall plans of the organization.

6) Behavioural Implementation:IT deals with the issues like leadership, corporate culture, social responsibilities taken up by the organization. Culture in the organization does have direct impact on its functioning.

S.I.E.S COLLEGE OF COMMERCE AND ECONOMICS, SION

17

STARTEGIC MANAGEMENT PROCESS OF DELL COMPANY

III)

STAGE 3 : STRATEGY EVALUATION AND CONTROL

Strategies have to be evaluated as well as certain control mechanism have to be in placed to ensure achievement of set objectives. IT generally involves following procedure

Taking corrective actions Calculation of Deviation Comparision of Actual Performance with the standards Measuring the Performance

Setting and Implementing strategy

1) Setting and Implementing strategy:Strategy has to be framed and implemented for achievement of organizational goals and objectives. performance. Such implemented strategy has to be evaluated to check the

2) Measuring the Performance:The actual performance of implemented strategy should be measured. IT may be measured in terms oif quantity, rupee, quality, cost or timing for such measurement the employees may be asked to submit various reports periodically.

3) Comparision of Actual Performance with the standards :The actual performance of the strategy should be compared with set standards. This helps to find out deviation if any.

S.I.E.S COLLEGE OF COMMERCE AND ECONOMICS, SION

18

STARTEGIC MANAGEMENT PROCESS OF DELL COMPANY 4) Calculation of Deviation:After the comparison deviation from set standards can be calculated. If actual performance is at par or better than the standard it is not a major concern. But if it is less than the standard the reasons for the same as well as degree of deviations should be calculated.

5) Taking corrective actions :If actual performance is less than the standard corrective actions have to be taken for overcoming the deviations/ Such action is needed to avoid mistakes in future and improve the performance.

S.I.E.S COLLEGE OF COMMERCE AND ECONOMICS, SION

19

STARTEGIC MANAGEMENT PROCESS OF DELL COMPANY

CHAPTER 3: TOOLS OF STRATEGY EVALUTION


In the process of strategy evaluation actual performance of the business has to be measured there are various tools or techniques for such measurement

I) FINANCIAL TOLL OR FINANCIAL EVALUATION :Financial evaluation is considered to be the best way to strategy evaluation. This is mainly because it can be expressed in the form of rupee or volume i.e. quantity. In other words financial evaluation cab be quantified easily. following techniques can be used While doing financial evaluation

1) Financial Ratio:
a) Return on investment/Return on Capital Employed :This ratio measures the firms ability to earn operating profits as a return on capital employed or total asset. Return employed= NPBIT x 100 C.E/Total assets This ratio is very important for prospective investors.

b) Earning Per Share :This ratio indicates earnings of on one equity share. It show the profitability of the company available to equity shareholder Earning per share= Profit Available to Equity Shareholder Number of equity share Profit available to equity shareholder is arrived at after deducting preference dividend from net profit after tax. This means dividend is paid to preference

shareholder first and then to equity shareholder. This ratio is also useful for existing and prospective investors.

S.I.E.S COLLEGE OF COMMERCE AND ECONOMICS, SION

20

STARTEGIC MANAGEMENT PROCESS OF DELL COMPANY c) Price Earning Ratio :This ratio compares market price oof the share with the EPS. Market price increases if EPS more. PE ratio = Market price per share EPS Higher ratio indicates that the share is in demand and investors are ready to pay more price for it.

2) Budgets:
Budget is an estimate of activities to be undertaken during decided period of time. It can be for one year or half year or even for a quarter. There are different types of budget that are prepared by an organisation. They can be classified in to two categories. a. Revenue Budget b. Capital Budget

a) Revenue Budget:Budget prepared for operating or day to day activities are called as revenue budgets. They are generally prepared for less than one year. Most common revenue budgets are cash budgets, sales budget, production budget, purchase budget, advertising budget.The most important revenue budget is cash budget. In cash

budget, the requirement of cash during a particular period is calculated. All incomes and expenses in cash during that period are considered while preparing cash budget. It also indicates net cash position of the business at the beginning and at the end of the period. b) Captital Budgets:Budgets preprared for long term activities are called as capital budgets. This activities give benefit for more than one one year. They include purchase of new fixed assets, replacement of old assets with new one, expansion, modernization etc. the techniques like pay back period, net presen value, profitability index, Internal rate of return are used for capital investment proposal.
S.I.E.S COLLEGE OF COMMERCE AND ECONOMICS, SION 21

STARTEGIC MANAGEMENT PROCESS OF DELL COMPANY

II) GAP ANALYSIS:GAP analysis is a business toll enabling a company to compare actual performance with the potential performance. The goal of gap analysis is to identify the gap between optimum allocation of resources and current level of allocation. The gap analysis involves determining documenting and approving the variances between business requirements and current capabilities. The comparison between expected performance and the current performance is called as gap analysis. It is a formal study of what the business is doing currently and where it wants to go in future.

