Environmental Analysis of Dell Organization Essay

dingles external surround identifies exclusively the current conditions and forces that cloak its strategic options and define its rivalrous situation. It consists of third main sectors the Remote Environment, the Industry Environment, and the Operating Environment. All of these environmental sectors affect the firms operations both on an global and municipal level.Remote EnvironmentIn recent years the computer computer hardware industry has experienced a slight lessen in profits. well-nigh of this is due to the recent winturn in the economy and a decr sleep in consumer confidence and spending because of inflation. Many consumers hesitate to upgrade their computers. As a result, dell must explore in the buff markets and introduce attractive(a) products at a broken iner-cost to attract its customers. The use of personal computers in international markets is growing rapidly. dingle Computer can take this opportunity as an advantage to provide lower cost computer for consu mers.Since Dell has the equipment and roof they can produce soaringer quantities of workstations or servers at a low operating cost and then sell it a petty to a higher place cost of goods to china, India, Vietnam and third world countries to increase their global market share. The meshing market has been expanding and exploding across the globe. It has varied by market segment and already has been a big hit in the U.S. Dell knows that the way to broaden the company fortunately is through e-business.Dell is gearing up in China. The key to its strategy is a locally designed PC called Su Ma (Speedy Horse) which it hopes leave alone draw sales away from the homegrown powerhouse, Legend. Dell has already built a mill in Xiamen, which is on the southeastern border of China in order to promote its next day bringing to 400 cities which is one of the company trade marks. As a result, Dells China market share has grown from near zero in 1998, to 4.4%. This runs preclude to the g eneral wisdom that Chinese consumers must feel andtouch a product before they buy. More business and more production facilities willing be opened world wide to adopt the globalization constitution and the global demand in the next decade.Industry Environmentrival is high in the computer industry because on that point is a roofy of competition among a number of market leaders, while there is overlook of differentiation and low switching costs for customers. Barriers to entry are also high due to a extensive part of the market is controlled by the market leaders of the industry, in addition to high start up costs. The bargaining power of providers is also high because suppliers are few and there is a heavy assent on them. The bargaining power of customers is also high because of the availability of many high forest computer companies, all products are perceived as similar and well as the ease of switching. The threat of substitutes is low because they are virtually non-exist ent. Furthermore, there is a high availability of supplementary products available.Dell Computer Corporation is more successful than its competitors because they contribute been able to cut out the middleman with its Direct trade strategy. Dell entered the computer industry at an opportune time with competitive prices and a production strategy which does not build units until units are ordered, which minimizes scroll and allows customers to customize their units. The direct sales model has helped in cutting down inventory costs and also reduces the lead time in fate customer order. The biggest entry barrier that Dell has to face when expanding into other areas of the engine room industry is having customers gain the trust of company over the more public veteran computer companies.Operating EnvironmentConsumers view Dell as a quality brand at a good price. near consumers find that Dells competitors may be a little more expensive but still offer a quality brand. Dells main comp etitors are IBM, Compaq, Hewlett-Packard andGateway. Dells competitors have all tried to echo Dells direct marketing strategy. However Dells competitors were and still are unable to replicate Dells direct marketing success. Historically Compaq and IBM sold through resellers and distributors. When IBM and Compaq announced their new initiative to sell directly to their customers, they angered the resellers, who in turn promoted HP products. HP is able to fulfill the needs of customers who necessity to see and touch the computer before purchasing it, which is not achievable in the direct marketing strategy. But HPs emergence is declining with this strategy and they have been unable to lure major accounts. Gateway has been approximately successful in implementing the direct marketing strategy, but Gateway does not have a strong hold in the lucrative large customer accounts.Dell ranks high with customers because the company offers free technical concentrate if needed. The purchasi ng process has changed for the consumers with Dell because all the ordering is done online which offers doohickey to its customers and minimize inventory. The flow of materials from suppliers into Dell starts by the company place in orders to factories that are based on two categories product type and geography. When putting in orders for product type Dell wants to select the right factory that specializes or deals with a certain product. Geographic orders mainly focus on the where the order is coming from to minimize the transportation expense. Dell has superb relationships with their suppliers they declare those superb relationships, by ensuring that the suppliers win every time Dell wins.Dell will need to implement several changes in the next duad years to develop its system, improve customer service, reduce cost, and improve supplier control. Dell will lead the technology industry and be a good example to the competitors. More technology of software and hardware will be avai lable in the futurw with less cost.Long Term ObjectivesDells objective should be continue providing customers the most recent technologies at competitively lower prices, at lower costs and faster thantheir competitors. This could be established in the long run as they1. Increase global market share by focusing on Asian markets.2. change magnitude revenues by penetrating the Chinese market benefiting from low costs.3. Continue involution of server and storage products.4. Continue to maintain the lowest costs in the industry5. Establish global brand recognition.6. Increase diversity in portfolio by expanding product offering and investing in a new industry within the technological sector.7. Manufacture some of its supplies, decreasing reliance on suppliers.8. Use the Internet to improve the efficiency of Dells procurement, manufacturing and distribution process and further expanding an already broad range of value-added services.ReferencesAbraham, H. getting in touch with Dells cul ture Youve got the soul in EnterpriseInnovator.com. Retrieved February 17th, 2006, from http//enterpriseinnovator.com/index.php?articleID=3844&ionID=4Dell. Dells Mission Statement. Retrieved on February 17th, 2006, from http//www2.xmrc.com.cn/jobads/dell2/mission.aspDell, Inc. SWOT Analysis. Dell, Inc. SWOT Analysis, April 2005, p1-10, 10p. Retrieved February 18th,2006 from Ebscohost Database Business outset Premier http//search.epnet.com/login.aspx?direct=true&AuthType=url&db=buh&an=16895029Lee, L., Burrows, P., and Einhorn, B. (2005) Dell may Have To Reboot In China. Business Week, 00077135, Issue 3958. Database Academic seem Premier.Tough, M. ( 2006). Creating a Mission and Vision Statement. In the Sideroad. Retrieved February 17th, 2006, from Http//www.sideroad.com/business_communications/mission-and-vision-statement.html