QUESTION ONE

Read the extract below and answer the questions that follow.

Dell broke into the big time by developing a business strategy and supply chain strategy that

worked together. In the late $1980\text{'}$s and early $1990\text{'}$s Dell's business strategy was

differentiation through low cost, speed of delivery, and customer service. The major channel

for sales was from customers to call centres. However, the emergence of the internet called

for more differentiation and fundamental change. With a well understood business strategy,

Dell began to formally integrate operational components $($e$.$g$.,$ logistics$,$ manufacturing,

distribution, inventory management$)$ and develop a supply chain strategy. The supply chain

strategy focused at driving costs out of the supply chain $-$ being the low cost provider $-$ while

at the same time supporting a business strategy emphasizing customer service. A business

strategy creates a vision and direction for the whole organization. It is important that all people

within a company have clear goals and are following the direction, or mission of the

organisation.

Critically discuss the underlying objectives Dell should follow when formulating its business strategy. $(20)$