INFORMATION TECHNOLOGY IN SUPPLY CHAIIN

MANAGEMENT: AN ANALYSIS OF DELL INC.

By
HIMUNGSHU KASHYAPA -18MBA0002
THANUHA S -18MBA00029
DEBASMITA SEN -18MBA0088
ROHIT PANDEY -18MBA0108

With the guidance of

Dr. STEPHAN THANGAIAH

PROFESSOR

SEPTEMBER 2019
INTRODUCTION
Information technology has increasingly become a necessary component of business and a strong
& important catalyst for economic development. The use of IT in business has enhanced
productivity effectively, smoothly information sharing, greater customer participation, and
enabled mass customization, besides reducing costs. Firms are very effectively using IT and
wireless telecommunications to improve service and delivery processes. Now a days, IT is an
important aspect of the electronic supply chain management particularly in the Internet, enables
companies to share information within and inter organizations. The Internet and its three
important types of networks: Intranet, Extranet, and Web allow organization to transfer digital
data instantly and with high fidelity at nearly zero marginal cost. Information sharing can
increase supply chain efficiency by reducing inventories and smoothing production.
Information technologies used for planning, organizing, coordinating, and controlling supply
chain activities including:
a. Enterprise resource planning (ERP) software which helps manage both the internal and the
external relationships with the business partners.
b. Supply chain management software which helps in decision making related both to internal
segments and to their relationships with external segments.
c. Radio frequency identification (RFID) is a technology that uses electronic tags (chips) instead
of bar codes to identify objects or items. This technology is same as 2D tags.
Above three are major IT supported managerial activities which improves supply chain
operations, integrating departmental systems with ERP, and introducing a variety of customer
relationship management (CRM) activities. Here, IT activities are supported by the good IT
infrastructure which refers to the shared information resources, such as corporate networks and
databases and their linkages, operation, maintenance, and management. It also supports activities
along the supply chain such as procurement, relationship with suppliers, SCM, CRM, and order
fulfillment.

INTRANET, EXTRANET, AND WEB TECHNOLOGY

ITs are things such as computers and internet, which allow the storage and transmission of data
in digital formats. IT is the collection of the computing systems in an organization, or
organization‟s collection of information systems, their users, and the management that oversees
them. It includes the hardware, software, data and database, networks, procedure, people, and
other electronic devices.
Descriptions Internet Intranet Extranet
Access Open/Public Private By agreement only
Information Fragmented Proprietary Shared by business
partners
Users Public/ Everybody Organization members Business partners
EFFECT OF INTERNET IN SUPPLY CHAIN MANAGEMENT
The relationship between information technology and the supply chain can be explained as: IT is
responsible for integrating the supply to achieve greater capabilities and profits. The primary role
of supply chain management is creating the integration of processes and information within a
firm such as marketing, finance, sales, manufacturing and distribution. It is also responsible for
the integration between firms and smooth flow of information and products between customers,
suppliers and the transportation through 3PL (third party logistics). The most direct effect of the
Internet is to create new opportunities to improve the efficiency and effectiveness of the
operation of the supply chain and exchange processes through e-commerce. This is because of
the cost-effective capacity to generate visibility across all aspects of the supply chain, including
point-of-sale information, manufacturing schedules, vendor stocks, customer inventories,
demand patterns, marketing & sales initiatives, and carrier schedules.

IMPACTS OF INTERNET IN SUPPLY CHAIN MANAGEMENT

The Internet changes the way companies do business. The changes are permanent from industrial
economy to the network economy. The Internet strengthened the power of combination, which
can be viewed in two aspects: global low-cost connectivity makes it possible for small and mid-
sized companies to take advantage of SCM techniques and speedy network helps businesses
realize seamless and real-time communications and transactions.
1. The Internet changes the way supply chains are managed, planned and controlled. SCM
related information and decisions are integrated into the Web, breaking the old model of inter-
organizational boundaries. By implementing the Web-based SCM and CRM, companies can
virtually eliminate the boundaries among business partners to form the extended enterprise.
2. The Internet enables the trading partners within the supply chain to better coordinate and
collaborate for mutual benefits. Technologies that are based on the Internet make seamless
integration possible among business partners.
3. Many e-commerce experts have deep arguments on the impact of the Internet on the supply
chain is that the Internet is shifting power from the seller to the buyer irreversibly. The search
power for the buyer is now unlimited. Suppliers also provide products and services information
through their Web sites.

