Logistics and Supply Chain Management

The paper discusses the challenges faced by supply chain management and solutions to overcome them. It focuses on Dell Company and the impact of various challenges on its profitability. The challenges include increased production cost, multichannel management challenge, high board expectations, safety and quality of services and products developed, and development of new skills. The paper also recommends the assimilation of e-commerce and e-business systems within the company to reduce production cost, develop efficiency, and realize growth.

Running head: SUPPLY CHAIN 1
Logistics and Supply Chain Management
Name
Institution
Author note……………….

SUPPLY CHAIN 2
Executive Summary
Supply chain entails a collection of various organizations that are involved in the
delivery of a given service and also in the production of a given product. Ssupply chain
management involves the management of the supply chain. The main aim of supply chain
management (SCM) is to ensure efficient service delivery and to develop a competitive
advantage for the company. Organizations in the supply chain are linked together and thus
control is necessary to ensure efficiency in the chain process. Also, the administration is
meant to ensure sustainability and also reduce exposure to risk for the entire supply chain.
The paper develops a study about SCM with an aim to generate information that can be used
to improve the performance of the SC field.

SUPPLY CHAIN 3
Table of Contents
Executive Summary...................................................................................................................2
Logistics and Supply Chain Management..................................................................................4
Introduction................................................................................................................................4
Dell Company............................................................................................................................4
Impact of Various Challenges Being Faced by The Company on Its Profitability....................5
Increased Production Cost......................................................................................................5
Multichannel Management Challenge and Customer Fulfillment.........................................5
High Board Expectations........................................................................................................6
Safety and Quality of Services and Products Developed.......................................................6
Development of New Skills....................................................................................................7
Role of E-Business and E-Commerce in Solution Development for The Given Challenge......8
Recommendations......................................................................................................................8
Conclusion..................................................................................................................................9
References................................................................................................................................10

SUPPLY CHAIN 4
Logistics and Supply Chain Management
Introduction
The business field is experiencing rapid changes following technological and
innovation development in the business sector (Sabet, Yadani & De Leeuw, 2017).
Globalization has served to be the leading cause of the underlined changes. Globalization
aspect has promoted the development of many businesses that offer the same services and
produce similar goods. As a result, stiff competition has been developed by the various
companies in a bid to ensure sustainability and competitivity within the market setting. The
organizations that fail to embrace the changes taking place within the business environment
are often faced with challenges that may result in their extinction from the market if no
solution is developed. Among the key challenges include poor service delivery resulting from
the use of old production processes. This flaw, in turn, results in reduced sales since
consumers prefer quality service delivery thus opting for alternative companies that ensure
customer satisfaction. Other challenges may include the increased cost of production that
results in company loss and poor market performance. Supply chain sector being a key player
in the business field is also affected by these challenges. As a result, there is a need to
develop the necessary changes within their chain process to enhance market competitivity,
ensure efficient service delivery and smooth running with the chain system. The paper
develops a study on the various challenges facing the supply chain sector concerning a report
by the SCM world. The article also suggests the multiple solutions to the obstacles giving
recommendations on factors that can promote efficiency, cost reduction and development.
The study is developed concerning the Dell company.
Dell Company
Dell is a global company with its headquarters based in Round Rock, Texas. The
company main operations include; designing, development and manufacturing of laptops and
other computer-based accessories (Augustyn, 2019). The company was founded in 1984 by
Michael Dell and has grown to be among the leading companies in the supply of
technological instruments including, cameras, laptops and televisions. Despite the company’s
development, it has been facing stiff competition within the market from its competitors,
more so, from Apple Company. The company has been struggling within the business market
as it is evident from its market performance. Dell company has been declining in its market
performance following a sharp decrease in its profits. For example, the company’s operating

