If I Have One Thousand Dollars

IT industry there are two heroes of legend, one is Bill Gates, the other one is in 1000 U.S. dollars in 1984, Dell founded the company Michael Dell (Michael Dell). March 4, 2004, Michael Dell was happy to retire, but continue to retain the chairman position, but resigned the post of CEO. He was happy because the Dell in 2003 as the year of the global PC leader, in 2002 the turnover increased by more than 6.4 billion U.S. dollars.

According to IDC released the latest statistics of the global PC market report shows that Dell in 2003 to 16.9 percent of the market share leader in the industry peers, HP and IBM with 16.4%, respectively and 6% market share followed. The turnover of Dell in 2002 from 35 billion U.S. dollars in 2003 increased to 41.4 billion U.S. dollars, profit reached 2.65 billion U.S., successfully avoided the “growth trap”, in the end what Dell has taken the strategy?

According to “Father of Competitive Strategy,” Michael’s strategic theory: “We achieved remarkable performance is the primary objective of all enterprises operating efficiency (operational effectiveness) and strategies (strategy) is to achieve this goal, two key factors, but People often confuse the two most basic concepts. operating efficiency means that the operation of similar activities better than competitors.

Strategic positioning (strategic positioning) it means that operations are different from competitors, or while similar, but their implementation is different from the competitors. Almost no companies have been able to by virtue of the advantages of operating efficiency in an invincible position. Operating effectiveness of the strategy to replace the final results must be zero-sum competition (zero-sum competition), static or falling prices, as well as rising cost pressures. The so-called competitive strategy is to create differences, that is the destination choice of a set of different operations in order to create a unique combination of value. Strategy is to create a unique and favorable position, dealing with different kinds of operations.

However, the choice of a unique position and can not guarantee access to a lasting advantage. A valuable position will cause others to follow suit. Unless companies make some trade-offs (trade-offs), otherwise, any kind of strategic positioning can not be lasting. Therefore, “what is strategy” to answer this question added a new perspective – trade-offs. Strategy is to make trade-offs in the competition, the essence of what is to choose not to.

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