INTERNET AND TECHNOLOGY’S CONTRIBUTION TO SCM

The Internet and Web technologies can support the entire supply chain‟s operations which are
very fast and inexpensive. Customers can instantly check the status of their orders by simply
clicking their computer mouse. The managers and executives can conduct real-time access to
firm‟s inventory level, and so do their suppliers and distributors.
1. XML based information exchange and sharing: Electronic data interchange (EDI) plays an
important role in the evolution of SCM. Trading partners used EDI for information exchange,
such as sending requisitions and receiving purchasing orders. The XML (Extensible Markup
Language) based Internet system allows organizations to exchange data on a transaction-by-
transaction basis.
2. Comprehensive integration of various technologies: IT in various forms and combinations
ranging from Internet, Web-based Technology, HTML and XML to different applications and
systems including ERP, CRM, SCM, and enterprise application integration (EAI), are enabling
business processes and creating new business contexts for companies to operate effectively and
efficiently in real-time.
3. Partners’ collaboration: Collaboration among trading partners helps SCM participants gain
great benefits from providing end customers with high quality, low cost products through
flexible and efficient distribution. Web technology boosts the supply chain visibility by
providing more real-time data from all links of the supply chain, resulting in greater
collaborations among trading partners.
4. Developing e-commerce applications: E-commerce consists of buy side (procurement) and
sell side (marketing). E-commerce plays an important role in SCM because it supplies the critical
data of customers and sales information to the partners that engaged in SCM. Customers‟ data
could be from individuals or organizations such as B2C, B2B, and B2G that are needed by all
supply chain partners for meeting customer satisfaction. A supply chain management serves as
the back end application by linking suppliers, manufacturers, assembling ,manufacturers,
distributors, and retailers in a cohesive production and distribution network while e-commerce
marketing serves as the front-end application by linking a firm with its customers.

