Supply Chain Management

Essay by Donna TyreeUniversity, Master'sA+, November 2004

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RUNNING HEAD: Supply Chain Management

The challenge could be written one sentence. How does the world's No.1 computer systems company use supply chain management software to reduce inventories, improve material management and enhance relationships with suppliers?

Dell builds customized systems as ordered by businesses and home customers globally, and delivers them in a few days - to their doors, across the globe, and in the way hey wanted it.

The world's No. 1 computer systems company, Dell, delivers desktops, notebooks, workstations, server and storage products for virtually any computing need. Dell's competitive advantage is its direct customer focus. Interacting with customers by telephone or via the internet, Dell custom-builds each system and delivers it faster than the competition can match. (Intel Corporation, 2002).

Dell's goal was to achieve global, end-to-end supply chain visibility and management, to enhance its supply chain process for efficient materials management, improved inventory planning, forecasting and execution.

In addition, inventory levels in its factories needed to be reduced from days to hours and transactions have to be online and real time.

To achieve these goals Dell chose to use solutions from i2, including components from i2 Supply Chain Management. The i2 system streamlines the supply chain by providing component suppliers and Dell planners with global views of product demand and material requirements. This system also provides real-time factory scheduling and inventory management, so employees can generate key reports based on accurate and timely data, pinpoint inventory on the factory floor, and receive supplier deliveries on a true just in time basis. (Intel, 2002)

Dell currently purchases 90 percent of its direct material supplies online. Three years ago, Dell worked with more than 1,000 suppliers. That has dropped to a current number of about 100. These suppliers receive orders from Dell worth in excess...