Case Study: Dell

 
Case Study: Dell
Introduction
There are no standard approaches which would help a company achieve a global
success and brand recognition. Each business searches for unique strategies and methods,
which would suit its marketing objectives and products delivered to a mass consumer. Dell,
an American-based technology company, has developed a set of unique methods and tools
constantly used in marketing and management for obtaining and sustaining its brand image
and excellent service quality. These methods can be described as company’s philosophy
and outward manifestations of a basic and important development in marketing and
management.
Historical Information
From the historical perspective, Dell tends to see marketing operations as complete
systems. The first computer of Dell – ‘Turbo PC’ – appeared on the market in 1985. Since
that time, Dell remains one of the market leaders in personal computers, servers, network
switches and software. In order to coordinate these divisions and improve marketing
management, Dell follows the systems approach, which is essential for effective decision
making, for the utilization of models in marketing, and for the application of computer
technology. Late in 1996, Dell sold its first computer through the website, and it was,
without any doubts, a notable moment. The main unnoticeable factors of success are a
unique corporate strategy and coordination activities used by Dell. Every company and
business use these strategies, but only an effective selection and analysis of the market
really helped Dell achieve success on the global market. It is worth to mention that, in
contrast to many other companies in this industry, Dell involves employees in corporate
strategy management and decision-making (Cage, 2009). Company’s management realizes
that employees must understand, accept and internalize the corporate strategy if the 
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strategic blueprint is to be transformed into positive strategic results.
Blue Ocean Strategy
Dell Corporation follows a Blue Ocean Strategy based on a unique product image
and innovative solutions in computer industry. Suppliers, strategic partners, and customers
must have a basic understanding and appreciation of the firm's strategic direction if these
stakeholder relationships are expected to be productive. The financial community must be
aware of the company's strategic intentions for properly evaluating a firm's current value
and prospects for the future. Only when the corporate strategy message is presented in a
clear, concise, timely, and persuasive manner, the stakeholders will have an idea whether or
not the firm has an opportunity to achieve competitive advantage (Friedman and Miles,
2006). Dell focuses on corporate strategy communications designed to create competitive
advantages.
Obviously, effective strategy communications can result in significant benefits.
Payoffs include an improved climate within the financial community, better relationships
with suppliers, customers, and strategic partners, as well as increased employee morale
(Lee, 2007). Some firms have experienced a boost in their share price and improved
shareholder value.
The underestimated coordination of organizational activities is often neglected by big
companies perceived as a traditional and old-fashioned tool of management. Thus, Dell uses
this strategy willing to improve its internal activities and increase productivity. The
coordination necessitates communication: formal and informal, vertical and horizontal, to and
from the marketplace. In Dell, complex networks of marketing communication have to come
into being with multiple levels of management, widely diversified products, geographically
decentralized plants and distribution centers. Without any doubts, the gathered information
affects the efficiency of the organization and largely determines its operational effectiveness. 
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Dell contains several structures. A task structure delineates the work people are expected to
perform. An authority structure gives some people the responsibility for directing others,
although, in practice, there may be a discrepancy between responsibility and authority. A
status structure determines the rights and privileges of people. A prestige structure permits
people to expect deferential behavior from others. A friendship structure stresses
interpersonal trust (Khanna, Palepu, and Sinha, 2005). These structures have an important
effect on organizational relationships, particularly on communication. In establishing
organization patterns, Dell management is concerned with the span of control – the number
of subordinates reporting to a manager.
Did Blue Ocean Become a Red Ocean?
It is possible to assume that in 10 years, Dell’s strategy and market position will be
characterized as Red Ocean Strategy, and the computer market will be saturated with low
cost computers and digital devices; so the majority of Dell’s products will have to