Matching Dell
Matching Dell
1. Describe Dell’s strategy.
2. What are the key trade-offs involved in Dell’s strategic positioning?
One trade-off is Dell’s strategic positioning of personalized computers refrains it from the benefits of supply-side economies of scale. The personalized products and customer-centric services mean higher cost.
The other trade-off is that Dell loses sales opportunities to a variety of distributors by focusing on direct sales. Although the strategic positioning of direct sales can cater for customers better than other competitors, the cost is relatively high. Dell had to invest much more on customer service and sales team. Although it tried to enter retail channel in 1990, the initiate ended with failure in 1994.
3. Why have rivals been unable to replicate Dell’s strategy?
Rivals have not been able to replicate Dell’s strategy because they can not replicate the strategic fit. All the activities of Dell are related and interacted with one another. A competitor can only replicate one of Dell’s activities such as personalized product or on-time customer service or direct sales. However, all the activities together formed Dell’s competitive advantages and it takes long time and great effort for a competitor to fully replicate the whole strategy of Dell’s.
4. Why has Dell’s competitive advantage deteriorated in the recent years?
The reasons lay in the company itself and the outside competitors. From the perspective of the company, Dell did not adapt to the rapid changing market of PC industry with new strategies. What’s even worse is that it ruined some of its competitive advantages. In 2006 Dell recalled 4 million batteries 1 and this issue destroyed its long built reputation of high quality. Another advantage of customer service was also deteriorated in recent years with the rising customer complains.
From the perspective of the market and competitors, there are other reasons led to the deterioration of Dell. First, ever since 2000, the PC market
1. Describe Dell’s strategy.
2. What are the key trade-offs involved in Dell’s strategic positioning?
One trade-off is Dell’s strategic positioning of personalized computers refrains it from the benefits of supply-side economies of scale. The personalized products and customer-centric services mean higher cost.
The other trade-off is that Dell loses sales opportunities to a variety of distributors by focusing on direct sales. Although the strategic positioning of direct sales can cater for customers better than other competitors, the cost is relatively high. Dell had to invest much more on customer service and sales team. Although it tried to enter retail channel in 1990, the initiate ended with failure in 1994.
3. Why have rivals been unable to replicate Dell’s strategy?
Rivals have not been able to replicate Dell’s strategy because they can not replicate the strategic fit. All the activities of Dell are related and interacted with one another. A competitor can only replicate one of Dell’s activities such as personalized product or on-time customer service or direct sales. However, all the activities together formed Dell’s competitive advantages and it takes long time and great effort for a competitor to fully replicate the whole strategy of Dell’s.
4. Why has Dell’s competitive advantage deteriorated in the recent years?
The reasons lay in the company itself and the outside competitors. From the perspective of the company, Dell did not adapt to the rapid changing market of PC industry with new strategies. What’s even worse is that it ruined some of its competitive advantages. In 2006 Dell recalled 4 million batteries 1 and this issue destroyed its long built reputation of high quality. Another advantage of customer service was also deteriorated in recent years with the rising customer complains.
From the perspective of the market and competitors, there are other reasons led to the deterioration of Dell. First, ever since 2000, the PC market