Group Project 1
Analyzing and Summarizing SCM Case Studies
Group 2
University of Maryland Global Campus
IFSM 311: Enterprise Architecture
Margie Drazba
September 9, 2022
Introduction
The purpose of this paper is to provide the chief information officer (CIO) with an analysis of the Supply Chain Management (SCM) enterprise system implementation at Amazon.com and Dell technologies incorporated. Amazon.com is a large trillion-dollar online retailer providing e-commerce services to millions of customers. Dell inc. is a large technology company that specializes in developing, manufacturing, and designing computers, software, and peripherals for a wide variety of customers. This analysis will describe the two companies’ businesses, the problem trying to be solved with SCM, if the implementation was successful, why or why not in terms of cost, schedule, quality, and performance, and any lessons learned. After reading this analysis the (CIO) will have an understanding of the (SCM) of Amazon.com and Dell technologies incorporated.
Amazon Background
Amazon, according to Kinza Yasar of TechTarget, is “the world’s largest online retailer” that focuses on cloud computing, digital streaming, and artificial intelligence. The company was founded in Washington state in 1994 by Jeff Bezos. Amazon has dabbled into pretty much anything anyone can think of from selling household items, clothes and shoes, pet supplies, and actual pets to grocery delivery services. Amazon has forever changed the online delivery service by implementing Amazon Prime in 2005 which is a subscription-based service that offers same-day and expedited shipping to thousands of items. Amazon prime subscription offers many benefits such as streaming services, book rental, and in-store discounts. Amazon has taken the world by storm and is currently dominating the e-commerce industry with its ever-growing trillion-dollar market value.
The era of electronic commerce is currently in effect. The online business centers have connections to almost everyone else in some form. The items sold at these stores are produced in various locations around the world and are consequently delivered to various locations across the world. Amazon is a cloud computing and e-commerce corporation. It is America’s largest Internet retailer (Yu et al, 2016). Amazon’s supply chain is faced with a lot of difficulties given that it was the first to engage in online selling.
In 1999, Amazon was rapidly growing and had to make important decisions regarding its Seattle warehouses. Additionally, Amazon had to decide whether or not to partner with other parties, which inventory to keep in its facilities, and which to store in supply chain upstream levels.
Lessons Learned
There are many teachings that can be learned from Amazon’s success in supply chain management. Firstly, technology can be a key enabler of supply chain success. Amazon has shown that by investing in technology, it is possible to gain a high degree of control over the supply chain and to respond quickly to changes in demand. For example, when the COVID-19 pandemic led to a surge in demand for household items, Amazon was able to quickly increase its production and delivery of these items.
Secondly, strong relationships with suppliers are important for sourcing products quickly and efficiently. Amazon has built strong relationships with its suppliers, and this has allowed the company to source products quickly and efficiently. Furthermore, Amazon’s suppliers are often willing to offer the company favorable terms, such as extended payment terms, which can help to improve the company’s cash flow.
Finally, a well-developed logistics network is crucial for ensuring that products are delivered quickly and efficiently. Amazon has invested heavily in developing its logistics network, and this has paid off. The company’s logistics network is now one of the most efficient in the world, and it is a key competitive advantage for Amazon.
In summary, there are a number of lessons that can be learned from Amazon’s success in supply chain management. Strong relationships with suppliers are crucial for sourcing products quickly and efficiently, and technology is a key enabler of a successful supply chain. Finally, a well-developed logistics network is crucial for ensuring that products are delivered quickly and efficiently.
Dell Background
Dell technology incorporated, according to fortune.com, is one of the largest billion-dollar tech companies in the world. The company was founded in Austin, Texas in 1984 by Michael Dell. Dell inc. specializes in supporting, developing, manufacturing, and designing computers, software, and peripherals worldwide. Dell is one of the top 20 biggest tech companies in the world ranking at number seven with a revenue of $92.22 billion (Kebra, 2022).
Dell understood that a firm’s supply chain can be disrupted, resulting in losses for the company and a decrease in firm value. This can happen when supply chain management software is implemented poorly and is meant to increase firm value (Sridharan et al, 2005).
Dell had to overcome and make decisions on the number and location of manufacturing facilities, the amount of capacity at each facility, the assignment of each market area to one or more locations, and the choice of suppliers for sub-assemblies, components, and materials are all part of the supply chain planning process.
Further, Dell managed a difficult task in supply chain management. Specifically, there were problems arising in the design of the selected supply chain and they had to ascertain what would be the most efficient taking into account global supply chains and domestic supply chains.
Lessons Learned
The lessons learned from Dell’s success with its direct-to-consumer business model are that bypassing retail intermediaries can lead to lower prices and better customer service. Additionally, selling directly to consumers can help a company to gain market share.
One of the key lessons learned from Dell’s success is that bypassing retail intermediaries can lead to lower prices. By selling directly to consumers, Dell was able to avoid the high overhead costs of traditional retailers. This allowed Dell to offer lower prices and gain market share.
Another lesson learned from Dell’s success is that selling directly to consumers can help a company to offer better customer service. By selling directly to consumers, Dell was able to build closer relationships with its customers and offer more personalized service. This helped Dell to differentiate itself from its competitors.
Lastly, the success of Dell’s direct-to-consumer business model showed that selling directly to consumers can help a company to gain market share. By selling directly to consumers, Dell was able to reach a larger customer base than its competitors. This allowed Dell to grow its business and become a leading player in the computer industry.
Overall, the lessons learned from Dell’s success with its direct-to-consumer business model are that bypassing retail intermediaries can lead to lower prices and better customer service. Additionally, selling directly to consumers can help a company to gain market share.
Conclusion
The industry giants detailed in this article viewed SCM in different ways. While Amazon embraced the technology and used it to exponentially grow, Dell worried more about the disruption it may ultimately cause. Both cases can be learned from and adopted by other companies looking to implement an SCM solution. The common denominator for a successful SCM is to ensure it is properly configured and managed correctly. SCM is a tool that brings great power and agility to an organization if it is implemented and managed correctly.
References
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Kabra, A. (2022, February 12). Top 20 Biggest Tech Companies in The World in 2022. The Teal Mango. Retrieved September 8, 2022, from https://www.thetealmango.com/featured/biggest-tech-companies-in-the-world/
Mileva, G. (2022, June 24). A Comprehensive Guide to the World’s Top 50 Ecommerce Companies. Influencer Marketing Hub. Retrieved September 8, 2022, from https://influencermarketinghub.com/top-ecommerce-companies/#toc-0
Sridharan, U. V., Caines, W. R., & Patterson, C. C. (2005). Implementation of supply chain management and its impact on the value of firms. Supply Chain Management: An International Journal.
Staff, F. (2022, August 1). Dell Technologies. Fortune. Retrieved September 8, 2022, from https://fortune.com/company/dell-technologies/
Yasar, K., & Wigmore, I. (2022, June 8). Amazon. WhatIs.com. Retrieved September 8, 2022, from https://www.techtarget.com/whatis/definition/Amazon
Yu, Y., Wang, X., Zhong, R. Y., & Huang, G. Q. (2016). E-commerce logistics in supply chain management: Practice perspective. Procedia Cirp, 52, 179-185.