ROLE OF IT IN SCM AND ERP

The function of SCM is to plan, organize, and coordinate the activities along the supply chain.
The supply chain concept is theorized from the formation of a value chain network consisting of
individual functional entities committed to providing resource and information to achieve the
objectives of efficient management of suppliers as well as the flow of parts. SCM is the concept
getting the right things to the right places at the right times for profit. Actually, SCM is very old
but new ITs particularly Internet and Web, have transformed today‟s supply chains, making them
extraordinarily better, faster, and cheaper. Better supply chain models do not just help
manufacturers of physical goods, but also service businesses such 3PL or a third party-logistics,
including those that require great creativity, imagination, and specialized knowledge.
When a supply chain is managed electronically, with Web-based software, it is referred to as an
e-supply chain. Most supply chains now involve a mix of Web-based, Internet, Extranet,
Intranet, and other information systems to ensure efficiency and uninterrupted flows of goods
and services in a timely manner. Thus, most supply chains are actually networks so it may be
more accurate to use the term Supply Network or Supply Web to describe the structure of most
supply chains. The improvements in supply chains involve an attempt to convert them to e-
supply chains, to automate the information and financial flows in the chain. Information sharing
can increase supply chain efficiency by reducing inventories and smoothing production.
Supply chains could not function at high levels of efficiency and effectiveness without powerful
information systems so Internet technology is the major tool on which firms rely on to manage
their lengthy and integrated systems. SCM software refers to software that supports specific
areas of the supply chain, especially in manufacturing, inventory control, scheduling,
warehousing, and transportation. This software is designed to improve decision making
regarding supply chain issues, optimization, and analysis. Basically, this software application
provide real-time analytical systems that manage the flow of products and information through
the supply chain networks which results that firms can work with a “supply chain suit” of
software that manages flow across the supply chain while including all of the key function areas.
Several firms producing “ERP” software such as SAP and Oracle have developed applications
that tried to integrate functional areas and bridge gaps across the supply chain. ERP is software
that helps integrate the components of a company, including most of the supply chain processes,
by sharing and organizing information and data among supply chain members. It transforms
transactional data like sales into useful information that supports business decisions in other parts
of the company. With ERP software, companies could integrate their accounting, sales,
distribution, manufacturing, planning, purchasing, human resources, and other transactions into
one application software. This enabled transactions to be synchronized throughout the entire
system.
For example when data such as a sale becomes available in one part of the business, it is
transmitted through ERP software, which automatically determines the effects of the transaction
on other areas, such as manufacturing, inventory, procurement, invoicing, distribution, and
accounting, and on suppliers. Through these information flows ERP organizes and manages a
company‟s supply chain.
IT HAS TRANSFORMED AND STREAMLINED SCM: DELL
Globalization and the evolution of IT have provided the catalysts for supply chain management
to become the strategic means for companies to manage quality, satisfy customers, and remain
competitive. A supply chain encompasses all activities associated with the flow and
transformation of goods and services from the raw materials stage to customer, as well as the
associated information flows. The movement of goods along the supply chain is reflected by
corresponding movements of information so without a good IT infrastructure, properly designed
supply chains, and capable people, this will not succeed. SCM focuses on integrating and
managing the flow of goods and services and information through the supply chain in order to
make it responsive to customer needs while lowering total costs. Supply chains require close
collaboration, cooperation, and communication among members to be effective. Suppliers, and
their customers must share information and also have same goals.
Web technologies allow firms to collaborate with business partners to gain the benefits of
reducing costs, enhancing customer satisfaction, and retaining competitive advantages. New
information technologies and e-commerce solutions have transformed supply chain operations
from mass production to mass customization as conducted by Dell where its practice of giving
customers the ability to match supply and demand because its customers order computer
configurations over the phone or online through Web site or Internet.
Dell, Inc. is known throughout the world as a leader in supply chain management (SCM) and
just-in-time (JIT) manufacturing. Relying heavily on a vendor managed inventory (VMI) model,
Dell has nearly eliminated inventory cost while maintaining a JIT manufacturing strategy. The
power of SCM and e-commerce are well exemplified by Dell, Inc. Dell Computers continues to
enhance and broaden its competitive advantage by integrating the Internet into its entire business
process, including online marketing & sales, procurement, customer support and CRM.
The supply chain can be a powerful competitive weapon, as market leaders like Dell, Grainger,
and Hewlett-Packard have demonstrated through the unparalleled success of their supply chain
processes. Dell achieves competitive advantage through deploying successful IT-enabled SCM.
Dell achieves rapid response by building personal computers with each customer‟s requested
software in a manner of hours. Dell‟s dominant strategy is quick, reliable response.
At Dell, the supply-chain management database systems manage key business functions that
support Dell‟s worldwide manufacturing operations. The major components of Dell‟s efficient
inventory management model and fast, direct-to-the customer delivery of computers, accessories,
parts and supplies. If these systems are down, Dell‟s factories are down, at the cost of thousands
of dollars per minute.
When Dell was a smaller company, before the development of powerful, industry standard
servers of the type that Dell manufactures and sells, the Dell Information Technology (IT) unit
ran these database applications on large, expensive, proprietary Unix-based servers. However, as
the company grew, these systems could not scale with the workload because the cause of
frequent downtime. Since they were not redundant it was necessary to bring down entire systems
to update a single server and when a server could not handle the required capacity it needed to be
replaced by a larger server. In recent years, the increased performance of x86 based industry
standard Dell PowerEdge servers has enabled the deployment of such database software as
Oracle 10g Real Application Clusters. By sharing a large database across multiple PowerEdge
servers, Oracle 10g RAC provides for very cost-effective scaling, high reliability, and the ability
to add capacity by adding additional low cost servers rather than buying larger, more expensive
proprietary Unix-based servers. Each of the core components of the supply chain management
(SCM) system are heavily used and relied on to keep Dell‟s operations running smoothly.

Component Description
Configuration Manages part numbers and Bills of Material
Management
Procurement Manages Purchase Orders and communicates Dell production
materials requirements to the suppliers
Cost Manages key areas of materials cost processes that calculates Bill of
Materials cost and cost of goods sold for Dell Orders
Inventory Manages Dell and Hub inventories. Within each facility, it manages
inventory stock room locations/bins and on-hand quantity.
Accounts Payable Manages Dell to suppliers‟ payment processing. It also deals with
invoices, receipts, and EDI processing.

Configuration Management: The Configuration Management system manages over 1 million

