A PRESENTATION ON

Contents
• Supply Chain Management
• Factors leading to SCM
• Activites/Functions
• History
• Mergers and Earnings
• Traditional Approach
• Why HP went online
• Why HP choosed FedEx
• Supply Chain Solution
• Summary
Supply Chain Management
• Definition: chain consisting of multiple organizations
and organization units operating as customer/supplier
links
• Includes external suppliers and subcontractors
• Involves internal manufacturing plants, warehouses, and
distribution centers
• Extends to final (external) customers
Factors Leading To SCM
• Globalization
• Competitive pressure
• Move to e-commerce
• Cost reduction opportunities
• Ability to share information
• Greater use of contract manufacturers
• Desire to manage vertical markets
Activities/ functions
• Strategic level

• Tactical level

• Operational level
History
• HP is an American multinational information technology
• Bill Hewlett and Dave Packard are the founders of H.P
• The company originated in a garage in nearby Palo Alto
• In 1939, Packard and Hewlett established (HP) in Packard's
garage with an initial capital investment of US$538
• HP incorporated on August 18 1947, and went public on
November 6 1957.
• Their very first financially successful product was a
precision audio oscillator, the Model HP200A 
• The Walt Disney Company was one of earliest customers of
H.P
Mergers and Earnings
• HP's posted net revenue in 2009 was $115 billion
• In 2006, the intense competition between HP and IBM
tipped in HP's favour
• In 2008 HP became #2 globally in IT services as reported
by IDC & Gartner
• In November 2009, HP announced the acquisition
of 3Com
•  On April 28, 2010, HP announced the buyout of Palm
• On September 2, 2010 won its bidding war
for 3PARwhich Dell declined to match.
• On August 6, 2010 CEO Mark Hurd resigned
 Traditional approach
• Two Types:
1. Markets Driven (Customize)
2. Market Driving.

• Going Directly to customers

Why HP went Online?
• Since 1939, Company has a reputation of exceeding
customers expectations.
• HP wanted to continue this legacy by leveraging the
power of the Internet
• The Main elements were Reducing costs, Increase Sales
revenue, and strengthen customer relationships
 Cont…
• HP’s online store was launched in early 1998 and
experiences revenue growth of over 500% annually.
• HP decreases returns cycle times by 80% and per unit
return product costs by 70% through FedEx Return
Manager.
• Online status tracking offers complete visibility
throughout the returns process
HPSHOPPING.COM
Why HP Choosed FedEx
HP wanted a provider with industry-leading experience and
capabilities, including:

• Proven expertise in information technology.

• Access to U.S. households through an extensive
distribution network.
• Experience in electronic commerce and supply chain
management
• HP shopping.com asked FedEx to develop a
comprehensive solution that would manage the entire
process—from order management to order fulfillment
Cont…
HP wanted a provider that could do it all:
• Analyze business processes, assess opportunities, and
recommend a solution.
• Integrate multiple solutions from various alliance
partners with HP business processes to meet customer
needs.
• Oversee the supply chain and information management
components of the solution, thus freeing HP to focus on
strengthening customer relationships.
• deliver the solution to market.
The Supply Chain Solution

• 1. Needs assessment and supply chain analysis.

• 2. In-depth solution design and development.
• 3. Order management.
• 4. Warehouse management.
• 5. Inventory management.
• 6. Order fulfilment.
• 7. Reverse logistics management.
1. Needs assessment and supply chain analysis

• Fed Exbrought in cross-functional teams of

professionals to assess HP’s supply chain architecture
and identify critical integration points.

2. In-depth solution design and development

• FedEx began the design and development of a “direct-
to-consumer” solution for HP
• FedEx not only develop and implement the solution, but
also manage the critical processes that serve as the
engine for the online channel.
3. Order management

• FedEx integrated critical information systems needed

for the new channel
• HPwas able to quickly launch the initial site, HP Outlet
Center
• FedEx also contracted a call center provider to manage
the services required to support HP customers that
prefer purchasing products via a toll-free number.
Order Management Process
4. Warehouse management

Through the FedExfulfillment center in Memphis,

FedExprovided hpshopping.comwith the resources necessary to
achieve such a requirement.
5. Inventory management
• At the FedEx fulfilment center, logistics information
systems constantly monitor and update inventory status
• Customers can also call the toll-free number and obtain
complete customer service information from call center
representatives
6. Order fulfillment
• FedEx placed both refurbished-and finished-goods
inventories in the FedEx fulfillment center
• Late cutoff times enable hpshopping.com customers to
order as late as 10:00 p.m. and still have their orders
shipped the same day.
7. Reverse logistics management

• HPshopping.com wanted to remain focused on customer

satisfaction by providing customers with an efficient
product return process.
• Such a process enabled hpshopping.com to quickly credit
its customers’ accounts and help them select products that
fulfill their needs.
• FedEx Return Manager provided a reverse logistics
solution that enabled the fast return of products from
customers
 Summary

• HP’s revenue growth of over 500% annually.

• Hpshopping.com was ranked #1 in retail revenue and #3
in PC product sites. It also ranked in the top ten for
overall revenue and brand recognition.
• HP decreases returns cycle times by 80% and per unit
return product costs by 70%.