Company Analysis of Dell

Inc.Presented by Group C:Arby Artoonian, Jessica Thomas, Richard Orozco,

Alex Fajardo & Sam Hacopian

About Dell Leading company

in PC manufacturing

Creates products for consumer and business environments

Builds Desktop PC’s, Laptops, Storage Devices, Software Etc.

External EnvironmentStrengths/Opportunities: Robust market position Good cash flow generation Emerging economies create

growth Gaining market share in cloud

computingWeaknesses/Threats: Weak R&D Lower margins compared to

peers Tablets cannibalizing PC sales Intense completion from Apple,

HP, Acer, Cisco etc.

Company Performance

Increases in R&D spending over the past years

Reducing the portion of low-margined products in its sales mix

Difficult sales climate ahead with economic issues and natural disasters.

Unfavorable earning estimates for Dell in 2012

CURRENT POSITION 2009 2010 10/28/11 ($MILL.) Cash Assets $11,008 $14,365 $13,838 Receivables 5,837 6,493 6,690 Inventory (FIFO) 1,051 1,301 1,397 Other 6,349 6,862 6,331 Current Assets $24,245 $29,021 $28,256 Accts Payable $11,373 $11,293 $11,107 Debt Due $663 $851 $1,831 Other 6,924 7,339 7,281 Current Liab. 18,960 19,483 20,219

SALES ($ mill.) 2008 61101 2009 52902 2010 61494 2011 61800 2012 61800

Major Challenges in the past three years

Low R&D spending over the years compared to competitors

Low innovation Sales numbers

decreased in certain years

=Revenue =Price

Dell’s Present and Future Challenges

Present Challenges:Comparatively weak R&DLower profit margins against competitors

Future Challenges:Tablets cannibalizingDependence on PC marketIntense competition from powerful rivals:Apple, HP, IBM, servers & tablets

Dell’s Management Team

Dell is dynamically comprised of both the Board of Directors and the Management Team.

Functions of Board of Directors:Management planning and oversightStrategic and operational planningFinancial reportingGovernance, compliance and risk managementGeneral advice to management

Functions of Management Team:Organizing managementStrategic and operational planning and implementationManaging riskFinancial reporting

Dell’s Management Team Continued

Key Management & Executive Members:Michael S. Dell - CEOBrian T. Gladden - CFO/Senior Vice

PresidentDavid Johnson - Senior Vice

PresidentJeffrey Clarke - Vice ChairmanKaren H. Quintos - Chief Marketing

Officer/ Senior Vice PresidentSteve H. Price - Senior Vice

President Human ResourcesStephen Felice - President, CCO,

Division Officer

Strategy and Structure of Dell

Dell has implemented a growth strategy that consists of delivering results, investing for growth and building on their strengths.

Dell tailor’s its business based on a mixed structure. The structure revolves around product structure and customer structure. Customers are divided into enterprise large companies, medium-small businesses and personal consumers.

Potential Solutions for Dell’s Challenges

Expanding products & services to emerging markets i.e. China

Investing on Cloud computing Developing new products such as

tablets to capture market share.

Lessons Learned from Dell

Dell’s centralized structure allows greater control from top managers.

Keep managers and employees engaged in the company’s goals and standards.

Keep costs low to ensure low prices for consumers.

Intensely research a new market before entering to maximize efficiency and price of the product.

THANK YOU!