Edamo,
What are your thoughts on the following issue.
There are 4 ways for a company to achieve growth.
1. Penatration, selling more of the same to the
same customers.
2. Product-development, selling new products (servers,
workstation, storage etc.) to existing customers.
3. Market-development, selling existing products
to new customers (China, Europe but also the consumer-
market).
4. Diversification, selling new products to new customers.
For example their ISP-activities in Europe.
When we look at the succes-rate of the 4 options mentioned
above history makes clear that diversification is a very,
very risky strategy.
1. Penetration, 80% succes,
2. Product-development, 50% succes,
3. Product-development, 25% succes,
4. Diversification, 5% succes.
I believe it was Igor Ansoff that was the first who wrote
about this theory.
Anyhow, what are your thoughts on the diversification-
strategy in relation with Dell.
Paul
So far Dell only loooked for expansion by entering
either new markets (geographic) or launching new
products.
I consider their
It seems to me that they now started a very risky
strategy of entering new markets with new products.
I mean their web
History has proven that these kind of moves have an
extremly high rate of faillure (80% I believe).
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