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Summary ESSAY: Dell Introduction

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Created in a dorm room at the University of Texas in 1984, Dell was founded by Michael Dell. The organization operates under a direct business model, meaning consumers do not directly associate with retailers and purchase products and services from Dell. Operating under this business model allows c...

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  • January 11, 2024
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DELL 1




Dell
Peter
School of Business, Library University
BUSI-740: Managing the Supply Chain
Dr. Deloris Easley
10 April 2021




Author Note

Peter J.

I have no known conflict of interest to disclose.

Correspondence concerning this article should be addressed to Peter J.

Email: p@liberty.edu

, DELL 2


Dell

Introduction

Created in a dorm room at the University of Texas in 1984, Dell was founded by Michael

Dell. The organization operates under a direct business model, meaning consumers do not

directly associate with retailers and purchase products and services from Dell. Operating under

this business model allows consumers to purchase customized systems at a lower price than

competitors. In taking this approach, Dell has risen to prominence within the technology industry

in ranking among the top-five technology manufacturers worldwide in 1993 and reached the top

ranking in 2001. Dell employs over sixty-two thousand employees at three United States

manufacturing facilities and four internationally in Brazil, China, Ireland, and Malaysia. Since its

inception in the mid-eighties, Dell has maintained a direct consumer sales strategy, proving a

successful business strategy leading to annual revenue of $56 billion (Simchi-Levi et al., 2020).

In maintaining a direct business structure, Dell has generated manufacturing cost savings.

In 2005, the organization noticed costs rising in Level 5 manufacturing creating the inability to

quickly produce motherboards to contracted manufacturing facilities (Simchi-Levi et al., 2020).

Dell faces numerous issues to include inaccurate forecasting, third-party supplier concerns, and

desktop computing supply chain quality issues. The main focus of the case study is Level 5 and

Level 6 manufacturing costs comparison and contrast. Additionally, six solutions are proposed in

which Dell can improve, sustainability recommendations are presented, organizational business

process improvement (BPI) team effectiveness is discussed, and solutions are provided to

combat Level 5 increased manufacturing cost root causes.

Managing Costs

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