Dell's Logistics and Supply Chain Management: A Detailed Report

This report provides an in-depth analysis of Dell's logistics and supply chain management strategies, focusing on the company's configure-to-order approach and its impact on their competitive advantage. It discusses the challenges associated with mass customization, such as managing product variety, unreliable forecasts, and inventory problems. The report also explores Dell's IT-enabled supply chain management, highlighting the importance of technology in automating functions, improving planning, and facilitating effective networking. Furthermore, it identifies and evaluates various logistics management strategies, including inbound logistics and freight management, to enhance efficiency and customer service. The report concludes by emphasizing the need for adaptability and flexibility in logistics management to address changes in the global economy.

Running head: LOGISTICS AND SUPPLY CHAIN MANAGEMENT
LOGISTICS AND SUPPLY CHAIN MANAGEMENT
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Executive summary
The report intends to deliver the discussion of the logistics and the supply chain management
of the dell company. Dell is the American company that is the multinational technology
company which, sells, develops, repairs and also supports the computers and the connected
services and the products. As the Dell company implemented the mass customisation strategy
in their manufacturing strategy, it provides them with the significant competitive advantage
in local market. As a result of this, the mass customisation could be any ideal strategy for the
American manufacturers for deploying against the fierce competition from the overseas. Dell
provides the required evidence for the effective IT enabled supply chain management in the
conducting of business and the company adjusts to the changing environment by the
deployment of the inclusive integration of the IT and the supply chain management. These
are the issues that are faced by the organisation and the discussion of the logistics
management strategies is detailed based on these.

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Table of Contents
Introduction....................................................................................................................3
Discussion......................................................................................................................3
Issues of Configure to order strategy.........................................................................3
Logistics management strategies................................................................................6
Recommendation............................................................................................................9
Conclusion....................................................................................................................10
References....................................................................................................................12

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Introduction
This report aims to discuss the Configure to order supply chain strategy of the Dell
company and address the issues that are associated with this strategy. The logistics
management strategies are identified that would be beneficial for the company in the future
and would be necessary for maintaining the success of the company in the future. Lastly, this
report concludes with an appropriate conclusion for the report.
Dell is the American company that is the multinational technology company which,
sells, develops, repairs and also supports the computers and the connected services and the
products (Dell.com, 2019). The company is majorly popular for the supply chain
management of the company and the electronic commerce, specifically the direct sales model
and configure to order approach of the manufacturing and delivering the individual PCs that
are configured according to the specifications of the customers.
Discussion
Issues of Configure to order strategy
In the present times, the manufacturers are making the shift from the mass production
to the mass customisation. The best example of the configure to order strategy of
manufacturing is the company Dell who implemented this strategy for mass customisation. It
includes the production of the small number of the common platforms that are further
customised as per the demands of the customers (Mangan, Lalwani and Lalwani 2016). Prior
standardisation, the multiple product lines at the both upstream and the downstream ends, but
after the standardisation, it has been observed that there has been a significant reduction in
the various product lines upstream and the customisation of the products is done at the
downstream end. This strategy provided the major benefits as in the present times the
consumers have more choices than ever. As well as the number and the kinds of the

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personalised products that are available are expected to grow in the near future as the
manufacturers Dell shift from the mass production to the mass customisation (Grabara, Man
and Kolcun 2014). A vast variety of the products are presently built to order like the
computers by the company Dell. As this concept is tackled by the manufacturers increasingly,
it would pose significant challenges and the opportunities for the engineers. The most
advantageous of the local production that is gained by the American company in U.S.
includes the low volume, high variety specialist items, which requires the increased price and
it also requires the fast delivery. As the Dell company implemented the mass customisation
strategy in their manufacturing strategy, it provides them with the significant competitive
advantage in local market. As a result of this, the mass customisation could be any ideal
strategy for the American manufacturers for deploying against the fierce competition from
the overseas (Li 2014). The mass production is majorly regarding the building of the large
batches of the identical products for achieving the maximum efficiency along with the lowest
cost. The mass customisation is regarding the establishing of the company for building any
lot size of any one with same efficiency as the mass produced product. The company claims
that configure to order strategy is regarding the pre-engineered modules, which could be
composed into any finished products deprived of requiring any kind of assistance or any
additional knowledge from the engineering. From the above case study, it could be concluded
that the configure to order comprises of the two unique elements, which are the building and
forecasting of the modules that are procured or it has been built and managed in the inventory
for facilitating the orders in the future and then assemble to order any configured product has
been built from the preassembled modules according to the requirements of the customers
(Crainic et al. 2015). The mass customisation mainly denotes that customer is solely driving
the configured order from any predefined menu. As it can be observed from the case study,

