Paper Example on Situation Analysis: A Powerful Tool for Business Growth

Introduction

Before any company develops a marketing strategy, it is essential for them to do a situation analysis for them to know the health of the business. The study happens to be a powerful tool that determines the weaknesses and strength of the industry, including the threats and vulnerabilities that affect the market. The results enable the person to see how the business is operating and how the strategies one can use to be successful in the marketplace. Situation analysis is the process of evaluating the external and internal conditions that affect the organization (Trevail, 2018 p. 9). The situation analysis also offers knowledge of the current challenges and opportunities to the organization, product, or service. This also assists in devising the strategies that can deal with the current situation of the company. The essay will do a situation analysis of Dell Company.

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Essential Factors in the Situation Analysis

When one wants to perform a situation analysis, several factors have to be put in place.

The product situation. This determines the current product sold by the company. The best way to achieve this is by viewing all the services and products separately and determines how they relate to the needs of the customers (Kohli & Jaworski, 1990 p.8).

Competitive Situation. The best way is for the company to analyze the primary competitors and determine how the business can be competing in the market (Kohli & Jaworski, 1990 p.12). To do this, the company needs to review the distribution on how to market the products either through intermediaries or distributors

Environmental factors. The best way to do this is by determining the external, internal sociological and economic factors that have an impact in the performance of the business.

Dell Company

Dell is a big organization that is known all over the world due to computer products. The success of this company was contributed due to the ability to create a streamlined supply chain system for reducing their cost. The company has also directed its business model to ensure that the computers are configured under the specifications of the customers when they are delivered (Freyer & Kurzmann, 2008 p. 24). Under this, Dell became the leading industry for years that was loyal to its customers.

Even though Dell has its success stories, it also goes through various threats that make the selling of the PC to decrease. One reason behind its risks is that Dell limited itself in selling one type of product. This means if it wants to rebrand, it must focus on the enterprise and software solutions. Dell also needs to have precise and clear goals by creating clear strategies based on effectiveness and efficiency (Freyer & Kurzmann, 2008 p.28). For this to apply, the company needs to develop an approach that will attain its strategic excellence as a short term plan.

Situation Analysis

Internal Analysis

The business model of Dell is based upon the creation of a direct model that will meet the desires of the customer. One way this is achieved is by making sure that the organization maintains its competition in the computer industry. Even though Dell understands that it cannot own the various parts of the value chain, the business will ensure that there is a high level of reliability and speed (Voigt, Buliga & Michl, 2016 p. 55). The internal analysis, in other words, reduces the inventory by allowing the company to sell the products directly to customers based on their specification. This analysis has also enabled the organization to minimize the risks and costs of transporting extensive goods inventories.

Competitor Analysis

The competitors of Dell include Lenovo, Acer, and HP. All companies have a means of reducing their prizes by ensuring that their innovative strategies combat the low prices set by Dell. Even though Dell is known to have creative approaches, they have slowly eroded down. Since the competition in the computer is stiff, Dell will lose its competitive advantage if it does not change its strategies. Currently, Dell has 15% shares in the computer industry, and this makes the third computer distributer globally (Voigt, Buliga & Michl, 2016 p. 59). The highest distributor remains HP, Lenovo, and other companies.

However, HP eroded the competitive advantage of Dell and made it become the biggest competitor of Dell. Dell also went through a decline of shipment of their computers, and this made the server market to decrease (Lepper, 2011 p .121). Dell also got other competitors from companies such as Apple because of its innovation and technology. As a result, the emphasis of smartphones and tablet computers is eroding the competitive advantage of Dell because more customers are now focusing on personal computer products such as tablets.

Market Analysis

The success of Dell in the market was due to its loyalty to the customer as well as the broad product portfolio (Lepper, 2011 p .135). The main products of the company are servers, 'software's, computer peripherals, network equipment, and personal computers. The company also offers printers, cameras, and other products. The reason why Dell became successful in the industry is that it created a flexible supply chain management system, which made it attain its goals. Dell has also been using online commerce to maintain their revenues and sales.

Customer Analysis

The customers of Dell come from diverse sectors, but most of them are the youth. One effort Dell has put is to use its marketing strategies to target the youth. With this line, Dell believes that they can promote their technology to young adults (Lepper, 2011, p .139). The company has also used specific and clear objectives to achieve individual goals. This achievement came when the company crafted a business strategy that aimed at achieving effectiveness and efficiency.