Dell part numbers across approximately 200 product families, and over 2 million Bills of
Materials (BOMs) per year. BOMs listing component part numbers are created for
manufacturing to build assemblies and sub-assemblies to produce Dell‟s products.
Procurement: The Procurement system manages nearly 1.8 million Purchase Order lines per
year, from more than 5,000 suppliers worldwide. To streamline the procurement process Dell
uses an automated application which includes workflow approvals and vendor communication,
and provides for services such as defective part warranty replacement.
Cost: The Cost component of the system runs mostly in batch mode to calculate the costs to Dell
for all Bills of Materials. These batch jobs run weekly, monthly and quarterly, with each run
rolling up total material costs.
Inventory: Between all sites there are more than 3 million inventory movements daily from
stock rooms to the factory floor. A corresponding 3 million messages are transmitted to various
systems for reporting, analysis and factory scheduling.
Accounts Payable: Accounts Payable handles approximately 15,000 items per day including
payments to Dell suppliers, invoices and receipts. Vendor information includes number, location,
negotiated terms and contact information.
ANALYSIS AND FINDINGS
The commercialization of the Internet in the early 1990s and the introduction of the World Wide
Web in 1993 provided Dell with an opportunity to expand rapidly. By 1996 Dell was selling
computers on the Internet/Web e-commerce and by 2000 the company‟s Web site was pulling in
$50 million a day in direct sales. Dell‟s supply chain is characterized by its minimum levels of
inventory, a policy of paying suppliers only after the customers have paid Dell, and direct sales.
Dell implemented aggressive online order taking and opened subsidiaries in Asia & Europe. Dell
also started to offer additional products on its Web site and in 2000 Dell became number one in
worldwide PC shipments. At that time, Internet sales topped $50 million per day and sells about
$62 billion a year in computer related products online, from network switches to printers,
employing over 88,000 people. Dell survived from its huge losses through a best practice leader
at perfectly integrating IT i.e. internet, web-ecommerce and SCM to enhance all processes across
and an extended supply chain and e-commerce. Dell sells its product lines to Individuals &
Households such as homes and home offices, for Businesses/Institutions/Government/Health-
care organizations/Partners, for Small and Medium-sized Enterprises (SMEs), for Large
Corporations, for Institutions/education, Government, health-care organizations and Partners.

MARKET SEGMENTATION
Sales to the first group are classified as B2C e-commerce. Consumers shop at dell.com using an
electronic catalog. The sales are completed using mechanisms of e-commerce platform.
Business-to-customer (B2C) sales are facilitated by standard shopping aids (e.g., catalogs,
shopping carts, credit card payments. Dell matches supply and demand because its customers
order computer configurations over the phone or online (Internet). These computer
configurations are built up from components that are available.

For B2B (e-commerce), sales to the other four groups are classified as B2B e-commerce. Most of
Dell‟s sales are to businesses that cover SMEs, Large enterprise Institution/educational,
Government, and healthcare organizations. B2B customers obtain additional help from Dell
where Dell provides each of its nearly 100,000 business customers with Premier Dell service.
For B2G, for example considers Dell to be a strategic supplier of British Airways. Dell provides
notebooks and desktops to 25,000 British Airways users and also offers two e-procurement
services to British Airways purchasing agents. The more basic service, Premier Dell, allows
British Airways and other businesses to browse, buy, and track orders on a Dell Web site
customized for the user‟s requirements. The site enables authorized users to select preconfigured
PCs for their business unit or department. A more advanced version, Premier B2B, supports e-
procurement systems. This provides automatic requisition and order fulfillment once an
authorized user has chosen to buy a PC from Dell. British Airways has placed the e-procurement
tools on its E-working intranet. This allows authorized staff to purchase PCs through a portal that
connects directly into Dell‟s systems. In addition to support its business customers with e-
procurement tools, Dell also using e-commerce in its own e-procurement. Dell developed an e-
procurement model that it shares with its business partners. The one thing in this model is the use
of electronic tendering to conduct bids. Dell uses electronic tendering when it buys the
components for its products.

ROLE OF IT IN DELL’S SCM

Dell shows effective IT-enabled SCM in conducting business. Dell changed its environment by
deploying a comprehensive integration of IT (e-commerce) and SCM. IT-enabled SCM enables
to communicate and collaborate (e-collaborate) with its many business partners with whom it
needs. Dell uses shippers, such as UPS and FedEx, to deliver its computers to individuals & also
uses third-party logistics companies to collect, maintain, and deliver components from its
suppliers, and it has many other partners. Dell is using Web Services (facilitate B2B integration),
an e-commerce technology, to facilitate communication and reduce inventories. The B2B
integration offer combines Dell PowerEdge servers based on Intel architecture and Web
Methods. B2B integration software to link customers‟ existing ERP or procurement systems
directly with Dell and other trading partners.
Dell expresses e-CRM effectively and uses a number of different tools to provide superb
customer service around the clock. To leverage CRM, a customer service or e-customer service
approach that is customer centered for lasting relationships, Dell provides a virtual help desk for
self-diagnosis and service as well as direct access to technical support data. Customers can also
arrange for a live chat with a customer care agent. Product support includes troubleshooting, user
guides, upgrades, downloads, news and press releases, FAQs, order status information, a “my
account” page, a community forum (to exchange ideas, information, and experiences), bulletin
boards and other customer-to-customer interaction features, training books, and much more. Dell
keeps a large customer database and using data mining tools and this database is used to improve
marketing as well.
IT enabled SCM fully supports Dell for mass customization. To support its build-to-order
capabilities, significantly improve its demand planning and factory execution accuracy, reduce
order-to-delivery time, and enhance customer service. They partnered with other multinational
companies like Accenture, Wipro etc. to create a new, high-performance supply chain planning
solution. Dell‟s plants around the globe, the program, which paid for it five times during the first
one year of operation, enables Dell to adapt more quickly to rapidly changing technologies and
the business environment, maintaining its position as a high performance business. Dell also has
automated its factory scheduling, demand planning capabilities and inventory management using
IT and e-supply chain models.
Dell adopts effective IT enabled marketing strategy. Dell‟s promotional programs links to a
variety of websites by which Dell provides affiliate partners the opportunity to link from their
websites to “dell.com”. Dell pays 2 to 4% on any qualified sale made from clicking on Dell‟s
link at the partners‟ websites. In addition to this, Dell auctions refurbished Dell computers and
other products at “dellauction.com”.
Dell succeeded in achieving competitive advantages through the deployment of IT enabled SCM
and effective e-commerce by which attributed to its direct-sales model in mass customization or
build-to-order systems. This made Dell excel over its competitors through effective IT
implementation to enhance SCM operations and survive from huge losses which was happened
in previous years and dell has been one of top five “Most Admired “companies and continuously
improving day by day and year by year.

