Cost leadership is a strategy used by companies to create a low operating cost within their niche. The use of this strategy is primarily to gain an advantage over competitors by reducing operating costs below those of others in the same industry. Mass customization is a marketing and manufacturing technique that combines the flexibility and customization of bespoke products with the low unit costs associated with mass production. Say no to plagiarism. Get a tailor-made essay on "Why Violent Video Games Shouldn't Be Banned"? Get an original essay Usually the most successful companies with innovative products are those that offer a great amount of variety and customization, this is because all consumer needs are met and therefore the product can be available to more consumers. With Dell in the innovative PC market focusing on cost leadership and therefore reducing its range of customization, it may experience some loss of demand as most customer needs are not met and some customers may have purchased a choice that it is no longer available. Furthermore, as many competitors have also reduced their product/customization range, some customers may feel that Dell has a USP and that their PCs are the only ones left offering a real variety of choices for customization, which could further damage the future demand of the company. . Therefore, focusing on cost leadership would leave Dell in a bad situation of declining demand, however Dell's data showed that only a small percentage of combinations are desired by customers, and so reducing variety would only slightly affect demand. This means that perhaps the drop in demand would be almost imperceptible and therefore Dell would be right to focus on cost leadership. Most companies would like to reduce the risks of a constant production flow, thus making the supply chain less complicated, so as to minimize the risk of production interruptions. For Dell in the PC market it is very rare that there is a company that makes all the computer parts and then has to source the parts from other places, not focusing on cost leadership. Dell had big problems with customization as they had to source many more different parts from many different places to satisfy consumer customization. This would have made it difficult to manage all the different suppliers and since there were so many different parties in the chain, there was more room for errors, this could have been a delay or interruption in production, either way the interruption of production would have significantly increased the total and unit costs of production. By focusing on cost leadership and reducing customization they would be able to reduce this risk by cutting parts of the chain and thus reducing unit costs and so it was right to focus on this. Despite this, however, the number of dissatisfied customers and the risk of supply chain problems are likely to remain as the company wants to source materials globally to achieve a lower price. This may therefore have actually increased the risk of production disruption due to global transportation methods being sensitive to weather conditions. Therefore, focusing on cost leadership may actually have increased the risk of production delays and dissatisfied customers, something that really needs to be minimized in.