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Dell Supply Chain Management

Dell employs over 82,000 people worldwide and manufactures computers in several global locations. Dell's supply chain consists of three main stages - suppliers, Dell as the manufacturer, and end users. Dell is able to match supply and demand by having customers customize their computer configurations online or by phone. This allows Dell to build computers from available components and reduce costs by eliminating intermediaries.

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Prashant Mishra
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545 views

Dell Supply Chain Management

Dell employs over 82,000 people worldwide and manufactures computers in several global locations. Dell's supply chain consists of three main stages - suppliers, Dell as the manufacturer, and end users. Dell is able to match supply and demand by having customers customize their computer configurations online or by phone. This allows Dell to build computers from available components and reduce costs by eliminating intermediaries.

Uploaded by

Prashant Mishra
Copyright
© Attribution Non-Commercial (BY-NC)
Available Formats
Download as PPT, PDF, TXT or read online on Scribd
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Dell Supply Chain Management

Presented By :Prashant Mishra kashyap joshi

Introduction
Dell was founded in 1984 by Michael Dell. Dell is a multinational technology corporation that develops, manufactures, sells, and supports personal computers and other computer-related products. Dell employs more than 82,700 people worldwide. Dell grew during the 1980s and 1990s to become the largest seller of PCs and servers As of 2010 it held the third spot in computer-sales within the industry behind HP & Acer.

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Dell is a trusted and diversified information-technology supplier and partner, and sells a comprehensive portfolio of products and services directly to customers worldwide.

Dell manufactures its computer systems at six locations: Central Texas and Middle Tennessee in the United States: Eldorado do Sul, Brazil; Limerick, Ireland; Penang, Malaysia; and Xiamen, China. Dell sells its products and services worldwide.

Dell's Direct Model is built on the principle that by selling computer systems directly to customers.

SUPPLY CHAIN SYSTEM


Configuration Management. Procurement. Cost. Inventory

Accounts Payable

SUPPLY CHAIN MANAGEMENT


Dell's supply chain consists of only three stages the suppliers, the manufacturer (Dell), and end users. Dell matches supply and demand because its customers order computer configurations over the phone or online (Internet). These computer configurations are built up from components that are available. Dells strategy is to provide customized, low cost, and quality computers that are delivered on time. Dell reduces the cost of intermediaries that would otherwise add up to the total cost of PC for the customer. Another advantage Dell gets by directly dealing with the customer is that it is able to get the customers requirements regarding software to be loaded.

Direct Model

Balancing Demand and Supply


Dell maintained a database to track the purchasing patterns of corporate customers and their budget cycles, in order to forecast demand. It also maintained a similar database for individual customers in order to cater to their future requirements for PCs. Through its forecasting techniques, Dell was able to forecast demand with 75% accuracy.

Production Process
Dell received orders via the telephone, Internet, e-mail, etc. Orders were received by business units, which downloaded the orders every 15 minutes. With advancement in technologies, the choices available for the consumers also widened. Customers could use Dell's website www.dell.com, to configure their customized computer and place an order for it. Customers could choose from a variety of products ranging from desktops, notebooks, servers, printers, etc. The website catered to different segments of customers like individuals, home office customers, small businesses, medium businesses, large businesses and public sector customers like Government departments, educational institutions and healthcare institutions.

Benefits
Dell maintained nearly zero inventories for some of its components. With the value of inventory declining rapidly at an average of 0.5% a week, holding a significant amount of inventory did not prove to be an advantage. As Dell did not hold large inventory of finished products, it did not have to sell technologically obsolete products at a discount. Dell was able to bring in new products according to the needs of the customers into the market faster than its competitors. In 2004, the inventory turnover rate in Dell was at 107 times a year, compared to 8.5 times at HP and 17.5 times in IBM.

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