Dell CEO Says Business Model Based on Close Customer
Relationship
By Chantelle WallaceEven though there were just a “handful” of battery-overheating incidences
around the world last summer, Dell Inc. chose to recall the “maximum rather than
the minimum” amount of merchandise.
“We want our customers to know that we’ll fess up if we make a mistake,” said
Dell CEO Kevin Rollins at his Nov. 14 VIP Distinguished Speaker Series talk.
Global Responsibility
Dell’s desire to be dependable is evident in their business model, which
encompasses environmental and social sustainability issues on a global scale.
This includes the proper disposal of toxic products such as computer batteries,
which customers can deposit at designated locations. The company recycles old
computers as one of its many efforts to implement reusability into its business
strategy.
With its increased presence in developing nations, Rollins, who spends 70
percent of his time traveling, said Dell works hard to follow fair labor
practices, and implement similar systems of recycling and reusability as it has
in the United States.
“The size and scope of what we have in the U.S. is something we never take for
granted, but now we’re focusing on emerging markets in such places as Poland,
Brazil, China, Russia and India,” Rollins said, adding that Dell has a vested
interest in improving the economic condition of poorer nations so their citizens
will have the financial ability to buy Dell’s products.
Dell’s earth-friendly efforts also include the creation of a corporate computer
that reduces energy used by its technological predecessor by 70 percent. This is
the equivalent of “taking millions of cars off the road,” Rollins said, noting
that 80 percent of their products are purchased by corporations.
Crafting a Successful Business Model
The basic premise of Dell’s business model is a unique interest in being very
close to the customer. “There is no middleman,” Rollins said. “We have an
efficient cost structure with the customer on the one hand and the supplier on
the other.”
Dell’s direct model works well in India and China despite intellectual property
issues rampant in those countries. “If you see a Dell computer sitting in a
store in China, you know it’s not a Dell,” Rollins said, adding that the Chinese
government has been very helpful in trying to combat such trademark violations.
“China’s going to be a serious market for years to come,” he said.”
Notable Soundbites
On the recently launched Dell 2.0:
“It involves redesigning every element of the company for
the future to take it to new heights unimagined to people all
over the world. It’s a revitalization of our business model.”
On customer service:
“We are strong advocates of whatever our customers need.”
On governmental oversight:
“When the government runs itself as well as corporations do,
then we’ll listen to them.”
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