Dell's Supply Chain Management Practices

 
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Please note:

This case study was compiled from published sources, and is intended to be used as a basis for class discussion. It is not intended to illustrate either effective or ineffective handling of a management situation. Nor is it a primary information source.



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Case Details:

Price:

Case Code : OPER063 For delivery in electronic format: Rs. 500;
For delivery through courier (within India): Rs. 500 + Rs. 25 for Shipping & Handling Charges

Themes

Supply Chain Management, Direct Model, PC Retailing

Case Length : 26 Pages
Period : 1991-2007
Organization : Dell Inc.
Pub Date : 2007
Teaching Note : Not Available
Countries : US
Industry : Hardware

Abstract:

US-based Dell Inc., one of the leading PC manufacturers in the world, pioneered a unique model of selling PCs directly to the consumers, bypassing the resellers. The model is popularly known as the Direct Model. The case describes this model in detail and explains how it enabled Dell to manage its supply chain efficiently.

In the third quarter of 2006, Dell's major competitor HP had overtaken the company in terms of market share to become the top PC manufacturer in the world. Industry experts opined that lack of new products, poor customer service, increasing support costs, lack of retail presence and the limitations of the Direct Model were some of the reasons for Dell's poor performance.

Operations Management Case Studies | Case Study in Management, Operations, Strategies, Marketing Management, Case Studies

Dell's Direct Model, which was company's strength, lost its sheen, with the competitors gaining better supply chain efficiencies and opting for a mixed sales model. The case examines how Dell planned to consolidate its supply chain and manufacturing activities globally and venture into retail business in order to regain its leadership status.

Issues:

Study and understand Dell's Direct Model

Critically examine the limitations of Dell's Direct Model

Understand the problems faced by Dell in late 2006 and 2007

Critically evaluate Dell's retail strategy

Contents:

  Page No.
Introduction 1
Background Note 2
The Direct Model 3
Role of Dells Suppliers 6
Balancing Demand and Supply 9
Production Process 9
The Benefits 12
The Problems 13
The Road Ahead 15
Exhibits 17

Keywords:

Dell Inc., Supply Chain Management, Direct Model, Global Operations Organization, Global Procurement, Distribution Models, Inventory Management, Vendor Managed Inventory, Suppliers Logistics Centers, Sales Forecasts, Valuechain.dell.com, Demand Shaping, Order Management System, Working Capital, Retail Format

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