Analysis of Dell's Business Model, Innovation, and Customer Engagement

This report provides a comprehensive analysis of Dell, covering its main features, direct customer business model, and approach to market innovation. It outlines how Dell.com facilitates two-way interactive communication with stakeholders and explores the advantages of Dell's Radio Frequency Identification (RFID) tagging system. The report also examines the IDEASTORM platform and its benefits, and includes a SWOT analysis of Dell's position in the Australian market. Furthermore, the report identifies which customer groups are attracted by Dell's personalization and customization options, and how Dell leverages customer feedback to drive innovation. The report also discusses the significance of Dell's direct customer business model and how it enhances customer satisfaction and market reach. Overall, the report provides a detailed overview of Dell's strategies for managing knowledge and information, attracting and retaining customers, and driving market innovation.

MANAGE
KNOWLEDGE AND
INFORMATION

Table of Contents
MANAGE KNOWLEDGE AND INFORMATION.......................................................................1
INTRODUCTION...........................................................................................................................1
MAIN BODY...................................................................................................................................1
1. Outline the main features of the Dell company......................................................................1
2. Explain 'direct customer business model' means in relation to Dell and its customers..........2
3. Identifying which group would be attracted by the ability to personalise and customise
laptop/ notebook..........................................................................................................................3
4. Outline how Dell.com provides two way interactive communication between Dell and its
stakeholders. ...............................................................................................................................4
5. Outline Dell's approach to market innovation and its importance in attracting and
maintaining customers................................................................................................................6
6. Explain how Dell's Radio Frequency Identification (RFID) tagging system operates with
inventory control and production and its advantages to Dell......................................................6
7. Use of Dell website to find out about how IDEASTORM operates and the advantages it
provides to consumers and Dell. ................................................................................................8
8. Research information about personal computer market in Australia using qualitative and
quantitative data..........................................................................................................................9
9. SWOT analysis for Dell to identify future challenges and/or opportunities for the company
in Australian market..................................................................................................................11
CONCLUSION..............................................................................................................................13
REFERENCES..............................................................................................................................14

INTRODUCTION
Effectively managing the information and knowledge helps business to effectively
accomplish the organisational goals and objectives. Knowledge management refers to systematic
management of organisation's assets of knowledge that creates values and also helps in achieving
strategic and tactical goals and objectives of company. Whereas, information management refers
to process or method that is used by business organisation for acquiring and retrieving the
information. The main purpose of information management is for designing, developing,
managing and using information to bring innovation and this also helps in supporting decision
making and creates values for individuals,communities, society and organisation as well. Dell is
an American multinational organisation that deals in developing, selling, repairing and
supporting computers and other related goods and services. The present report is based on the
case study provided and includes main features of Dell company. The report identifies different
market segments of Dell and outlines Dell's approach for market innovation. The report further
describes the IDEASTORM and its advantages.
MAIN BODY
1. Outline the main features of the Dell company.
Dell is global corporation that aims at designing, developing and manufacturing personal
computers according to the needs and wants of its customers. It is at number one position in
provider of personal computers in USA and stands at second position in world. The company
processes more than 3 million transactions every day and approx 140000 computer systems are
shipped each day. The company was founded in the year 1984 and founded by Michael Dell
(Parvez and et.al., 2018). The tag-line of Dell is “Yours is Here” and explains that concept of
building computers is inspired through individual computers. Following are given the features of
Dell company:
Dell.com: This is the official website of Dell company that generates sales revenue over 50
million dollars per day. The success of its e-business is because of the series of customised
website provided to different customers world wide. The official website Dell.com aims at
providing heigh level of services to suppliers and customers. This website helps in effectively
managing the production and ordering process and also speeds up the process which leads to
bring higher accuracy that allows customers for direct ordering and technologies are then
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delivered to customers. This website also allows customers the ability for ordering and
purchasing through online and access technical advices as well.
Customer Segments: The company Dell divides its business into fur different segments
globally. This is done so that each segment can focus on developing innovative and creative
products and solutions using expert of knowledge that can also be applied to world wide. The
four different segments of Dell business are Consumers, large business enterprises, public sector
business, small and medium sized business organisations.
