FEBRUARY 13, 2013DELL: EXTERNAL FACTOR EVALUATION MATRIX ASSIGNMENT #3 DAVE NINOBLA BUSINESS STRATEGY AND POLICY
1 DELL:External Factor Evaluation MatrixExternal Strategic Factor Weighted Weight Rating Comments ScoreOPPORTUNITIESThe company is working on Michael Dell is working in a deal with private investment 0.14 4 0.55going private firms in buying the company back from the public Company has gotten this strong by offeringThe companys award-winning customization, reliability, excellent service and support;customer service, growth and 0.08 4 0.32 while developing and manufacturing the lateststrong financial performance technologyDell Services’ flexibility Subservices like ProSupport have been created toenables the organization to accommodate new business. These are brands under 0.05 3 0.12adapt to changing customer DELL.requirements. The companys application of the Internet to other partsInternet Support 0.12 2 0.46 of the business --including procurement, customer support and relationship management. DELLs Direct Model approach of enables the companyDirect Model Approach 0.08 1 0.12 to offer direct relationships with customers such as corporate and institutional customers.THREATSNew / Younger customers 0.09 4 0.16 Attracting the college student segment has been quite difficult.iPad /MSFT Tablet Market 0.15 4 0.34 The tablet market has caused quite a stir in the PC / Laptop industry almost killing the market for these easy to carry products. The rapid increase in the advanced technology is the issue which is the opportunity for the company itAdvancements in technology 0.07 2 0.28 improves but on the same hand it is the threat for the company because Dell have to keep its position close to its competitors. There is an issue that the Dell is the PC maker not a PCLabor costs 0.08 1 0.24 manufacturer due to which labor costs remains low and disadvantageous for their growth.Trade barriers and hurdles Trade barriers and hurdles affect the position of the 0.14 1 0.42affect company in multiple countries that decline the growth.Total Weighted Score 1 3.01
2 DELL has been going on quite some scrutiny in the past few monthssince their CEO’s decision to take the company private. To many thismay seem as if it were a sign of weakness and downturn. But inactuality, this is one of their strongest, most logical plans to givethe company a fighting chance. Taking a company private may definitelyhurt the firm in out of pocket expenses, but in the long run, a leadercan take the firm off of the grid, take control of the processes andmanagement, and mold it to become that major competitor it once was. DELL can attribute much of their success to their customerservice, growth and strong financial performance. The company hasachieved this high level by offering customization, productreliability, and excellent customer service and support. Ascustomersstruggle to do more with restricted budgets, DELL services continuesto set the industry standard. The growing requirement for efficientlymanaging support related costs among medium and large businessesincreasingly overshadows all other concerns and is the only concernsteadily increasing in relevance in today’s IT environments.DELLmanaged to find a way to achieve both objectives by developing aglobally consistent, simplified and proactive delivery infrastructuretied to flexible and configurable ProSupport offerings that meet theneeds of its customers. ProSupport is a brand of service that DELLalso offers. DELL believes that flexibility is important to itssuccess, allowing the company to manage costs, while at the same timequickly adapting to changing customer needs.I have also added Internet
3Support and the DELLs Direct Model approach of enables the company tooffer direct relationships with customers such as corporate andinstitutional customers. Their strategic method also provides otherforms of products and services such as internet and telephonepurchasing, customized computer systems; phone and online technicalsupport and next-day, on-site product service. This extensive range ofproducts and services is definitely one of DELL’s strengths. In contrast DELL has had quite a bumpy ride the past year. Theirstock price has dropped significantly, and earnings have been at aloss. All this due to stiff competition, technology advancements, aswell as new products from rivals which have controlled the market.From a consumer standpoint, newer and younger customers are notlooking for a PC to be built for them, they are looking for somethingeasier to use. That is where DELL does not fare so well. Theseconsumers want something that works right out of the box. Anotheraspect that is hurting the company is that these newer customers arelooking as to what their friends are buying. They all want somethingthat is recommended or is similar. Younger consumers also want a bitof flash and style, which DELL is not competing against. Now to add tothe falling in market share, iPad and Tablets have become somewhat ofa laptop replacement. They do not do everything that laptops do, butfor simple activities such as email and web browsing, they aresuffice. This has definitely put a dent in DELL’s hold in technology.They have not produced a tablet or technology to rival these gadgets.
4 DELL still does not manufacture their own parts. They are in thePC business where they make computers, but not the parts to make them.In order for them to keep labor costs low, they must adjust theirbusiness plan and start to manufacture major or common parts. Withthis said, trade with other countries has brought some hurdles to thefirm. In order for a company to get a good footing in the GlobalMarket, they must take on the emerging markets. China and India aregoing to be two of the world’s biggest economies. In order for DELL tomake a serious mark, DELL needs to make a presence in both of thesecountries. They have been doing so in India, but China has not been onthe upside. Trouble with laws and labor have caused DELL to back out,at least for the mean time. In a nutshell, these are some points I have gathered about DELL.This is definitely a company to watch within the year to see whattheir fate will be. I am quite optimistic on their outcome, DELL willsucceed.