Transcript DELL 2005 - HEC Paris

DELL France
Best in France Case Study
January 2005 - March 2005
By: Marie Ledru, Rachid Dray, Benjamin Hakoun
and Pierre-Emmanuel Pegues
Dell: corporate profile
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Dell computer corporation was grounded in
1984 by the 19 year-old Michael Dell
The world leader in computer manufacturing
(since 2001) and data processing solutions
50000 employees around the world, including
1350 in France (coming from 30 countries)
An annual turnover of 50 billion $ in 2003
A market share of 16,4% in 2004, 31 million
computers sold
And almost: a specific business model
A brief overview
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1984: Dell is grounded in Texas
1989: The company comes to France (Paris,
currently 350 employees)
1992: Setting up in Montpellier (call center,
currently 1000 employees)
2003: Setting up of a new call center in
Casablanca, Morocco
2003-2005: the target is to double the
turnover
Why Dell came to France
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A predominant market in Europe for 15
years
A “stategic market” for Dell for 2 years
A strategic platform for South Europa,
especially Italy and Spain
But no plant…
DELL’s core values
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DELL’s values are the result of its success
story based on the entrepreneurial
personality of Michael Dell
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A post start-up spirit: a top-down organization
with plenty of room for creativity and innovation
The importance of execution
Transparency and constant performance
assessment: an obsession
Closeness of management to their teams: 1
manager for only 10 employees
Outstanding competitiveness
DELL’s challenge: to instill
these values in the French unit
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Child care unit in Montpellier:
a way to demonstrate the long-term commitment of
DELL to the French market
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Recruiting of adequate staff, in
particular
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people with international profiles (middle and top
management) and
through the setting up of DELL’s first sales school
in Europe
DELL’s challenge: to instill
these values in the French unit
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The constitency of DELL’s policy is
a crucial asset to help instill its USflavoured values in France
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The revision of the agreement « les 35
heures »
Cost containment and investment
optimization as a daily battle at DELL
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Work trips of managers
Close scrutiny of the ROI of advertising…
DELL’s products
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DELL does not produce its computers in France and
rumors about France being chosen as he location for
the second assembly plant to be set up were denied
by one of our interviewee (confidential).
France is one of DELL’s strategic market: the firm
could not do without being in France, contrary to
Spain and Italy
DELL’s location
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Paris
Montpellier
…Casablanca
DELL’s products
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Hardware, software and peripherals
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Desktop
Workstation
Notebook
Servers, storage and networking
Software and peripherals…
Business services: solutions
Outrageous deals !
DELL's clients
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DELL targets 3 market segments
Small and medium size businesses
 Large firms
=> access to a dedicated private webpage,
personalized advice, cost efficiency
 Private customers: the best computer at the
lowest price
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A French presence is an essential condition to
access a French speaking workforce, offer a
tailored service and be close to clients to
deliver real value.
Human Resource Policy in Dell
France
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A special kind of recruitment
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The Comp&Ben System
The French workers always have to be
reassured with long-term projects
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A specific sales school.
Child care unit in Montpellier
International transfers
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The board of the Montpellier site is composed of
Anglo-Saxons.
In Dell, there is a high mobility of talents.
Constraints in France
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The Dell’s distribution model require a high sense of work
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Cost of work ( social security and contributions , tax level…)
The traditional problem of the trade unions
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No strikes, but tense negociations with trade unions when the opening
of the Casablanca unit was announced.
The mentality of the French Workforce
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The revision of the agreement « les 35 heures » highlights the will to
keep the investment margin, as the work productivity of the Montpellier
unit is too low according to the managers.
Qualities required to work for Dell : adaptability, flexibility, evolution,
mobility, creativity.
Transparency: the performance of each worker has to be estimated.
These constraints are a real hurdle to settle in France
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A new plant is needed for the European market but France won’t be
chosen.
Dell set up its EMEA headquarters in London…
Key Benefit Numbers
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What are the key benefits of being in France?
A high quality of life: very important for the establishment of
foreign managers
 Location benefits ( Montpellier: easy access and equal
distance between Paris, Italy, Spain) and a quite cheap real
estate market
 Government assistance: subsidaries, tax credit
 High quality of Infrastructures: airport, road, communication
network
 A high qualified pool of competences (both technical and
commercial)
The establishment in France answers 2 logics:
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A logic of market: France is a dominating market in Europe
with worlwide firms (Accor, Axa…)
France constitutes a European platform especially for the
markets of the South (Italy, Spain, Portugal, Greece).
Essential Advice…
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Dell has a unique business model based
on the need to be close to customers.
Its competitive advantage is based on
the distribution.
By the way it’s hard to set up rules and
solutions from our case study
Dell = Outlier
We thank
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The Dell company, and especially
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Mr. Patrick Thill, HR manager for France and
top manager in charge of Montpellier’s
operations
Miss Audrey Caillaud, HR assistant
Mr. Franck Penot Senior Marketing Manager
Our team
Rachid Dray [email protected]
Benjamin Hakoun
[email protected]
Marie Ledru [email protected]
Pierre-Emmanuel Pegues
[email protected]