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majority of the mass customised products are configure to order. The configure to order
strategy would be most beneficial when the company is facing these challenges:
 The variety of the products is an issue. The strategy that is implemented by the company
provides the build to forecast producers to sell the products from the inventory. As the
variety increases, there is the issues of managing the variation in the stock for satisfying
the demand.
 The issues of unreliable forecasts. The accuracy of the forecasts decreases significantly
with the variety and the increase in the volatility in the market (Vahabzadeh, Asiaei and
Zailani 2015).
 Inventory problems is an issue. the selling of the products from the inventory makes
significant problems like the depletion of the stock, obsolescence, costs of carrying the
inventory, writeoffs, extra handling and the warehousing.
 Customisation products by the craft production is expensive and slow. The maintenance
of the quality of product is significantly difficult (Allegra, Bellia and Zarbà 2014). The
customisation of the products while the mass production could be inefficient and it
compromises the high volume assembly.
 The response time is the issue. The manufacturers might intend to create the products to
order but it might not be able to provide them easily if the manufacturers have to wait for
significant time for the parts, the changes in the setup and the availability of the
equipment.
The issues of the configure-to-order approach could be analysed by using the Dell
case study. This approach might force the manufacturers to alter the assembly process.
The most significant issues is the creation of the flow afterwards the point of scheduling
with outcome being the predictable lead time, which has the ability of delivering
whatever is required by the customers and whenever it is required (Eskandarpour et al.

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2014). The aspect of the error proofing is crucial in the environment of the configure-to-
order approach. It is raised due to the fact that the increased choices could increase the
chances for any error. The standardisation of the parts and the components is the critical
prerequisite of the configure-to-order production. The proliferation of the parts
complicates significantly the issues of the supply chain, and it increases the possibility of
unavailability of the parts that are required for supporting the production and it would
increase the additional cost (Panuccio et al. 2015).
Logistics management strategies
The Dell Company implemented the outbound logistics for transporting the products
and the materials from their factory to the places where it is mostly required. For the Dell
company, the technology is the driver of the supply chain management where the tools
allowed the enabling of the Dell company to perform the automation of the functions of the
supply chain for removing the redundancies and the cost, generate the information that helps
in the effective planning, executing, evaluating and then perform the networking of the
capabilities, skills and the experience of the people by the supply chain managers for solving
the issues of the supply chain (Waters and Rinsler 2014). Dell provides the required evidence
for the effective IT enabled supply chain management in the conducting of business and the
company adjusts to the changing environment by the deployment of the inclusive integration
of the IT and the supply chain management. The company utilises the shippers like the UPS
and the FedEx for delivering the components from the suppliers and it comprises of several
other partners. The company utilises several companies of third party logistics for collecting,
maintaining and the also delivering the components from the suppliers and it also comprise of
several partners. The company claims that having the correct hardware arrive at correct place
along with the correct time is essential for the process of deployment. The logistics services
of the company allows the users to pre-determine delivery at any particular location at any

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pre-defined time (Rimmer 2014). In the present economy all around the world, the need of
being increasingly adaptive and also flexible is crucial for staying connected. The changes in
the logistics management of the Dell company is majorly driven by the price of the oil, costs
of labour, trade regulations, security, capacity of the vessel, labour stoppages and the
technology (Paché and Colin 2015). The company claims that along with having the skilled
personnel, the tools and the practices for proactively adapting the changes in the present
business scenario would help the company to obtain a significant competitive advantage.
The logistics management is the important component of the performance of the
business operation as the performance not solely impact internal processes but also the
customer relations. The globalisation and the evolution of the information technology have
offered the required fuel for the supply chain management for becoming the strategic
methods for the companies to manage the quality, satisfy the customers and also remain
significant competitive (Batarfi, Jaber and Aljazzar 2017). The logistics management
includes the all the activities that are linked with flow and the transformation of the services
and the goods from raw materials and manage the materials and provide the customers with
the products whenever it is required. The logistics management plays the significant role in
success of the operations of the company and it has the direct impact on the bottom strategies.
The logistics processes impacts significantly on the satisfaction of the customer that is
importantly than the lower product costs. The logistics management is the part of the supply
chain management that helps in planning, implementing and then controlling the effective,
efficient forward as well as the reverse direction flow and the storage of the services and the
goods and the associated information among the origin point and the consumption point for
meeting the requirements of the customers (Melo and Baptista 2017). The logistics
management is increasingly practical sector of the supply chain management where the goods
have been transported in the facility, stored properly as well as handled and also transported.

