Snapshot of The World of Global Multinationals

Running head: IMPORTANCE OF INNOVATION
STRATEGIC MANAGEMENT AND LEADERSHIP in the context of DELL
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IMPORTANCE OF INNOVATION1
Executive Summary
As found in the study, the personal computer industry witnessed quite a drastic change in
consumer behaviour. There is a shift to buying innovative and high-performing products at the
most competitive prices. Lenovo and Apple can be considered to have utilised the trend
excellently. HP Inc. and Dell have also been the industry’s big names. However, Dell needs to
show more resilience to the highly unpredictable market demand. Dell found its dominance
significantly affected post-2005 from increasing product innovation by other industry giants. The
study concluded that Dell should use more change for its Notebooks and personal desktops.
Besides, it needs to gain expertise in offering highly trusted enterprise services and solutions.

IMPORTANCE OF INNOVATION2
Table of Contents
Introduction......................................................................................................................................4
Brief profile of Dell.....................................................................................................................4
Analyse how the industry has changed over the last few years and assess the impact of such
changes on Dell............................................................................................................................5
Purpose of the report....................................................................................................................7
Body.................................................................................................................................................7
1. Evaluate the sustainable competitive advantages of Dell.........................................7 critically
1.1 VRIN analysis....................................................................................................................7
1.2 Identify the competitive advantages of Dell....................................................................10
1.3 How these capabilities will/will not support the new service ‘Enterprise Solutions and
Services..................................................................................................................................11
2. Challenges to be faced by Dell from its expansion in the area of ‘Enterprise solutions and
services’.....................................................................................................................................12
2.1 Dell's critical acquisitions in the case study....................................................................12
2.2 The key issues/challenges in any acquisition..................................................................12
2.3 Using the Integration matrix to identify the type of integration should Dell adopt........13
2.4 The advantages/disadvantages exist for each example of integration strategy suggested
...............................................................................................................................................14
3. A critical commentary upon the Dell strategies....................................................................16
3.1 The importance of innovation to this industry.................................................................16

IMPORTANCE OF INNOVATION3
3.2 A crucial analysis upon the Dell strategies......................................................................17
4. Using the BCG matrix...........................................................................................................17
4.1 Plotting each of Dell’s products/services........................................................................17
4.2 Discuss the strategic options............................................................................................18
5. Proposing strategies for Dell.................................................................................................19
Conclusion.....................................................................................................................................20
References......................................................................................................................................21

IMPORTANCE OF INNOVATION4
Introduction
This report is on Dell and its long journey in PCs (personal computers) making. The tour
shows how it once attained and enjoyed a competitive advantage to rule PC industry for years.
The section also highlights things that went wrong for Dell and affected the company’s market
supremacy. The journey shows a shift of focus entirely or partially when Dell decided to gain
expertise in computer services and software. The study also gives two points of suggestions to
Dell thinking that it would add value to the whole company or its products and services.
Brief profile of Dell
Dell is a Texas, United States-based computer technology company that primarily
manufactures personal computers. It produces many other products like Dell servers, computer
peripherals, televisions and smartphones. Michael Dell founded this company 36 years ago in
1984. Other than United States, Dell exists in Ireland, Japan, China and many other parts of
world. In the 1990s, Dell used to sell its products through mail orders and internet, thus saving
on the distribution cost. Dell, unlike other computer-technology companies, relied on just-in-time
delivery. Besides, assembling of computer peripherals used to be done internally instead of
outsourcing to China and Taiwan to access low-cost labour. It is how Dell managed to save
considerably on the manufacturing and distribution of personal computers. All these helped Dell
attain the competitive advantage that lasted till 2004. It was 2005 when Dell began to lose its
competency. Dell’s competitors like Hewlett-Packard, IBM, Lenovo and Apple challenged its
dominance of the industry with their product innovation. Situations became more challenging
when another American multinational, Apple moved to China seeking low-cost manufacturing

IMPORTANCE OF INNOVATION5
operations for its hugely successful products like Apple laptop and iPads. Besides, IBM found its
areas into computer services and software. Sensing the urgency to address these issues, Dell
stepped into IT solution services to stabilise and more importantly boost up its share of PCs
market (Dell.com 2020).
Analyse how the industry has changed over the last few years and assess the impact of such
changes on Dell.
Dell used to be the industry leader when it ruled the PCs industry with its that time
unique strategy to assemble products in-house, and supply orders through mail order and
internet. However, Dell's cost-competitiveness was challenged much from changing industry
picture and the changing strategies of its rival companies. Consumers who used to be quality-
oriented and desirable for sustainable products were found as changing their ways into buying
PCs. Consumers began showing their prime concern for price ever since 2005 (Cancino et al.
2017). The change in trend was well read by many of Dell’s competitors like Lenovo, IBM and
Apple. They responded to it with a difference in their product manufacturing strategy. However,
Dell remained mostly silent over it. It began showing some concern to it in the late 2000s when it
acquired few companies to roll out its activities concerning 'Enterprise Solutions and Services’.
Computer service and software became Dell's new identity ever since 2005. However, a series of
acquisitions of companies to support its new strategy and gaining significant shares of the latest
market segment do not speak of the volume of success Dell had with this new strategic move.
Dell’s performance over the years suggests its struggling story with its diversified
product/service portfolio. The figures for revenue mix shown below suggest the same: