Essay on Ford Supply Chain

Dell uses a just in time order fulfillment policy and accurate forecasting of sales to minimize inventories. This allowed Dell to hold inventory of finished products far below levels of their competitors (10-20% compared to 50-70% industry level) and furthermore allowed them to quickly implement changes to their product lines as new technologies became available. This quick inventory turnover also allowed Dell to retain more capital. Finally, this policy enabled Dell to respond immediately to technological progress in components and deliver state of the art new finished products (e.g. Pc’s holding the newest Pentium microprocessors) while competitors

Landon Orchard 292 Windermere Court West, London, Ontario, Canada 519-661-7006 Landon Orchard is currently an undergraduate business management major at Ashland University, Ashland, Ohio North Central Ohio APICS Chapter Full-time undergraduate student

The advantages of Dells model are: The internet allows Dell an extensive scope and reach for its products at a relatively low price (Dedrick and Kraemer 2001). Using the internet Dell has been able to automate many of its business functions, such as product configuration, order entry and technical support (Dedrick & Kraemer 2001), therefore the company can achieve higher revenues without customer service costs increasing greatly. Online configuration ensures that the customer gets exactly what they want. Dells build to order strategy means that inventory levels are low, they only hold approximately 4-8 days of stock, therefore inventory costs are low (Breen 2004).

Ford supply chain strategy case study is an in-depth analysis report based on the inside and outside factors affecting the organization. Our analysis have included two alternatives and a few other attributes of the Ford which focuses on production on various countries and how the factor supply chain is contributing to the company policies. Moreover the report will focus on the current objective and suggest new ideology of Ford with global environment changes in mind.

Integration Business-Level: Hewlett Packard (“HP”) is an example of an organization that is using the integration business-level strategy, which is a combination of the differentiation and cost-leadership strategies (Rothaermel, 2013). HP utilizes this strategy because Apple holds the differentiation position while Dell holds the cost-leader position in the mobile devices market (Rothaermel, 2013). For this reason, HP must seek to implement both the cost-saving strategies in supply chain management, like Walmart, and the differentiation strategies in product design, like Apple (Rothaermel, 2013). There are differences, however, in the value chain between HP and the two companies above. HP

Supply-Chain Management is the activities that procure materials and services, and transform them into intermediate goods and final products and deliver them, through a distribution system (Heizer & Render, 2011, p. 452). DELL is a computer technology corporation that develops sells, repairs and supports, computers and computer related products. DELL has realized that supply chain is becoming more and more important for the success of today’s business world and they work accordingly to keep a competitive advantage in the market. This study will examine to what extent Dell has used supply chain management to gain and retain a competitive advantage in the computer market.

Henry Ford was an engineer from Detroit, Michigan who had an idea. By 1902, Ford had attempted several times to produce a gas powered vehicle, but with little capital, he realized that his attempts were futile. Ford approached a man by the name of Alexander T. Malcomson about the possibility of manufacturing an automobile. Malcomson, a friend of the family and wealthy coal merchant was reluctant at first but finally agreed with Ford, and decided to assit Ford financially with his endeavor. With Malcomsons investment and Ford's engineering skills a partnership was formed and in mid June of 1903, papers of incorporation for the Ford Motor Company were filed in Dearborn, Michigan.

United States Securities and Exchange Commission, (2012).Ford motor company 10-k . Retrieved from Ford Motor Company website: http://phx.corporate-ir.net/phoenix.zhtml?c=87772&p=irol-SECText

Over the years, the U. S. auto industry's market has been experiencing fluctuations due to many reasons including: price, quality and foreign competition. General Motors Corporation (GM) which had been the leading car and truck manufacturer had been experiencing declining market share and facing stiff competition from both U.S manufacturers and foreign imports such as the Asian auto producers that included Toyota, Honda and Nissan. The main reason for increased foreign competition was that foreign cars were more fuel efficient, smaller, less expensive, and often more reliable than their American counterparts.

The key to achieving this goal lies in the ability to take advantage of the Ford Company’s size and global presence to invest in information technology. This can be accomplished by using its intelligence resources to renegotiate the way it does business with suppliers, including partial integration of the “virtual integration model”, such as Dell Corporation

Dell applied virtual integration in four main areas: organizational simplification, inventory management, customer service and support, and suppliers’ management. Ford’s supply base is complex in nature when compared with the DELL supply base—many more layers and many more companies. This is one area that would be difficult to apply the same degree of virtual integration. Although there are several key differences between the companies, the restructuring initiatives of Ford 2000 have set a viable foundation to implement Dell’s virtual integration strategy in inventory management, customer service and support and suppliers’ management. In order to successfully implement the virtual integration, the problems existing in the current supply chain will be identified and addressed.

Although the direct business model of Dell is most attractive, there are several key differences between the computer and auto industries which serve as barriers to Ford‘s implementation of uniform, supply chain virtual integration. Ford must tackle many diverse obstacles that were, simply, not a factor with Dell‘s implementation. These obstacles range down the delivery chain from the supplier to the manufacturer to the dealer and, ultimately, to the customer. Overall, the intricate and historic process of manufacturing and selling automobiles contradicts the technological innovation necessary for a true virtually integrated system to exist.

Third, Dell has a rapid-response system for linking all suppliers, workers, managers, and customers to Dell’s value chain. This interactive real time communication system is employed to order parts, manufacture and outsource computer modules, and coordinate assembly and distribution of products to customers. Managers employ this system for all human resource functions, workers and suppliers for all coordination sequencing and quality control processes,

The class text states that Supply chain management is frequently divided into supply chain planning applications, supply chain execution applications, logistics management, and warehouse management. Often when companies fail at implementing an efficient supply chain because of the planning section, or inaccurate demand forecasts. The text states electronic data interchange is one of the earliest uses of information technology for supply chain management, Electronic data interchange is the use of the Internet for everyday business transactions. “In this era of information a firm’s supply chain should operate at speed of thought and this is possible only by enhanced e-speed communications and information sharing with their critical partners.” (4)

Ford Motor Company was incorporated in Delaware in 1919. They acquired the business of a Michigan company, also known as Ford Motor Company, which had been incorporated in 1903 to produce and sell automobiles designed and engineered by Henry Ford. They are one of the world’s largest producers of cars and trucks. They and their subsidiaries also engage in other businesses, including financing vehicles.