Inventory management and demand planning at Dell The computer company Dell has long been seen as one of the most agile businesses in the industry. The success of Dell is in large part due to its highly responsive supply chain, which is capable of building and delivering customized products in a matter of days with minimal inventory. Dell’s ability to operate a build-to-order strategy is based partly on the modular design of many of their products but more particularly on a very high level of synchronization with their suppliers. There is a high level of visibility across the Dell supply chain with suppliers receiving information on Dell’s order book every two hours. Ahead of this information, suppliers are provided with capacity forecasts from Dell to enable them to produce at a rate that is planned to match actual demand. Each of Dell’s factories is served from a ‘vendor hub’, operated by third- party logistics service providers, the purpose of which is to keep a buffer of inventory from which Dell can draw as required. Suppliers are required to keep a defined level of inventory at these hubs and Dell only takes ownership of the inventory when it reaches their factories. Dell adopts a very proactive approach to demand management by using the price mechanism to regulate demand for specific products or features. If a product is in short supply the price will rise and/or the price of an alternative substitute product will fall. This facility to actively manage demand enables a very close matching of supply and demand. 1. WhatarethefeaturesofDell’sInventorymanagementplan?Listdown few important points. 2. Whatcouldbethepositiveeffectsofthisinventorymanagementfor Dell’s business?
Critical Path Method
The critical path is the longest succession of tasks that has to be successfully completed to conclude a project entirely. The tasks involved in the sequence are called critical activities, as any task getting delayed will result in the whole project getting delayed. To determine the time duration of a project, the critical path has to be identified. The critical path method or CPM is used by project managers to evaluate the least amount of time required to finish each task with the least amount of delay.
Cost Analysis
The entire idea of cost of production or definition of production cost is applied corresponding or we can say that it is related to investment or money cost. Money cost or investment refers to any money expenditure which the firm or supplier or producer undertakes in purchasing or hiring factor of production or factor services.
Inventory Management
Inventory management is the process or system of handling all the goods that an organization owns. In simpler terms, inventory management deals with how a company orders, stores, and uses its goods.
Project Management
Project Management is all about management and optimum utilization of the resources in the best possible manner to develop the software as per the requirement of the client. Here the Project refers to the development of software to meet the end objective of the client by providing the required product or service within a specified Period of time and ensuring high quality. This can be done by managing all the available resources. In short, it can be defined as an application of knowledge, skills, tools, and techniques to meet the objective of the Project. It is the duty of a Project Manager to achieve the objective of the Project as per the specifications given by the client.
Inventory management and demand planning at Dell
The computer company Dell has long been seen as one of the most agile businesses in the industry. The success of Dell is in large part due to its highly responsive supply chain, which is capable of building and delivering customized products in a matter of days with minimal inventory.
Dell’s ability to operate a build-to-order strategy is based partly on the modular design of many of their products but more particularly on a very high level of synchronization with their suppliers. There is a high level of visibility across the Dell supply chain with suppliers receiving information on Dell’s order book every two hours. Ahead of this information, suppliers are provided with capacity
Each of Dell’s factories is served from a ‘vendor hub’, operated by third- party logistics service providers, the purpose of which is to keep a buffer of inventory from which Dell can draw as required. Suppliers are required to keep a defined level of inventory at these hubs and Dell only takes ownership of the inventory when it reaches their factories.
Dell adopts a very proactive approach to demand management by using the price mechanism to regulate demand for specific products or features. If a product is in short supply the price will rise and/or the price of an alternative substitute product will fall. This facility to actively manage demand enables a very close matching of supply and demand.
1. WhatarethefeaturesofDell’sInventorymanagementplan?Listdown few important points.
2. Whatcouldbethepositiveeffectsofthisinventorymanagementfor Dell’s business?
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