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Dell: Selling Directly, Globally (2007)  
 
Product Ref: 07/348C Company: Dell
Hewlett-Packard
Lenovo

Product Type: Case Industry: Technology Hardware

Related Product(s): Teaching Note
Authors: Ali Farhoomand   Iris Wang   Pauline Ng
On 31 January 2007, Dell Inc. announced the return of Michael Dell, its founder, to the position of CEO, replacing Kevin Rollins in providing day-to-day leadership to the troubled PC maker. The radical decision came after a turbulent year that saw a sharp decline in both market share and profitability, and which ended with Dell losing its leading position in the industry to Hewlett-Packard, from which it took in 2003. Once a high-flying success case with its revolutionary direct business-to-customer model, Dell was now facing an obvious challenge in turning itself around. This is a management strategy case concerned with the applicability of the direct business-to-customer model in global expansion, further complicated by changing industry dynamics. The application of the model is dependent on many factors that are outside the control of the company. The combined effect of these factors¡Xsuch as physical infrastructure, telecommunications infrastructure, political climate, transportation networks, availability of suitable staff¡Xdetermines the market readiness of the country concerned. Meanwhile, the changing market conditions, such as consumer purchasing patterns and market growth patterns, may also impair the effectiveness of the model. The test is whether Dell can successfully apply its direct model in other markets with different social and economic contexts, notably China. In addition, should Dell unswervingly adhere to the direct model in the face of shifting market conditions, globally and regionally? What are the strategies it should develop to conquer the world¡¦s second-largest PC market¡XChina?
Functional Area : Marketing
Strategy & General Management

Issues: Dell, Lenovo, Hewlett-Packard, PC, China, Business Model, Direct Model, Competitive Advantage, Business-to-Customer
Length: Text: 13 pages
Exhibits: 12 pages
Country: China (People's Rep. of)

Pub. Year: 2007 Level of Difficulty: 2
         
This product type is available in the following language(s):      English
         
Related Information: N/A
 
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