Customer satisfaction case study

The organization must make integrated efforts if it wants to attain customer satisfaction. For maximum productivity, marketing must extend beyond the marketing division and encompass other departments including finance, production, engineering, research, and development.
In an effort to abandon its traditional business practices and adopt cutting-edge technology in the face of other industry players' revolution, the case study details Dell Inc.'s transformative journey (Cawsey, Deszca & Ingols, 2013). The business has long been content to produce and distribute inexpensive but effective computers, settling for the lower end of the market. The situation altered, though, as the market switched when its rivals, including Hewlett-Packard, IBM, and Apple, introduced new sophisticated products with superior and attractive features, distributed through retail stores. Dell reacted to this by changing the management team and providing new products and services that matched the needs of its consumers.

However, the dramatic changes in the market had already deeply affected the organization. Despite selling the most competitive products and remaining one of the leading companies in the technology industry, key financial ratios from 2006 and 2010 were a clear illustration of its declining market share and competitive edge. This prompted the CEO, Michael Dell, to decide on making the company private. Transforming the organization will take it back to profitability, and ensure that the products meet the current market standards.

Organizations mainly face problems when presented with financial, operational, and legal issues. When matters of grave economic, functional or law intensity affect a company, it is bound to suffer loss, and the management must formulate strategies to turn around the newly found misfortunes (Waters, 2009). The problems at Dell Inc. began to manifest themselves when the market shifted. Initially, the organization provided customized built to order computers to consumers, with corporate being the major clients. This arrangement turned Dell into a production and distribution expert, with strong relationships budding between the company and its customers, as opposed to retailers. The previous marketing strategy was no longer helpful as the marketplace shifted from corporate to consumers. The importance of design over machine power, and software over hardware pushed the company into the unfamiliar ground, where the straightforward organization that Dell was comfortable with earlier could no longer meet the new intricate market expectations (Dell, 2009). This prompted the CEO to make critical changes in the top management - a move that was aimed at bringing the company to par with competitors. Dell performed exceptionally well, remaining a leading player in the technology industry. However, key financial ratios experienced a worrying decline, which the top management hopes to rectify.

The alternatives presented by the newly appointed managers included shifting the company’s traditional model of direct selling to consumers. To maintain its competitive edge, the company should use retailers to approach the market. However, the company is also presented with the alternative of direct selling, where it could still reap the benefits of customizing computers for direct delivery to consumers, even though the market is shrinking. This means that Dell could operate using a hybrid model, embracing both direct selling and reselling channels. However, strategists must be wary of the current trend in the market, noting that the product being sold should dictate the channel chose, and the level of maturity of the product.

Pricing is the second alternative that Dell could consider working on. Alternatively, the management could work towards reducing its product sales, while maintaining the current price (McGee, 2005). This move would significantly increase the profit margin.

Adopting a promotion strategy is another alternative that is available to the organization. Concentrating on an aggressive marketing campaign through television adverts, the internet, and via print media, marketing publications, including catalogs, newsletters, and other promotional materials would make an impact on the company’s turnover.

Among the alternatives provided, the best way to solve the financial problem is by reducing the costs of production. This will increase the profit margins. Dell could do this by outsourcing some of the processes or products, and also by producing in bulk. Manufacturing products in large quantities benefit the company through economies of scales. To increase the volume of revenue, Dell should maintain its direct selling channel as it adopts the new retail distribution channel (Kotler, 2008). Despite the shrinking corporate market segment, any few units sold would still make a significant contribution to the company’s revenue turnover, while having the best of both alternatives.

The main objective of any organization is to create and maintain a satisfied customer. In relation to this, Dell Inc. must ensure to adopt the strategies that prioritize their customers by understanding their needs and then trying to align their products based on those them. However, satisfying customers must be done in conjunction with improving business performance. In view of this, Dell must focus on its consumers, competitors, and partners in order to maintain a healthy business environment.

References

Cawsey. T.F., Deszca, G., & Ingols, C. (2013). Organizational Change: An Action-Oriented Toolkit. Hoboken, N.J: Wiley Publishing

Dell. (2009). Customer-Driven Innovation. Retrieved from http://content.dell.com/uk/en/corp/d/corp-comm/cto-customer-driven-innovation.aspx

Kotler, P. (2008). Principles of Marketing. (12th ed.). London, UK: Pearson Education.

McGee, J. (2005). Strategy Analysis & Practice. New York, NY: McGraw-Hill Education.

Waters, R. (2009) Dell predicts return to growth. Financial Times. Retrieved from http://www.ft.com/cms/s/0/5c4d55dc-934c-11de-b146-00144feabdc0.html