About Dell Computer

Dell Computer is a premier provider of products and services required for customers worldwide to build their information-technology and Internet infrastructures. Company revenue for the past year totaled $57 billion. Dell, through its direct business model, designs, manufactures and customizes products and services to customer requirements, and offers an extensive selection of software and peripherals.

Organization

A board of directors of nine people runs the company. Michael Dell, the founder of the company, serves as chairman of the board and chief executive officer. The board of directors usually sets up five committees having oversight over specific matters. These committees include the Audit Committee, which handles accounting issues, including auditing and reporting; the Compensation Committee, which approves compensation for the CEO and other employees of the company; the Finance Committee, which handles financial matters such as proposed mergers and acquisitions; the Governance and Nominating Committee, which handles various corporate matters (including nomination of the board); and the Antitrust Compliance Committee, which attempts to prevent company practices from violating antitrust laws. The corporate structure and management of Dell extends beyond the board of directors. The Dell Global Executive Management Committee sets strategic directions.

Marketing

Dell advertisements have appeared in several types of media including television, the Internet, magazines, catalogs and newspapers. Some of Dell Inc's marketing

strategies include lowering prices at all times of the year, offering free bonus products (such as Dell printers), and offering free shipping in order to encourage more sales and to stave off competitors. In 2006, Dell cut its prices in an effort to maintain its 19.2% market share. However, this also cut profit-margins by more than half, from 8.7 to 4.3 percent. To maintain its low prices, Dell continues to accept most purchases of its products via the Internet and through the telephone network, and to move its customer-care division to India and El Salvador. A Dell advertising campaign for the XPS line of gaming computers featured in print in the September 2006 issue of Wired. It used as a tagline the common term in Internet and gamer slang: "FTW", meaning "For The Win". However, Dell Inc. soon dropped the campaign. In 2007, Dell switched advertising agencies in the US from BBDO to Working Mother Media. In July 2007, Dell released new advertising created by Working Mother to support the Inspiron and XPS lines. Also in 2007, Dell began using the slogan "Yours is here" to say that it customizes computers to fit customers' requirements.

Dell partner program

In late 2007, Dell Inc. announced that it planned to expand its program to valueadded resellers (VARs), giving it the official name of "Dell Partner Direct" and a new Website.

Criticisms of marketing of laptop security In 2008, Dell received press coverage over its claim of having the world's most secure laptops, specifically, its Latitude D630 and Latitude D830. At Lenovo's request, the (U.S.) National Advertising Division (NAD) evaluated the claim, and reported that Dell did not have enough evidence to support it.

Retail In the early 1990s, Dell sold its products through Best Buy, Costco and Sam's Club stores in the United States. Dell stopped this practice in 1994, citing low profit-margins on the business. In 2003, Dell briefly sold products in Sears stores in the U.S. In 2007, Dell started shipping its products to major retailers in the U.S. once again, starting with Sam's Club and Wal-Mart. Staples, the largest office-supply retailer in the U.S., and Best Buy, the largest electronics retailer in the U.S., became Dell retail partners later that same year. Starting in 2002, Dell opened kiosk locations in shopping malls across the United States in order to give personal service to customers who preferred this method of shopping to using the Internet or the telephone-system. Despite the added expense, prices at the kiosks match or beat prices available through other retail channels. Starting in 2005, Dell expanded kiosk locations to include shopping malls across Australia, Canada, Singapore and Hong Kong. On January 30, 2008, Dell shut down all 140 kiosks in the U.S. due to expansion into retail stores. By June 3, 2010, Dell had also shut down all of its mall kiosks in Australia.

Dell first opened their retail stores in India. The U.S. computer maker got serious in India only a few years ago -- and then proceeded to thrash HP and everyone else. Now India is Dell's fastest-growing market, with 55% growth. In the U.S., Dell originally became a market leader through its online and direct madeto-order sales model. When the computer maker decided to enter India, however, it needed a change of strategy.

Case Study: Supply Chain Management at Dell, Dell's Direct Model

Dells direct contact with customers allows it to:

properly identify market segments, analyze the requirements and profitability of each segment, and develop more accurate demand forecasts.

Dell matches supply and demand because its customers order computer configurations over the phone or online (Internet). These computer configurations are built up from components that are available. Dells strategy is to provide customised, low cost, and quality computers that are delivered on time. Dell successfully implemented this strategy through its efficient manufacturing operations, better supply chain management and direct sales model. Dell takes orders directly from its customers; either on phone or online. Thus, Dell reduces the cost of intermediaries that would otherwise add up to the total cost of PC for the customer. Dell also saves time on processing orders that other companies normally incur in their sales and distribution system. Moreover, by directly dealing with the customer Dell gets a clearer indication of market trends. This helps Dell to plan for future besides better managing its supply chain. Another advantage Dell gets by directly dealing with the customer is that it is able to get the customers requirements regarding software to be loaded. Dell loads the ordered software in its plant itself before dispatching it. By eliminating the need of a PC support engineer to load software, the customers gain both in time and cost. They can use the PCs the moment they arrive. More soon....

