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Dell Computers was founded by Michael Dell in 1984. At the age of 19, Dell's interest in computers caused him to drop out of medical

Dell Computers was founded by Michael Dell in 1984. At the age of 19, Dell's interest in computers caused him to drop out of medical school and start up his own company. Dell's concept was simple: selling computer systems directly to customers This direct business model eliminates retailers and can distribute computers much more quickly than slow-moving indirect distribution channels Dell's assemble-to-order model Dell achieved a great innovation in supply chain management by adopting a direct sales model, i.e., a demand-driven supply chain in which the traditional make-to-stock approach is replaced by the assemble-to-order model. At this stage. no other computer manufacturer had used this model, and it was seen as being against the norm. However, Dell was proven to be a visionary in the industry and his foresight has paid off. Through the direct ordering system, Dell has created the opportunity to significantly increase the flexibility of what it offers customers. The company keeps inventory of numerous sub-assemblies that can be assembled into almost any configuration, depending on the customer's specific request. With this configuration of its transformation process, Dell has increased customer involvement and utilises internet technology to increase connectivity with the customer throughout the process. The amount of freedom for the customer to choose a product has provided a competitive advantage above rivals like IBM and HP. Dell has expanded its JIT practices from the company to the entire supply chain as suppliers have been integrated into Dell's operations through the means of well-designed IT systems. A well-managed supply chain reaps the best fruit from the assemble-to-order tree. Dell has over time created efficiencies through its materials-management process. It was able to meet the demand of customer orders by building the customised system in a timely manner. Dell has enhanced its procurement process, resulting in almost 90 per cent of the company's procurement being done online and leaving only two hours of inventory on the factory floor. The Internet and web services Dell's assemble-to-order model utilises the Internet efficiently. The internet provides Dell not only with a channel for direct sales, but also with a great opportunity to manage and control its supply chain. Source: Pienaar, V. Editor. 2016. Business Logistics Management, 5th edition. Oxford University Press. Cape Town.. Explain the competitive advantage gained from the assemble-to-order operations strategy that Dell Uses?

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Dells assembletoorder ATO operations strategy provides several competitive advantages for the company 1 Customization The ATO model allows Dell to offer a high level of customization to its customers ... blur-text-image

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