| U02A1 Dell Supply Chain | James DeHaven | BUS3022 Fundamentals of Supply ChainCapella University | Why has Dell’s Direct Supply Chain been so Successful? The direct supply chain model that Dell has been using for many years to sell customized PC’s to customers via the internet has been very successful. Dell designed and structured the supply chain to provide customized computers in a quick manner and with a reasonable price. Customers can visit the Dell website and configure the PC they desired and see the cost options they selected. Once the order was finalized, Dell would then start the building of that customized computer to meet the customer’s selection and ship the finished product directly from the manufacturing …show more content…
Using the direct model supply chain design, the company can bring these new products and capabilities quickly to market. These changes in technology can impact how the supply chain functions, so Dell needs to properly introduce these new technologies in an effective manner, and not impact how the computer is post assembled at the manufacturing facility after the customer orders. In 2007, Dell decided to change the supply chain strategy to support the use of retailers for selling a standard configuration computer for customers. Customers could visit their local Wal-Mart or if in China, the local GOME retail store to pick from the standard computer models available (Chopra, 2012, Pg. 6). The changes Dell made to support the retailer to end customer model helps increase the revenues and provides a low cost solution at retail points of sale. Dell utilizes the retailer’s distribution and retail store facilities which keeps the costs low for Dell and also sees lower outbound transportation costs compared to the online supply chain model (Chopra, 2012, Pg. 21). There are potential uncertain events that could occur in the market or future to impact Dell’s supply chain. An example would be where Dell outsources the component assembly in low cost countries, if these areas are impacted by environmental storms or damages, this could be an impact to product deliverables.
staff, management, and goals are in place to include them in the grid. Future plans must
Dell uses a just in time order fulfillment policy and accurate forecasting of sales to minimize inventories. This allowed Dell to hold inventory of finished products far below levels of their competitors (10-20% compared to 50-70% industry level) and furthermore allowed them to quickly implement changes to their product lines as new technologies became available. This quick inventory turnover also allowed Dell to retain more capital. Finally, this policy enabled Dell to respond immediately to technological progress in components and deliver state of the art new finished products (e.g. Pc’s holding the newest Pentium microprocessors) while competitors
This project charter is planned to help O’Donnell & O’Donnell LLP who will lead the project management team take place the parade smoothly. This parade for welcoming home troops will be organized in Colorado Spring which has a long history of military. This project charter’s goal is making sure project management team and sponsors understand all details and tasks of this parade and getting an agreement between these two parties. Some important tasks can be directed with the project charter. For examples, raising fund, arranging thousands of soldiers and planning a lunch
Long Write-up: Greeley Hardcopy-B Finally, the Greeley Hardcopy (GHC) Portable Scanner Initiative got its sponsor that would support its project throughout its research and development phase. This is in the name of Phil Faraci who took over as the General Manager of GHC handling both the Flatbeds and Portable businesses. During the previous phases of research and development of the Portable Scanner, despite being recognized as a very promising product, it faced several challenges in terms of support, budget & focus. For over five years the product did not take off and observed as a very slow-paced development. The pace of the project was so slow that it passed-on from one leadership into another in the organization. Its failure in its
This situation was different to Dell’s supply chain, were by using new technologies Dell shared information in a real time fashion with its suppliers, helping them know Dell’s daily production requirements making the supplier more responsive to Dell’s needs.
The Project Manager has some tasks that have to be carried out, he/she is responsible for the full project. The Project Manager has to make the best use of all the resources so the project can be completed successfully. The project Manager sets the boundaries for the project, such as schedules and what is done and when it has to be completed.
Title: Project Management Concepts and Practices: Project Proposal for Installation of 220 Radiology (X-Ray) Imagers for the I-Med Network Australia-wide.
