please read the case and answer questions 1-2.

Human Resource Management 106 106 CHAPTER 2 Strategic Human Resource Management MANAGING PEOPLE How Should Dell Respond to the HP Challenge? Dell Computers was founded by Michael Dell in his college plants into 23. This enabled HP to reduce both the time and dormitory room. It quickly became one of the fastest growing cost of building PCs, and reduce late deliveries by 30%. HP's businesses in history, an almost unparalleled success story. margins grew to 4.8% in the second quarter of 2007 from 3.6% By 2005 Dell had become the largest manufacturer of PCs, a year earlier while Dell's fell to 6.5% from 6.7% a year earlier. primarily focusing on the B2B market. This was achieved by Finally, he built better relationships with the retailers. He creating a "Direct" model that allowed companies to buy cus pushed products such as touch-screen PCs that would garner tomized computers directly from Dell cutting out the mar attention from customers. He also helped retailers to design in previously captured by middlemen such as CDW. The products exclusive to their stores, enabling them to differenti- creation of Dell's Premier Pages website made it easy for ate their products from competitors. He worked with them to corporate customers to easily place orders for large numbers be able to create customized imprints. For instance, working of computers configured exactly as they wanted. The direct with Best Buy, HP created a silver and white laptop, softer model also allowed Dell to better manage its supply chain, colors aimed at female customers. reducing both the inventory of components as well as fin Ished products. Thus, in 2007 Dell gave up its title as the largest producer However, by 2007 HP had surpassed Dell in PC sales. of PCs. In addition, as the consumer market continued to After having tried to imitate the Dell model, in 2005 HP grow at a much faster rate than the corporate market, Dell hired Todd Bradley to turn the business around. Instead of was ill-positioned to reverse this trend. fighting Dell in Internet and phone sales where Dell was strong. Mr. Bradley decided to focus on its strength, retail QUESTIONS stores, where Dell was completely absent, and where individ. I. What are the major competitive and strategic challenges ual customers, the fastest growing segment, made most of Dell needs to deal with if it is to regain a position of their purchases. He noted that PCs aren't just a commodity strength within the industry? that you run out and buy on the Internet. People are going to 2. What can HR do to help Dell re-establish its position as want to touch it and feel it and understand how it connects." the leader in PCs? Assume you just got on the elevator He also began advertising campaigns using celebrities such with Michael Dell and want to explain how HR will aid as hip hop mogul Jay-Z to talk about how they used their HP him in regaining its proeminent position. What will you laptops. tell him in the 1 to 2 minutes you have? In talking with retailers, be found that they complained about late and incomplete deliveries. So, he focused on fixing Jamal, June 4, 2007, from http://online.com/article_print/ SOURCE: C. Lawten. "How HP Repalced Its Lord over Dell." Wall Street the logistical problems and consolidated 30 manufacturing S8118092117687623314 HR IN SMALL BUSINESS Radio Flyer Rolls Forward The mid-2000s were a difficult time for Radio Flyer, a private children sit inside is difficult to make both functional and business famous for its little red wagons. After spending hun safe. The costs were excessive. dreds of thousands of dollars to develop what they hoped was When Schlegel ended the project, he feared his reputation a hit, managers realized their idea wouldn't fly, so they killed might suffer as well. But CEO Robert Pasin assurd Sol it. And in the same year maniem