Unique Selling Point(USP): This feature of Dell company provides ability to customers for
selecting and customizing their personal computers (Parvez and et.al., 2018). They are allowed
to buy the custom-built services and products. The Dell provides feature of customizing
computer and provides options for selecting processor, operating system, memory, hard drive,
optical drive, software and many more options.
2. Explain 'direct customer business model' means in relation to Dell and its customers.
The Direct Customer Business Model is a method used by dell to directly deal with end
customers rather than through distributors, resellers and intermediaries. Dell company allows
customers for purchasing the custom-built commodity and custom-tailored services. The
company aims at delivering and selling computers to directly end consumers rather than through
intermediaries and distributors. Dell aims at combining its manufacturing structure with direct
customer model and supply chain consists stages of Component Suppliers, Dell Company and
Final or end customers. The business model of Dell makes direct relationship with end customers
and has following core elements:
 Developing effective one-to-one relationship with end customers.
 Developing products with customer's specification (Ramcilovic-Suominen and Pülzl,
2018).
 Providing products and services at lower prices by enabling lower mark-ups.
 Deals with end customers directly by reducing intermediaries.
 Maintains effective supply chains.
This Direct Customer Business model is considered as most effective model as it provides
effective solutions that fulfils need and demand of customers. This model provides benefits the
Dell company to:
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 The Direct Customers Business model helps Dell to identify different market segments
effectively.
 It can bring benefit of accurately and properly identifying the requirements and demands
of every segment (Ibarra, Ganzarain and Igartua, 2018).
 This model helps in accurately development of forecasting the future demands.
 This model uses direct distribution channels removing intermediaries saves cost which
can be used for further development and also in providing value added services.
Benefits of Direct Customer Business Model to customers are given as below:
 Customers only pay for the features they actually uses in computers.
 They can deal directly with the maker of the computer or products.
 They can use the products immediately as Dell already loads the software in computers.
 This model includes lean supply chain management that lowers the cost of products and
services for customers.
 Dell provides value added services to its customers through Direct Customer Business
model.
The Dell company aims at gathering customer's feedback so that it can according bring
changes and innovation in its products and services. The official website of Dell is Dell.com that
allows two-way interaction process and uses formal and informal ways for providing information
to customers. The customers also provide feedback and suggests how they feel about the product
and what they want the products to do (Sabri, 2019). The model provides efficiency to Dell for
gathering customer's feedback and focuses on specialising in customer-driven development and
innovation. It also posts questionnaires on online site that helps in establishing response and
feedback of customers for specific ideas.
3. Identifying which group would be attracted by the ability to personalise and customise laptop/
notebook.
Personalisation lies at the heart of dell ethos and the company aims at developing and
manufacturing products and services in a way that effectively meet needs and demands of
customers (Bröckling, 2018). It builds the computers that are inspired by the individual
customers. It sells products like desk top computers, notebook computers, networking and
servers products, business solutions and range of software and customers services. Market and
customer segments refers to classifying the prospective group of customers according to their
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requirements and needs. This helps business organisations to effectively understand and fulfil
their needs. Dell company divides business organisation into four different customer segments
globally as shown below:
 customers,
 large business enterprises,
 public sector organisation,
 small and medium business organisation.
The different segments aims at developing products and solution using expert knowledge
that satisfies customers. The consumer segments helps dell to enable dedicated team which
concentrates on specific demands and needs of customers. Products are directed according to
specifications of end customers rather than using commercial existing product and turning it into
one that is suitable for customers. Dell has already pitched the selling process in different market
segments that brings effective benefits for overall organisation (Foote and Halawi, 2018). Every
group and customer segment will be attracted to personalise and customise their products or
computers. Dell aims at providing features in products that are demanded by customers and
accordingly builds the computers and solutions, this attracts different market segments. Large
business enterprises will get attracted towards personalized and customized products and
services so that they can effectively manage their business using necessary features and solutions
provided by Dell. Customers will get attracted to personalisation as Dell aims at upgrading the
system in a way so that it can be configured to the technology that is demanded by customers.
Other public sector, small and medium sized organisation can make use of this feature in order to
style their computer programs and systems in a way that provides maximum benefits.
4. Outline how Dell.com provides two way interactive communication between Dell and its
stakeholders.
