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Case Study: DELL & Cisco  Team 6  04/25/05 Arsalan A. Lodhi Pankaj Luthra Daniel M. Li
DELL Inc – Company Profile ,[object Object],[object Object],[object Object],Splits:10-Apr-92 [3:2], 30-Oct-95 [2:1], 09-Dec-96 [2:1], 28-Jul-97 [2:1], 09-Mar-98 [2:1], 08-Sep-98 [2:1], 08-Mar-99 [2:1] 12.00 – 33.50 1990-1991 77.37 – 61.88 (2:1 stock split on 10/95) 1995-1996 44.06 – 28.50 2000-2001 35.50 – 39.16 2004-2005 Stock Price Range Year
DELL Inc - TIMELINE 1983-- Michael Dell starts business of pre-formatting IBM PC HD’s on  weekends 1985-- $6 million  sales, upgrading IBM compatibles for local businesses 1986-- $70 million  sales; focus on assembling own line of PC’s 1990-- $500 million  sales; with an extensive line of products 1996-- Dell goes online; $1 million per day in online sales;  $5.3B  in annual sales 1997--   Dell online sales at $3 million per day; 50% growth rate for 3 rd   consecutive year,  $7.8B  in total annual sales. 2005-- $49.2B  in sales
DELL Inc – Company Comparison 341 32,600 329,001 151,000 55,200 Employees: 6.20% -2.20% 8.00% 9.40% 18.70% Rev. Growth (ttm): 116.36M 11.20B 96.95B 81.85B 49.21B Revenue (ttm): -153.00K 645.00M 8.25B 3.50B 3.04B Net Income (ttm): 23.94% 40.88% 37.42% 23.87% 18.32% Gross Margins (ttm): 112.93M 11.79B 121.16B 60.17B 89.29B Market Cap: Industry SUNW IBM HPQ DELL DIRECT COMPETITOR COMPARISON ,[object Object],[object Object],[object Object],[object Object]
DELL Inc – The Success Secret ,[object Object],[object Object],[object Object],[object Object],[object Object],[object Object]
Dell Inc – The Success Secret ,[object Object],[object Object],[object Object],[object Object],[object Object]
DELL INC – Same Business Model applicable to other Industries? ,[object Object],[object Object]
Dell Inc – Key Questions ,[object Object],[object Object]
Dell Inc – Boundaries of Direct Business Model ? ,[object Object],[object Object],[object Object],[object Object],[object Object],[object Object],[object Object],[object Object],[object Object]
DELL Inc – Information Orientation ,[object Object],[object Object],[object Object],[object Object],[object Object],[object Object],[object Object],[object Object],[object Object],[object Object]
Cisco Systems, Inc – Company Profile ,[object Object],[object Object],[object Object],Splits:18-Mar-91 [2:1], 23-Mar-92 [2:1], 22-Mar-93 [2:1], 21-Mar-94 [2:1], 20-Feb-96 [2:1], 17-Dec-97 [3:2], 16-Sep-98 [3:2], 22-Jun-99 [2:1], 23-Mar-00 [2:1] 23.75 – 68.00 1990-1991 63.63 – 92.87 1997-1998 109.94 – 18.45 2000-2001 24.36 – 17.50 2004-2005 Stock Price Range Year
Cisco Systems, Inc - Timeline 1984-- Founded by Len Bosack & Sandy Lerner (computer scientists from Stanford) 1989-- $27M  sales with only 3 products and 111 employees 1990-- $69M  sales; goes public with market cap of $224M 1994-- $1.13B  sales; Cisco goes online with its  Cisco Connection Online  and  becomes the first major supplier of Multiprotocol internetworking products to be  awarded ISO 9001 certification 1997-- Cisco reorganizes/aligns products and solutions into 3 customer  segments: enterprise, small/medium business, and service provider. 1998--   Cisco becomes the first company in history to achieve a market capitalization of  $100B in 14 years.  $8.5B  in total annual sales. 2000-- $18.9B  in sales 2001-- $22.3B  in sales 2005-- $23.6B  in sales
Cisco Systems, Inc
Cisco Systems, Inc – Company Comparison 248 35,160 2,948 1,925 34,000 Employees: 12.90% -3.60% 90.50% -25.10% 16.80% Rev. Growth (ttm): 61.74M 10.48B 1.56B 657.95M 23.58B Revenue (ttm): -690.00K 305.00M 177.64M -156.22M 5.39B Net Income (ttm): 39.69% 41.30% 69.27% 37.70% 67.82% Gross Margins (ttm): 101.10M 11.44B 12.30B 1.20B 112.67B Market Cap: Industry NT JNPR COMS CSCO DIRECT COMPETITOR COMPARISON ,[object Object],[object Object],[object Object],[object Object],[object Object]
Cisco Systems, Inc – Success? ,[object Object],[object Object],[object Object],[object Object],[object Object],[object Object],[object Object],[object Object],[object Object],[object Object],[object Object],[object Object]
Cisco Systems, Inc – Information Orientation ,[object Object],[object Object],[object Object],[object Object],[object Object],[object Object],[object Object],[object Object],[object Object],[object Object],[object Object]

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Dell merged

  • 1. Case Study: DELL & Cisco Team 6 04/25/05 Arsalan A. Lodhi Pankaj Luthra Daniel M. Li
  • 2.
  • 3. DELL Inc - TIMELINE 1983-- Michael Dell starts business of pre-formatting IBM PC HD’s on weekends 1985-- $6 million sales, upgrading IBM compatibles for local businesses 1986-- $70 million sales; focus on assembling own line of PC’s 1990-- $500 million sales; with an extensive line of products 1996-- Dell goes online; $1 million per day in online sales; $5.3B in annual sales 1997-- Dell online sales at $3 million per day; 50% growth rate for 3 rd consecutive year, $7.8B in total annual sales. 2005-- $49.2B in sales
  • 4.
  • 5.
  • 6.
  • 7.
  • 8.
  • 9.
  • 10.
  • 11.
  • 12. Cisco Systems, Inc - Timeline 1984-- Founded by Len Bosack & Sandy Lerner (computer scientists from Stanford) 1989-- $27M sales with only 3 products and 111 employees 1990-- $69M sales; goes public with market cap of $224M 1994-- $1.13B sales; Cisco goes online with its Cisco Connection Online and becomes the first major supplier of Multiprotocol internetworking products to be awarded ISO 9001 certification 1997-- Cisco reorganizes/aligns products and solutions into 3 customer segments: enterprise, small/medium business, and service provider. 1998-- Cisco becomes the first company in history to achieve a market capitalization of $100B in 14 years. $8.5B in total annual sales. 2000-- $18.9B in sales 2001-- $22.3B in sales 2005-- $23.6B in sales
  • 14.
  • 15.
  • 16.