Dell Supply Chain

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Talks about how dell has used MIS and Information technology to get a leadership position ...(though its not a leader now)

Talks about how dell has used MIS and Information technology to get a leadership position ...(though its not a leader now)

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  • a detailed ppt covering the supply chain in Dell..very useful
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  • 1. MIS @ DELL NAME ROLL NO Pranav Bhardwaj 6 Amit Kumar 20 Ashish Modani 26 Tarun Shetty 47 Anuj Pratap Singh 48 S. Karthik 53
  • 2. Dell at a Glance
    • Globally 2 nd in computer hardware design, manufacturing and distribution with a market share of around 16%.(HP is 1 st with 19%)
    • Founded by Michael Dell in 1984.
    • 1987 --first computer systems company to offer next-day, on-site product service .
    • Greater than $50 Million sales per day through the internet with yearly revenue of $55.908 Billion with employee base of 78,000.
    • Ventured in areas of storage products, workstation systems, online technical support, appliance servers, network switches, standards-based point-of-sale offering for retail customers, recycling .
    • Shipped more than 10 million systems in a single quarter (Q4, FY06)
  • 3. Dell’s Direct Model
    • Direct relationship, most efficient path
    • Low cost and best value
    • Built to order
    • Customized systems
    • Superior, tailored service and support
    • Highest quality and most relevant technology
  • 4. Dell’s Value Web Model
  • 5.
    • Material costs account for 74%($21 billion) a year for dell.
    • Improving SCM by 0.1% has bigger impact than improving manufacturing process by 10% .
    • Changing technology obsoletes Materials’ value by almost 1% per week .
    • Rely on market forecasting to drive Production.
    • Technological breakthroughs cause very short Product life cycles .
    Why SCM is so Important in PC business
  • 6.
    • Need to hold inventory at each step in value chain .
    • Have to pay suppliers first before getting paid from customers .
    • Caught with short supplies of hot products- lost sales.
    • Stuck with excess inventories of slow selling products .
    • With about 2,000 product transitions a year, the ability to reduce product time to market is critical.
    Competitors’ Disadvantages vis-à-vis Dell
  • 7. Dell’s Competitive Advantages
    • Dell is having one of the best SCM in the world.
    • 90% supplies ordered online using integrated websites of supplier and Dell (B2B).
    • 95% of suppliers situated very close to assembly plant hence coordination is easier.
    • Dell’s factories have only 7 hrs worth of inventory for most items whereas industry wise it is around 10 days.
    • 15 suppliers provide almost 85% of all supplies.
    • Dell gets paid by customers and then pays to its suppliers.
  • 8.
    • Dell chose i2 Technologies for its SCM system.
    • i2 serves almost 70% of the SCM market.
    • Every 20 sec the S/W aggregates orders, analyzes material requirements ,compares Dell’s on-hand inventory with its suppliers’ inventory and then creates a supplier bill of material to meet its order needs .
    • Instead of forecasting the daily supply needed, Dell receives the exact material every two hours to fulfill actual customer orders.
    Dell Chooses i2 SCM S/W package
  • 9. Dell ERP Debacle
  • 10. Dell’s Ans to ERP G2 Architecture The G-2 architecture enables company to run “best-of- breed applications” rather than only a single enterprise system.
  • 11. RFID @ DELL
  • 12. What is RFID
    • RFID stands for Radio Frequency Identification Devices.
    • RFID is a 3 part technology consisting of:
    • A reader
    • A receiver with decoder
    • A Transponder
  • 13. RFID applications
  • 14. RFID at Dell - Manufacturing
    • Tracking code and Computer assembly instructions are added to the tray.
    • This determines the specific line to which the tray should go to.
    • At every stage of the assembly, the tags are read by the antenna for specific instructions.
  • 15. RFID at Dell - Shipping
    • Once assembled and tested, production information is inserted into the tags and sent to a shipping station.
    • At the shipping station, the RFID tag transfers data to the control PC.
    • This control PC uses this information to print the appropriate label.
  • 16. Benefits of RFID
    • Production stops have reduced dramatically.
    • Labor can be allocated by minimizing repetitive activities.
    • Returns due to wrong shipping of products have been minimized.
  • 17. SCALEABLE DESIGN AT DELL
  • 18. Reduction of TCO
    • Dell aims to reduce TCO for its customers by improving its IT systems:
    • To meet corporate objectives.
    • Keep costs to a minimum.
    • Reduce Complexity.
