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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

A study of more than 260 manufacturing executives released today by IFS North America indicates how trends in Enterprise 2.0 will affect enterprise software used by mid- to large-sized manufacturers and industrial companies.

While it is clear that there are various sources of complexity and obstacles for supply chain executives to overcome, IBM points out that there are three new rules, which will be required to topple these hurdles throughout the next decade, including: 1-Know the customer as well as yourself. Smooth volatility with predictive demand; 2-See what others do not. Unveil responsibility with collaborative insight; and 3-Exploit global efficiencies. Enhance value with dynamic optimization.

A recent KPMG International survey, “Global Manufacturing Outlook – Relationships, Risk and Reach” of 200 senior-level executives from North America, Western Europe and Asia-Pacific on supply chains dynamics as a result of prevailing economic uncertainty, shows that 66% feel cost is the leading consideration of their supply chain models, but 63% agreed that more attention should be paid to non-financial elements of the supply chain and 38% said that an acute focus on cost has harmed relationships with suppliers.

While the market has grown exponentially, and a 30% increased expenditure last year is eye-opening, the nature of these engagements doesn't give us confidence that this market will sustain its growth trajectory unless customers think beyond short-term labor arbitrage, and service providers introduce significant process and technology enhancements to the early adopters to help them optimize their delivery.  This "lift and shift" model could well result in customers losing more than they save.

Develop a Code of Conduct that includes Green. Be clear with what you are looking for in a supplier. Many industry trade groups have codes of conduct that spell out expected behaviors in terms of labor, products, GHG emissions and handling of waste. Point to those, or develop your own, but make it clear that it is more than a pamphlet; it is the way you do business and you expect your suppliers to do business.

Reward good behavior. Keeping tabs on your suppliers, either by encouraging them to respond to the Carbon Disclosure Project (CDP) or through other audit mechanisms. That way you can see which suppliers have made a commitment to operating more sustainably. Reward that good behavior with a larger share of your business.

One of the top challenges supply chain executives list in any survey is lack of visibility.  Whether it is the status of orders, location of shipments or quantity of inventory, managers struggle to have the latest information about goods in the supply chain.  The lack of visibility contributes to a significant amount of inefficiency and waste.  Assuming the worst, most organizations stock buffer inventories to overcompensate for any potential supply shortages they may be unaware of.  The result is that more inventory than necessary is in the supply chain tying up working capital and inflating corporate balance sheets.

top performing companies have experienced significant improvement when it comes to collaborative processes. However filtering the results based on those companies that have implemented Software as a Service (SaaS) solutions for collaboration, reveals that these subset of companies have greater collaboration capabilities than lower performing companies. 

top performing companies have experienced significant improvement when it comes to collaborative processes. However filtering the results based on those companies that have implemented Software as a Service (SaaS) solutions for collaboration, reveals that these subset of companies have greater collaboration capabilities than lower performing companies. 

Procurement professionals may have found 2010 testing but the past 12 months have also seen businesses prepare for recovery, albeit cautiously. So what does 2011 hold for procurement? We asked  CPOs worldwide for their predictions.

On opening day of COP16, CEO’s of leading global multinationals and the head of WWF joined together to emphasize the urgency of building a low-carbon economy for our global prosperity, health, security and safety. While expectations for COP16 may be dampened from those in Copenhagen, these business leaders showcased the depth and breadth of business commitment to action against climate change as they outlined what they are already doing and how governmental leadership and civil society collaboration can help to accelerate and scale impact.

APICS The Association for Operations Management, the global leader in supply chain and operations management certification, education, and membership, announced today key findings from an event exploring APICS members' roles in corporate social responsibility (CSR) and sustainability in relation to the United Nations Global Compact.

Mobiata, the mobile app developer, is based in Ann Arbor, Michigan and its headquarters will likely remain there, despite Expedia's purchase of the company. But the rise in the company's shares after news of the acquisition by Expedia surfaced indicates that high hopes are attached to the deal.

The objective of strategic purchasing is to manage suppliers to reduce cost of materials and engage them in downstream processes and also to reduce the cost of purchasing. The implementation of IT in purchasing enables automation of many of the processes such as bid management and evaluation, order management and payment processes such as handling of invoices. The automation reduces errors in the purchase to pay cycle and increases process efficiency.

In the wake of constant demand and supply market changes driven by recent economic crises, procurement and supply chain professionals are facing higher expectations from management to drive down costs. But a myopic focus on cost savings can have an impact on supply and supplier risk, and can result in the unintended consequence of diluting the total value delivered from that supplier relationship. The key, therefore, is to balance supplier risk with reward to obtain the greatest benefit from suppliers while minimizing risks.

Supplier risk can happen anywhere, anytime and with any supplier, but D&B Supply Management Solutions (D&B SMS) has debuted a new solution aimed at giving procurement, finance and vendor management professionals "anytime, anywhere" access to supplier status and alerts from their mobile devices.