Competition
Dell's major competitors include HewlettPackard (HP), Acer, Toshiba, Gateway, Sony, Asus, Lenovo, IBM, Samsung,Apple and Sun Microsystems. Dell and its subsidiary, Alienware, compete in the enthusiast market against AVADirect,Falcon Northwest, VoodooPC (a subsidiary of HP), and other manufacturers. In the second quarter of 2006, Dell had between 18% and 19% share of the worldwide personal computer market, compared to HP with roughly 15%. In late 2006, Dell lost its lead in the PC-business to Hewlett-Packard. Both Gartner and IDC estimated that in the third quarter of 2006, HP shipped more units[dead link] worldwide than Dell did. Dell's 3.6% growth paled in comparison to HP's 15% growth during the same period. The problem got worse in the fourth quarter, when Gartnerestimated that Dell PC shipments declined 8.9% (versus HP's 23.9% growth). As a result, at the end of 2006 Dell's overall PC market-share stood at 13.9% (versus HP's 17.4%). IDC reported that Dell lost more server market share than any of the top four competitors in that arena. IDC's Q4 2006 estimates show Dell's share of the server market at 8.1%, down from 9.5% in the previous year. This represents a 8.8% loss year-over-year, primarily to competitors EMC and IBM.[69] In 2011, The Brand Trust Report, India study revealed that Dell is ranked as the 27th most trusted brand as compared to Samsung which stood at 5th and HP which ranked 23[70]

Criticism
See also: Lawsuits involving Dell Inc. In the 1990s, Dell switched from using primarily ATX motherboards and PSU to using boards and power-supplies with mechanically identical but differently wired connectors. This meant customers wishing to upgrade their hardware would have to replace parts with scarce Dell-compatible parts instead of commonly available parts. However, company practice in this respect changed in 2003.[88][89] In 2005, complaints about Dell more than doubled to 1,533, after earnings grew 52% that year.[90] In 2006, Dell acknowledged that it had problems with customer service. Issues included calltransfers[91] of more than 45% of calls and long wait-times. Dell's blog detailed the response: "We're spending more than a $100 million and a lot of blood, sweat and tears of talented people to fix this."[92] Later in the year, the company increased its spending on customer service to $150 million.[93] Despite significant investment in this space, Dell continues to face public scrutiny with even the company's own website littered with complaints regarding the issue escalation process. [94] On August 17, 2007, Dell Inc. announced that after an internal investigation into its accounting practices it would restate and reduce earnings from 2003 through to the first quarter of 2007 by a total amount of between $50 million and $150 million, or 2 cents to 7 cents per share.[95] The investigation, begun in November 2006, resulted from concerns raised by the U.S. Securities and Exchange Commission over some documents and information that Dell Inc. had submitted.[96] It was alleged that Dell had not disclosed large exclusivity payments received from Intel for agreeing not to buy processors from a rival manufacturer. In 2010 Dell finally paid $100 million to settle the SEC's charges of fraud. Michael Dell and other executives also paid penalties and suffered other sanctions, without admitting or denying the charges.[97] In July 2009, Dell apologized after the firm offered its Latitude E4300 notebook at NT$18,558 (US$580), 70% lower than usual price of NT$60,900 (US$1900) in its Taiwan website. The firm withdrew orders and offered a voucher of up to NT$20,000 (US$625) a customer in compensation. The consumer rights authorities in Taiwan fined Dell NT$1 million (US$31250) for customer rights infringements. Many consumers sued the firm for the unfair compensation. A court in southern Taiwan ordered the firm to deliver 18 laptops and 76 flat-panel monitors to 31 consumers for NT$490,000 (US$15,120), less than a third of the normal price.[98] The court said the event could hardly be regarded as mistakes, as the prestigious firm said the company mispriced its products twice in Taiwanese website within 3 weeks.[99]

lawsuits involving Dell Inc..

In 1997 Hkan Lans sued Dell for infringement of his color-graphics display patent, U.S. patent no. 4,303,986.[1] Dell won the case because Lans did not have any ownership interest in the patent, having assigned it to a corporation that he owned.