Dell.com is the official website that provides technical support to customers by allowing
them to asking questions, getting answers, entering forums, getting step-by-step solution or
information regarding specific issues or problems (Hwang, Lin and Shin, 2018). The customers
can also get the information latest issues or news. This website also offers fundamental feature of
time to market technology. The customers are provided with the ability to style their products
according to their choice of colour, trim and also art designs. They can also upgrade the system
in technology configured as they want it to be.
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Customers are allowed to get needed information through Dell.com in both formal and
informal ways. Dell uses Dell.com to do market research as it is most critical and important
aspect of any company. Dell.com creates two way interactive process helps organisation to get
the knowledge of how customers feel and also what they need in products and services. This two
way interactive communication provided by Dell.com brings benefits for customers as well, as
they can opinion of other people regarding products. The customers also gain benefits of getting
real-time help for certain issues or problems. Dell gets feedback through Dell.com which can be
used while bringing innovation and changes in products or business operations.
Dell.com provides print and television advertisements on the website in order to provide
additional details directly to customers. This provides benefits of keeping advertisements simple
and unchanged and also reduces cost. Dell.com is able to trace the 'waterfall' effect regarding
specific online marketing tools and can record number of people who visited the website after
launching of print or television campaign. It can also record how many people have actually
purchased the products or services. And number of people who drop out and from where they
drop out from the process. This information helps marketing campaigns to refine and also able
for creating different vanity URLs (Ibarra, Ganzarain and Igartua, 2018). Different marketing
activities regarding communication can also be done easily through the phone numbers which
are available through Dell.com. This provides benefits to Dell for measuring response rate of
customers through the online visits and phone call of customers and it can make decisions
accordingly on certain problems or issues. Dell.com also allows customers with a feature called
Community which provides :
 solutions
 how- to- 's'
 discussions and friends
 advice
Visitors browse the blogs, wikis, forums, media galleries and group sharing with others
and also with Dell. Dell.com provides technical support that allows customers for entering
forums and get information for specific technical problems and issues.
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5. Outline Dell's approach to market innovation and its importance in attracting and maintaining
customers.
Business organisation needs to bring innovation in order to attract new customers as well
retain the existing ones (Kaptein, McFarland and Parvinen, 2018). Organisation can bring
successful innovation through step-by-step and manageable process or procedure of
improvement. Dell aims at introducing successful market innovation and uses effective
customer-driven innovation technique for effectively connecting with its customers. Dell focuses
on seeking new ideas and to trail them effectively so that it can be successfully introduced in the
markets. Dell company introduced direct customer business model which allows customers for
purchasing customer-built commodity and also custom-tailored solutions or services. Dell also
aims at maintaining effective relationship with its customers by selling products and services
directly to end customers and than through intermediate resellers or distributors.
Dell aims at specialising in customer-driven innovation for connecting to its customers.
Technological innovation refers to bringing more effectiveness which leads to increasing the
connection between customers and company. And every connection render new information or
data that gives valuable insight to customers needs and wants. Customers are able to share the
information only when they feel that this will be sensitively handled and resolved. Company also
aims at providing ongoing benefits to its potential existing customers (Lakshmi, 2018). The
market innovation approach is introduced by Dell that helps in attracting new customers and also
retains existing ones. The breakthrough innovation helps in expanding the market but generally it
takes time in providing financial return and also creates risk in development and innovation
period. Therefore, step-by-step and manageable process of innovation is introduced by Dell in
order to bring successful innovation. Dell has achieved successful interaction with its customers
through its business model and market innovation approach. This brings benefits in developing
innovative products and services that provides satisfaction to customers and also attracts new
customers.
6. Explain how Dell's Radio Frequency Identification (RFID) tagging system operates with
inventory control and production and its advantages to Dell.
This tagging system allows Dell for identifying individual products and also its
components. The Radio Frequency Identification tagging system allows organisation to track
products and services throughout the supply chain starting from production up-to sales. Radio
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Frequency Identification system is related to process management, warehouse management,
supply chain management, tool management and life cycle management. Dell uses this tagging
system as this technology uses radio waves in order to make communication between reading
device and tag. Usually the tag consist of microchip which is attached to antenna (Parvez and
et.al., 2018). The reader is allowed to read the data from and also to write data on tag. The
microchip contains digital information regarding particular items and tags are enclosed in paper,
plastic or in same material and is also fixed to the product or to its packaging. The Radio
Frequency Identification reader is interrogated to tag that allows transmission and reviving of
radio signals in both ways, i.e. to and from tag. The reader collects the information or data and
further processed by using special computer software. Tags can be remotely read even at
distance and it can be read at once only that also enables an entire pallet-load of products that
needs to be checked simultaneously. Readers are placed at different places or positions to show
that when goods are moved.
