The following report will outline and explain how the company Apple can improve its market share in the computer sales market amidst the growing competition it faces from its competitors Dell and Hewlett-Packard. This will also include how these companies have use e-commerce to their advantage and how Apple could use these advantages to their opportunities and how could they over come the disadvantages that these two main companies have.It will outline the benefits as well as the possible risks that may arise as a result of fighting head to head with two large organizations that are holding a large percentage of the PC market in the world at the moment. Like any other business the hope is that the suggestions will help apple to a long and successful future based creative use of the e-commerce and e-business.And report will also mention about the importance of looking for every available opportunity in its search for competitive advantage The company’s objectives are outlines followed by a breakdown of the competition the company is likely to face and where this competition comes from.
Strategies that can be taken to overcome the competition and attain the company’s objectives are discussed.This is followed by the conclusion and recommendations. INTRODUCTION The company’s core competency; the sale and service of computer products, does not give it an immediate advantage in the market, since it is practically saturated by a number of other players particularly Dell and Hewlett-Packard, who happen to be giants in this arena, where most others may struggle to stay afloat much less make a go at long term success.The aim is to retain and possibly gain more market share, before its competitors push it out of the market, to do this, it needs to develop and undertake a number of strategies to have a chance at success.
Firstly, it would necessary to look at both Dell and Hewlett-Packard’s strategies, to find out the secret to their success, which can be used as a foundation to build on; this analysis may also reveal some weaknesses that the company can use to its benefit, in gaining that much wanted competitive advantage.OVERVIEW OF THE COMPETITION: DELL Chairman of the company is Michael Dell who was born in 1965. This company was established in 1984, with it main objective being to know the customer and learn what he or she really wants out of the computer they intended to purchase, therefore building the system to suit the requirements of the end user, the almost certainly guaranteed success. He started this business with $1000 and has gone to be one of the larges companies in the world with ontinually reaped financial rewards in fact it earned around $45.
5 billion in the last four quarters. Dell has earned its respect in the market as it is seen as the top of the line provider of computer products to the world largest corporations, including many of the fortune 500. This massive money machine employs around 50,000 persons throughout the world to support its global enterprise. The key to its apparent success is that Dell offers in-person relationships with corporate and institutional customers.
The direct customer relation made it possible to cut out the middle man (the retailer), which therefore led to a reduction in costs and the ability to save valuable time. This method enables them to sell customized products with the latest technology at competitive prices, because of its direct relationship with its clients. And it also has a very much improved distribution channels. In 1994 the company launched its web site to let the world know what it had to offer and later in 1996 began sales of its products over the internet.
This vast reaching availability has helped to add to the company’s success over the years. This shows that they are very much in action and that they not afraid to experiment new ideas and new technology. Using the internet the company has also been able to provide its customers with after sale customer support. Dell purchases much of it components and materials online and they ensure that the supply of these materials are never more than two hours always. This new supply chain allows for the company to minimize its inventory.
Dell’s current supply chain allows its suppliers access to the company’s long run and short run material needs for all its factories worldwide via internet reports, which help suppliers keep abreast of the demands they are therefore able to reduce wastage of material (the company does not get ‘stuck’ with stock that has become obsolete which usually happens, because the technology advances so rapidly), improve efficiency and respond immediately to customers needs.HEWLETT-PACKARD Hewlett Packard is one of the oldest and one of the strongest in the market It was started in 1939 by Bill Hewlett and Dave Packard, to provide products, services and after sales services of the highest quality, which they hoped would gain them customer loyalty. They hope to gain this by meeting the needs and demands of the customer, at competitive prices. The company provides technology that can be found in almost all businesses and home.They provide information technology solution to users, personal computers, and accessing devices, global services and imaging and printing equipment to its customers.
They spend approximately $4 billion yearly on research and development to come up with new technology that change the market to their advantage which by extension creates opportunities for them to stay ahead in the market. They have a work force of about 142,000 personnel in approximately 170 countries, and in the fiscal year ending October 23 2003 they earned $73. billion dollars. HP has identified four core competencies to focus on they are; the customer solution group, which markets and sells computer hardware and software, the imaging and printing group which provides printing and imaging devices to it customers, personal systems group which supplies competitively priced computers, and the technology solution group which deals with storage systems, software and services. Both Dell and HP have use their own strategy to the maximum use and that has given them competitive advantage over the other rivals.
Both companies are easily adaptable to any business to which they would be relevant. OBJECTIVES OF THE COMPANY The main objective of the company at the moment is to retain what market share it currently has; this can be viewed as an overall or long term objective of the company. The company like many other also has other objective to work towards these. The creation and retention of profits; to be able to generate profit would mean that the company can be able to put money back into the organization to facilitate growth, research and development.
Profits in the business could help it achieve its main objective, by enabling possible product development. Market leadership for the organization will be possible, by providing what the customers want, the products, the services, the after sale support systems. The company constantly needs to keep abreast of the changes in technology, the offers of the competition and the demands of the consumer, you may if finances allow, need to be pioneers in some new technologic development.For any of this to be possible the mind set of everyone in the organization from management to shop floor needs to be adjusted to a common belief and goal; the need to be at the top of the market, that happens through hard work, dedication and good strategies. The business can grow if it is will to come up with innovative ideas and develop products based on them. The management needs to be able to make decisions where there may not be any particular level of certain about the outcome, in order to encourage growth; part of being in business is about taking risks based on the market conditions.
Because computer technology is such a large part of our daily life, the demand for the products is almost unlimited, so the potential for growth is great. It is up to the come to act smart and try to be one step ahead of everyone. THE SOURCES OF COMPETITION The threat of competition is always eminent in public sector industries, and there are always some elements in the environment to influence the competitive nature of the businesses. The diagram below represents the Five Forces identified by Michael Porter, which affect companies in a given industry, in this case businesses in the computer industry.
