Dell 's Model Of Virtual Integration Essay

Satisfactory Essays
1. Adopt Dell’s model of Virtual Integration
One alternative is for Ford to create a virtually integrated supply chain using Dell’s model as a baseline. This will allow Ford and its suppliers to virtually share information between their systems and coordinate production. Customers would place all their orders online or on the intranet at a Ford dealership and would be able to customize their designs as per their needs (Ter, 2013). The system would move from completely from a push to a pull based system.
Pros Cons
Customization of customers’ own vehicles Change in traditional processes and production methods
Customer requirements are met faster with higher profits due to the no dealer’s mark up Costly as it is a brand new form of supply chain
Ford is able to control their service level to the customer Time consuming to implement the new system and adapt to it
Better ability to forecast demand Risk because both Ford and Dell are completely different types of industries and what works at one place may not work in another.
Minimal inventory carrying costs Loss of dealerships may result in competition Change management is costly financially and emotionally. Complexity in manufacturing process and consumer behavior may not lead to success of virtual integration.
2. Maintain the current strategy with a few changes Ford can maintain its current supply chain system and operational procedures. However, in making some slight changes, it can standardize the materials that are used
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