In addition Dell’s reliance on suppliers also creates risk and uncertainties. “Reliance on suppliers, as well as industry supply conditions, generally involves several risks, including the possibility of defective parts (which can adversely affect the reliability and reputation of Dell’s products), a shortage of components and reduced control over delivery schedules (which can adversely affect Dell’s manufacturing efficiencies), and increases in component costs (which can adversely affect Dell’s profitability).” (Form10-K 2005 p9)
“Marketing / Sales” While most competitors supplied machines based on orders from distributors, resellers, retailers, Dell took orders directly from customers. Dell used indicators of a company’s potential PC purchases, such as the number of employees and the number of PCs per employee, to divide customers into two groups: Relationship buyers and Transaction buyers.
Without this, Dells competitive advantage would cease to exist. As researched, a large amount of Dells suppliers are located in close proximity to Dells assembly plants. This means it inevitably reduces lead times and associated costs e.g. shipping.
There are, however, some exceptions. For example, Dell may manipulate the schedule when there is a need to replace defective units or when facing large customers with specific service-level agreements (who have nonstandard quoted manufacturing lead times) for their orders. In most cases, Dell has significantly less time to respond to customers than it takes to transport components from its suppliers to its assembly plants. Many of the suppliers are located in Southeast Asia and their transportation times to Austin range from seven days for air shipments to upwards of 30 days by water and ground. To compensate for long lead times and buffer against demand variability, Dell requires its suppliers to keep inventory on hand in the Austin revolvers (for “revolving” inventory).Revolvers or supplier logistics centers (SLCs) are small warehouses located within a few miles of Dell’s assembly plants. Each of the revolvers is shared by several suppliers who pay rents for using their revolver. Dell does not own the inventory in its revolvers this inventory is owned by suppliers and charged to Dell indirectly through component pricing. The cost of maintaining inventory in the supply chain is, however, eventually included in the final prices of the computers. Therefore, any reduction in inventory benefit Dell’s customers directly by reducing product prices. Low inventories
Dell revolutionized the PC industry in the 1990’s because of its strategic innovation of the Build-To-Order model. It was a bold new business model that changed the rules of the industry. Through our research we have come to know that in today’s competitive world, a brilliant business model alone does not create a sustainable advantage, unless it is supplemented by operational excellence, the continuous identification and adoption of best practices.
Project objectives were divided into two areas, first one planned to be done by October, 1999. And the second task, to achieve the same period assessed system feature upgrades, add special prorate(SPA) function. Center hopes introduction of software engineering to improve the professional software development capabilities, thereby accelerating the main business automation processes. But the results of the project are not good, the general the task completed on time, SPA module was postponed to the end of March 2000, overall, it can be said the implementation of the project was unsuccessful.
The difference, however, was the structure of distribution. The traditional distribution system was not competitive for the time-based environment. The traditional distribution was referred to as “the channel”. The PC maker would sell the products to distributors who would buy the products from many manufacturers and then sell to a variety of resellers and retailers. Even the best of the PC makers were plagued by their inability to accurately forecast future market demands and were either left with excess slow selling inventories or a short supply of the hot products. Even with the best of forecasting, the PC makers had to hold inventory for each step in the channel to fill orders. It was common, in the 1990’s, for PC makers to have at least 90 days of inventory on hand within the channel. With the severe lack of efficiency with the channel, it allowed an opportunity for improvement. Dell was the company that seized the opportunity and established a new business model based on selling PCs directly to the customer and making the PCs built to order. Selling directly to the customer removes two links in the supply chain that enabled inventory to build up. Dell was able to provide better service to the customer, now knowing who they are, as well as promoting sales to them. By building the computer to order, Dell is able to introduce new technology as soon as the customers want them and that ensures supply and demand are adjusted
One of the major benefits of information technology in supply chain management is that it enables collaborative forecasting, which requires all supply chain partners to share information regarding parameters that might affect demand, such as the timing and magnitude of promotions. For instance, Dell Computer shares with their components suppliers all of the promotions, e.g., holiday, back-to-school, etc., that they have planned. These suppliers could, in turn, notify their suppliers of discrete components that a spike in demand is anticipated. These demand forecasts for end items determine the demand for components and coupled with the knowledge of fabrication times, allows all members of the supply chain to provide the right quantity at the right time to their customers.