Following are given some benefits or advantages to Dell because of using RFID tagging system
for inventory control and production.
 Helps in preventing over-stocking and under-stocking of products and also makes it
easier for implementing flexible process for manufacturing.
 RFID system reduces the time taken for taking inventories and also increases the
accuracy.
 This leads to increase the efficiency ad also cuts down the cost for rework and increases
productivity.
 RFID system improves the transparency and quality of information across the supply
chain (Pedersen, Gwozdz and Hvass, 2018).
 Helps in maintaining quality control, in case of stock items with limited shelf life.
 Helps in stock security through positioning tag readers regarding points of risk.
 It helps in achieving absolute supply chain visibility (RFID and Inventory Control, 2018).
 The information tagged trays is read at distribution points, which results in improving
delivery logistics.
 Continuous monitoring of items limits the inventory shrinkage regarding misplacing of
items, thefts, etc.
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 It helps in developing probabilistic demand pattern or can monitor demand patterns.
 RFID system provides exact count and locations of products or items and helps in
following specific issuing policies and procedure.
 Helps in asset tracking and also in electronic payment (Ramcilovic-Suominen and Pülzl,
2018).
 It helps in scanning multiple items at the same time and also contains more information.
7. Use of Dell website to find out about how IDEASTORM operates and the advantages it
provides to consumers and Dell.
This is website launched by Dell in the year 2007 to allow Dell for gauge that which
ideas are important and relevant to public. After successful registration, the users are allowed to
add articles, promote or demote them and also comment on them. Dell company posts
questionnaires on online websites for establishing responses of customers on specific ideas as a
part of their market research as it is very critical for any company (Ranta, Aarikka-Stenroos and
Mäkinen, 2018). IDEASTORM allows community members of Dell to give suggestions, ideas
and views regarding products and services that they want from Dell to offer.
IDEASTORM is considered as the classic form for bringing innovation and both
customers and company work together for creating something new and leading to bring
innovation. The four stages of IDEASTORM are explained as follows:
Ideas: The innovative ideas by customers and users are received on the website regarding
products and services. The number of customers who willing share their ideas, specific
knowledge with other community members and users. These suggestions and ideas can also be
shared and discussed with other community members.
Action: The high transparency is provided by Dell to community members fro sharing their
ideas and views. Customers and users willing share their knowledge and ideas which is used by
Dell in order to bring innovation in products and services. The different ideas within action
section explain about what development is brought by Dell in products and services.
Implementation: This stage of IDEASTORM involves Dell addressing the concerns of
community members and follow through on their ideas and suggestions (Ritter and Lettl, 2018).
The two interaction process helps Dell in effectively implementing the ideas and bringing
development and innovation in products and services.
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Feedback: This step of IDEASTORM includes feedback and comments from its community
members, users or customers regarding the innovation in products and services on the status of
ideas. Online technical help and different other forums provides opportunity to Dell for doing
market research. Chat features involves reviews of customers and users that guides further
suggestions to Dell.
The benefits and advantages of IDEASTORM to both customers and Dell company:
 It provides benefits to customers to have real time help for problems through opinions
and views of other community members.
 15000 ideas are being submitted since the launch of IDEASTORM and out of them 490
are implemented by Dell.
 This brings benefits of improving the values regarding process and outcomes.
 The feedback and ideas of people brings benefits to company for bringing improvements
in products and services as users want it (Sabri, 2019).
 The IDEASTORM is two way interaction procedure that provides benefits to company to
have insight of customers wants and needs.
 Customers share this information on website because they fell that their ideas are handled
sensitively and it leads to develop trust of customers and brand image.
 Online community members gets benefits of connecting other members and customers
and they can also share their opinions and views.
 The IDEASTORM makes advertising and marketing activities more measurable and also
allows company for seeing Return On Investment(ROI).
8. Research information about personal computer market in Australia using qualitative and
quantitative data.
Each and every individual in today’s world is highly attracted towards developing
technology and is highly influenced to buy their own computer system (Sammons, 2018). The
increasing demand of personal computer in the global market had encouraged computer
manufacture to develop new and unique products to meet demand of the customers effectively.
