Dell PC & Laptop's Supply Chain Management
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Dell's supply chain management involves managing quality, demand, logistics, and customer relationships. Dell shares supply chain information with suppliers and assesses supplier performance. It uses systems like ValueChain to coordinate inventory levels and quality metrics. Dell also forecasts demand using techniques like neural networks. Its build-to-order and configure-to-order models help match production to customer orders. Dell integrates supply and demand planning to reduce inventory levels.
![SUPPLY CHAIN MANAGEMENT
[PC & LAPTOP]
Team VERY NORMAL: Nguyễn Đăng Chí | Võ Sơn Lâm | Đoàn Ngọc Châu | Lâm | Lê Đức Huy
LECTURER: Mr. NGUYỄN QUỐC BẢO](https://image.slidesharecdn.com/finalpptdellcase-160501044814/85/dell-pc-laptops-supply-chain-management-1-320.jpg)
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Dell PC & Laptop's Supply Chain Management
- 1. SUPPLY CHAIN MANAGEMENT [PC & LAPTOP] Team VERY NORMAL: Nguyễn Đăng Chí | Võ Sơn Lâm | Đoàn Ngọc Châu | Lâm | Lê Đức Huy LECTURER: Mr. NGUYỄN QUỐC BẢO
- 2. Contents 1. Definition of SCM 2. Introduction about Dell 3. Quality management 4. Demand management 5. Logistic management 6. Customer Service 7. Cashflow optimization & Interal collobration 8. Inventory management 9. Benefits and limitation 10. References
- 3. WHAT IS SUPPLY CHAIN MANAGEMENT?
- 4. Founded year: 1/2/1984 | Founder: Michael Dell Revenue: $59 billion (2015), is the 28th largest income in the United States. Number of employees: 108,800 (2013) Industry Computer hardware, computer software, IT services, It consulting Products Personal computers, servers, peripherals, smartphones, tv www.dell.com
- 5. Headquartered: Round Rock, Texas, United States
- 6. DELL PC & LAPTOP’S SUPPLY CHAIN
- 8. Dell shares information to suppliers. • Indirectly by mail, phone or internet. • Directly by meeting each quarter combine exchanging employees to support technology. How to assess performance of supliers? Dell used a scorecard that compares each supplier with its competitors based on cost, quality, reliability and continuity of supply QUALITY MANAGEMENT
- 9. ValueChain.Dell.com • Operates as an extranet between Dell and its suppliers. • Suppliers can get informed about the level of inventory in the supply chain, supply and demand data, component quality metrics and new part transition. QUALITY MANAGEMENT
- 10. • Dell's new PC models are tested at the same time as the networks that they reside on are tested. This cooperation with other vendors reduced the testing period from 60 or 90 days to 15. QUALITY MANAGEMENT
- 11. The i2 system (Supply Chain Planner, i2 Collaboration Planner, and i2 Factory Planner to meet it supply chain needs) enables Dell: • Pull material in to its factories every two hours based on real time customer order. • Provide suppliers know factories and assembled to meet customer demand. • Automatically checking accessories follow requirement parts and component list. • Automatically and electronically ordered directly from suppliers if the accessories out of stock. QUALITY MANAGEMENT
- 12. Ways for Dell to manage quality of SC : • Conflict – Free Mineral • Supplier Diversity • Supplier Responsibility • Conflict – Free Smelter • Coalition Code of conduct • Supplier Global Citizenship Commitment • Policies and Positions QUALITY MANAGEMENT
- 13. Some of transportation partners: LOGISTIC MANAGEMENT
- 14. 3Cs strategy: • Cube - Reduce packaging size. • Content - Use recycled or sustainable materials. • Curb - Make packaging easily recyclable. LOGISTIC MANAGEMENT
- 16. Reverse Logistics • This is efforts to decrease product return. • The product returned will be resold as Certified Refurbished, Dell Outlet New or Scratch and Dent, and all Dell Outlet machines carry a Same-As-New warranty. => The products resold Increase from 90% => 94%. LOGISTIC MANAGEMENT
- 17. The functions of Dell’s Logistics Services Warehousing service | Drop in Box | Remove Item Multi Pack Over | Pack Pallets & Crates | | Custom Packing | Ship Box Label | Order Consolidation | | Time & Date Specific | Delivery. Inside Delivery | Customer Carrier | International Shipping | Reporting & Notification LOGISTIC MANAGEMENT
- 18. DEMAND MANAGEMENT CTO (Configure to order): you can choose different hardware to suit your needs such as adding more RAM, processor speed, selecting a DVD BTO (Build to order): Dell pre- builds what they it believes will be the most popular configurations In 1999, Dell introduced SAP R/3 solutions on Dell PowerEdge servers With new i2 technology , Dell able to profile customers, target them using their medium of preference, and also measure the results. Dell integrated the supply and demand side of the business by using unique software that would eliminate inventory overages.
