Dell strategies for growth: to focus on PCs and tablets

Michael Dell, who last week won shareholders’ approval for his $25 billion offer to buy and take Dell private, shared growth strategies. It will strengthen focus on PCs and tablets.

The U.S.-based computing major will invest in the personal computer and tablet markets, in expanding sales coverage, and in growing its distribution network.

Devices such as PCs and tablets are important focus for the company despite the rapid decline of the global personal computer market.

Dell says a significant incremental investment is required to turnaround the company. Support from the two strong private investors will aid the restructuring.

dell plans

“We still have a long way to go and many challenges to meet,” the company founder said. “But under a new private company structure, we will have the flexibility to accelerate our strategy and pursue both organic and inorganic investment without the scrutiny, quarterly targets and other limitations of operating as a public company.”

Asked if layoffs were in the offing, CFO Brian Gladden said there would be a company re-alignment, without elaborating.

Michael Dell has argued that revamping his company into a provider of enterprise computing services in the mould of IBM is a complex undertaking best performed outside the spotlight of public markets.

Dell reported a 72 percent slide in quarterly earnings last month, reflecting price cuts intended to soothe nervous customers and spearhead a foray into the enterprise market.

It remains to be seen if Dell can build its storage, networking and software portfolios to vie with Hewlett Packard and others. Some analysts think it may be too late, since a large swathe of the corporate market has been locked up by IBM and HP, Reuters reported.

But with the PC market expected to shrink again in 2013, investors say the company has little choice.

Global PC sales are expected to fall 7 percent this year and 4.5 percent next year, according to analysts at CLSA.

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