Improved visibility across the supply chain and increased profitability for the
firm are the primary business benefits received when implementing supply
chain management systems. Supply chain visibility is the ability to view all
areas up and down the supply chain in real time. The primary challenges
associated with supply chain management include costs and complexity. The
next wave in supply chain management will be home-based supply chain
fulfillment. No more running to the store to replace your products as your
store will come to you as soon as you need a new product.
Learning Outcome 8.3: Identify the three technologies that are
reinventing the supply chain.
The goal of ERP is to integrate all of the organizational systems into one fully
functioning, high-performance system that is capable of meeting all business
needs and user requirements. Of course, this goal is incredibly difficult to
achieve because businesses and technologies experience rapid change, and
ERP must support mobility, cloud, SaaS, and tiered architectures.
GREAT BUSINESS DECISIONS – Michael Dell Decides to Sell
PCs Directly to Consumers and Built-to-Order
Michael Dell decided that to be successful in the PC business and to gain a
significant competitive advantage he would bypass the dealer channel
through which personal computers were being sold. Dell developed and
deployed their own channel for manufacturing and selling PCs. This personal
channel eliminated the reseller markups and large inventory expenses and
allowed Dell to operate with lower costs than anyone in the industry, which
led to higher profit margins.
Michael Dell understood that consumers were getting smarter and that
customer service abilities were becoming more sophisticated. Beginning with
telephone sales, and then moving to Internet sales, Dell bypassed retailers
and targeted corporate accounts. Dell understood that tailoring products to
meet specific requirements of large accounts could be accomplished not only
more cheaply, but also more effectively without an intermediary.
Dell boasts sales of $12.3 billion and is the world’s number one direct-sales
computer vendor. The company’s website currently generates over half of its
orders. Everybody in the industry is trying to imitate Dell’s strategy.
Near Beer Game
This is an excellent exercise for students who are just learning about the