Lyle Week 4 paper
Dell Inc.: Improving the Flexibility of the Desktop PC Case Study
Gary Lyle
Integrated Supply Chain Applications ISCOM/476
April 7, 2014
Leon Powell
Dell Inc.: Improving the Flexibility of the Desktop PC Case Study
Dell Inc., is a successful personal computer (PC) manufacturer with a unique business model that sells direct from the manufacturer to the customer. The business model starts with a customer order, and ends with a delivery directly to the customer - no distribution centers or retailers. This business model keeps costs low in shipping and inventory, but can see increased manufacturing costs because of the supply chain requirements involved in the custom fabrication of individualized orders. The case study begins with the investigation of the increased manufacturing costs that reached an alarming level in 2005.
Case Study Question Responses
The case study questions involve process analysis, decision-making, supply chain optimization, and root cause analysis. Because Dell Inc., assembled a group of appointed experts with a division director leading the business process improvement, the data required to answer the questions is readily available in easy to use figures, tables, and charts. The increased manufacturing costs relate directly to the supply chain, and solutions to the supply chain and manufacturing problems for the company will result from the task team analysis. Examining the effects of the recommended changes resulting from the root cause analysis on the supply chain also provide valuable insights that may be applied to nearly any manufacturing process.
Manufacturing Costs Identification
Why does L5 incur higher manufacturing and logistics costs than L6? Identify costs incurred by L5 and not by L6. Identify any costs incurred to only L6 and not L5. Manufacturing a consumer ready PC from an L5 configuration versus an L6 configuration requires the extra steps of installing the motherboard, and often the power supply. This increase costs
Gary Lyle
Integrated Supply Chain Applications ISCOM/476
April 7, 2014
Leon Powell
Dell Inc.: Improving the Flexibility of the Desktop PC Case Study
Dell Inc., is a successful personal computer (PC) manufacturer with a unique business model that sells direct from the manufacturer to the customer. The business model starts with a customer order, and ends with a delivery directly to the customer - no distribution centers or retailers. This business model keeps costs low in shipping and inventory, but can see increased manufacturing costs because of the supply chain requirements involved in the custom fabrication of individualized orders. The case study begins with the investigation of the increased manufacturing costs that reached an alarming level in 2005.
Case Study Question Responses
The case study questions involve process analysis, decision-making, supply chain optimization, and root cause analysis. Because Dell Inc., assembled a group of appointed experts with a division director leading the business process improvement, the data required to answer the questions is readily available in easy to use figures, tables, and charts. The increased manufacturing costs relate directly to the supply chain, and solutions to the supply chain and manufacturing problems for the company will result from the task team analysis. Examining the effects of the recommended changes resulting from the root cause analysis on the supply chain also provide valuable insights that may be applied to nearly any manufacturing process.
Manufacturing Costs Identification
Why does L5 incur higher manufacturing and logistics costs than L6? Identify costs incurred by L5 and not by L6. Identify any costs incurred to only L6 and not L5. Manufacturing a consumer ready PC from an L5 configuration versus an L6 configuration requires the extra steps of installing the motherboard, and often the power supply. This increase costs
References: Simchi-Levi, D., Kaminski, P., & Simchi-Levi, E. (2008). Designing and managing the supply chain: Concepts, strategies, and case studies (3rd ed.). Boston, MA: McGraw-Hill/Irwin.