Competitive Strategy Analysis: HI6006, Dell, Strategy Development

This essay provides a comprehensive analysis of competitive strategy, focusing on the application of strategic development tools to the case of Dell. The paper begins by defining and explaining the SWOT analysis, PESTEL analysis, Porter's Five Forces, and generic strategies. It then applies these tools to Dell, examining its strengths, weaknesses, opportunities, and threats (SWOT), the political, economic, social, technological, environmental, and legal factors (PESTEL), the competitive forces within its industry (Five Forces), and the generic strategies it employs (hybrid broad focus). The essay highlights how these tools inform strategic decision-making, enabling Dell to manage its operations effectively and prepare for future growth by gaining competitive advantage. The analysis includes specific examples and insights into Dell's business model and market position, emphasizing the importance of adaptability and strategic planning in a dynamic business environment.

Running head: COMPETITIVE STRATEGY
Competitive Strategy
Name of the Student
Name of the University
Author Note

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The paper is focused in the elaboration of the strategy developmental tools such as
SWOT Analysis, PESTEL Analysis, Generic strategies and Five Forces Analysis with a
precise focus on a chosen company, Dell. The paper elaborates the concept of the above
mentioned tools and along with that, it shows the usage of the above mentioned tools with the
example of the chosen company. The paper elaborates the impact of the above mentioned
tools in the development of the business strategies which has the potential to help the chosen
organization in the effective management of their business operations and in preparing for the
growth of the above mentioned organization.

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SWOT Analysis:
The SWOT analysis is considered to be the evaluation of the internal environment of
the organizations. The tool is notably crucial for the managers of the organizations in the
identification of the strengths, weakness, opportunities and the threats that the organizations
are subjected to (Yuan 2013).
With a precise focus on the selected company, the mentioned tool helps the managers
in the identification of the strengths such as strong presence in the market, improved skills of
using the latest technology and incorporating the innovative solutions to the products, low
inventory cost and excellent customer services. Apart from that, the company only assembles
the components for the products instead of manufacturing which helps the selected
organization in providing products at cheaper rates.
The tool helps the management of the selected organization in the identification of the
weakness such as absence of strong retailer relationships, inappropriate penetrating strategy
in case of the young generation which is pretty evident from the fact that the selected
organization is able to generate merely 5% of their total revenue from the educational
institutions along with the significantly slow growth of the market share.
The identification of the opportunities such as improvement of the business from the
online retail stores along with the scope of increasing the product chain of the organization
which is pretty much possible with the impact of the Direct approach model of the selected
company on other IT products, the scope of targeting the low priced tabs for capturing the
emerging markets and the rural areas, can be achieved with the application of SWOT
Analysis (Gupta 2015).
The tool plays a crucial role for the managers of the organization in the effective
identification of the threats such as incapability of achieving the breakthrough innovation as a

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result of the constant technological advancement, the significant market competition from the
part of the organizations such as the Lenovo, Apple and Acer, the need of constant up
gradation for maintaining their relevancy in the market with a precise focus on the increasing
changes in the technology and innovation.
Hence it is pretty evident that the mentioned analysis helps the selected organization
in their preparation of the strategies for managing their threats and weaknesses and achieving
the opportunities through utilising their strengths.

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Five Forces:
The Porter’s Five Forces analysis has the potential to help the strategy makers of the
organization in achieving the idea of the level of competition that surrounds that particular
organization. In addition to this, it also plays a crucial role for the mangers of the
organization in achieving the knowledge of the impact of the suppliers, new entries or the
buyers on the business operations of the selected organization (Takata 2016).
With a precise focus on the business operations of the selected organization and the
industry in which it operates, the tool enables the decision makers of the organization in
gaining the idea of the competition that the organization is expected to face the rival
organizations such as Apple, Lenovo, HP Hewlett-Packard and Acer. The tool enables the
company to gain the knowledge of their position in the market in case of providing the
quality products, cheaper products, products that are in alignment with the preferences of the
customers along with the other success factors that have the potential to develop any
business.
In addition to this, the tool plays a crucial role for the managers of the organization in
achieving the idea of the impact of the suppliers of the organization, the number of suppliers
available for supplying the materials, the number of the suppliers capable of maintaining the
quality ratings, the number of suppliers capable of providing the materials in accordance to
the desired costing. Along with that, the tool helps in the identification of the buyer’s power
in purchasing, whether the other competitor organizations are providing considerable amount
of options to the customer or not and apart with that, whether the company is able to establish
monopoly in the market or not (Pelaez, Yu and Lang 2013).
Apart from this, the tool is of great significance for the managers of the selected
organization in gaining the knowledge of the threat that the entry of the new organizations in

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the industry possess for the selected organization. The impact of the policies and the
procedures of the selected organization on the customers and the business environment of the
selected organization can be efficiently measured by the application of the tool.