- 21. Management By Objectives (MBO) gives reduced costs For example when you want to sell a product you send out an offer to many different customers, instead of sending out 100 offers to random customers and in the end only do business with three of them, you can send out three offers and do business with all three. DEMAND MANAGEMENT Demand forecasting: Multilayer Perceptrons and Radial Basis Function neural networks, Multivariate Adaptive Regression Splines, Machine Learning, and Tree algorithms are tools to forecast. The forecast can go wrong with maximum 10 % and is done 12 months in advance.
- 22. Premier Pages of Dell at http://premier.dell.com which are custom-designed Web pages containing purchase data DEMAND MANAGEMENT
- 23. CRM
- 24. Premier Pages allows: - Customer: configure, price, and buy systems at the agreed-upon price, track orders and inventory through detailed account purchasing reports by group, geographic location, product, average unit price, and total dollar value. - The Dell staff : know detailed demographic information about customers, customer sales history and trade relationships. - Sales management: track activity within accounts, and lapsed quotes can be acted on. - The marketing department can track customer activity, product sales, and marketing mixes. CRM
- 25. CRM Smart Selection Catalogue Catalog in the application ,which suggest some the best or most popular choices of Dell, ( usually used in large companies) will be integrated with Dell’s ERP. This system accepts enterprise can use systems to order from Enterprise Procurement Application of them. Dell will manage Catalog of enterprise. Enterprise will be repay this catalog to adjust order
- 27. CRM Dell's Enterprise Resource Planning (ERP) B2B E-Commerce Solutions
- 28. CRM Dell's Enterprise Resource Planning (ERP) B2B E-Commerce Solutions Helps Companies Save Time & Money: Better Customer Relations Simplifies Purchasing Process No Duplicate Entries Fewer Errors Improves Accounts Receivable Turnover Ratio
- 29. Dell is also using several other information technologies, including e-mail, EDI, video teleconferencing, electronic procurement, computerized faxes, an intranet, DSS, a Web- based call center, … CRM
- 30. CRM
- 31. CRM Oracle 10g Real Application Clusters running on low-cost industry standards-based Dell Power Edge servers provides for very cost-effective scaling, high reliability, and the ability to add capacity by adding additional low cost Servers rather than buying larger, more expensive proprietary Unix-based servers
- 32. CRM
- 33. CRM 1 million Dell part numbers across approximately 200 product families, and over 2 million Bills of Materials (BOMs) per year. 1.8 million Purchase Order line per year, from more than 5,000 suppliers worldwide. 3 million inventory movements daily from stock rooms to the factory floor Transmit 3 million messages for report, analysis and factory scheduling Handle approximately 15,000 items per day and vendor information and contact information. SCM Oracle database application in Dell’s Americas consists of approximately 3,000 database objects (functions, packages, procedures, trigger, tables, and views). New Dell serves solution can solve, manage:
- 34. • Real time and just in time (JIT) Quick deliveries, low inventories, little or no obsolescence, and lower marketing and administrative costs • Suppliers provide Dell with goods in a “high speed” No say: “Deliver 5000 to this warehouse every two weeks”, Dell say: “Tomorrow morning we need 6.795 to be delivered at door A3 (of the warehouse) by 7 am” Dell holds an average of less than 6 days of inventory, while the corresponding average of its competitors is 6 weeks • The main suppliers are required to maintain inventory near or in Dell’s plants • Dell has Merge Centers to store the order before shipping. INVENTORY MANAGEMENT
- 35. Expand selling channel: have retailer after successful direct sale model Increase in capital costs due to the 60- day finished goods inventory Increased manufacturing costs by 5%, But it allowed Dell to a gain back its 12% price premium through add-ons and upgrades Using customer information to leverage mass customization Dell customers visited Dell's portable business unit in Round Rock, Texas to voice their needs in reliability, consistency, and the ability to customize equipment with screen size and memory. In 1997, Dell responded to this needs with its new Latitude CP line44 CASHFLOW OPTIMIZATION
- 36. Get more interest revenue When customer pay money for Dell in 30 days, Dell only pay for manufacturer in 9 days, so Dell can get mỏe interest revenue for 21 days Dell has a lot of supplier provides rapid delivery, competitive prices, and available computer options to the customers. CASHFLOW OPTIMIZATION Use and develope itself operation, planning, management and control information systems, application and software small and big company. For example, Dell reduces enterprise hardcopy printing costs by 50 percent with Lexmark solution Internet is the best solution for Dell to operate, management, control supply chain and it is very cheaper than without it
- 38. BENEFITS AND LIMITATION Competitive advantage compared with traditional rivals based on: • Disintermediation (cutting out the middleman): • Enhancing customer value • Process and operations innovation • Easily accessible sales and customer services data that resulted from online sales BENEFITS:
- 39. BENEFITS AND LIMITATION Spend a lot of cost for technology in the beginning. Dell must be integrated with many ERP systems, some steps must still be done manually as data update Information and payment not is 100% protected on the Internet Everything is based on forecast from the last year so drastic changes can cause problems for Dell and their sub-suppliers because they have customer order production Direct selling model is higher transportation costs Limitations:
Editor's Notes
- Supply chain management (SCM) is the management of the flow of goods and services.[2] It includes the movement and storage of raw materials, work-in-process inventory, and finished goods from point of origin to point of consumption (Wikipedia).
