Dell Computer Solutions: Growth Strategies

This assignment analyzes Dell's computer solutions business, examining its past success, current challenges posed by competitors like HP and Apple, and potential future strategies. It highlights the company's direct sales approach and suggests focusing on after-sales support, environmental sustainability, and continuous innovation to achieve sustainable growth.

Running head: LOGISTICS MANAGEMENT
Logistics management
Name of the student
Name of the university
Author Note:

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Table of Contents
Introduction......................................................................................................................................4
Background......................................................................................................................................4
Fundamental Reasons for Success...................................................................................................5
Maintenance of Competitive Advantage.........................................................................................6
Suitability for other companies........................................................................................................9
Configure to-order and postponed production work.......................................................................9
Recommendations..........................................................................................................................10
Conclusion.....................................................................................................................................10
References......................................................................................................................................12

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Introduction
The modern day supply chain management is a complex chain of different companies
that are dependent on each other. The researcher has provided the example of “Dell” in this
report which is one of the largest technology companies of the globe. The technology industry is
too much dependent on supply chain as the suppliers of different products or raw materials have
to be shared with the customers. The company is committed to responsible practices in business
and maintains high standards of ethical practices. The main aim of this research is to derive the
reasons for the success of the company in the modern marketing world and how the company has
been able to hold its competitive advantage for such a long time.
Background
Supply Chain Management and Logistics have become the key issue of the mentioned
technology organization. The story of Dell started in the year 1984 in the state of Texas of USA.
Mr. Michael Dell was the founder of the company who was a medical student in the University
of Texas. The strategy of the company in the beginning years was a bit different from the other
similar companies of the time. It stuck to the process of direct sales as which they believed to be
the best way to personally reach the customers. After some years they adapted the use of retail
sales only to return back to the old process of direct sales. The company reaped the benefits of its
innovative strategies of not depending upon any third party suppliers to deliver their product as
they became the supreme company of USA beating their rivals like Apple, Hp and IBM. The
company is reputed worldwide because of its unique and totally different logistics system
(Waters and Rinsler 2014). On the global front Dell relies on a wide range of innovative

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marketing personnel and some reliable suppliers who are well reputed for delivering the finished
product to the service users.
Fundamental Reasons for Success
Dell has been there in the market from 1984 and the company has enjoyed huge success
since then (www.dell.com). As mentioned earlier the use of latest and innovative technological
methods and proper strategies has been the main force behind its success (Waters and Rinsler
2014). The case study has provided a brief insight into the logistical and supply chain
management of the mentioned organization. As mentioned earlier Dell has followed a system of
sales direct to customers. This particular system has been instrumental in carving out the success
of the company. In the beginning the company began with upgrading the old IBM machines and
reaching the products direct to the customers without involving any middlemen in the process.
The following strategy helped the mentioned organization to directly interact with the customers
and answer their all queries and difficulties. A large section of the media as well as other
companies viewed Dell’s strategy to be a negative one and termed it as a company which sold pc
like bananas. The Company however remained focus on improving the customer relationship
management and getting more close to the key customers (Christopher 2016). The success of the
company can also be credited to the performance objectives as it s main aim is to provide the
buyers with quality pc at a lower cost. Such a lucrative deal was easily accepted by the people
and was thus in a very small time Dell became one of the best companies in the market.
The researcher has compared the success story of the company with another similar
company which has been unsuccessful to survive in the market. Palm Inc was a successful
technological company that cropped up in the last decade. It specialized in manufacturing PDA’s

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and different other electronic devices that could easily be integrated into computer platforms.
The company was moving in the right path and it appointed a network of computer developers to
stay updated with the latest technological advancements of the modern day. But things started
changing after some time due to a variety of different factors (Wisner et al. 2014). The first and
foremost being its association with another company named Sprint Nextel which was itself a
shrinking firm. The company also failed to develop any unique product of its own that could give
stiff competition to other existing products like apple I-phone or android. On the other hand the
company failed to market the products in a suitable manner as the advertisements campaigns,
promotional campaigns failed miserably. However the most important reason behind its failure
laid in its overdependence on third party selling as it failed to reach out the customers and
understand their needs and difficulties (Ross 2015).
Maintenance of Competitive Advantage
Dell has created an organizational structure that is focused on inventions and is based on
a flat structure around key processes and supported by a network of independent organizations.
Some of the features by which it maintains its advantage in the market are;
1. Market Orientation- As mentioned earlier Dell believes that success comes only on
reaching the customers personally without involving any third party in the deal.
Therefore the basic task done by the organization is to create superior value for their
products to the customers (Hult et al. 2013). The company earned itself a reputation by
producing high quality pc and offering them to the customer’s at the most competitive
prices. This particular policy landed the company with huge success as other
organizations failed to formulate such strategies as they were dependent on the