  • 19. THE SCALEABLE MODEL
    • A shift from proprietary technologies to in house Dell capabilities.
    • ‘ Pay as You Go’ model.
  • 20. Benefits of the ‘Scalable’ Model
    • Increase performance and availability by scaling incrementally
    • Minimize management overhead.
    • Improve utilization rates.
    • Preserve capital.
    • Reduce TCO
  • 21. Delivering High Performance
    • 2 Global Centers with 72 Dell PowerEdge 6650 servers.
    • Dell uses Oracle 9i Database with Real Application Clusters (RAC) running on Red Hat Linux Advanced OS for servers.
    • Servers help carry out 5 million transactions a day
  • 22. Delivering High Performance - Storage
    • Dell uses Dell/EMC Fibre Channel SAN (Storage Area Network)
    • This helps:
    • Store and retrieve critical information.
    • Helps it scale easily and thus enabling it to accommodate any increase in storage system.
  • 23. Dell’s Factory Planner Solution
    • Manages 250 suppliers who handle 4000 components.
    • Calculates schedules.
    • Estimates surplus parts in the factory and in the supplier inventory.
    • Places orders, which are delivered within 90 minutes!
  • 24. Reliability
    • A single database is run on a cluster of Dell servers running on Intel processors.
    • This ensures that the minute a server is down, another server automatically comes up and takes over.
  • 25. B2B @ DELL
  • 26. Business To Business (B2B) Model
    • INTRODUCTION
    • Business model for dealing with large business entities.
    • Server- to- server communication over internet integrating both supplier & buyer system.
    • Shopping online with customer’s ERP Procurement Application with simultaneous up gradation.
    • No duplicate information entry.
    • Easy process, less cycle time, less errors.
  • 27. Dell’s Objectives With B2B Integration
    • To quickly integrate customers who are capable today.
    • Built a solution to integrate any customer who
    • supports open industry standard of XML,EDI
    • To help customers built a B2B solution for rapid deployment & connectivity.
    • Providing hardware, software & consultation to help build a system which not only connects to Dell but even to other suppliers.
  • 28. B2B e-Commerce Solutions
    • Connection to more than 20 different industry E-procurement (ERP) tools & usage of standard formatting protocols.
    • Example- Ariba, Peoplesoft, SAP, EER, Peregrine,etc.
    • Basic division into 2 parts:
    • Supplier hosted solutions
        • Dell will host the catalog .
        • Customers will access their own custom catalog to retrieve their personalized configurations.
        • Catalog maintenance by sales representatives.
  • 29.
    • "PunchOut" - authenticated access to the customer's catalog at Dell from the customer's Internet browser to facilitate shopping
    • Order Requisition - shopping cart data pulled back into the customer's ERP system and workflow processing
    • Electronic Purchase Order - sent back to Dell for automated order processing
    • PO Acknowledgement - response returned to customer
  • 30.
    • Buyer Hosted Solutions:
    • Most complex and require resources, time and effort to implement.
    • Catalog information exported to a spreadsheet or file and either sent to the customer directly for inclusion in their own system or moved to the E-Procurement vendor's network to be utilized and accessed there.
    • Information can become outdated so regular updates required.
    • Customer bears a large burden of catalog maintenance.
  • 31. Supplier vs. Buyer
    • Supplier
    • Pros:
    • Real-time Data Updates
    • Data Accuracy
    • No Double Entry
    • Integrated Electronic Transaction
    • Allows supplier to manage complexity of valid configurations
    • Cons:
    • Requires XML Communication Capability .
    • Customer gets a different look and feel from every 'Punchout' supplier
    • Buyer
    • Pros :
    • Works well for commodities with limited configurations
    • Catalog Preview Management
    • Consistent look and feel among different suppliers
    • Cons :
    • Data Accuracy
    • Catalog Management
    • Manual Data Update and Order Receipt (sent in email)
  • 32. Engaging With Dell
    • In order to maximize customer opportunities through B2B integrations, Dell has identified the primary criteria for quick, successful integrations. These are divided into two parts:
    • Purchasing Focus:
            • Developed or are developing an e-commerce strategy.
            • Larger numbers of orders .
            • More standardized configurations.
            • Centralized procurement.
  • 33. Engaging with Dell Contd.
    • Technology focus:
    • Dell's solutions are best designed for customers with some of these capabilities:
            • Punch out capabilities in their ERP or access to an authenticated intranet.
            • Dedicated development teams.