- In the CTO world, every order is custom and is built only after the order is placed. For commercial customers, this meant that the typical wait time from receipt of order to shipment time was around a seven to ten days. With Smart Selection, Dell pre-builds what they it believes will be the most popular configurations, or SKUs, and will ship them within 24 hours. It called BTO( build to order). Large enterprises can even get their approved custom software image by adding another 24 hours Because there is BTO Dell can save and improve many things. BTO configurations are easier to service as well. Every CTO configuration is unique and so is a service event
- Each 20second The system i2 technologies will collect orders, analyze the parts of orders and check inventory of Dell and suppliers, after that set up the orders, accessories necessarily for suitable supplier Dell sử dụng hệ thống SCM của i2 Technologies Còn hệ thống tiếp nhận đơn hàng của nàh cung ứng sẽ tự động cập nhật 2 giờ một lần. Sở dĩ, hệ thống có thể làm việc như vậy nhờ, Hệ thống này có thể liên kết thẳng tới hệ thống ứng dụng trên nền tảng ERP của nhà cung ứng. . This new i2 technology was used to coordinate the build-to-order processes from order placement to customer support. This system tracks backlog numbers, stock status, and supplier commitments For example when you want to sell a product you send out an offer to many different customers, instead of sending out 100 offers to random customers and in the end only do business with three of them, you can send out three offers and do business with all three. This is possible if you use MBO.
- This system also has a paperless ordering process, with the customer’s existing technology configurations already captured. The process of knowing the customer begins when the customer orders a PC. The PC is built after the customer orders it. This means that Dell has to have a direct relationship with the customer. The final system that Dell is using to maximize CRM is the Dell South Africa’s implementation of an enhanced CRM system with the help of IS Partners, an information systems company. Sales, marketing, financial and management segments benefit significantly from this software. The Dell staff has easy access to the detailed demographic information about customers, customer sales history and trade relationships. Sales management can track activity within accounts, and lapsed quotes can be acted on. The marketing department can track customer activity, product sales, and marketing mixes.
- This system accepts enterprise can use systems to order from ERP system ( ERP Procurement Application) of them. CRM of Dell will manage Catalog of enterprise. Enterprise will be repay this catalog to adjust order. British Airway(BA) : ) used Dell like strategy partner Dell provided about 25000 laptop and desktop for employees of BA. Beside, Dell provided 2 shopping online systems for BA. This thing was Dell accept BA to watch for, purchase and check the orders through website which Dell customize suitable with BA. In website, BA could choose and configure laptop or desktop difference to suit each business department. The employee of BA would be accept their choice and order their computer suitable with their use demand through internet system which was connected with Dell’s system
- Dell also uses the Internet to create a community around its supply chain. Dell’s corporate portal has links to bulletin boards where partners from around the world can exchange information about their experiences with Dell’s products, logistics, and customer service. 1, "PunchOut" – Xác thực các truy cập tới catalog của khách hàng tại Dell từ trình duyệt của khách hàng cho việc mua hàng. ( redifine the access catalog of customer at Dell from customer’s webpage for purchase) 2, Order Requisition – Các dữ liệu về giỏ hàng sẽ được chuyển tới cho khách hàng vào thẳng hệ thống ERP của khách hàng. ( The data about cart will transfer for customer push in ERP system of customer) 3, Electronic Purchase Order – Khách hàng chuyển cho Dell các đơn đặt hàng. ( Customer give orders for Dell) 4, PO Acknowledgement – Dell phản hồi lại cho khách hàng. ( Dell response for customer) Cơ sở của phương thức giao dịch này dựa trên sự trao đổi dữ liệu điện tử EDI giữa các máy chủ của các bên