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Technology
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Topic:

Definition of Supply Chain

Essay Instructions:

1-1 Discussion: Definition of Supply Chain
Introduce yourself by sharing something interesting about yourself, as well as your career or academic experiences in supply management. How does this course fit into that experience, or your plans to go into supply chain management?
Consider Dell which is famous for its low inventory of parts (from Dell’s suppliers) and finished products (assembled at Dell’s manufacturing facilities). If Dell maintains low inventory of parts, and if Dell wants the suppliers to ship the parts soon after it places an order for them, does it mean that the suppliers shall maintain a high inventory of parts? And if the suppliers shall maintain a high inventory of parts, do the suppliers incur high holding costs? And if the suppliers incur high holding costs, who will eventually pay for those costs? Dell? Or its suppliers? Or ultimately the customer? If you were Dell, discuss how you would ensure that the holding costs are actually reduced, not just transferred.
If you were a supplier negotiating with Dell, what approach would you take to negotiating holding inventory with Dell?
Discuss the inherent risks of holding inventory at a supplier from the supplier's perspective.

Essay Sample Content Preview:

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Does it mean that the suppliers shall maintain a high inventory of parts?
No. The suppliers need not maintain a high inventory of parts to service the needs of Dell because there are several measures they can take to ensure a constant supply.
If the suppliers shall maintain a high inventory of parts, do the suppliers incur high holding costs?
Yes. If the suppliers maintain a high inventory of parts, they will incur high holding costs by virtue of storage charges such as warehousing in more places, security, etc. (Boström & Lundell, 2020; Youngerman, (2020).
If the suppliers incur high holding costs, who will eventually pay for those costs? Dell? Or its suppliers? Or ultimately the customer?
The high holding costs will eventually reach the customers because the suppliers will pass them on to Dell, who will in-turn include them in their product costs (Poormoaied, 2021; Ding & Schmidt, 2020; Ovezmyradov & Kurata, 2019).
If you were Dell, discuss how you would ensure that the holding costs are actually reduced, not just transferred?
There are two major measures that suppliers can apply to reduce holding costs (Franco & Rubha, 2017). First, they can locate their factories near Dell's assembly plant to minimize delivery time and exploit the just-in-time production approach. In this way, they can manufacture and deliver products on short notice without maintaining high inventory. Second, they can maintain Dell's daily and even hourly production schedules, sales projec...
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