Company Introduction
Dell Technologies, most often referred to as Dell, is an international company that produces computer hardware and software (Dell Technologies, “Company Information”). The firm was founded in the United States in 1984 and has been providing services worldwide for many years. Its headquarters are based in Round Rock, Texas (Dell Technologies, “Company Information”). Dell can be considered one of the main firms in the computer manufacturing industry as it develops, manufactures, and sells personal computers (PC), smartphones, servers, and other hardware, as well as various software products. The company employs approximately 150,000 workers and is represented in more than 150 countries (Dell Technologies, “Annual Report”).
Global Business Environment
In the analysis of the global business environment, one can see the factors that influence Dell’s place on the market. Political factors such as various federal and international regulations determine the operations of the company and their possible limitations. For example, Dell is a computer manufacturing company which falls under policies that regulate waste of electronic and electrical equipment. According to the company’s annual report, it works towards saving electricity consumption (Dell Technologies, “Annual Report”). Moreover, many regulations require companies such as Dell to implement more environmentally-friendly practices.
In this case, social environment is also influenced by similar notions, which can positively impact Dell’s popularity. Legal compliance affects the way the firm operates. As Dell is a multinational corporation, it has to adhere to various local laws. The economic conditions of the industry reveal a rising interest in purchasing computer equipment (Khan et al. 964). The technological segment of the business environment also shows that Dell remains close to the top of the industry’s most popular manufacturers.
Specific Business Environment
The factors of the specific business environment are directly linked to the company’s primary goals. First of all, customers in the sphere of computer manufacturing can significantly affect the success of firms. Dell manufactures and sells products at different levels and price categories, which allows it to attract diverse customer groups. For example, its range of gaming electronics may attract professional and amateur gamers who are ready to pay for more expensive equipment. The company produces hardware for other businesses and organizations as well, presenting solutions for both individuals and corporate entities. However, customers in this industry are exposed to a vast array of choices as the number of manufacturing companies is rather large. While Dell’s clients may represent different groups according to their age and financial capabilities, their uncertainty remains high in all areas. Theoretically, every person who needs a PC or some piece of electronic equipment can become a customer of Dell. The company’s international presence also allows it to appeal to different markets.
The suppliers of the company are numerous as it needs to gather materials for a wide range of goods. As was mentioned above, Dell tries to focus on increasing environmental sustainability, which limits the number of possible suppliers and limits the company’s choice of options. However, as the company is part of a major industry, its supply chains are most likely firmly established. The company’s position in the market remains stable which suggests that it is unlikely for Dell to experience a shortage of suppliers in the near future (Dell Technologies, “Company Information”). However, as this market continuously changes and invests in new materials, Dell has to remain alert as to its relations with potential stakeholders.
Many pressure groups can influence the company. First of all, various organizations concerned with the environment may push Dell to invest in more eco-friendly practices. In fact, environmental pressure groups may be the primary influence for this industry, given its extensive use of various metals and plastics. For example, chemical use may become a problem for the company. Dell responds to these pressures by introducing new eco-friendly campaigns and products manufactured with sustainable practices and recycled materials. Lobbying groups can also limit Dell’s presence on the market. Advocates for local production and home market growth may decrease international sales for Dell.
The industry of computer software and hardware development is full of powerful competitors. According to recent statistics, Apple is one of the leading competitors in the segment of computer manufacturing (“Dell Technologies Inc. Competitors”). Apple is also based in the US and has divisions in many countries throughout the world. It has more than 120,000 employees who design, produce, and sell PCs, tablets, smartphones, MP3 players, and various accessories (Khan et al. 957). Furthermore, Apple can be considered a robust competitor because of its strategic capabilities. Its principal advantage is its unique presentation of new concepts and innovative technologies. The company focuses on aesthetics and creation of a specific niche for its customers which makes it more appealing to many consumers. Its design is easy to recognize and difficult to replicate due to its level of popularity. Moreover, the company’s full range of products and their compatibility with each other but not competitors’ products is an advantage that separates it from other PC manufacturers.
