Dell Supply Chain
Anton van Steenwijk
Procurement Director
Global Fulfillment and Logistics
March 20, 2013
Do you know Dell?
$56.9 billion
2 billion
$4.2 billion
Top 5
98% of Fortune 500 companies
10M
35% of data center servers shipped in
Top 5
100% of G20 governments
total revenue
Newsweek’s Greenest Companies in
America for past three years
North America are from Dell
conversations with customers each
year
choose Dell
In Gartner Supply Chain five
consecutive years
Dell ships more than
1 system per sec
1
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EBITDA
Small businesses
served by Dell
choose Dell
Products and services as diverse as our customers
Laptops
Servers
Infrastructure management
Desktop virtualization
Software & Peripherals
Desktops
Storage
Application services
Data center virtualization
OEM solutions
Business consulting
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2
Networking
Adding to our portfolio of customer solutions
Added 17 acquisitions in the last 3 years
•
Continue to expand our enterprise services, solutions, and storage capabilities
•
Making sustained organic and inorganic investments while building an IP portfolio
•
Creating optimal solutions for our customers that are Open, Capable and Affordable
2006
2007
2008
Consumer
Significant Supply Chain
Involvement
3
Copyright 2013 Dell Inc. All Rights Reserved
2009
2010
2011
2012
Delivering to any customer anywhere in the world
Annually, we ship …
• between 20 factories, 60+ fulfillment centers/ hubs, and 1,500+
partner facilities
• 110M cartons
• ~1.5B lbs. of cargo
• 22K ocean containers ex Asia
• 25K MDs ex Asia, ~two 747s every day
• 15M service part packages
… >60 business partners moving >21,000 Dell & >300K 3rd party S&P
products
… serve more than 13M unique customers
… and represent ~60% of total transformation cost
4
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New business dynamics and customer needs require innovation
Growth in emerging markets
• Unique distribution model
• Immature infrastructure
• Low cost local competitors
Integrated Solutions Delivery
• HW + SW + Services orchestration
• E2E , global capability to pilot, test, and execute solution delivery
Planned Configurability
• Complexity shift outside of factory
• Increased focus on BTx supply chains
Copyright 2013 Dell Inc. All Rights Reserved
5
Apply a process framework to three opportunity areas for continued innovation
A
Strategic
Sourcing
Innovations by Dell
• Direct model
B
• Configure to Order Manufacturing Process (CTO)
Operational
Optimization
• Dell.com
• Segmented supply chain
C
IT
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6
A
Evaluate strategic sourcing goals through demand and supply power dynamics
Key approaches
Demand & Supply power dynamics
Inbound
High
Vested
Parcel
• Leverage market imbalances
• Track industry indices closely
• Improve IT and Ops supplier transition capabilities
Supply power
Contract
Logistics
Contract Logistics
• Form a strategic alliance and vested relationship
• Longer term commitment
• Reduced reliance on RFQs
Inbound
Air and
Ocean
Travel
Parcel
Low
Low
7
Demand power
High
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• Bundled deals
• Combine attractive emerging markets spend with stable parcel
market spend
A
Create value-based solutions through vested outsourcing
3 key benefits to Dell’s reverse supply chain…
Improved Collaboration
Innovative Solutions
Industry Leadership
Source: Vested Outsourcing: Five Rules That Will Transform Outsourcing by Kate Vitasek
Used with permission
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B
Enable full supply chain potential through a continuous optimization framework
•
•
•
•
•
Gather customer requirements
Collaborate across GO teams
Design the flow
Develop disruptive change
Leverage lessons learned
• Analyze internal/external triggers (e.g.,
volume, capacity, regulatory, new markets,
new products)
• Review benchmarking
• Challenge current design
•
•
•
•
•
•
•
•
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Realize full potential
Maximize utility
Drive incremental improvements
Eliminate waste
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Provide capability
Ensure system connectivity
Begin execution
Capture data
B
Drive operational optimization through three engagement types
Strategic Initiatives
Tactical Initiatives
Mapped onto three types of engagements
Mature Markets
• Optimizing existing networks
• Improving delivery precision
10
Emerging Countries
• Developing new networks
• Adding BTS capability, where appropriate
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Opportunistic Improvements
• Taking advantage of local opportunities
C
Avoid limited and fragmented regional IT solutions
GF&L IT landscape driving challenges to scale with business
• x
needs…
…benchmarking indicates opportunity to drive a standardized
approach at Dell
High Volume Shippers
Logistics Leaders
• 54 systems utilized globally
• >400 hrs. downtime or degraded service YTD (includes Trade)
• Limited IT resources to support tools
• Regional tool and process uniqueness
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I/T Solution
I/T Solution