ed in relation to its targeted segments, its distribution system, and its relative cost per unit. Dells long-term goal should be to sustain high levels of cash flow generated by operating activities it all of its market segments and therefore sustain long term profitability. The strategy would require the uncontested vision of a CEO like Michael Dell and not just an expression of unfounded exuberance or corporate hype.The Dell Direct Model seems to be the vehicle to achieve the goal of capturing increased market share and for further penetration into markets abroad. The primary alternative should be for Dell to enhance and broaden the fundamental competitive advantages of its Direct Model by increasingly applying the efficiencies of the Internet to its entire business. Dell estimates that about 50 percent of its sales are web-enabled along with about 50 percent of Dells technical support activities and about 76 percent of Dells order status transactions occur online (Dell-FactPack, 2001). 4 Dell has managed to create a synergy through its web-enabled model, and is a key partner with many of its corporate and individual consumers in helping them deploy the technology they need to capitalize on the efficiencies of the Internet.The efficiencies of the Dell Direct Model should incorporate a greater focus toward its medium and large business and institutional customers thereby complementing both the replacement and upgrade needs for PC hardware along with further penetration into the higher margin PC server and peripheral market segment.Dells strategy is, and should remain, to be the price leader for the home and small business PC user. At the current time Dell seems to be strangling the competition by its willingness to aggressively cut prices. The capability to sustain its leadership position is enabled by its Dell Direct Model. While competitors have followed this path, it seems that none have moved along the learning curb and ...