SUPPLY CHAIN 5
income net profits dropped from 11.11% to 8.27% between the years 2008 and 2012. More
significant was the decrease in the company operating finances which fell from 71.77% to
27.3% between 2008 and 2012 (Bauer, Hogan, Raiche, & Styles, 2013). The performance was
contrary to the competitor’s performance whose net profits were continually increasing over
the years. The poor performance of Dell company is attributed to poor adjustment to
technological development among other factors as discussed below.
Impact of Various Challenges Being Faced by The
Company on Its Profitability
Increased Production Cost
The increased cost of production is a significant challenge to many supply chain
companies. Increased production cost result from several factors which include poor planning
of the business development and use of traditional means in the production process. Business
planning should be designed about changes taking place within the business market and the
future expected business performance (Azadeh, Rabi, & Khazaee, 2015). The decision adopted
should be based on the result obtained from a market study conducted to identify the chances
for development within the market and the various areas of improvement to ensure adaptation
to business changes. In the case of Dell Company, the management made decisions without
considering the changing business environment. As a result, Dell competitors took the
opportunity to develop cheap and efficient products. Also, the companies acquired a
significant market share at the expense of Dell since it was developing expensive and less
efficient products compared to its competitors. The decline is evident from the statistics
generated by Statista (2019) where the market share had dropped from 16.8% in March 2018
to 15.9% in December 2018. The weak market performance has reduced the profitability
margin of the company due to low sales and increased cost of production.
Multichannel Management Challenge and Customer Fulfillment
Supply chain system is made up of several channels with a focus to develop a
particular service or product. Supply chain channels are focused on offering high quality
services. Hence, there is a need to ensure the smooth running of the chain process through
effective management. However, control is a challenge especially for a global company
which has various supply chain channels. The managerial difficulties encountered include;
communication challenges, control of the procurement sector since the company has some
suppliers making it challenging to keep a track on individual supplier performance and
allocation of resources to the various activities taking place within the business system (Patil,

SUPPLY CHAIN 6
2015). The existence of management problems within a supply chain system results in poor
service delivery. As a result, the company makes losses since its assets are not aligned in a
position to increase the efficiency of the company. Dell company development has been
expanded through the acquisition of other firms. The various purchases have increased the
managerial risks within the company since it has to extend resources and manage the market
of the acquired company. Balakrishman (2015) asserted that Dell Company could not
effectively control the market of acquired companies more so EMC company’s market force.
Similarly, the acquisitions led the company to obtain the enormous debts of the acquired
firms that further complicated the financial position of the company since the debt continued
to accrue interests. This affected the profitability of the company as interest acts as an
expense for the company.
High Board Expectations
In most businesses, the board is responsible for the overall management of the firm.
The board can be described as the body that is responsible for developing decisions within
the business system. Notably, it is the responsibility of the board to establish business targets.
In most cases, board members are focused on achieving the interests of the business owner.
In relation to a company, board members tend to develop irrational decisions, that is,
decisions based on personal view other than on company capability and performance
(Hoglund, Martensson, & Sarari, 2018). The decisions create an expectation gap since the
company cannot achieve the set goals. Poor decision making by board members may also
result from poor communication between the management and the board members. Poor
decision making results in poor business performance. The reason is that a company will be
struggling beyond its capacity resulting in losses. Dell company has suffered from the high
board expectation challenge where the board unveils a performance plan that is high above
the company capacity. The 2016 fiscal year serves as an example where the company failed
to meet its expected performance. In return, the company had to cost-cut to meet the running
expenses. To cost-cut, the company lowered the employee bonus compensation by 25%
(Hesseldahi, 2016).
Safety and Quality of Services and Products Developed
Consumers are often concerned with the quality of the product they purchase and
consume. Following the rationale nature of consumers, they seek to attain maximum utility
from a commodity. As a result, consumers always opt to spend on the best commodity in the
market. In response to market competition, companies have designed innovative ideas to

SUPPLY CHAIN 7
produce products and offer services that best suits the consumer needs. The innovation
assures the companies of increased market share and profits in the long run.
On the other hand, companies who fail to develop innovative ideas in the production
of their products often lose their market share since consumers opt for alternative goods that
are of high quality. Dell company serves as an excellent example of a company that has failed
to embrace innovation in their product production resulting in loss of market share to
competitor companies. Among the critical competitors to Dell Company is Apple company
that has utilized innovation in the production of its products. Apple Company has ensured the
security and efficiency of its products creating consumer loyalty to its products thus
increasing its market share. On the contrary, Dell Company has not innovated its products to
enhance more demand and more market share, and instead, the company has been using the
same model despite the high competition being developed within the technology market
(Frue, 2018). Also, Dell Company has failed to market its brand to create awareness among
the people. Following the failures witnessed within the company, consumers have lost their
trust in the company thus lowering the company market share. Reduced sales, in return, result
in poor market performance and losses in the long run.
Development of New Skills
New skills are essential in a business environment since they improve the knowledge
of individuals within the company on the performance of a given task. Knowledge
development helps to come up with innovative ideas in production and service delivery. In
addition, training helps to develop new skills, capability and the overall performance of the
employee. In return, the employee acquires a positive attitude and increase efficiency in the
production of their assigned responsibilities. Furthermore, training helps to improve the
productivity of a company and enhance long term progress within the company. Ganesh &
Indradevi (2015) noted that the development of new skills among the employees helps them
adjust to technological changes within the business environment.
Similarly, the training strategy can be used as a measure of the performance of an
employee through continued evaluation of the skills acquired. Dell company has been
adamant about responding to the changing environment. In return, the company does not
consider the development of its employee’s skills. As a result, the company has remained to
use the traditional knowledge to produce its products and service delivery resulting in low
quality products and reduce the performance capability of the employees. The decline has led
to the poor performance of the company in the market resulting in huge losses.

