Dell 2008 for Its Entire Essay

Excerpt from Essay :

The company can no longer look to its production model as a source of sustainable competitive advantage. Although it can still provide competitive advantage, evidence over the past few years indicates that any such advantages will be temporary. Production cost control is only a core competency, therefore, not a source of sustainable competitive advantage. The company's brand is a source of sustainable competitive advantage as the Dell name has opened doors into other product lines, some of which have been successful for Dell. The company name, however, is no stronger than that of Hewlett-Packard or Apple, two of its main competitors, and is arguably weaker than either two. Thus, while the brand value of Dell is more easily sustained it is not necessarily a source of competitive advantage.

This leaves Dell in a challenging position. It has built its market share on its ability to deliver the lowest-cost computers and the best value proposition. The minute competitors are able to beat Dell's prices or value, the company is going to suffer. This is already happening in the U.S. consumer market. Going forward, Dell needs to find a true source of sustainable competitive advantage. The company's competitors are so strong that right now anything Dell does can be matched or bested by HP, Apple or the newer Asian computer-makers. Even Dell's name is no guarantee of success. Dell can continue to succeed as a strong competitor if it controls its costs (especially in marketing). There is the possibility that a family of integrated products can provide some source of competitive advantage but even then it is hard to make the case that HP could not match such an advantage. Dell needs to recognize that its current market position is anything but certain, and it needs to look at all alternatives to bring its costs back down so that it can once again be the lowest cost producer in the industry. Eventually, if a low cost producer has a large enough market share that its production efficiencies and buying power are unmatchable, it can sustain this advantage (Wal-Mart is a good example of this). For now, however, Dell is not in that position and given the sheer size of HP, it might never be able to…

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