Organisations such as Dell, HP and Lenovo try to target large markets such as Australia to
increase their profitability’s software and computer retailing industry has faced challenging
trading situations or conditions in the last few years. Volatile consumer sentiments and weak
discretionary income growth over this period have encouraged a huge number of customers to
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rein in their expenditures. The total PC shipments in Australia including Notebooks,
Workstations and Desktop were around 1.16 million units till the fourth quarter of 2017, posting
a year over year growth of 2.2% according to quarterly personal computing devices tracker of the
international data corporation (IDC). It was a bit higher than the growth of international market
of 0.5%. The overall market was market was driven by major education deployments including
private and public schools which resulted in the growth of education segment by 55.5%. High
growth of convertible and ultra slim notebooks shows that Australian business and consumers
are willing to pay a premium price for the light and thin notebooks according to a market analyst
for client devices research at IDC Australia (Santoro and et.al., 2018). IBISWORLD has
identified that most important and key success factors for the computer and software retailing
industry are, Ability to control on hand, having a clear market position and production of goods
or products presently demanded by the market. There are three top vendors displayed double
digit growth during 2018 –
1. HP successfully maintained its leading position in the market and continuing its 8 consecutive
of growth resulted in a growth of 15.7% in the year 2018.
2. Dell posted the highest growth in the top 5 vendors with 20.9% increase in 2018. This has
leads to a significant growth in small and medium business.
3. Lenovo also jumped from 4th to 3rd position by shipment with 11% of growth driven by its
success within large government contract and growth in the very large business segment.
Figure 1- PC companies in Australia
(Source: Australia continues to buck global PC trend, 2018)
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9. SWOT analysis for Dell to identify future challenges and/or opportunities for the company in
Australian market.
Following is given the SWOT analysis of Dell for identifying opportunities and
challenges in the Australian markets.
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Strengths:
Large portfolio: Dell company is well- known
company in the world which manufactures and sells
large portfolio of computer products. The company
has also spent on acquisitions and mergers.
Unique personalisation and customisation option:
The Dell allows customers to personalise and
customise their products. This unique feature
provided by Dell makes its strongest strength.
Direct Business model: Dell aims at directly selling
the products to end customers and removing
intermediaries such as resellers (Swab and Gentry,
2018).
Strong customer foundation:Dell aims at
personalising the products as customers needs leads
to make them satisfied and develops strong customer
foundation. Dell is also known for being quick
responsive and compromising.
Weaknesses:
Commodity products: the majority of
products offered by Dell fall under the
computer industry and it is a low-profit
margin industry as related to hardware
products (Watkinson, 2019).
High operating expenses:The operating
expenses of Dell company has increased
very high which may lead to bring
further negative impacts in the
Australian markets.
Lack of individualism: The competition
in the global markets and Australian
markets is booming which does not
allows Dell to offer low prices products.
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Opportunities:
Diversity: Dell needs to work on their product
portfolio and patents as well. Australian markets may
bring great opportunities for Dell if it comes with
diversifies products and services (Bröckling, 2018).
More than hardware: Australian markets may
provide benefits to Dell if it comes up with more
hardware products as it deals into software related
services and products.
Tablet market growth: The Dell company can have
great opportunity by releasing new models of Tablet
in Australian, emerging and global markets and
increase its market share and profits.
Threats:
Booming tablet and smartphone
industry: This industries are booming
and increasing in Australian as well as in
global markets that may bring challenges
for Dell to sustain its position and market
share.
Increasing material cost: The cost of
material is increasing and making it more
expensive for Dell for obtaining and
manufacturing the products and leads to
cut down the profits margin.
CONCLUSION
Dell deals in computer products and services and leads the global computer system
markets. The company has adopted direct business model that allows customers to personalise
and customise their products vis mobile phones and internet. The official website of Dell is
Dell.com that brings success and benefits for overall organisation. This website creates two way
interaction process with its customers and allows real time solutions and opinions to customer's
problems. The recent changes and innovation brought up by Dell has given customers to see and
buy products before purchasing it. The Unique Selling Point feature is introduced by Dell that
provides ability to customers for customising their computers. The company also provides the
custom-built products and custom-tailored services to its customers.
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