1. Industry Studies 1
Seminar:
Dell’s distribution departure
Topic Number: 4
2. Overview
In the 1990s Dell was one of the most successful computer
companies in the world, with an annual turnover of $30 billion. It
was a pioneer in its distribution capability and sold its products
directly to consumers. In addition, their supply chain drove
further efficiencies like none other in the industry.
However, Dell has seen a massive declines in recent years, so
much so, that Michael Dell has recently bought the company back
to try and regain their entrepreneurial spirit.
In this seminar, we will initially explore their direct distribution
model and what made them successful. Thereafter, we will look at
their supply chain and how they were able to meet customer
needs more effectively then competitors.
Thereafter, we will look at what has changed in the environment
that has caused their decline and determine the outlook for the
future of Dell.
3. 3
Learning outcomes of this seminar
• Be able to identify key aspects of the original Dell
distribution model that led to their tremendous success
• Critically evaluate and describe the Dell supply chain to
understand what was unique about it that gave them a
competitive advantage
• Determine and describe key environmental changes that
led to Dell’s decline
• Be able to articulate what the outlook is for the future
4. Agenda for this seminar
Describe Dell’s original distribution model
Critically evaluate Dell’s push-pull supply chain strategy
Evaluate and describe the environmental factors that led to Dell’s
decline
Determine what the outlook is for the future
5. Structure for the session
You will have
15 minutes to
discuss each
question
We will have a
de-brief at the
end of each 15
minutes to hear
your thoughts
on each area
Feel free to ask
questions but
please do not
have separate
conversations
‘we are all in
this together’!
6. The importance of operations
Our business is about
technology, yes. But it’s also
about operations and
customer relationships
Michael Dell
7. The background to Dell
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. Michael Dell dropped out
of school in order to focus full-time on
his fledgling business, after getting
about $300,000 in expansion-capital
from his family.
