SWOT Analysis of Dell Corporation: Strengths, Weaknesses, Opportunities & Threats - Essay Sample

Introduction

In this analysis, I am going to describe my personal experience with Dell Corporation Inc. Specifically, the paper will touch mainly on the organization's SWOT analysis (strengths, weaknesses, opportunities, and threats) as well as its leadership. The Dell Corporation is an international technology provider and majors on Information Technology software, hardware along other related services including the upcoming cloud technologies as well as the traditional IT infrastructure which are mainly aimed at building the world's digital future and to transform how people live and work. The corporation was incorporated as a private limited company in 1986 and it is currently headquartered at Clarendon Dock Belfast, in the United Kingdom (Kraemer et al. 2000).

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SWOT Analysis of Dell Corporation Inc.

According to the vast experience that I already have with the Dell Corporation Inc., I can point out that the organization has had an extreme decline in the demand for its products over the past ten years, and the main reason for this decline is the increase of mobile computing. Besides this, the organization also faces very high competition from other computing organizations such as Lenovo, HP, Acer, Asus, Apple and many more. Furthermore, I can say the organization has failed to expand as its worthy competitors do. For example, Apple and Lenovo have expanded their production to enter the smartphone market, a move that has made the company most profitable (Kumar & Craig, 2007). Despite all these failures, Dell is still recognized as a major computing organization with strengths as well as many opportunities. Since anything good can hardly be free from weaknesses and threats, Dell happens to be an organization of such kind. The following is, therefore, a SWOT analysis of the Dell Corporation Inc., based primarily on my personal experience with the company.

Strengths

Brand reputation: the organization has an outstanding brand reputation as being an international IT and PC organization. As my experience with Dell is concerned, the fundamental reasons for this amazing reputation are its focus on innovation and product quality. Also, this amazing reputation can be attributed to the company's different pricing techniques. Essentially, Dell has been able to bring many products to the market. This good reputation has, therefore, resulted in the organization's longevity regardless of the stiff competition.

Product collection: I have known Dell as an organization that has maintained a varied product collection which has increasingly grown through many strategies such as new acquisitions. Dell's business is divided into various segments including Client Solutions Group, VMWare, and Infrastructure solutions group and many other segments. Under the client solutions group, the company offers notebooks, PCs and other peripherals such as projectors and monitors. It is worth noting that the organization created its infrastructure solutions group after its merger with the Dell Enterprise Solutions Group (DESG) as well as its acquisition of EMC (Dell Inc., 2018). The company's other business segments are; Secure Works, RSA, Secure Works and the Pivotal. In Dell's PC business, it has been able to bring both low-end and high-end products.

Focus on innovation: the organization has been so much innovative and has invested in it for the constant growth of its product line. As per my experience with Dell, I can say that the company has placed its focus on developing scalable technological solutions at reasonable prices. Also, the company's engineers normally collaborate with other large computing organizations to bring modernized solutions and new designs. Most recently, Dell increased its research investment to approximately $1 billion, $2 billion and $4 billion in2016, 2017 and 2018 respectively (Anthony et al. 2016).

Global extension: the company doubtlessly a multinational corporation with its operations cutting across continental borders. With the United States as its major market, Dell has expanded to the Asian markets, European markets and well as in the Middle East. Currently, the company is extending into China, Japan as well as in the South American markets.

Well-organized production and chain of supply: the company has a well-organized production and supply chain. Dell owns production facilities in the US, China, India, Malaysia, Ireland, Brazil, and Poland. From what I recently learned, Dell's production process comprises of software installation, assembling computer components, quality control along with functional testing.

Weaknesses

High operational costs: the company has been experiencing high operational costs which in turn, has made the company to incur any losses. In 2018 alone, the company's operating costs increased to $23 billion which resulted in a loss of not less than $3 billion (Kraemer et al. 2000).

Overdependence on the founder's decisions: over the years, the company has been dependent on the decisions made by Michael Dell who apart from being the Company's CEO, also commands the largest stock in the company. As far as my experience with Dell Corporation is concerned, and without fear of contradiction, I can say that an abrupt loss of Michael's services can result in a nightmare in the organization. Since Michael is the main decision-maker at the Dell Corporation, it implies that the highest authority rests on his hands. To some extent, I can say that Michael is the major pillar of the company, hence in a situation where his services can come to a halt, then the company will be next to collapse.

