Dell SWOT Analysis Internal Strengths

DELL SWOT Analysis

Internal Strengths of Dell

A first strength of Dell Inc. is that they produce a wide array of hardware consumer products, which are able to satisfy the needs of a vast consumer base. Additionally, they have set the basis for numerous strategic partnerships that allow them to import the most cost effective commodities to be integrated within their products.

This in the end leads to high quality products at reduced retail prices, generating as such increased customer satisfaction. Customer loyalty was also generated through the sale of high quality products, meaning that the organization could count on its customers and that it would have to invest fewer resources into marketing campaigns, as the current customers are satisfied and likely to return for future purchases. Some of their most notable items include personal computers, laptops, desktop units, printers, key boards, mice, as well as other computer accessories.

Foremost, Michael Dell's vision revolved around a system with as few intermediaries as possible. The model is called direct sales, in which the manufacturer sold its items directly to customers. This model allows for reduced retail prices as intermediaries do not have to be paid. Also, customer satisfaction increases as they can purchase products and require 24-hour assistance directly on the company's website. Aside the reduced retail price and the adjacent customer satisfaction, the direct sales model has also constituted an organizational strength as it allowed the manufacturers to directly interact and efficiently communicate with the buyers.

Dell is better able than its competitors to implement the latest technological advancements are they are not slowed down by indirect retail networks. Their direct model then offers another important strength. The implementation and usage of the latest technological developments in all corporate actions (including procurement or relations management) leads to more efficient operations and increased productivity and profitability rates.

Another force that improves Dell's strength is given by its customizing features. In this line of thoughts, Dell manufactures products in accordance with the customer specifications. The fact that they can order customized computers and accessories further increases customer loyalty, organizational profits and reputation (Cuizon, 2009).

Throughout its existence, Dell has engaged in operations that improved its market perception. They have promoted their products onto numerous channels; they have supported technological innovations in various fields and they have also become supporters and sponsors of charitable events. In other words then, the third major strength of Dell Inc. is given by its favorable reputation and market perception.

An organizational strength also relies in the company's financial status. Throughout the past years of existence, the Dell revenues, assets and market capitalization have followed a sustained ascendant trend. They even closed financial year 2008 with growth rates in profitability, unlike most economic agents who reported losses due to the economic crisis.

Internal Weaknesses of Dell

Despite its sustained growth in assets, profits and market capitalization, the company has sadly followed the trend set by the contemporaneous economic crisis in terms of its stock performance. Throughout the past trailing twelve months, the Dell share has decreased from a maximum of $26.04 to a current trading value of $10.62 (the Motley Fool, 2009). This negatively impacts its perception among investors.

A second strength was manifested in the packaging of their products. The Dell management sustained intense efforts to ensure that the organizational customers would receive their products as rapidly as possible and in the best of conditions. To ensure then the full protection of the hardware items, they would pack the products in large packages. This however brought severe criticism from environmental organizations which argued that Dell was wasting precious resources that were already scarce (Murray, 2008).

Following the same agenda of reduced prices and customer satisfaction, the Dell engineers sometimes fail to pay enough attention to all details. In 2006 for instance, 4.1 million laptop batteries were withdrawn from the market for fear that they might ignite. The same year, Dell profits decreased by 51% and the stock also plunged (Kirkpatrick, 2006). The drastic decreases called for an investigation, which severely impacted the manufacturer's reputation.

A fourth weakness is given by the retail focus adopted by Dell. In this line of thoughts, the hardware producer has centered its sales and promotional campaigns on corporate entities and for-profit operators. They have however neglected to address the public domains, especially the schools system. This generates a twofold loss -- first of all, schools and colleges could spawn large demands for computers; secondly, the students' processes of purchasing computers are based on the influences at school and had the schools been equipped with Dell computers, they would have generated large demands for the same computers in the homes of the students.