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wholesalers and the retailers to market their products (Gleghorn and Harper 2015).
According to business will see the light of success once they formulate the right strategies
emphasizes on their customers and competitors and finally develop one of the best
learning cultures within the organization. The management of Dell has been successful in
creating the best type of strategy for the organization because of the great involvement of
each and every employee of the organization. The employees of the company have
effectively collected shared and interpreted information and decision making process of
the organization (Govindan et al. 2015).
2. Market Positioning and preferences of customer- Segmentation, Targeting and
positioning of the customers is done to ensure what type of customers are present in the
market, secondly what are the needs of the customers and lastly are there any additional
preferences. This helps the organization to prepare their products based on the enhanced
customer demands (Fredendall and Hill 2016). Generally at the beginning the business
units does not select any particular customers for their products but treat all of them as
the same and applies the same strategy over all their products. Secondly there are
strategies where the business entity tries to be selective towards the marketing and focus
on potential groups to enhance their customer base over that group (Stadtler 2015). Dell
has followed exactly the same structure and has achieved huge success. The products of
Dell are affordable and are of high quality suiting the range of the selected group of
individuals. This helps the organization to hold a competitive advantage over their rivals
over a given period of time. Dell usually uses the customer segmentation in its marketing
strategy and also the product segmentation where it targets several segments of the
market and offers their customers a wide variety of products. As mentioned earlier the

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main strategy of the organization is to ensure that they serve the customers the best
products according to their demands. This helps them to increase the market share and
have a superior competitive advantage over their rivals in the industry.
The mentioned technology organization has divided the customers into two types
namely;
a. Transactional Customer- This kind of customer’s is too much sensitive to the
price of the products. They are always in search for high quality products at the
lowest possible price, reliable products; value added services and an uninterrupted
service from the organization (Stadtler 2015). The following range of customers
have been on a rise since the last 5 years because of the advancement of the
computer technology especially the internet where one can buy online products
easily. The mentioned organization has a set team of experts who look after the
online purchases and regularly keeps a detailed update on the buying patterns and
behaviors of the people and accordingly approaches them. Thus it can be said that
the organization has carefully divided the market according to the preferences of
the customers. Dell has the knowledge and ability to make sure that their products
meets all the different needs of the customers. The company has earned itself a
reputation in the technology and innovation market as one of the premium
business unit that sells high quality computer products at a competitive price.
b. Relationship Customer- Relationship customers are the large customers who
provide the organization with the largest portion of profit as they are the bulk
purchasers of the different products of the company. These corporations or
government offices are represented by sales representatives or managers in charge

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of the accounts (Fawcett et al. 2013). Delivering a quality set of products and
services to these service users for a long time creates a strong bond between the
organization and the company. The company on the other hand also provides the
organizations with a number of different benefits like charging a less amount for
the products, offering special discounts for them and also allowing them to
provide recommendations on the quality of the product during the production
process. Dell has also developed customer specific web sites like “premier-pages”
with already determined prices of different products.
Suitability for other companies
The other companies that can attain success by following Dell’s business structure are the
manufacturing companies (Mangan and Lalwani 2016). They can follow the following structure
to manufacture and distribute their products on their own which will help them to increase their
productivity and increase their percentage of profit. It will be easier for them to do business if
they get rid of the middle men as they will not have to share their profit\it with those people and
thus will be able to earn the maximum profits (Ross 2016).
In the beginning some other companies were reluctant about following the same strategy
like Dell but they slowly started changing their strategies after the huge success of Dell in the
market. Companies such as HP and Apple made some serious investigation into the strategic
structure of the mentioned technological company as mentioned in the research and made some
necessary changes to their already existing structure. HP which provides personal computers,
imaging and printing products and many other different computer accessories provides IT
infrastructure to both individual and different enterprises. HP has incorporated some of the

