In-Depth Analysis On Dell Strategic Management
Task: Develop a report analysing how Dell strategic management approaches make the organization successful in the consumer market.
Dell strategic management undertaken in the following study refers to the process of initiating, planning, analysis, monitoring, and assessing the requirements within the organization to accomplish its objectives and goals. Moreover, the changes within the environment of business require effective strategies to make the organization successful in the consumer market. The paper will focus on the implemented Dell strategic management. The approach of businesses will be evaluated within the article as well. The paper will look forward to analyze the capital within the company. The effective recommendation will also be provided within the document in context with the Dell.
Dell is a multinational organization of America, which looks forward to offer effective technologies at the global platform. It is computer software and hardware industry whose predecessor is Quest Software. Michael Dell founded the organization in the year 1984. It is headquartered in Round Rock, Texas, US (Delltechnologies.com 2020). The organization offers personal computers, peripherals, servers, televisions, smartphones, and other technological gadgets (Bloomberg.com 2020). The company is also being considered as a well-known firm for its useful innovations in electronic commerce and management of the supply chain. Earlier, the organization only focused on providing hardware services worldwide. However, in the year 2009, the organization looked forward to expand its operations towards IT services. It facilitated the organization to effectively make its additional acquisitions in the networking and storage systems. The organization always aims towards expanding its entire portfolio for delivering effective and complete computer hardware and software solutions.
Figure 1: Market Share of Dell from 2011 to 2019
(Source: Statista, 2020)
The above-stated graph provided in the study of Dell strategic management represents the market share of Dell from the year 2011 to 2019. It indicates that the organization had continuously looked forward to increase its market reach and market share in the market (Statista, 2020). Moreover, the organization faced a downfall in several years. However, the company did not look back towards its failure and continued its operations to gain a competitive advantage over rival firms. One of the major concerns by the declining sales in recent years is due to the shortage of Intel’s Central Processing Unit (CPU’s). Dell had been listed in the rank 51, within the Fortune 500. The company also ranked as the third-largest computer hardware and software vendor at the global platform after Lenovo and HP. The company is one of the largest suppliers of PC monitors in the international market. The market share of Dell's shipment all over the world makes the company one of the most effective global personal computer unit (Delltechnologies.com 2020).
Currently Implemented Technological Strategy and Return of Investment
Recently, Dell Technology initiated its strategy and vision related to the Internet of Things or IoT. Alongside this, it also started a new division of IoT that is related to particular products, partner programs, labs, and consumption models. IoT, which is the latest distributed model that the company is implementing, is resulting in the gradual transformation of the business (DANISH and SHARMA, 2018). With the emergence of a new model in the form of cloud computing, the IT industry is now witnessing the development of an extensively centralized model that is now becoming vital in providing relevant IT services. However, in this digital era, there is now a need for a "distributive core" that focuses on real-time data processing.
As a result, IoT is now changing the way organizations tend to operate and hence, to alter the global operations in process. Dell Technologies has been a pioneer for the customers with a recently developed and distributed IT architecture. It allows the company to bring the concepts of Artificial Intelligence and IoT together in a single independent digital ecosystem. From the core of cloud technologies to the edge, these implications for international society are profound.
Latest Dell Technologies Concerning IoT Division
The organization's newly formed IoT division is responsible for the orchestration of development of IoT services and products across the company. The Solutions Division of the organization now combines the technologies developed internally with the deliverables from the vast digital ecosystem of Dell (Jakimoski, 2016). Earlier, Dell strategic management has witnessed the opportunity of rowing rapidly with the implementation of IoT as it is highly regarded in the market of cutting edge computing. The new IoT division of the organization has resulted in leveraging strength across the entire organization to make sure that the most suitable solution is delivered.
Organic Investments in the Future of IoT
Currently, Dell Technologies is investing over $1B in new IoT solutions, products, labs, and ecosystem and partner programs. Dell Technologies is now already offering Edge Gateways, which can effectively manage and secure the Control Center of IoT. Along with this, servers of Dell PowerEdge Series are enhanced for machine learning and batch training (Luo et al. 2018). Being a significant aspect of the distributed core, Elastic Cloud Storage and Dell Isilon provide object and file storage. It is done for proper management of large chunks of data and enabling analytics via HDFS.
Return of Investment of Dell Technologies
The organization of Dell Technologies is now closely collaborating with the latest division of IoT. As a result, it provides industrial relationships and insights to support the agenda of strategies. With the investments that the company has made in recent times, Dell Technologies is now offering a valuable connection with its external system of innovation. As a result, it has effectively accelerated the deployment and development of the latest products of IoT, ML, and AI technologies. Along with this, Dell Technologies is also helping manufacturers to deploy accurate sensor technologies. It can deliver data securely with advanced tools concerning analytics.
Understanding the Application of Technological Strategies in Dell
Dell looks forward to implement strategies with robust capabilities to increase its efficiency into the international market (Bellini et al., 2017). Effective Dell strategic management of the supply chain helps the organization to gain a compelling competitive advantage over the rivals.
Dell technologies focus on implementing the latest technologies through the IoT divisions to make its hardware and software systems smarter than before (Trabucchi et al., 2018). Moreover, the distribution of the core computing model is based on the IoT strategies of the organization. The use of Artificial Intelligence within the organization had helped the company to increase the predictive systems of the products (Larsen, A.I., 2017). The use of IoT strategies for an effective Dell strategic management had helped the company to effectively facilitate the customers to speed up their implementation of projects (Nilsen, 2017). As the customers are much aware of the digital transformation into the international market, it influences the organization to effectively look forward to naturally and standardize its devices to increase the satisfaction level of the customers.
The divisions of IoT facilitate the organization to active control and monitor the electronic systems which are being used in various types. The international market is highly competitive; however, a business must use the available resources effectively. Dell looks forward to apply IoT divisions within its organization to stay updated with the changing market conditions and customer’s demand (Larsen, A.I., 2017). The IoT divisions help the organization to effectively navigate the different businesses and help the partners to keep increasing their scope. The partners of Dell can easily look forward to access the new integrated solutions for the analytics of IoT and vertical applications. The effective collaboration of SAP and VMware undertaken by Dell strategic management facilities the solutions used in SAP Cloud Platform, SAP Leonardo, and VMware Pulse IoT Center to helps the customer’s effective hardware and software solutions (Nilsen, 2017).
However, Dell is still facing various challenges even after applying the IoT divisions effectively within their organization (Trabucchi et al., 2018). Effectively meeting the expectations of customers is one of the major issues with the business strategies. It is much required for the organization always to look forward to innovate their devices as per the choices of customers. Easing the concerns of security is also not available with the IoT divisions. Keeping the hardware updated is also one of the major concerns within the company as the overcoming issues of connectivity reduce the efficiency of IoT divisions.
Dell technologies also look forward to invest in the organically for the future of IoT effectively. The IoT decisions had helps the organization to be effective compete in the competitive market. Moreover, Dell Technologies looks forward to continue its commitment towards standardization of the EdgeX Foundry, OpenFog Consortium, and (IIC) Industrial Internet consortium (Sinclair, 2018). It facilitated IoT to create new models of revenues from the customers by offering new support such as Cloud Payments and other online payment operations for the customers. The organic investment by Dell strategic management had helped the business to grow their business efficiency by increases the effectiveness of business systems and economies (Trabucchi et al., 2018). It also facilitated Dell to effectively expand its business operations into the international market, increasing its production, output, the base of customers’ development of new products, and dynamic process of firm. Dell had increased its efficiency by reaching the targeted customers and markets and had made its well-defined niche within the market. It had also helped the organization to effectively develop east to define differentiators and a strong balance between traditional and modern marketing.
The organic investment of the firm had helped the organization to make its expertise visible in the market. However, the organization is facing a major challenge to be dependent on the growth of the overall market. Moreover, the organization is also facing difficulty to build its market share because it is already one of the key players of computer hardware and software in the international market (Bellini et al., 2017). It is also leading the organization towards the slow growth and the fluctuations in market share, and it makes the organization difficult to manage and monitor, such as complex and huge business activity on the global platform (Sinclair, 2018).
How are these strategies developed and their reasons
This discourse displays the Dell strategic management and how they are implemented and reason for their implementation and development. In this world of Technological advancement and Globalization, Dell is one of the prominent names in the corporate sector.
This section of the study intends to shed light on the numerous critical details, which are elements of Dell strategic management, while analyzing Dell Company's position and circumstances against the competitors with the commonly prevailing issues in the industry. Additionally, there is an explanation of Dell's present strategic aspects, and Industry’s prevailing corporate formation and work culture. Subsequently, the report is backed by installing some recommendations about analyzing its concept, intentions, goals, and utilizing alternative tactics. Furthermore, there is an introduction to developmental strategies to be incorporated by Dell for essential business growth and expansion.
