Then, in 2005, Asus announced the creation of its own brand of computers. Dell essentially outsourced everything inside its personal-computer business-everything except its brand-to Asus. That process continued as Dell outsourced the management of its supply chain, and then the design of its computers themselves. The Dell analysts realised that this, too, was a win-win.
We can take all the remaining manufacturing assets off your balance sheet, and we can do it all for 20 percent less.” And we can make them for a 20 percent lower cost.” The Dell analysts realised that not only could Asus do it cheaper but it would also allow Dell to erase all the motherboard-related manufacturing assets from its balance sheet.Īfter it had reorganised to accommodate this arrangement, Asus came to Dell and said, “We’ve done a good job fabricating these motherboards for you, why don’t you let us assemble the whole computer for you, too? Assembling those products is not what’s made you successful. Making motherboards isn’t your competence-it’s ours.
Then one day, Asus came to Dell with an interesting proposition: “We’ve done a good job making these little circuits for you, let us supply the motherboards for your computers, too.
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