Dell Strength and Weakness
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Based on the external environment and the historical perspective of Dell, Michael Dell needs to realize that his nearly 20 year-old business model needs a dramatic change. He needs to get the product in customers hands (before point-of-sale), focus on quality customer support/service, and use customer indicators as a sign of what areas need improvement/enhancement within the company. Additionally, limited options based on narrow-minded perceptions (only using Intel chips) not only cost Dell market share, it also cost them on the bottom line (Operations). Not listening to the needs and wants of loyal consumers can result in a loss of market share, which is what Dell has experienced.
REQUIRED ACTIONS
In my opinion, Dell will only regain its growth percentage when it ceases focusing on measuring profitability via delivery time ratios and number of unit sold and begins focusing on what foreign markets expect, based on their cultural differences. It seems Dell did little research before opening several foreign manufacturing facilities and attempting to develop international sales relations. As a result, they failed to alter their U.S. business model to meet the needs of other (foreign) consumers. Also, through this ignorance they also sacrificed the brand name and initial marketing push/hype.
SUPPORTING INTERNAL RESOURCES
Strategic groups should be used as internal resources to analyze the industry and use competitor analyses to observe whether the business mission is still being served, or perhaps requires modification to meet the changed environmental factors. The firm could use its internet associations to present the customer with a survey for feedback about the product offerings – what they would like to see added to the product line, or perhaps what service could be added or improved. Seeking the direct opinion of the loyal customer base is readily at hand when they are contacting customer service/support for assistance with a problem. Not only is this a prime opportunity for mending or strengthening a relationship, it is the opportunity to receive quality input from the consumer group that is purchasing Dell’s product.
STRATEGIC WEAKNESSES
The weaknesses to implement a new strategy are self-conceived via issuing poor customer service, limited consumer choice, limiting the consumer shopping experience to one method (indirect – phone, mail order, internet), and failing to measure quality before selling thousands of faulty products, thereby costing the firm significant amounts of profit and negatively altering the customer-base as a result of these actions. At this point I believe Michael Dell should remove himself from the picture and appoint someone he trusts to administer the renovation of Dell. A new face breeds the acknowledgement that change is occurring and it typically brings great attention. However, if the revised strategies result in even further profit-loss and negative press from analysts, then Dell can surely consider their image scared permanently.
STRATEGIC MISSION
Dell’s strategy is direct consumer sales – the customer chooses the options they want (from what Dell limits the offerings to) and Dell builds the computer to that design and ships for free. Through this avenue they intended to provide the customer with what they want. However, that model was corrupted by a failure to maintain open communications with customers (asking what options they really wanted to choose from) and failing to spend monies on R&D to design new innovations to keep the product line fresh and new.
INTEGRATION
Unfortunately, Dell failed to integrate their mission – “Dells mission is to be the most successful computer company in the world at delivering the best customer experience in markets we serve” (Dell.com, 2008) – successfully. They failed to obtain this goal by losing focus on the customer