In the Technological PC market, there are several competitors of Dell, including Hewlett-Packard, Sun Microsystems, Gateway, IBM, and so forth. Speaking about the Dell strategic management approaches to be incorporated by the company, as a business giant, to combat the common issues and the significant Business threats from the competitors, the following concerns and suggestions are crucial and should be implemented.
Industry Prevalent Issues and Strategy Implementation
In order to reach their objectives effectively, customers’ preferences and requirements should be prioritized, and extra care has to be taken by companies in regards to the detailing of product features starting right from the shape and design to the bigger things, such as performance concerns as they are crucial for achieving sustainable growth in the company annual performances (Cusumano et al., 2019).
Diversification of product features:
To extend the company’s reach towards a more significant number of potential buyers and to increase customer satisfaction introducing unique and upgraded features with the products and services expansion will be helpful.
Technological advancements are necessary:
Taking the help of Technological advancements and newer operational methods or strategies while producing unique and modern products or services will be profitable as it increases the efficiency and quickness in the outcomes generated within the company (Ezrachi and Stucke, 2016).
Strategies: Corporate, Business, Functional Level
Corporate Strategy is the overall planning of Dell strategic management for achieving diversified objectives and business growth intentions at the managerial level. This concept frequently consists of the various administrative decisions and implementation of crucial modifications established to deliver excellent business rankings in multiple industries and the innovative approaches utilized to the fullest to manage the company's overall performance (Cusumano et al., 2019).
Following the demographics of Dell, target areas should be set and segregated for the ultimate increase in the sales figures and purchasing level.
At the Business Level, a good strategy is to seize the attention of potential customers before the competitors are crucial by introducing and utilizing innovative procedures in regards to advertisements and displaying of Dell's newest product collections in the market. Another strategy under Dell strategic management could be to apply applications that appear as spontaneous to the end-user and doesn't require further training (Ezrachi and Stucke, 2017).
At the Functional level, Dell computers' crucial Strategy is to employ its authoritative aptitudes in the realms of promoting direct sales, supply-chain management, and low-cost manufacturing to develop the product categories and produce customer satisfaction with added value at lower prices (Ezrachi and Stucke, 2016). Extending its marketing strategies to establish company sales is crucial. To pursue revenue growth opportunities utilizing the competitiveness of PC’s and Servers to improve efficiency is always a good strategy.
If Dell is still using the Traditional Value Chain Model for processing its orders, then it is pivotal for the company to introduce and implement advanced Dell strategic management for the product orders to enhance the in-house stock of finished goods inventories.
Next comes, enhanced Internal Control and Risk Factors Management, which is crucial for any company to improve its performance standards (Ezrachi and Stucke, 2017). Improvement in International trading skills, owning powerful strategies to generate high revenue, exceptional marketing skills with highest regards to Customer service and satisfaction, Brand enhancement and management with more corporate awards and recognitions, moderate pricing with lucrative offers, maintenance of the quality of sharp Brand Image, diverse advertising, innovation and high-quality performance level in product variations, and reliable financial backup can assist Dell in achieving uniqueness and a competitive edge over its competitors.
The core Dell strategic management is built around the customers, logistics, and high quality and effective manufacturing of computer hardware and software. Moreover, the organization is looking forward to increases its reach among commercial customers and individuals on the global platform.
Driving Digital Transformation through effective humanity, empathy, and leadership
The organization had looked to effectively drive the digital transformation to increase the organizational reputation and goodwill on the global platform (Parvez et al., 2018). It will look forward to integrate effective leadership within the organization, humanity factor, and empathy, along with the integration of digitalized technologies to deliver effective value to the customers. It had helped the organization to effectively cope up with the market changes (Sinclair, 2018). It had helped the organization to adopt effective strategies to provide valuable opportunities to the functions of the firm and automate the entire businesses processes.
The ventures of Dell technologies were generated with the aim of supporting new businesses and effectively investing in an efficient strategic direction along with the expertise of technologies. The organization looks forward to effectively invest in various business activities to gain a higher return on investments (Parvez et al., 2018). The capital strategy initiated within the Dell strategic management helps the company to maximize the appreciation of capital within the organization. The effective portfolio of investment facilitates the organization to allocate the assets and securities effectively, which will ultimately add value to the business and increases their profitability (Sinclair, 2018).
