Operations Management Dell’s Supply Chain Management

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has been replicated by major competitors such as HP and Acer and today it’s not a novelty to have made to order PCs the way it was few years ago. Because its supply chain system is so dependent on the reliability and commitment of its suppliers, a breakdown at one stage of the company’s supply chain can create havoc in the entire supply chain stream. The suppliers, too, feel pressurized to come up to Dell’s standards simply because there’s nothing such as long term supplier partnerships in Dell. The moment a supplier underperforms, he/she is removed from the list of suppliers which is rather demotivating for the suppliers. However, for Dell, this is just another way of doing business and keep thriving as a low-cost, high quality PC provider.
The company also faced issues for reasons external to its own operations. for instance, the recall of Sony batteries. Furthermore, the company has always had to reach a compromise between its business to business market and its consumer market as traditionally the company has always focused on the latter. The issue with this is that the company has focused on the technical benefits of its products rather than seeking the emotional aspect tied to its products.
Perhaps, the root cause of Dell’s problems has been that it has largely been a selling and marketing company rather than a production company. thus, its suppliers are not suppliers, they are the actual producers on which the company’s brand image thrives. It is the suppliers who deliver the product that the company promises and any mismatch between the two can lead to potential loss of goodwill. Thus, Dell’s supply chain has been an area related to its core competencies and as the paper discusses, the ultimate solutions offered by Dell have been related to changes in its supply chain and policies that enable the company to retain its competitive edge in its business model, which has become a challenge specially when competitors such as HP have replicated