United International UniversitySummer Trimester 2015School of Business and EconomicsCourse: IBS3121_International Business | Case Analysis and Term PaperCase 1Chapter 1Topic 1 |
Dell’s Globalization of Business
Dell, Inc. the largest direct sale computer vendor in the world, selling servers, desktops, laptops, workstations, printers, monitors, storage solutions, and other computer peripherals. Since its inception in 1984 Dell was a pure hardware vendor for much of its existence, but with the acquisition in 2009 of Perot Systems, it entered the market for IT services. With a unique business model for computer vendor industry named “build-to-order” or direct sales philosophy, Dell expanded its footprints as one of the most successful global company. Using the most advance technologies with the benefit of globalization, Dell built its competitive advantage as a low cost provider of customized product offerings.

To capture the advantage of low cost production, in 1994 Dell enthusiastically moved to the use of Internet to coordinate and control its globally dispersed production system. It was so efficient that now it holds only three days’ worth of inventory at its assembly locations. This advancement in reducing inventory cost to a minimum level was not possible unless company use Microprocessor and Internet. Dell’s Internet-based system records orders for computer equipment as customers submit them via the company’s Web site, then immediately transmits the resulting orders for components to various suppliers around the world, which have a real-time look at Dell’s order flow and can adjust their production schedules accordingly.

Besides, given the low cost of airfreight, Dell can use air transportation to speed up the delivery of critical components to meet unanticipated demand shifts without delaying the shipment of final product to consumers. Dell is also