This management case study briefly discusses Dell’s channel strategy and partner program introduced to recapture its lost market leader position. The case further highlights how Dell has successfully transformed itself from its direct-sales-only mantra to building a successful reseller network within three years.

Case Contents

  • Introduction
  • Dell’s unique ‘direct build-to-order’ sales model
  • Dell’s Transformation over the years
  • The 80s – PCs by mail
  • The 90s – Extending Direct sales, user-customized systems & JIT
  • The 2000s – Moving towards a broad-based IT company
  • Dell – Quick Facts
  • Michael Dell – Leading from the front
  • Dell’s Channel Strategy
  • White Box program
  • Partner Program – Dell PartnerDirect
  • Three tiers in Dell PartnerDirect
  • Bibliography
  • Exhibit 1 – How Dell’s direct build-to-order’ sales model worked
  • Exhibit 2 – Five key elements in Dell’s successful Direct Model
  • Exhibit 3 – Dell – Business Segments
  • Exhibit 4 – Dell Historical Timeline
  • Exhibit 5 – Requirements for Dell PartnerDirect program
  • Exhibit 6 – Dell PartnerDirect Timeline – Dec 2007 to 2008
  • Exhibit 7 – Dell – Product Lines and Brands
  • Exhibit 8 – Dell Inc. – Historical Stock Chart
  • Exhibit 9 – Dell Inc. – Historical Income Statement
  • Exhibit 10 – Dell’s market share in Q1 2009 versus other PC makers

Sample Page of case study

“We don’t think about the channel as a second thought – it’s integrated into everything we are doing. Every new offering and capability has partners in mind.”
– Michael Dell in September 2011.
“Our channel business continues to grow, continues to prosper, and we continue to attract new partners and grow our install base, and become a bigger and bigger part of the Dell portfolio.”
– Davis, Dell’s global channel chief in 2011.

Introduction

In January 2007, Dell had lost its No. 1 position in worldwide PC shipments to Hewlett-Packard Company (HP). In 2011, Dell reported the largest revenue increase in the company’s history when it reported its results for financial year 2011. Within three years, Dell had successfully transformed itself from its direct-sales-only mantra to building a successful reseller network.

Dell has probably witnessed more changes in its business model than many other companies have. Dell is now engaging more with channel strategy and is on a channel-hiring blitz seeking ways to improve working with channel partners. Dell is making bigger investments in the channel with new innovative channel sales initiatives. The Dell channel business now amounts to about 33 percent of the company’s $62 billion in annual sales in 2011.