Dell is the most successful company in PC industry of 21st century. It has shown phenomenal growth record over the past decades & listed as America’s third most admired company. Their core strength lies in Direct model offering closer customer interaction and Virtual Integration. This is giving a low cost advantage to Dell and its competitors are not able to imitate this model for all these years.
The products of Dell are known for their quality, service & on time delivery. Their focus on customer satisfaction helped them overtake their competitors and acquire Number 1 position in the market.
Now with the success in its hands Dell wants to take a larger bite in server and storage market. Also it wants to explore …show more content…
• Technical expertise (Virtual Integration)
• It is not able to leverage through Retail channels & had to close those operations.
• Extremely price sensitive market makes it difficult to retain customers
• Venturing into new product segments like Storages, Servers, Workstations etc
• Opportunities in International market through Strategic acquisitions
• Economic slowdowns affect the PC industry heavily thereby reducing revenues
• The dependency of Dell on R&D is high on its partners as compared to competitors.
• In the international market there may be acceptability issue of Dell Direct model.
• Competition with product specific companies in Storage & Server segment would be difficult Evaluation of Options
1) Revamp the existing model to suit its expansion plans through strategic acquisitions
There are certain areas where improvements are desirable to meet the growth targets of Dell. They are listed as below:
R&D Investment: Its always advantageous to have In-house R&D Dept. against dependence on other suppliers. This will help bring innovation & latest technology expertise, which will eventually boost sales
Penetration to International / Remote markets through Retails: Though the Direct model of Dell is successful, there is still untapped remote market which might not be feasible to tap directly. In such case help of Retail outlets can be taken.