Environmental Analysis

The environment of Dell is highly competitive because of the economic, political, and social changes. The recession e made Dell lose its customers because many were forced to reduce their expenditures. Due to this, Dell was forced to scale down its way of operating, and this made the other players emerge in the market (Lepper, 2011, p .141). Due to this, Dell was forced to make changes that will make them remain competitive on the market.

The Business, Branding and Marketing Strategies

Below are the marketing strategies for Dell:

The company should dwell on corporate branding to transform itself from a computer manufacturer to a firm that offers services and products to various niche markets. The best way to do this is by embracing corporate branding, which deals with the level solutions, supercomputers, and storage networks that align with the corporate sector. For this to be successful, the company needs to be cohesive through mergers and acquisition (Subramanian, 2017, p. 116). This is only successful when the product diversification is supported by innovation, particularly in the fields of Smartphone, tablet PCs, 'software's, and enterprise solutions.

The innovative technologies, in this case, can be designed to allow for low-cost sales. This will be achieved through innovative technologies to enable the company to sell its products at lower prices. In most cases, innovative technologies are the backbone of many companies because most of them manage their logistics (Subramanian, 2017, p. 128). In this statement, Dell should also increase the relationship it has with the customers for it to be successful. Dell should also come up with other innovations rather than the production of the PCs that align with the current market conditions.

Positioning and Targeting

Dell must restructure its strategies to become a diversified technology solution provider. Software and Services should be the backbone of the marketing strategy. The core business of Dell, which is hardware, will be the same but will also offer innovative and technological solutions (Lepper, 2011 p .144). Dell also needs to focus on corporate customers as well as home users. Such strategies will make the company attain long-term success. To do this, the company also needs to conduct a cash analysis from profitable services and products. This will assist the company to remain competitive in the market. Also, Dell needs to focus on the key strengths not only to reduce their costs but also ensure that innovation aligns with the new technology.

The Growth Strategy

Product diversification is the only way Dell can use to remain competitive in the market. One way the company needs to restructure the core priorities and create new structures to assist it to gain leverage in the competitive market. Such an approach is required because it will make the company remain competitive in the market. Product diversification means that Dell has to focus on storage management solution, supercomputers, 'software's, and tablet PCs to make it grow. Corporate branding is also essential because it assists the corporate and home users to enjoy the 'company's products (Narver & Slater, 1990 p. 27). With these steps, the company will value the proposition of its customers through the direct distribution model.

The Dangers of Aligning the Strategies

When Dell introduced its first the Smartphone in America, all the product reviews were dismissed. The product was compared to the other 'smart phones and Dell's Smartphone had mediocre hardware and operating system. This was using the old version of Google's Android. One danger Dell put itself is because it introduced the Smartphone to a crowded market. Another reason is that it was overshadowed by a significant and dramatic event from a Texas company that unfolded almost $53 billion due to its high-end data storage technology. Even though Dell bought the 3PAR storage technology, it found itself competing with HP who had bought twice as much than what Dell purchased.

According to the ranking brands website, another company that found its strength by creating products that consumer needed and wanted was Nokia (Trevail, 2018 p. 12). Through the partnership, Nokia came together with Microsoft and shared their marketing strategies under the same concept. For instance, Nokia benefited from adopting the windows phone, while Microsoft helped when it gained Nokia's language support and hardware design (Trevail, 2018 p. 14). Such opportunities made the brands to maintain the positions for the future.

The reason why Dell failed is that it was too late for them to change the world because companies like HP were leading in offering sharper services and products. Since then, the company has undergone through pains, and due to the growing consumer markets, the company could not launch the Smartphone product. Despite the products, Dell also had leadership issues, and that is why it never managed to remain a competitive advantage. Dell Company, in short needs diversification, for it to transform. From the table above, it is also evident that companies like I phone had already stormed the market, thus decreasing the sales of PCs.

Conclusion

Situation analysis is an essential move for a company before a company develops a marketing strategy. The situation analysis also offers knowledge of the current challenges and opportunities to the organization, product, or service. When one wants to perform a situation analysis, several factors have to be put in place. The company needs to determine the current product sold by the company. One company that found itself in a fixed situation was Dell when it introduced the first Smartphone. Despite the products, Dell also had leadership i...