III)

COST BENEFIT ANALYSIS:It calculate cost of the project as well as benefits arising out of it. The process involves calculation of direct as well as indirect expected costs along with total expected benefits. The two are compared with each other to choose the best or most profitable option. This formal process is referred to as cost benefit analysis. The process involves monetary calculation of initial and ongoing expenses verses expected returns. During cost benefit analysis monetary values may be assigned even to non monetary factors like risk. It is mainly used to access the value of money of very large projects private sector organizations make more use of this technique. The practice of cost benefit analysis differs from country to country and even from sector to sector.

IV)

RESPONSIBILITY CENTER:It is a new accounting concept called as responsibility accounting for large diversified organizations. It is impossible to manage centrally. Therefore the activities are decentralized or separated into manageable part. This part or segments are called as responsibility centers. These centre are1) Revenue Centre : A segment that mainly generate cost but no revenue. 2) Cost centre: A segment that generates cost but no revenue. 3) Profit centre: A segment that generates both revenue and cost.

S.I.E.S COLLEGE OF COMMERCE AND ECONOMICS, SION

22

STARTEGIC MANAGEMENT PROCESS OF DELL COMPANY 4) Investment centre: A segment which takes care as acquisition and utilization of assets. This approach allows to assign the responsibility to sector manager that control activities under that centre.

S.I.E.S COLLEGE OF COMMERCE AND ECONOMICS, SION

23

STARTEGIC MANAGEMENT PROCESS OF DELL COMPANY

CHAPTER 4: STRATEGIC MANAGEMENT OF DELL 4.1 INTRODUCTION


Founded in 1984 by Michael Dell. No.1 PC provider in the U.S. and No.2worldwide. Based in Round Rock, Texas. Employs more than 82,700 people worldwide. Grew during the 1980s and 1990s to become a brand. Direct Business Model is the foundation for Dells business. Dell maintains a consistent focus on offering the best value and customer. Dell is a trusted technology innovator with a diversified, comprehensive IT portfolio. Dell is a global company committed to its customers and employees.

4.2 HISTORY
In 1996, Dell began selling computers via its web site. Introduced the 316LT, the companys first notebook computer in 1989. Joined the top-five computer system makers worldwide in 1993. Earning appr. $1 million per day 7 months after the launch of dell.com in 1996 Introduced E-Support, an online tool to provide technical support to customers1999. 1999, Dell overtook Compaq to become the largest seller of personal computers in the US. 2007, Dell set a goal of becoming the greenest technology company on Earth for the long term. The company launched a zero-carbon initiative. For the first time, Dell achieves No. 1 ranking in global market share in 2001. 2003, name was changed to "Dell Inc." 2006, Dell purchased the computer hardware manufacturer Alienware. January 2007, started a turnaround plan that promises to yield $3 billion in annual savings over the next three years.
S.I.E.S COLLEGE OF COMMERCE AND ECONOMICS, SION 24

STARTEGIC MANAGEMENT PROCESS OF DELL COMPANY

Recent Developments:
In January 2009, Dell announced that they will withdraw all manufacturing from Limerick and move it to its new plant in the Polish city of Lodz by January 2010. Raised their cost-reduction target to $4 billion. Dell also announced that it aimed to become a "one percent company," giving away 1 % of pretax profits to education and digital inclusion projects mainly in emerging markets, by February 2010. Product line.

S.I.E.S COLLEGE OF COMMERCE AND ECONOMICS, SION

25

STARTEGIC MANAGEMENT PROCESS OF DELL COMPANY

4.3 KEY TOWARDS STRATEGIC PLANNING


VISION STATEMENT:Through effective and strategic community partnership, dell supports educational services programs that address the critical and most basic technology access needs of its neighbours in Dell communities prerequisite to success in digital world. Dell provides a classic example of how the principles of strategic management have been used to translate an innovative vision into a successful and sustainable enterprise. Their vision statement basically tells the way they do their business. They want to be successful in the digital world for this they rely on latest technology. Dell provides quality products to cater the needs of the people. In intend to build good relationship with their customers and suppliers.

MISSION STATEMENT:To provide customers with superb value, high quality, relevant technology, systems, superior service and support and products and services that are easy to purchase and use.

VALUES:Their first priority is to be a successful business and that means investing for growth and balancing short term and long term.

