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Competitors find it difficult to match Dell’s business strategy because the company approaches the building of computers differently. During the 90’s many competitors were building computers, but Dell built it computers on how the customers wants. Dell asked the customers how they wanted to build their computers, and they build it to order. The strategy made other competitors unable to match Dell’s business strategy. Other competitors were doing what they think the competitors want, but Dell was building its computers on what the customers need. Confusion with the management team was on how to match its competitors by trying to get products to the market. With the manufacturing of thousands of PC’s, it was difficult to market them and the strategies that relate with it prove to be more difficult than imagined. The direct marketing of products was not enough to market products. The use of retailers became the new strategy. Also, management was also confused on how to add value to the company. The industry has many competitors all vying to become the best in the market. It was difficult for management to get differentiation and how to make the company sustainable in its place. The competition in the market place was high. There were many great companies who have the resources to make their products available to customers. The marketplace for PC’s was so competitive to the point that it was difficult for many great competitors to hold their place as the best in the market. The companies focused on outperforming each other with their products and services.
Dell’s competitive advantage was on the basis of what the customers need, and not what other companies think they want. Dell offered its customers the opportunity to choose how they want their computer and Dell built. Dell treated its customers as their number one priority, and this is what no other company did. Dell’s competitive advantage focuses on customer service. According to the article, Dell had about 50,000 pages of information that will help answer any questions their customers will have about their products and services. In addition, the company also had over 1,000 customer services technicians who were available 24 hours via hotline to help the customer with any problems they have. Customer service increased Dell’s rating, and customers were highly satisfied with the products and services of the company. Dell was on top of the market after the implementation this strategy. The company also added more services that helped installed computers on site for business. They had a diagnostic software program that will allow a technician to solve the problem online. The company also offered financial services that help in leasing, asset management and technology planning to its customers.
Competitors in the computer manufacturing did not pay attention to customer needs. Some internal barriers that prevented companies from matching Dell were their business strategy. Competitors in the computer manufacturing focused on sales and making profit, they did not see beyond what will increase their sales and profits. When companies such as IBM and Gateway started performing poorly, they did not know the sources of their performance because they only focused on manufacturing and selling without taking into consideration who is buying. Another internal barrier is resources. Companies such as IBM and Gateway had the resources to become successful. Many companies and suppliers invested in them. The companies had all the resources they need, but they invested into products and services that did not produce as much impact as they imagined. Some external barriers that affected the company were innovation. Many of Dell’s competitors lacked innovation not only the products they manufactured, but also innovation to improve the company’s services. Many of the companies did not have any innovation on how to improve the business to customer relations. There were also no services that they offered after the purchase of their products. Another external barrier was consumer demand. Many of the competitors focused on outperforming each other than focusing on consumer needs. Since there were many competitors in the industry, consumers are most important, and they must be treated as such, but many of the competitors did not see it that way. Finally, many of the competitors did not watch the trend of the market. With the increasing number of competitors and manufacturing in the industry, it was only a matter of time for companies to realize that the market will take a different shape. Dell saw the trend of the market and progressed with it, but other companies did not. When Dell was making profits, companies such as IBM, Gateway and others were doing poorly because of the market trend.
Today, Dell’s competitive advantage is not as sustainable as it was before. Dell has lost it competitive advantage to HP and other companies. The company needs to change its business strategy and the delivering of its product. The computer manufacturing industry is now bigger than it was a decade ago. With many competitors all offering similar products it just comes down to innovation. Dell needs to come up with a product or a service that can revolutionize the computer manufacturing industry. The competitors in the industry use the latest technology and services to make the best product, but Dell has to do more than that. They need to look at their business strategy, watch the trends of the market and come up with a business innovation that could set them apart from their competitors.