In 2005, Dell began the construction of a facility in Winston-Salem, North Carolina.[2] Many claims emerged that Dell had used unfair practices to obtain huge incentives. [3] Dell Inc. fought a lawsuit which the court system later dismissed.[4] In October 2005, Dell filed a lawsuit in a Paris court to sue Minorca-based independent website-designer Paul Dell of "Dellimages" for engaging in "parasitism and unfair competition". This related to his company website "DellWebsites".[citation needed] On January 31, 2007, some shareholders filed a lawsuit accusing Dell and Intel of conspiring, and accusing Dell executives (including Michael Dell) of backdating options and of propped financial reports.[5] Specific allegations claimed that: o Dell had received kickbacks from Intel to maintain Intel exclusivity o Dell had used the funds to prop up its sales-figures o Dell reduced the period and scope of its warranties and cut corners on manufacturing and testing in order to funnel additional funds to sales; causing the stock-price to inflate to around $40 per share o once stock-prices had peaked, several Dell executives, including Michael Dell, sold massive amounts of their personal stock-holdings to benefit from the artificially inflated stock-price On February 8, 2007, seven current and former workers at a call-center in Roseburg, Oregon sued the computer-maker, saying the company worked its sales reps "off the clock", failed to provide proper restbreaks and improperly recorded their lunch-periods.[6] Moves have begun to turn the case into a class action. Dell suddenly closed down the facility at Roseburg, Oregon on August 2, 2007.[7] The facility had consisted of computer and electronics sales-agents and of customer-service representatives. In March 2007 an article titled "Computer Giant Faces Consumer Lawsuit Consumers Allege They Didn't Get the Tech Support They Paid For" appeared on an ABC News website. [8] "Part of the suit claims that though Dell gave the impression of an "award-winning service" available to consumers "24 hours a day, seven days a week", consumers faced "nightmarish obstacles" to get help and technical service for their computers. New York State Attorney General Andrew Cuomo said that New York had received 700 complaints about Dell more than the number of complaints for any other related subject. In May 2007, Andrew Cuomo filed a lawsuit against Dell for "false advertising and deceptive business practices, including offering misleading financing, and failing to honor rebates, warranties and service contracts". [1] Dell spokesman Bob Pearson portrayed the lawsuit as based on only a small portion of Dell's customers and as in no way reflecting the way the company treats its customers. Dell's hardware-warranty contract says that customers must troubleshoot over the phone including possibly opening the computer before Dell will send a technical service provider to replace a part. On May 27, 2008, State Supreme Court Justice Joseph Teresi required Dell to clarify its financing and warranty criteria, saying the computer maker engaged in fraud, false advertising, deceptive business and abusive debt-collection practices.[9] Parties have filed more than 1,000 additional complaints with the attorney general's office since the initial filing of the lawsuit in May 2007.[10] On December 5, 2007, Typhoon Touch Technologies filed a lawsuit naming Dell inc. along with other defendants, and alleging patent-violations over Dell's use of touchscreen technology.[11] On June 25, 2009, Dell made a major pricing error on its Taiwan web page, labeling all of Dell's product around $30 to $220 lower or higher than the intended price. Dell spent 8 hours responding to this error. Dell announced that in consequence customers submitted about 140,000 orders for monitors and notebooks to Dell Taiwan[citation needed]. After a week, the company apologized for the error. Taiwan's Consumer Protection Commission suggested that due to pricing error Dell should at least sell each customer one product at the contract price, and then offer a discount on the additional orders. However, Dell refused to comply and continues in discussions with Taiwan's authorities [citation needed]. On July 5, 2009, following the previous incident, Dell again suffered from a pricing error in Taiwan. Dell labeled its Latitude E4300 laptop PCs (then normally priced at $2,101.34 in Taiwan, $1,450 in the U.S.A. and in Hong Kong) for sale at $563.40 on its online sales page for 8 hours, according to Taiwan's Consumer Protection Commission[citation needed]. After notification by a reporter, Dell responded to this error 6 hours later after netting around 40,000 orders of the product. The company suspended its online sales for three days to fix the system. Dell apologized for the errors and offered $600 dated coupons on this product to people who had purchased computers at misprinted prices. However, the Taiwan Consumer Protection Commission (CPC) claimed it "cannot accept" such a response, because even if customers use the coupons, the price would still exceed the market price in Taiwan and other countries. On July 29, 2009, the CPC fined Dell $30,000 because Dell did not establish its bona fides with its customers on this issue. The CPC stated "If Dell wouldn't have the agreement with the customers within two weeks, the company will not only be suspended its business in Taiwan but also penalized $45,000 each day"[citation needed]. On June 28, 2010, The New York Times described a civil case against Dell in Federal District Court in North Carolina, in which Dell shipped at least 11.8 million computers from May 2003 to July 2005 that

were at risk of failing because of faulty capacitors made by the Japanese manufacturer Nichicon. The suit alleges that these faulty components in Dell's OptiPlex desktop computers, were known by Dell to cause problems or computer failure up to 97 percent of the time over a three-year period, and yet it is alleged that Dell knowingly concealed these component problems from customers.[12]

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