S.I.E.S COLLEGE OF COMMERCE AND ECONOMICS, SION

26

STARTEGIC MANAGEMENT PROCESS OF DELL COMPANY

OBJECTIVES:Following are the objectives of Dell Corporation 1. Modify laptop designs according to students preferences. 2. Double laptop sales in student market. 3. Increase revenues by 25% by the end of the second year of launching. 4. Develop a promotional campaign to promote the modified laptops. 5. Increase awareness of the existent agency project objective research strategicplan conclusion.

GOALS:Goals are the specific interim or the ultimate time based measurement to beachieved. While implementing strategies in pursuit of companies objectives. Thegoal of the organization are set consistent , achievable and realistic. As per surveys the present major goal of the organization is to adopt the best technologyand appoint few more personnel that would bring efficiency in the organization.

PROGRAMS:Last but not the least program plays a significant role in maintaining a smooth track within the

organization. Dell has got an implementation plan followed up by the above strategic plan. The Program of Dell creates opportunities to develop real-world skills in an environment that encourages personal and professional growth and gain exposure. It learns the ins and outs of one of the high-tech industries in the same sector.

S.I.E.S COLLEGE OF COMMERCE AND ECONOMICS, SION

27

STARTEGIC MANAGEMENT PROCESS OF DELL COMPANY

STRATEGY:To do business with its customers one on one through the phone and internet. In doing so, Dell will meet its customers expectations of: Highest quality. Leading technology. Competitive pricing. Individual and companys accountability. Best in class service and support. Flexible customer capacity. Financial stability.

The direct relationship continues throughout the customer experience

S.I.E.S COLLEGE OF COMMERCE AND ECONOMICS, SION

28

STARTEGIC MANAGEMENT PROCESS OF DELL COMPANY

CHAPTER 5: STATEGIC MANAGEMENT PROCESS

Strategic thinking provides the foundation of the strategic management. By providing an insight into the forces behind the intense competition, by developing a sustaining competitive advantage based on organization core competency. It can be broadly divided into three phases:

PHASE 1: STRATEGIC FORMULATION:-

Framing mission objectives


Analysis of the internal environment Analyze of external environment

Gap analyses Framing alternative strategies


Choice of strategies

S.I.E.S COLLEGE OF COMMERCE AND ECONOMICS, SION

29

STARTEGIC MANAGEMENT PROCESS OF DELL COMPANY It is referred as a strategic plan 1. Framing mission objectives:The first step adopted by Dell Corporation was to frame the mission and objectives for the organization. For example mission: The purpose of the organization is to achieve the honor of becoming the best consumer friendly company.

2. Analysis of the internal environment:After setting the mission and objectives the next step is to analyses the internal environment. E.g.: Dell Corporation needs more qualified manpower, machines adopted by Dell Corporation should be highly Resultant.

3. Analyze of external environment:The management conducts the analyses of the external environment. E.g.: Dell Corporation manufactures product that are hygienic and long lasting.

4. Gap analysis:Management also conducts gap analyses that is for this purpose the management compares and analyses its present performance level and desired future performance level. E.g.: Dell Corporation has in acted gap analyses as it compared the last 5yrs.The performance level with the present level and came with a conclusion that in future they will surely come up with the new brand launch.

5. Framing alternative strategies:The management needs to frame alternative strategies and accomplish the objectives of the firm.

6. Choice of strategies:Dell Corporation already has a highly sophisticated server with alternative strategies it chooses the best among the various strategies.

S.I.E.S COLLEGE OF COMMERCE AND ECONOMICS, SION

30

STARTEGIC MANAGEMENT PROCESS OF DELL COMPANY

PHASE 2: STRATEGIC IMPLEMENTATION:The strategies are formulated for each and every functional area. Once the strategies are formulated the next stage is strategic implementation.

Step 1:

Formulation of plans, programs and projects Project implementation Procedural implementation Resources and allocation Structural implementation Functional implementation Behavioral implementation

Step 2:

Step 3:

step 4:

Step 5:

Step 6:

Step 7:

Step 1: Formulation of plans, programs and projects:Setting strategies will not guarantee success, so every organisation also needs to work laboriously in order to achieve the desired results. Dell Corporation has abroad plan which includes the goals, policies and procedures.

Step 2: Project implementation:The project passes through various stages i.e. i. Dell Corporation makes it a point that their concept is achievable.

S.I.E.S COLLEGE OF COMMERCE AND ECONOMICS, SION

31

STARTEGIC MANAGEMENT PROCESS OF DELL COMPANY ii. Their plans are organized in such a way that the results are achieved without any damage or duplications. iii. clean up phase: Dell Corporation follows follow up action of above listed phases.

Step 3: Procedural implementation:Dell Corporation before implementing any new strategies examine all the government regulatory framework. E.g. Dell Corporation before dealing with any foreign company needs to be aware of all the export and import charges.