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strategies of Dell and now it has created an excellent account management system for
maintaining its global network. The organization has reviewed its prices and rather than offering
quality products in a much higher price they are now offering the similar products with advanced
features at a much lower price that is believed to be competitive in the market.
Apple on the other hand is a well known organization that has established its name as one
of the best Pc manufacturers around the globe. Its own system software is totally different from
that of the windows and Intel and thus has carved out its own name in a different way. In the
earlier days the company used to distribute its products to the customers by appointing a third
party intermediate (Waters and Rinsler 2014). Apple has also changed its strategy to compete
with the other players in the market. They are slowly changing their approach to appoint third
parties and are now involved in direct selling to the customers from its large number of different
flagship stores.
Therefore the strategy of Dell has been a hit in the market as more and more number of
organizations are likely to follow the strategy of the organization in the near future.
Configure to-order and postponed production work
Dell uses the postponement strategy to carry on its business. It has a lot of different
advantages (Christopher 2016). The changing demands of the customers now and then and the
availability of different substitute products in the market have forced the organization to risk the
non selling inventories and keep the best selling products on a different side. The existence of a
number of challenges before the delivery of the final product makes the organization vulnerable
to profit. Therefore it is necessary for a business entity to provide the right product to the right
people with the right price. Dell ensures that the products of their company meet all the

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necessary specifications of the customers and then they segments out their target market and
ultimately sells them to the potential customers. Some benefits include;
a. Minimize wrong inventory and the products are obsolete and marked down.
b. The use of own technologies spurts up in the absence of imports.
c. The customers can be presented with a number of different options to make sure that they
are able to get the products at a reasonable cost.
Conclusion
After a thorough analysis of the whole report it can be suggested that Dell has been
successful to survive in the market in times of crisis just because it has adapted to innovative
measures to make itself sustainable. The organization has been successful to maintain its
integrity and brand equity and has earned itself a name for the provider of quality pc solutions.
The company must use the same strategy of innovation and growth until it gets success. In recent
times the company has been facing stiff competition from the likes of HP, Apple and many other
companies. The direct sales approach by the company cuts the cost of the middle men and thus
helps them to reap all the profits without sharing it with the others. Dell can also invest in after
sales support as because the after sales support offers a huge profit as compared to the sales of
the computers. Last but not the least the mentioned company must focus on the environment and
take environment friendly measures and ct down upon the carbon emission rates of ther
organization.

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References
"Dell India Official Site | Dell India." Www1.ap.dell.com. N.p., 2017. Web. 19 Aug. 2017.
Christopher, M., 2016. Logistics & supply chain management. Pearson UK.
Fawcett, S.E., Ellram, L.M. and Ogden, J.A., 2013. Supply Chain Management: Pearson New
International Edition: From Vision to Implementation. Pearson Higher Ed.
Fredendall, L.D. and Hill, E., 2016. Basics of supply chain management. CRC Press.
Gleghorn, G.D. and Harper, A., 2015. Logistics and Supply Chain Management and the Impact
of Information Systems and Information Technology. In Technology, Innovation, and Enterprise
Transformation (pp. 295-301). IGI Global.
Govindan, K., Soleimani, H. and Kannan, D., 2015. Reverse logistics and closed-loop supply
chain: A comprehensive review to explore the future. European Journal of Operational
Research, 240(3), pp.603-626.
Heckmann, I., Comes, T. and Nickel, S., 2015. A critical review on supply chain risk–Definition,
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Holweg, M. and Helo, P., 2014. Defining value chain architectures: Linking strategic value
creation to operational supply chain design. International Journal of Production Economics, 147,
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Hult, G.T.M., Closs, D. and Frayer, D., 2013. Global supply chain management: Leveraging
processes, measurements, and tools for strategic corporate advantage. McGraw Hill
Professional.

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Mangan, J. and Lalwani, C., 2016. Global logistics and supply chain management. John Wiley &
Sons.
Ross, D.F., 2015. Distribution Planning and control: managing in the era of supply chain
management. Springer.
Ross, D.F., 2016. Introduction to e-supply chain management: engaging technology to build
market-winning business partnerships. CRC Press.
Stadtler, H., 2015. Supply chain management: An overview. In Supply chain management and
advanced planning (pp. 3-28). Springer Berlin Heidelberg.
Waters, D. and Rinsler, S., 2014. Global logistics: New directions in supply chain management.
Kogan Page Publishers.
Wisner, J.D., Tan, K.C. and Leong, G.K., 2014. Principles of supply chain management: A
balanced approach. Cengage Learning.