1. What are the key challenges DELL should be concerned with as it enters the large-scale server market?
There are three major challenges or threats that DELL should be concerned with as it enters the large-scale server market. First, as a company, DELL is significantly influenced by the downward trend in desktop PC Sales. Moreover, the entire market capitalization of the company is declining due to price wars and potentially lowers profits. Furthermore, there is heavy competition in the large-scale server business. More specifically, the customer of the large-server segment is different and does not fit DELL’s position or focus on low-cost production and low prices.
2. Should DELL outsource the four hour service level support or should DELL provide the service with in-house resources?
DELL should outsource its support because the outside vendor (DecisionOne) will have a higher reach in the target market. DELL is not yet established and the outside vendor will be more highly experienced in providing service and is focused exclusively on the high end. Using in-house resources would allow DELL to maintain its extraordinary commitment to high-quality service, but the high level of service and operations policies required might limit the effect and reach of the support. Additionally, DELL’s existing customers are being handled by outsourced services. These services have had proven service records and similar policies and constraints could be applied to this market as well.
3. If DELL outsources the service support, then should it use IBM as a vendor to provide the service support? Why or Why not?
As mentioned earlier,…