Step 4: Resources and allocation:It deals with the arrangements and commitment of physical financial and hr, Dell Corporation allocates all its resources in such a way that there is no duplication of work and also aims at avoiding wastage. e.g. it sets different goals for the delegates.

Step 5: Structural implementation:There is a need for an organizational structure for implement strategies. Dell Corporation follows the divisional structure and therefore the implementation strategy moves on division wise.

Step 6: Functional implementation:Dell Corporation as an organization implements all its functional plans and its policies.

Step 7: Behavioral implementation:After implementing the strategy an organization studies the behavior of the strategy. E.g. Dell Corporation studies the impact of its strategies by keeping a small conference meeting with all its divisional heads.

S.I.E.S COLLEGE OF COMMERCE AND ECONOMICS, SION

32

STARTEGIC MANAGEMENT PROCESS OF DELL COMPANY

PHASE 3: STRATEGIC EVALUATION AND CONTROL:It is the phase in which the manager tries to assume that the strategic choice is properly implemented and is meeting the objective of the organization.

Step 1: Setting standards

Step 2: Measurement of performance

Step 3: Finding out deviation

Step 4: Analyzing deviations

Step 5: Taking corrective measures

Step 1: Setting standards:Dell Corporation in order to initiate control is done by setting standards and making them aware of the tolerance limit they should keep. Step 2: Measurement of performance:The next step is to measure the actual performance with the planned one. E.g. the organizational heads compares the set targets with the achieved one. Step 3: Finding out deviation:At this step the organization pin points the deviation or blockages if any. E.g. while implementing a strategy for a new branded product Dell Corporation faced a difficulty as the packaging of that product was done with the help of low quality plastic. Step 4: Analyzing deviations:Here the top executives are the cause of deviations. E.g. Dell Corporation could not procure better spare parts from the company it used to buy earlier. The emotional bonding was the main cause for its dependence of that company providing low quality spare parts. Step 5: Taking corrective measures:The top level management of Dell Corporation will analyze the blockage and give an alternative. E.g. in order to remove the blockage Dell Corporation may replace the low quality spare parts and find out other good quality plastic at the low price.

S.I.E.S COLLEGE OF COMMERCE AND ECONOMICS, SION

33

STARTEGIC MANAGEMENT PROCESS OF DELL COMPANY

CHAPTER 6: CONCLUSION

Dell computer is successful in global markets as a result of best understanding of customers' needs and their direct sell business model. Dell's environmental programs for product for environment have spanned more than a decade. The company designs and customizes products and services to the requirements of the organizations and individuals, and sells an extensive selection of peripheral hardware and computing software. Dell is a well known name in the world that has been very successful towards its mission. It has focused on customization and maintaining low cost that has been very profitable for the company. But are faced with the problem of slipping sales in the U.S. They are being forced to look at alternative ways of bringing revenue to the company and will be able to tackle this situation and would maintain a tight grip on the market due to their cost leadership and because of their coming strategies. asset recovery and product design

S.I.E.S COLLEGE OF COMMERCE AND ECONOMICS, SION

34

STARTEGIC MANAGEMENT PROCESS OF DELL COMPANY

RECOMMENDATIONS
Dells lead in customer service and support has declined in recent years. Declining training and the outsourcing of customer service and support has damaged

its reputation. To rectify this problem, Dell must improve its customer service representatives selection process. Dell must pursue relationships with only those suppliers that are able to integrate seamlessly with Dells supply-chain. This strategy will allow Dell to offer additional choices for its customers while maintaining production efficiencies. There is a stark discrepancy in computer use among ethnicities. Whites and Asians are much more likely to use and own computers than their Black or Hispanic counterparts. This high ownership among Whites and Asians makes it difficult for Dell to grow in this demographic segment. Dell must improve its customer service representatives selection process, ensuring they are easily understood and well trained. By improving this segment of business Dell can once again clearly differentiate itself from rivals HP and IBM.

S.I.E.S COLLEGE OF COMMERCE AND ECONOMICS, SION

35

STARTEGIC MANAGEMENT PROCESS OF DELL COMPANY

bibliography
BOOKS: Strategic management (M.com I) By Manan Prakashan Strategic management (T.Y.BBI) By Arun D Sawant

WEBSITE: http://www.managementstudyguide.com/strategic-management-process.htm http://smallbusiness.chron.com/five-stages-strategic-management-process-18785.html


http://www.scribd.com/doc/51862116/Dell-Strategic-Management

http://www.balancedscorecard.org/BSCResources/StrategicPlanningBasics/tabid/459/Default.a
spx

S.I.E.S COLLEGE OF COMMERCE AND ECONOMICS, SION

36