Comparitive Analysis: Growth Plan of Dell and Amazon

Growth Plan of Dell and Amazon
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Growth Plan of Dell and Amazon
Introduction
Global competition is on the rise, and the complexity of global market is creating a sense of urgency for business in the U.S. to transform business practices, technologies, and resources in order to stay afloat in the market (Dhirendra 2012, p.3). Therefore, he further notes that businesses must have a plan to find new customers or new markets through developing new products, modifying existing products, gaining market share, increasing business opportunities etc. E-commerce presents many opportunities which e-businesses can take advantage of to increase their revenue. To seize these opportunities, they need a well-thought growth strategy that will transform them. The business growth plan or strategy must find a balance between the market driving forces and the internal continuous improvement goals. In this light, this paper executes a comparative analysis of the growth strategies of two e-commerce giants; Dell and Amazon.
Growth Strategies
Growth is a key issue many businesses and it touches both big and small enterprises. If they do not plan to grow, then they may be cutting their path to failure. After all, failure to plan is planning to fail. Growth is usually measured in terms of increased revenue, profits, or assets.
Dell and Amazon are each using a different strategy to achieve its growth objective. Dell is using marginal acquisition strategy otherwise known as in-organic growth while Amazon is using organic growth strategy.
Dell chose acquisition in which it uses other companies leverage in the market, products, and revenue to achieve its growth objectives. For example, it acquired EMC Corporation while maintaining VMware as a publicly-traded company. The acquisition and merging of Dell and EMC was meant to create the world’s largest privately-controlled, integrated technology company. The aim was to make the company a leader in high-growth areas of the information technology market. Their main competencies in servers, storage, virtualization and PCs bring together strong capabilities in the fastest growing areas of the industry, including digital transformation, software-defined data center, hybrid cloud, converged infrastructure, mobile and security (Dell 2015, p.1). In this case, Dell’s strength in dealing with small businesses and mid-market customers was combined with EMC’s strength in dealing with large enterprises to gain profitable growth. This upholds Dhirendra (2012, p.3) argument that although large companies have a significant level of internal resources to support their growth concept, they need partners to accomplish it quickly. Ernest & Young (1994, p.3) acquisitions have a significant impact on the overall profitability and financial health of a company. Therefore, any intended acquisition transactions require thoughtful planning and execution. Non-financial factors such as products, market position, and management are mainly the most attractive attributes of an acquisition candidate. However, Ernest & Young c...