Another possible rival is Acer, a Taiwan-based firm, which competes with Dell in another way. Although its products are not as unique as Apple’s, Acer produces equipment that appeals to the general audience. Acer designs and manufactures PCs, smartphones, tablets, servers, Virtual Reality equipment, and other accessories. Approximately 7,000 people work in the company, which makes the company more flexible and open for innovation and development (“Acer, Inc. Full”). Acer sells PCs to the domestic and intentional market, increasing the potential for further growth.
Acer also has a wide range of products that can be used by businesses and individuals for different purposes. Similarly to Dell, this company has a series of gaming products and accessories. It also finds a niche with lower priced products, where Apple is not represented. Therefore, it may become a more influential competitor in this segment, affecting Dell’s sales of less expensive goods. Acer’s competitive advantage is not as distinguished as Apple’s unique style. However, its wide range of hardware and software products makes it a compelling rival.
Finally, another one of the companies in the same price and product range is HP Inc. This company is also based in the US and has approximately 50,000 employees (“HP Inc. Full”). This firm presents a variety of technology solutions, including equipment, financial services, and software. It also sells printing, imaging equipment, and accessories and works for different consumer groups. The similarities between all the companies mentioned before make them competitors as they do not have any obvious differences. HP also caters to governmental sectors and sells equipment for businesses and individual users. The company balances its more expensive corporate solutions with budget offers and has a scope of reach comparable to most computer manufacturing companies. The company’s extensive portfolio of products is its core competency. Moreover, the company can sell its goods directly to customers, which may also raise its competitive advantage.
Dell’s Core Competencies and Competitive Advantage
Dell is one of the largest companies selling computer equipment (“Dell Technologies Inc. Competitors”). Moreover, it sells its goods through the Internet, avoiding the need to depend on retailers and other dealers. While maintaining relationships with some other sellers, Dell can create a more comfortable environment for its clients and offer them support through its main website. Furthermore, the company also allows customization of products upon purchase, which may attract customers with specific needs and a better understanding of technology. This option does not put a strain on other customers and reduces the costs of marketing for the company.
Dell offers products over a range of prices, maintaining a broad reach to different sectors of the market and choosing to appeal to multiple audiences instead of selecting a single niche. This aspect can also be considered a competency that allows competitive advantage. The process of selling goods directly to clients permits Dell to maintain a sound relationship with them after purchase. Therefore, Dell can offer customer support on a better level than its competitors. The reduced dependence on retailers also ensures financial stability for the firm.
Sustainability of Competitive Advantage
Dell’s strategy outlined above may be sustainable if the company adheres to some rules. First of all, as the firm offers many products, it is crucial for it to provide new innovative solutions in every branch of the market. Therefore, it should maintain a strong focus on development and innovation to retain its customers. Moreover, Dell’s relationship with customers and the option to purchase customizable equipment should stay a priority in attracting new clients. By lowering its reliance on retailers and dealers, Dell creates a more stable business strategy that may prove to be more sustainable long-term. However, the company can improve its competitive advantage by creating more recognizable and sought-after products. One of the main elements of Apple that other firms do not possess is its unique marketing strategy that puts Apple ahead of the competition. While Dell’s approach may be more stable financially, it may consider adapting its marketing strategies to better respond to consumers’ need for innovation and novelty.
Works Cited
“Acer, Inc. Full Business Profile.” Financial Times, 2018.
Dell Technologies. “Annual Report to Customers.” Dell, 2017, Web.
“Company Information.” Dell, 2018, Web.
“Dell Technologies Inc. Competitors.” NASDAQ, 2018, Web.
“HP Inc. Full Business Profile.” Financial Times, 2018.
Khan, Usman Ali, et al. “A Critical Analysis of Internal and External Environment of Apple Inc.” International Journal of Economics, Commerce and Management, vol. 3, no. 6, 2015, pp. 955-967.