Lack of separation: as far as my experience with Dell is concerned, the company happens not to be a separated corporation and this is demonstrated by its failure to enter into the smartphone business which is currently a highly lucrative market. Other computing companies that had realized this such as Apple and Lenovo have reaped so much over a very short period. However, Dell happens to have refused to move out of its comfort zone when it comes to matter exploring new business opportunities. As of now, the products offered by Dell have countless substitutes, meaning low income.Opportunities

The emerging technologies: the company faces a good opportunity in the sense that it can use a differentiation strategy to grow and expand its business even faster. The company can invest in new market segments, particularly in emerging technologies such as tablet and smartphone markets. Essentially, there are so many emerging technologies that offer lucrative opportunities for Dell Corporation. The company can, therefore, consider investing in such areas to expand and grow its business. Also, emerging technologies will make Dell even more competitive than ever.

Asia and the Pacific markets: from what I have learned over the last ten years, Asia and the Pacific markets have grown unimaginably. This calls for the Dell Corporation to direct its focus on these markets including India and China. These emerging markets are great opportunities that should be explored by the Dell Corporation to realize its growth and expansion ambitions. The Chinese and Indian markets are growing at a faster rate (Dell Inc., 2018). This implies that if Dell can decide to heavily invest in them, then there is no doubt that the company's income from global markets will be increased in a significant manner.

Differentiation: to create a distinguished product reputation, there is a sense in which the company must go back to the drawing board and try a higher differentiation strategy. Currently, Dell faces an extreme level of competition in the global market since almost all its products have countless substitutes. Differentiation in this regard will be an instrumental strategy towards the growth of the company's product line as well as revenues.

Dependence on the United States markets: I first knew the Dell Corporation as a United States-based corporation, little did I knew that it is based in the United Kingdom. I had this perception because I could notice a larger portion of the company's products being used in the United States. In 2017 alone, approximately 50 percent of the company's income came from the US, this gesture is enough to tell that the company is still highly dependent on the US market (Anthony et al. 2016). Be that as it may, it is also important to point out that the company's customer bases extend into Canada, Japan, and Western Europe. Even though the company is trying to stretch its arms in the pacific markets, its major market base remains to be the Americas. For this reason, if the company can reduce its reliance on the American Markets, it can be more profitable than ever.

Threats

High competition level: currently, there is extremely high compaction in the computing industry. As I speak, the company is facing high competition from companies such as Acer, Lenovo, Asus, Apple, and HP. Dell has therefore invested heavily in innovation, continuous research as well as extensive marketing to counter this high competition level. Regrettably, the company has not considered the importance of spending on promotions. In 2018, the company's promotion expenditure stood at around $1 billion compared to its expenditure on research and extension which stood at $4 billion (Anthony et al. 2016).

The decreasing market for PC: in the past few years, the PC market has decreased significantly. This has been so due to dozens of reasons, but the major reason remains to be the increase in mobile computing. Mobile computing has led to the development of devices like tablets and smartphones which can do what PC does. People, therefore, prefer them because of their sizes and prices among many other factors.

High regulation level: the political and legal regulations placed in the PC business has grown and continues to grow day by day. As I speak, there are many laws almost in all countries, leaving alone those about international trade, that are made to regulate both PC use and business. As a result, severe compliance and operational costs have been placed. This is a major setback to the Dell Corporation which heavily relies on the PC business.

The Leadership of Dell Corporation Inc.

Michael Dell is the founder and CEO of Dell Corporation. He has led the organization from scratch to high profitability and growth. The organization has ever at the forefront in terms of direct selling and according to my experience with the company, I can say it commands a larger percentage of the computing market. Based on the experience I have with the Dell Corporation, and the information about the company's leadership as described in its website, it is worth noting that most of the major facts have been taken into consideration by this leadership analysis. Regardless of whether the company has an effective leadership or not, the following are true about the leadership of the Dell Corporation under Michael Dell as its founder and CEO.

There is an Accurate Financial Controls and Reports

The Dell Corporation's leadership team records all the financial statements quarterly and annually. These records are constantly reviewed, agreed and ratified by the board of management before they are officially released by the CEO. Moreover, there is a distinct leadership team created as part of the auditing committee whose role is to assist board members in fulfilling their obligation to identify omissions that may have been made by the board members. This leadership team works as the company's internal control purposely to ensure that the information being passed on is true and accurate (Salicru et al. 2016). Also, the committee is tasked with duties of ensuring compliance with accounting standards, they analyze potential risks that are associated with the company and most imp...