Article: Dell Computer, Using E-commerce To Support the Virtual Company

Dell Computer has been touted by itself and others as a quintessential Internet company.  The 
Internet has given Dell a means for extending the reach and scope of its direct sales business 
model at a relatively low marginal cost.  It has done so in part by automating functions such as 
product configuration, order entry, and technical support, enabling the company to grow 
revenues without a corresponding increase in customer service costs.  Also, it has used the 
Internet to coordinate a network of suppliers and business partners who carry out many of the 
processes involved in building, distributing and supporting personal computers.   Dell refers to 
this network of partners as a “virtual company” linked electronically by the Internet.  Another 
name for this type of industrial organization is the value web (Kraemer and Dedrick, 2000). 
In early 2000, Dell began to redefine itself as the company that “knows how E works.”  
Capitalizing on its reputation as an e-commerce pioneer, Dell has offered to share that expertise 
with its customers as they develop their own e-commerce capabilities.  Dell is using the virtual 
company approach to expand the scope of its business without a commensurate expansion of its 
own work force and without making a major acquisition.  It is doing so by developing a network 
of software and services companies that offer technologies and skills that Dell lacks in its 
existing value web.  However, Dell remains focused on the fact that it is still a hardware 
company.  Its e-commerce efforts are aimed at improving its own efficiency, enhancing 
customer satisfaction, and reaching new product markets, rather than transforming itself into a 
services provider as its competitors such as IBM, Compaq, and Hewlett-Packard are becoming. 
A close analysis of Dell’s use of the Internet and electronic commerce illustrates the strategic 
and organizational challenges that face any company that is serious about embracing the 
Internet and trying to tap its potential.  It also offers insights into a new form of business 
organization that may become more prevalent in the networked economy. for more details click here

1 comment:

  1. in my oppinion when using information system can provide competitive advantage.for example,when using e-commerce or e-business company can get a lot of advantage such as time restrictions are nonexistent while conducting businesses, as e-commerce empowers one to execute business transactions 24 hours a day and even on holidays and weekends. This in turn significantly increases sales and profit.beside that, Electronic commerce gives the customers the opportunity to look for cheaper and quality products. With the help of e-commerce, consumers can easily research on a specific product and sometimes even find out the original manufacturer to purchase a product at a much cheaper price than that charged by the wholesaler. Shopping online is usually more convenient and time saving than conventional shopping. Besides these, people also come across reviews posted by other customers, about the products purchased from a particular e-commerce site, which can help make purchasing decisions.carrefour has prepared the web that to their company, you need non food online so when using this information system,can increase their effectivenes in production.