Case study on Dell Supply Chain Management Strategy

This case study is on Dell’s supply chain management practices. Dell has been following its unique ‘direct build-to-order’ sales model for more than 30 years. Customers can plan their own configuration and place orders directly with the company online. Over the years, Dell’s supply chain efficiencies and direct sales gave it a competitive advantage.

In previous years, Dell faced several problems. Many customers complained about long delays in receiving their order. Recall of Sony battery cells in its laptops brought undesirable media hype to the company. Increasing discontent of customers led to a slowdown in sales. Consequently, Dell lost its market leadership to another major competitor.

Industry analysts felt that, with Dell’s competitors also improving their supply chains and matching Dell’s direct model, the company had been losing its competitive edge. Dell will have to bear additional costs with its foray into retail distribution thereby minimizing its cost advantage. Besides, profit margins of Dell will drop further since it will have to offer incentives to compete with other major brands in retail stores. Though Dell spruced up its product design and range but Apple is clearly far ahead of it. Many experts feel that such new initiatives will only distract Dell from its supply chain operations.

Questions to answer:

1. Examine and analyze Dell’s Direct model, its basic working, success and future challenges

2. How does Dell’s Supply Chain work and potential future supply chain challenges
3. Highlights Dell’s evolving Supply Chain practices and strategy and steps being taken by it to recapture its lost market leader position