How Dell Does It (ISBN 0072262540)

Some (not much) Interesting Material:
Fortune dubbed Dell as the "Most Admired Company in the U.S." in its 3/07/05 issue. It is now a $49 billion company, with 57,000 employees worldwide. Formed in 1984, three years after the IBM PC, it was only 25th among computer manufacturers in the early '90's, but, according to Holzner, still made the Fortune 100 in '92. Dell was fortunate that when he began IBM could only meet about 10% of its demand, and it had made both the software and hardware open-source (no patent protection). Dell not only was one of many to take advantage of the situation, but added the competitive advantage of using a low-cost direct sales model. (Dell estimates this eliminates the need for an additional 25-45% markup.) Dell also soon concluded that selling direct allowed better understanding of customers (vs. receiving information filtered through a retailer), and management of inventory (order data was not "confused" by retailer actions - eg. sales, hoarding). Soon Dell had a strong presence thanks to selling at about half IBM's price, while providing as much as twice the CPU speed. Dell also recognized that an unknown firm would have difficulty winning acceptance, and so was one of the first to offer a guarantee (30-days), and then went competitors one better by providing ono-site service. Holzner points out that Dell moves into products after they become standardized, but before commodities. Relatively recent areas include printers (also punctured H-P's major profit source, decreasing its ability to fund new attacks on Dell), servers, and AV equipment. Dell uses standardized parts, thereby minimizing need for R & D expenditures (Dell < 1% of sales, Sun Microsystems 14.7%, Hp and IBM about 6%). Lately Dell has come under attack for significant service problems - long waiting periods on hold, clueless technical support, and hard-to-understand representatives. (The latter is due to outsourcing to India, and the "cluelessness" due to an inability to get both English-speakers and technical competence in a single representative.) This has angered many former supporters, including myself; however, Dell points out customers have an option to pay extra for better service. Thus, the new policy can be justified on the basis of meeting Return on Invested Capital (ROIC) measures - the basic evaluative tool used throughout the firm. (Underlying Logic: A tech-savy customer should not have to subsidize support for those who are novices.) Dell segments its business by customer type, not product. (Large business, small business, home user, etc.) The other Dell technique heavily emphasized in "How Dell Does It" is minimizing inventory - eg. two hours' worth on hand. However, Holzner would do well to also point out that this is nothing more than part of the Toyota Production System, applied to P.C. manufacture, and pursued by most every other reasonably successful firm today.) Bottom Line: "How Dell Does It" provides minimum information that one would not have already surmised.

How Dell does it - Or rather how the Author does it.....:
I am still reading this book. I have gone through around 100 pages or so. A lot of things are widely known. But worst of all, I don't know if I can believe this book at all. The author included a lot of quotes from articles and Dell's website. Has the author interviewed any insiders who might have offered insights into how Dell is managed ? Or did he just bash together this book from all the anecdotes available after "googling Dell" on the web.

Why Dell works for its "Dudes":
Using material from Direct from Dell, by Dell Computer founder Michael Dell, and from computer industry Web sites and trade publications, author Steven Holzner does a solid job of describing Dell's rise over the past two decades and explaining what it is doing now to expand its market dominance. If you want all the details, though, you may feel frustrated. For example, Holzner says that Dell obsessively tracks the profit and loss of every business unit. However, he does not explain how. Which metrics does the company use, other than the often-cited ROIC, and how did it develop them? Similarly, Holzner notes that Dell analyzes markets and moves into them at just the right time. But how is it able to judge them so accurately? The book plateaus at the level of reportage, rather than rising to the level of inside analysis. However, if you are looking for a summary of Dell's very successful business strategy, we recommend this overview.

Needs An Editor:
I was very excited to get around to reading about 'how Dell does it.' I have admired Michael Dell and his company for many years as an IT professional. I'm very interested in their supply chain management system that allows for the phenomenal Dell Direct process. With this said - I was deeply disappointed with this book. Mr. Holzner, IMHO, needs an editor. The chapters do not flow. I was constantly distracted by his cross-referencing that litters far too many paragraphs. Here is an example sentence from page 25, "Dell also cuts its inventory radically (Chapter 5), works with standard components (Chapter 4), is perpetually streamlining (Chapter 6), and puts enormous pressure on suppliers (Chapter 8). There is a Table of Contents on page iii that tells me where these topics are covered. I do not need constant reminders throughout the chapters. An editor would have minimized or eliminated this along with Mr. Holzner repeating himself a few times in each chapter. Lastly, I also felt that Mr. Holzner relied too much on Michael Dell's book and various magazine articles. There was very little first-hand information that I couldn't find using Google and buying 'Direct From Dell.' I really liked the topic, I just wish I wasn't so distracted by the writing style. If you're interested in reading this book, go to a bookseller and sit down and read the first chapter and then look at the endnotes. If it still appeals to you after this, go ahead and make the purchase. Otherwise I recommend a pass.

He got paid to write this book?:
I can't believe he was paid to write this book. The book is overly repeatative. Truthfully the book could be condensed into about 1/3 the size. The writer is obviously bias toward the Dell to the point that they slant all of the information and views. It does contain some usefull information. The good news is that it is so repeatative you should have the information memorized by the time you are through.