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Not everyone is impressed by Dell's "smart" supply chain - 0 views

  • To understand Dell's situation, you have to go back to the start. After being founded in Michael Dell's dorm room at the University of Texas at Austin in 1984, the company mastered the science of supply-chain efficiency. It was a model that made Dell the top-performing stock in the S&P 500 during the 1990s. Because it curtailed its retail store business early on and sold directly to consumers and businesses, Dell could build computers "just in time," which meant that it didn't have to assemble a machine and then let it sit in a warehouse or a retail location until someone bought it. Instead, it generally put together PCs only after customers had already ordered them. That meant Dell could order certain parts for its computers just days before they were needed—and often not pay for them until after the assembled computers were shipped off to customers
  • derstand Dell's situation, you have to go back to the start. After being founded in Michael Dell's dorm room at the University of Texas at Austin in 1984, the company mastered the science of supply-chain efficiency. It was a model that made Dell the top-performing stock in the S&P 500 during the 1990s. Because it curtailed its retail store business early on and sold directly to consumers and businesses, Dell could build computers "just in time," which meant that it didn't have to assemble a machine and then let it sit in a warehouse or a retail location until someone bought it. Instead, it generally put together PCs only after customers had already ordered them. That meant Dell could order certain parts for its computers just days before they were needed—and often not pay for them until after the assembled computers were shipped off to customers. But in the past few years, Dell has tried to expand its market by selling in stores. That has forced Dell to deal with several new challenges, among them that big chains such as Best Buy and Wal-Mart stock their shelves with a fixed lineup of PCs rather than customizing machines for each buyer. "We've had to change the entire supply chain to build fixed configurations," the company's chief financial officer, Brian Gladden, recently told Technology Review. And retailers order these machines months in advance, not days or weeks. google_protectAndRun("ads_core.google_render_ad", google_handleError, google_render_ad); As a result, Dell must try to figure out over the summer what to charge for PCs that will actually be made and sold during the holiday season. If the price of a major component such as memory chips jumps between July and December, Dell's profits can get squeezed. That's what happened in 2009. Even a plunge in prices can be damaging, because the company hedges many of its component purchases to lock in prices within a certain range. If prices fall way below the expected level, it has overspent for the parts. E-mail Print Favorite Share 12 Related Articles Bringing Down the High Costs of Business Forecasting Cloud-based services now provide a way for companies to plan ahead without relying on cumbersome spreadsheets. But what's a boon for smaller companies is disrupting the market for higher-end solutions. Dating Sites Try Adaptive Matchmaking New software is inspired by algorithms that target online ads or recommend books and movies. The Brainy Learning Algorithms of Numenta How the inventor of the PalmPilot studied the workings of the human brain to help companies turn a deluge of data into business intelligence. Tags business business impact Dell Predictive Modeling To comment, please sign in or register Username Password Forgot my password Adverti
  • niversity of Texas at Austin in 1984, the company mastered the science of supply-chain efficiency. It was a model that made Dell the top-performing stock in the S&P 500 during the 1990s. Because it curtailed its retail store business early on and sold directly to consumers and businesses, Dell could build computers "just in time," which meant that it didn't have to assemble a machine and then let it sit in a warehouse or a retail location until someone bought it. Instead, it generally put together PCs only after customers had already ordered them. That meant Dell could order certain parts for its computers just days before they were needed—and often not pay for them until after the assembled computers were shipped off to customers. But in the past few years, Dell has tried to expand its market by selling in stores. That has forced Dell to deal with several new challenges, among them that big chains such as Best Buy and Wal-Mart stock their shelves with a fixed lineup of PCs rather than customizing machines for each buyer. "We've had to change the entire supply chain to build fixed configurations," the company's chief financial officer, Brian Gladden, recently told Technology Review. And retailers order these machines months in advance, not days or weeks. google_protectAndRun("ads_core.google_render_ad", google_handleError, google_render_ad); As a result, Dell must try to figure out over the summer what to charge for PCs that will actually be made and sold during the holiday season. If the price of a major component such as memory chips jumps between July and December, Dell's profits can get squeezed. That's what happened in 2009. Even a plunge in prices can be damaging, because the company hedges many of its component purchases to lock in prices within a certain range. If prices fall way below the expected level, it has overspent for the parts. E-mail Print Favorite Share 12 Related Articles Bringing Down the High Costs of Business Forecasting Cloud-based services now provide a way for companies to plan ahead without relying on cumbersome spreadsheets. But what's a boon for smaller companies is disrupting the market for higher-end solutions. Dating Sites Try Adaptive Matchmaking New software is inspired by algorithms that target online ads or recommend books and movies. The Brainy Learning Algorithms of Numenta How the inventor of the PalmPilot studied the workings of the human brain to help companies turn a deluge of data into business intelligence. Tags business business impact Dell Predictive Modeling To comment, please sign in or register Username Password Forgot my password
ISM Silicon Valley

First Cohort Graduates, Celebrates ISM Approved Master's - 0 views

  • Eleven supply management professionals are the first to complete the ISM Approved Master of Science in Supply Chain Management (MS-SCM), granted by the University of San Diego (USD) School of Business Administration.
ISM Silicon Valley

NRX Asset Hub - 1 views

  • The NRX Asset HubTM application addresses your business needs for managing asset information through all phases of the asset lifecycle from design & build, through commissioning & start-up, and operate & maintain, to decommissioning and disposal.
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    Improve the quality and accessibility of asset information for an existing asset; and remediate, consolidate and migrate asset master data from single or multiple asset management systems to the new system
ISM Silicon Valley

Solve Supply Chain Challenges with New Book - 0 views

  • The Supply Chain Management Center at the University of Maryland's Robert H. Smith School of Business is bringing together top industry and government leaders to address inefficiencies in today's supply chain and come up with innovative ways to manage risk. The center spearheaded a recently released book, "X-Treme Supply Chain Management: A Guide to Mastering Business Volatility," and yesterday hosted an executive roundtable discussion among senior government and business leaders on the implications of the global economic crisis for supply chain management.
  • Edited by Boyson, center co-director Professor Thomas Corsi and senior fellow Lisa Harrington, the book is a collaboration with CSCMP and co-contributors from some of the industry's leading corporations and organizations. The book also includes a companion tool kit, developed by Smith's Supply Chain Management Center and Interactive Learning Solutions Inc., that provides practitioners with simulations and spreadsheets to manage volatility in their supply chains. Sterling Commerce, an IBM company, is the project's technology sponsor and a co-contributor. Published by Routledge, the book was introduced on the West Coast last week at CSCMP's annual global conference in San Diego.
ISM Silicon Valley

Global Trade Management - 0 views

  • Between August and September 2010, Aberdeen, a Harte-Hanks Company (NYSE: HHS), surveyed 136 companies documenting their processes and capabilities regarding Global Trade Management. The Aberdeen Group report, Global Trade Management: Strategies for Mastering Trade Compliance and Supply Chain Complexity, reveals that trade compliance teams are actively revamping and augmenting their Global Trade Management (GTM) and specifically their Global Trade Compliance (GTC) programs to stay current with supply and demand fluctuations, growing global operations, increasing operational complexity and risk, and trade lane changes.
  • "There is no silver bullet for a successful GTM/GTC program -- it is a combination of excellence in the areas of access, enablement internally and externally, process/technology, and proactive planning and execution. When these things are aligned, in proper combination, they yield superior results," explained Bob Heaney, Senior Research Analyst of Supply Chain Management at Aberdeen.
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