SUPPLY CHAIN 8
Role of E-Business and E-Commerce in Solution
Development for The Given Challenge
The business environment has revolutionized to include new mechanisms, more so,
the application of information technology in the development of business activities. Among
the critical developments made include the use of e-commerce technology. E-commerce
entails development of business activities through an online platform, that is, through the use
of electronic devices (Kunjir & Gage, 2016). Similarly, e-commerce can be applied to the
performance of inter-organizational activities. Another key development within the business
field is the e-business. E-business entails the utilization of any business activity developed
electronically. Among the key events associated with E-business include the production
process, customer-related processes and management of internet within a company. E-
commerce plays a significant role in the development of company activities. Among the
essential functions include the improvement of communication within the business system.
Effective communication within a business environment ensures efficient management since
one can monitor the company activities from a central point. Also, e-commerce reduces the
cost of running a firm by eradicating transport expenditure for a business meeting. The use of
e-commerce and e-business allows constant conversation with suppliers which help to keep
track of their performance. Also, a business can use the platform to attract customers through
the formulation of emails where consumers can access detailed information on a company
product which helps in selling the brand of the company. Lastly, the use of internet services
will help the company to keep informed on the changes taking place within the business
environment from which the company can develop relevant changes. On the other hand, e-
business forms a base for the development of supply chain management by bringing together
all business stakeholders and consumers together (Kunjir & Gage, 2016).
Recommendations
Dell Company is a global company that has managed to maintain its reputation
despite the various challenges within its operating system. To ensure continued maintenance
of its reputation, the company should consider solving its weaknesses which will serve as
strengths in favor of the company. Among the key challenges facing the company includes a
poor adjustment to technology development. Therefore, the company should consider
developing changes within its system to adapt to the rapidly changing business environment.
Dell company should consider the assimilation of e-commerce and e-business systems within
the company with a view to reduce production cost, develop efficiency and realize growth.

SUPPLY CHAIN 9
Additionally, Dell company should consider enhancing value addition to its employees by
offering them training to acquire new skills which will help them to initiate innovative ideas
in the production and service delivery.
Conclusion
Competitiveness within the business field is a crucial challenge to many businesses,
more so, to the businesses that fail to adapt to the changing environment. The stiff
competition calls for the development of strategies to enhance business sustainability and
expansion. Companies should consider making a business decision based on field research to
identify the available opportunities and the various gaps that require improvement to enhance
business competitiveness. Similarly, companies should consider the application of
technological innovations within their systems to ensure effective administration,
communication and management, that is, the use of e-commerce and e-business.

SUPPLY CHAIN 10
References
Augustyn, A. (2019). Dell Computer Corporation. Retrieved from
https://www.britannica.com/
Azadeh, S. Rabi, A. & Khazaee, A. (2015). Ranking factors affecting supply chain
management in industries: A case study of Shokoohiyeh industrial town, Iran.
International journal of economics, commerce and management, 3(10), 439-468
Balakrishnan, A. (2015). Four changes for Dell-EMC deal. Retrieved from
www.cnbc.com/amp/
Bauer, C., Hogan, N., Raiche, E. & Styles, A. (2013). Computer industry: Apple vs. Dell.
Retrieved from https://sites.google.com/
Frue, K. (2018). Swot Analysis of Dell Technologies: Is the declining laptop market a major
threat? Retrieved from https://pestle analysis.com/
Ganesh, M. & Indradevi, R. (2015). Importance and effectiveness of training and
development. Mediterranean Journal of Social Sciences, 6(1), 334-338
Hesseldahi, A. (2016). Dell hints at continued weakness in memo to employees. Retrieved
from www.google.com/amp/s/www.record.net/
Hoglund, L. Martensson, M. & Sarari, A. (2018). Expectation and the performance of
governance between board, management and other stakeholders: the case of
Robotdalen. Journal of management and governance 22(4), 805-827
Kunjir, M. & Gage, R. (2016). “To study the scope of E-business and its application in the
era of E-commerce.” International journal of recent and innovation trend in
computing and communication, 4(1), 286-289
Patil, M. (2015). Challenges for supply chain management in today’s global competitive
environment. European journal of business management, 7(10), 61-63
Sabet, E., Yadani, N. & De Leeuw, S. (2017). Supply chain integration strategies in fast-
evolving industries. International journal of logistics management, 28(1), 29-46
Statista. (2019). Dell's market shares of pc units’ shipments 2011-2018, by quarter. Retrieved
from https://www.statista.com/