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PESTEL Analysis:
The PESTEL analysis is one of the significant tool for the senior level management of
the selected organization in the accurate identification of the political, societal, legal and
environmental impact that act on the selected organization. Apart from this, the PESTEL
analysis evaluates the economic stability of a particular region for the selected organization
and at the same time, it also evaluates the impact of the technology on the chosen
organization’s business operations and the selected segment of the customers (Khan, Alam
and Alam 2015).
The tool is of great significance for the managers of Dell in achieving the idea of the
political impact such as the changing political dynamics of a particular region, the presence
of the political pressure on the business conduction of the organization in a particular region,
the impact of the local and national politics on the business operations or the activities of the
selected organization. Apart from this, the tool is also helpful for the managers in evaluating
the effect of the European Union’s business guidelines on their business policy along with the
impact of European turmoil of the sales of the products of the selected organization. The list
of benefits also includes the capability of the tool in explaining the impact of the tax
regulations along with the impact of the diplomatic relationships between the host country
and the parent country of the selected organization. Apart from this, the evaluation of the
impact of the various aspect of the global economy such as GDP, growth rate, inflation rate
along with scope of experiencing recession can be significantly achieved with the application
of the above mentioned in context of the selected organization (Kalu, Nto and Nwadighoha
2017). The tool also evaluates the impact of the business operations of the selected company
in the aspect of the environment where it evaluates whether the raw materials for the products
are sourced in ethical manner and in accordance to the environmental guidelines. On the
other hand, it also enables the company to evaluate whether their disposal of the excess waste

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is affecting the environment in the detrimental manner or not. In addition to this, the tool
helps the managers in evaluating the scope of incorporating the modern technology in the
products of Dell or in the services of the employees of Dell. While incorporating the
technology or the innovative solutions into the products and services of the selected
organization, the company also evaluates the easiness of the customers in terms of using that
technological advancement through the tool.

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Generic Strategies:
Porter’s generics strategy is one of the significant tool for the managers of the modern
business organizations. It helps them in gaining competitive advantage with specific
utilization of the generic strategies that the organizations use (Lambert and Davidson 2013.).
Considering the business operations of the selected company, it is pretty evident that Dell
uses the hybrid broad focus strategy. The fundamental strategies of the mentioned tool are
considered to be the cost leadership and the differentiation strategy. However, the business
operations of the selected organization has strong emphasis on both the strategies and that is
pretty evident from the fact that the selected organization produces their products in a unique
and cost efficient manner.
The tool proves to be significant for the managers of the organization in gaining the
idea of the scope of achieving the competitive advantage over the competitor organizations
through the business strategies of the selected organization. As mentioned earlier, the chosen
organization assembles the components that are purchased from other companies, for the
creation of the products that they offer to the customers, the company is able to save a
significant amount of investment that had to be allocated for the research and development of
the products if the company was a manufacturer. Hence it is pretty evident that the Dell’s
direct business model is of great significance for the selected organization in introducing low
priced products. In addition to this, the company is seen to have a comparatively low
distribution and assembling cost which notably contributes to the company’s strategy of cost
leadership (Rajasekar and Al Raee 2013).
On the other hand, the company’s direct business model has created notable amount
of flexibility in the processing of the products that the selected organization offers to the
customers. It enabled the company to put strong emphasis in the customization of the

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products and that is pretty evident with the company’s urge in gaining the customer needs
and tailoring the products in accordance to the needs the customers. Thus the products of the
selected organization are unique in nature. Hence it is pretty evident that the selected
organization employs a hybrid focus strategy for gaining competitive advantage and that
includes the reflection of both cost leadership and differentiation strategy.

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