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The inbound logistics is one of major overlooked aspects in the logistics management
of the company. It is required for driving the significant saving and also improve the
customer service. The strategy that could be implemented for enhancing the logistics
management is the freight paid to the freight (Rivera, Gligor and Sheffi 2016). The freight
paid denotes that supplier pays for the costs of the transportation. The switch to the freight
collect is significantly advantageous and this is associated where the consignee is tasked with
paying for the freight cost. The switching to the freight collect would provide the company
with the control over the inbound logistics. Frequently, true cost of the transportation is not
provided to the company. With the inbound freight the costs of transportation could be
known and it could help in streamlining the route of the truck by providing the direction to
travel to the distribution centre. The company could implement the reverse logistics for
proper handling of the products and services of the company (Govindan, Soleimani and
Kannan 2015). The well planned and customised reverse logistics strategy would
significantly reduce the distribution and the storage costs and improve the brand reputation as
well as help in creating increased sustainable business practices and it would also satisfy the
demands of the customers. The reverse is the kind of the inbound freight that that might be
expensive and difficult to control but still the companies in the present times are
understanding the value of this strategy and are implementing this strategy effectively.
The visibility in the functions of the logistics is the major benefit that could be
achieved by the organisations. The visibility allows the organisation to observe the challenges
as well as the opportunities for allowing the adapting with the logistics management and then
make the enhanced decisions.

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Recommendation
Some of the strategies that could be utilised for enhancing the logistics management
includes:
Implementation of the transport management system: The transport management
system permits the business to effectively manage the data flow of the company efficiently
and it allows the visibility of the cost and performance (Agrawal, Singh and Murtaza 2015).
This system could be implemented in the logistics management of the company for gaining
the valuable insight and information.
Advanced tracking: The transparency and the visibility are increasingly becoming
important for the businesses. The advanced tracking system along with the features has been
adopted for giving the customers with the real time information regarding the location of the
goods and products (Savy 2016).
Gain the information management system: the company could implement the
information management system for enhancing the logistics management. It would benefit
the organisation in several methods and in the range of the areas that includes the warehouse
management, order tracking, supply chain management, accurate delivery of the orders of the
customers and the inventory management (Awasthi, Adetiloye and Crainic 2016).
Significant inventory at warehouse: The issue of the adequate warehouse is the
significant for managing the stock in the large quantity. It leads to the shortage of the supply
and the delayed orders in several instances. It is therefore best recommended to manage the
adequate inventory in the warehouse for supplying the manufacturers and the suppliers with
the products that are required instantly and immediately. The reliable partner for the support
of the logistics and then ensure the adequate inventory size is available for the shipment
(Grawe, Autry and Daugherty 2014). Moreover, it must be executed afterwards the proper

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analysis of the information management systems as well as the data insights of the customers.
It would provide the insight regarding the quantity, kind, trends of the market, packages and
several other aspects.
Training of the staff: the training must be provided to the staff for allowing the proper
management of the logistics of the company. The staff who are significantly habitual for the
management of the orders and the information in the conventional method should be trained
regarding the modern methods.
The company should consider the selective addition of the other vendors for the
supply chain management system. Because of the increase of the global sales of Dell, the
company might need to consider the selective addition of the suppliers for the supply chain
management system. The extra suppliers must not lead to any significant cost to the company
and Dell might gain the capability of negotiating better regarding the costs of the component
from the new suppliers.
Conclusion
Therefore, it can be concluded that the logistics and the supply chain management of
the Dell Company along with the enhanced business process helps the company to gain
significant competitive advantage. In the present times, the manufacturers are making the
shift from the mass production to the mass customisation. The best example of the configure-
to-order strategy of manufacturing is the company Dell who implemented this strategy for
mass customisation. It includes the production of the small number of the common platforms
that are further customised as per the demands of the customers. The company claims that
configure to order strategy is regarding the pre-engineered modules, which could be
composed into any finished products deprived of requiring any kind of assistance or any
additional knowledge from the engineering. The issues of the configure-to-order approach

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could be analysed by using the Dell case study. The Dell Company implemented the
outbound logistics for transporting the products and the materials from their factory to the
places where it is mostly required. For the Dell company, the technology is the driver of the
supply chain management where the tools allowed the enabling of the Dell company to
perform the automation of the functions of the supply.

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References
Agrawal, S., Singh, R.K. and Murtaza, Q., 2015. A literature review and perspectives in
reverse logistics. Resources, Conservation and Recycling, 97, pp.76-92.
Allegra, V., Bellia, C. and Zarbà, A.S., 2014. The logistics of direct sales: New approaches of
the EU. Italian Journal of Food Science, 26(4), pp.443-450.
Awasthi, A., Adetiloye, T. and Crainic, T.G., 2016. Collaboration partner selection for city
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Batarfi, R., Jaber, M.Y. and Aljazzar, S.M., 2017. A profit maximization for a reverse
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Engineering, 106, pp.58-82.
Crainic, T.G., Dell’Olmo, P., Ricciardi, N. and Sgalambro, A., 2015. Modeling dry-port-
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Govindan, K., Soleimani, H. and Kannan, D., 2015. Reverse logistics and closed-loop supply
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