Dell’s Diversification Strategy Essay

The article called Dell’s Diversification Strategy: a Day Late and a Dollar Short? describes the recent attempts of Dell company to diversify its production and to enter other markets in addition to low-cost computer sector. The article consists of four parts. Introduction describes the unsuccessful diversification attempts of Dell. In the second part the author focuses on the inability of Dell to address customer needs. The next section describes the new direction of Dell interest cloud computing. Here author presents very interesting concept of servicization of some hardware companies shifting into the sphere of computer service due to increased competition in hardware industry. In the final section the uncertainty of Dell strategic objectives is stressed. The author states that Dell is trying to reach high diversification, which is extremely difficult.

The article clearly illustrates such concepts as differentiation strategy, focus strategy and low-cost strategy. It is shown in the article that Dell was previously quite successful using the low-cost strategy, at the expense of its internal optimization. The attempts of Dell to introduce product differentiation are also considered. The comparison of Dell’s differentiation attempts to Apple innovation activities (focus strategy) was performed. Also, the features of operating in a highly competitive environment were discussed, and the methods of gaining competitive advantage in computer industry were analyzed.

Basing on the SWOT analysis, it is possible to determine that some key Dell weaknesses and opportunities were not covered by the article. No evident bias could be noticed while reading the article. In general, the article is very informative and provides many interesting facts. Although these facts are presented in somewhat a chaotic manner and some key points should be added to show the full picture, the article provides a valuable insight into Dell’s current economic position and its difficulties related to further development.

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