Professional Documents
Culture Documents
Strategy
Online shopping experience from Dell
and Ford
Product variety
Necessitates the management of large number of
individual component inventories
Production capacity for individual components get set
long in advance and cannot be changed quickly
Ford
What historical “legacies” affect
Ford’s ability to move to a BTO model
Process Complexity
A large number of suppliers
3 tiers of suppliers
Business was usually over the phone and
fax
Ford a $150billion company enjoy a
tremendous leverage over its suppliers
Annual component price decrease and open
book
Ford
What historical “legacies” affect Ford’s
ability to move to a BTO model
Powerful independent dealer network
Incompatible systems
Ford credit – DEC
Parts and service – IBM
Suppliers and dealers – Variety of systems
Ford Motor Company: Supply
Chain Strategy
What is virtual integration? What benefits
does Dell gain from it
A way of capturing the advantage of vertical
integration without actually vertically integrating
Vertical integration solves production problems
related to communications, coordination, and
control but at a cost of the increased overhead
needed to arrange production organization
Forecasting
Dell’s direct relationship with customers are key to
forecasting.
Dell has easy access to data useful for forecasting; most
of the data are already in Dell’s systems
In case of Ford, the dealers own most of the direct data
about customer demand.
Ford has a very base of individual customer unlike Dell
that has a relatively small number of institutional
customers
Ford
Compare Ford and Dell
Old channel players concerns
Costs of developing web capabilities
Implication for information sharing
Problems of connecting to suppliers and other
external parties who tend to be less
technologically advanced than the Ford
Forecasting what customers will buy for Dell and
for Ford
Difficulties in implementing a true build-to-order
model for so complex product as an automobile.
Ford
What practical challenges must Ford
address as it tries to establish
Internet linkages with its supply base
Difficulties in establishing B2B linkages
Lack of technology and technological
sophistication that prevail in the supply
chain, especially at lower tiers.
Ford Motor Company: Supply Chain
Strategy
How should Ford use Internet technologies to interact with
suppliers