            • ERP systems that can use or translate XML.
  • 34. Dell- Customized for the Customer
  • 35.
    • Corporate customers account for almost 85% of revenue.
    • Large corporate customers access Dell website called dell premier which is a customized version of dell.com.
    • Access to product and service information tailored to a particular company.
    • Can order PCs directly from a menu of
    • configurations pre-approved by the company without going through normal purchasing channels or paperwork.
    Dell Premier
  • 36.
    • Orders put on Premier are automatically routed to higher managers for approval which eliminated paperwork and delays.
    • Access to Dell’s own on-line internal technical support tools which is actually used by Dell’s Support personnel when a customer calls for help.
    • Premier sites can integrate with - Microsoft (Biztalk)
    • Oracle, Peoplesoft , SAP ,etc .
    Dell Premier contd.
  • 37.
    • The Dell Premier sites includes more than 500,000 pages of information and facilitates greater knowledge transfer.
    • Gives detailed info on all the configurations(h/w and s/w) present in the customer’s pc which helps in quick decision making for customer if going for upgrades.
    • The same configurations info helps Dell to make repeat business with customers by offering products specifically to them.
    Dell Premier contd.
  • 38. Dell e-learning
    • Need for training for continuous product development, while keeping a worldwide sales and service organization up to speed.
    • Issues of quality, costs and no re-use
    • Eedo's ForceTen chosen as the content development and delivery platform for e-learning programs
    • Enabled Dell to own and control their content as well as the development process
    • Higher quality training, cost reduction, re-use and translation facility.
    • Result : Dell increases sales productivity by 20%, while reducing training development costs by 55%
  • 39. Authentication Solutions @ DELL
  • 40. Dell authentication
    • Challenge at hand:
    • Integrate authentication and identity management for Microsoft Windows, UNIX, and Linux platforms
    • Incorporate this into Microsoft Active Directory across the entire Dell infrastructure
    • Solution:
    • Vintela Authentication Services from Quest Software deployed with the help of Quest Professional Services
  • 41.
    • Consolidating authentication and
    • identity management systems:
    • Multi-Platform Management
    • Integration (MPMI).
    • Microsoft Active Directory service
    • Planning for the future:
    • Migrate the local user accounts from each non-Windows system into Active Directory.
    • Building a relationship:
    • Able to use this product for all costumer related solutions with a guarantee of successful execution
    Dell authentication contd.
  • 42. CRM @ DELL
  • 43.
    • Dell maintains special DB of its top 50 global customer.
    • Maintains a Global Data Repository for all of its customer.
    • Uses DB compiled by Dun & Bradstreet for 500 global companies for selectively targeting sales efforts .
    • Real Time CRM
    • When a customer calls in for placing order then customer service links directly to Dell’s Real Time inventory .
    • Depending on latest inventory data Dell can :
      • Push Available inventory at lower cost.
      • Promote latest/new products at higher cost.
      • Provide add-on products with discounts .
    CRM in Dell
  • 44.
    • Boeing as part of Federal Govt rule cannot use internet for doing business.
    • Dell has adapted customized its offering to Boeing’s IT system .
    • Dell uses EDI for processing orders from Boeing directly into its order management system.
    • 30 Dell people take care of Boeing’s 140,000 Dell PCs - forecasting future PC purchases, managing current inventory and securing needed service and support.
    Why Boeing will only do business with Dell -CRM
  • 45. Demand Forecasting at Dell
  • 46.
    • Starting 2005 Dell set up Kiosk locations at Shopping malls across US (Wal Mart Stores and other shopping malls), Canada ,China ,Japan and Australia where people can experience dell products .
    • Customers place order for dell products to be delivered later.
    • Reasons for going for Hybrid Sales Model
    • Biggest competitor HP gaining market share faster particularly in notebooks chiefly because of retail outlets.
    • Low internet penetration in India and China –two of biggest and fastest growing markets.
    Dell losing confidence in Direct internet based sales model ??
  • 47. Summary of MIS and its Effect in Dell
  • 48. Acknolwdgements /Sources
    • Dell.com
    • Cio.com
    • Idc.com
    • Wikipedia
    • Google.com
    • Quest.com
    • I2.com
    • CENTER FOR RESEARCH ON INFORMATION TECHNOLOGY AND ORGANIZATIONS University of California, Irvine.
    • Businessweek.com
    • http://www.intel.com/ebusiness/pdf/affiliates/i2-dell.pdf
  • 49. THANK YOU