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Dell

In: Computers and Technology

Submitted By lisagarvey
Words 3661
Pages 15
Question 3:
Does Dells expansion into other IT Products and services make good strategic sense? Why or Why not?????
Dells decision to expand in to other IT Products and services made good sense as customer can be brand loyal and prefer to have matching components for their PCs. Dell has a quality reputation which customers know and trust. Dells expansion into data storage hardware, switches, handheld PCs, Printers, and Printer Cartridges and software products represented an effort to diversify the company’s product base and to use its competitive capabilities in PC and servers to pursue revenue growth opportunities.
The expansion into different products and services complemented sales of PCs and Servers. In 1995 Dell had a 2% market share in the server market, increasing to 30% in 2008. Dells idea to sell Data Routing switches proved to be a clever strategic move as they were able to price products 2 and a half times less than the market leader at the time Cisco. This resulted in Dell shipping 1.8 million switch ports in the period of a year. Senior Dell executives saw external storage devices as a growth opportunity because the company’s corporate and institutional customers were making increasing use of high speed data storage and retrieval devices.
Competition in the IT industry can be a challenge. So for any company to survive within that industry, it has to have the ability to harness the basics of its core competencies to the very maximum. This is an inventive design that Dell learnt from the onset and is now positioned to reap the dividends. Computers and computing are the main focus of the IT industry in its entirety. And because Dell has taken dominance of the greater part of the market share, most of the competition are, or have relapsed into the production of mainframe servers or the production of ancillary products and services to shore up their...

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