Dell: A case study of dynamic competition

The Dell company (“Dell”) is a case study in bringing and surviving disruption. Dell’s entry into computer manufacturing disrupted the industry in the 1980s. But Dell almost collapsed when a shift in demand and technology hit the economy in the 1990s and 2010s. Dell learned the hard way how to adapt to changing circumstances. Today, Dell supplies a portfolio of products that bears little resemblance to the one of its origins.

In his book “Play nice but win” (“the book”), founder Michael Dell takes us on a journey from his years of early enthusiasm for computer technology to the creation and management of a billion-dollar business.

In this short review, we derive policy insights from the book. We start with an overview of the computer industry when Dell entered, and how its outlook irreversibly changed. We then focus on how Dell managed two waves of technological and market disruption. The book’s perspectives offer good insights into dynamic competition. In our opinion, what helped Dell to survive are “dynamic capabilities”. We close with a few reflections on competition policy in a context of uncertainty and rapidly changing markets.