Dell always looks forward to hire effective employees who are much dedicated to working effectively to increases organizational efficiency and accomplishing organizational goals. Dell technologies had always looked forward to adopt a direct sales model, which is one of the most successful factors within the company (Mburu, 2018). It influences the strategic innovation within the company and helps them to bypass the channels of retailers. Dell is well known for the fact that the other key players or competitors of computer hardware and software in the market are much focused on building highly standardized machines and stuffs the channels with the inventories. However, a dell technology focuses upon manufacturing the machines and only maintains 12 days of inventories. In the factories of Dell, the personal computers are effectively assembled, packed and tested along with effectively installed software within just eight hours from the time order had been received (Securities and Morgan, 2016). The basic approaches comes under the Dell strategic management to eliminate the intermediaries’ effectively influenced the company to reduce the load of inventories, build an effective relationship with the suppliers, and receive direct feedback from the customers. The organization always looks forward to innovate its entire processes to gain a competitive advantage over the rivals by benchmarking the quality of its products.
Business Model that Dell technologies currently implements
In the past years, Dell technologies always looked forward to sell its computer hardware and software and configured servers at low process individually. The organization provided the approaches of Low price for the customers by effectively involving special value architecture and classical architectural business model of innovation (Securities and Morgan, 2016).
Business Model Canvas of Dell
· Technological partners programs
· Technological alliance (Intel, BMC, Microsoft)
· Industries and Providers
· Logistic provider
· Value-added Reseller
· OEM Partners
· Marketing and Sales
· Engagement of customers
· Understanding the change of market and technologies
· Low-cost offerings than the other brands
· Help the companies to transform itself digitally
· Hardware for the business and homes
· Development of the advanced solutions for the companies
· Field Test
· Dedicated personal assistance
· Social media
· Online Community
· Promotional Offers
· Online Shopping
· Businesses of various sizes and with different vertical markets
· Government sectors
· Corporate users
· Small and medium businesses
· Personal users
· Intellectual Property
· An efficient and effective chain of supply
· Effective online presence
· Model of Commercialization- Built to order strategy
· Partners of distribution channel
· Consultants and Partners
· Local and regional offices
· Marketing and sales
· Service and Support
· Platform Maintenance
· Services – 27%
· Desktop- 18%
· Notebook- 18%
· Printer and Displays- 11.9%
· VMware -6%
· Infrastructure solutions- 18%
· Servers and networking – 9.1%
· Storage- 4.2%
· Others -1.5%
Table 1: Business Model Canvas of Dell
(Source: Created by the learner)
The direct sales approach of Dell strategic management facilitated the manufacturing process, which leads the productions of computer devices to meet the order of the customers. However, the business model of Dell was pressured from various factors. Within the consumer, market apple's well-designed computers look forward to gain a higher market share (Mburu, 2018). The users of Apple Mac hold the Market share of around 14.10%. It also facilitates the entering of new products of competitors in the market. The intense competition influences the organization to rethink their manufacturing process (Ghaffarzadegan et al., 2017). The introduction of Net Book within the market with the latest innovations and technologies increased the customer's purchase decision-making processes. Net books were cheaper from the regular computer devices of dell. It affected the value proposition of Dell in its traditional form of business operations. It weakened the market share of Dell in the international Market.
It has also been considered that Dell technologies are not a strategic leader. However, it always looks forward to follow the other key players in the international market. The purchasing of Dell computers by the customers makes the organization one of the key players; however, the Dell strategic management is much focused on integrating various cultures within their organization, along with integrating ineffective strategies.
Issues that the Current Strategies Face
Despite getting several benefits, the organization is facing various challenges while operating at the global level.
Issues to keep up with the changing demand:
The current Dell strategic management is making the organization face difficulty to keep up with the market demand. The digital transformation within the organization is also increasing the issues within Dell Technologies to effectively connect the IT infrastructure. Dell technologies offer on-premises infrastructures and equipment of data centers to the large companies at the global level. However, the terminology of digital transformation is increasing the financial issues within the organization.
What are the challenges with supply chain under Dell strategic management?
Due to the current strategies, dell is facing a major challenge within their supply chain. It had affected the sales, transportation, inventories, customer services, and cost of the organization.
Conclusion and Recommendations
The study on Dell strategic management had looked forward to evaluate the business and technological strategies used by Dell Technologies. It can be concluded that the organization had effectively looked forward to implement various current Strategies to grow in the market. However, it is facing challenges to integrate its strategies effectively with the IT Infrastructure. Dell requires a much better business strategy. The organization must apply effective Dell strategic management to increase their level of competency. It is also required for the company to change their business model to extend its market and customer’s reach effectively.
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