BENEFITS OF IT IN SCM
Maintaining product quality on whole supply chain is one of the main objectives of the actors
involved in developing material flows. If in the case of different types of general products, this
poses no particular problem, for example in case of perishable foods it is necessary to monitor
the environmental conditions, like temperature and humidity, during the transport and storage
periods. The introduction of automatic monitoring of these features allows obtaining information
in real time and deviation from normal values can be fixed in a short time.
Customer Relationship management (CRM) offer the possibility to identify the most
profitable customers and monitoring their behavior. The current trend is to adopt collaborative
CRM systems in order to involve all business partners in collaborative customer services.
Warehouse management systems automatically or semi-automatically manage the location of
storage spaces, create picking lists, assortment of ordered goods and handling products in
warehouses. Handling is done through automated guide vehicle, automated storage and retrieval
systems, conveyors and other devices and also provide warnings on product with expired
warranty period. In current conditions, managing inventory manually is inefficient and generates
errors. A number of mathematical models can be associated and used in simulation of
configuration of warehouses. The newest and most frequently adopted technologies in
warehousing are:
1. Warehouse management systems
2. Warehouse automation systems
3. Voice picking
4. Mobile and computerized devices
5. RFID
6. Handheld devices

Using bar-coding allows identification and traceability of products, allowing simplification of

processes in logistics channel. For example, in combination with warehouse management system
it enables the fluidization of picking activities in order to compose the expeditions. At the sales
points it provides information on quantities of different types of inventories of products and on
the level of value of sales. But barcodes do not offer the possibility of identification the time and
place of good production or about moment of product expiration. These shortcomings are
removed allowing RFID technology via radio frequency signals to read information about the
product during the way from manufacturing to final sale.
Using RFID tags enable automatic obtaining information about the goods stored or transported
without physical contact, even in conditions when these are objects between the reader and tags.
RFID systems use large capacity data storage and high speed operation and also allow
reprogramming and updated information storage. RFID tags can be used to prevent:
1. Fast identification of products
2. Handling products only once in order to form expeditions.
3. Elimination of selecting products for shipping orders
4. Optimization movements in warehouses.

An integrated system as the Enterprise Resource Planning system offers the advantage of an
overview of the entire logistic channel, the existence of a common database collected across the
supply chain. ERP systems, by their ability to integrate the functions of production, logistics,
sales, human resources, accounting and finance, offers premises for a performance management
across the organization. For example, in the logistics field, ERP streamlines procurement, order
management, planning of logistics activities.
Transport management systems allows real time communication and getting monitoring of
order at any time based on GPS/telematics and cellular devices. In the event of any disruptive
event it can accomplish the rerouting delivery vehicles. Use of mobile device is favored by
lowering their cost of acquisition. Equipment for fluidization of freight transport used in current
years are:
1. Location and event reporting
2. Route progress tracking
3.Fleet telematics solution like in cab displays, on board computers, and satellite
communications
4. Information capture and retrieval

Decision support systems (DSS), interactive software based systems assist in decision making
can be used in logistics activities. E-commerce, integrating functions of data and funds transfer
allow the remove the geographical barriers between suppliers and customers. Expansion the use
of internet has provided opportunities for electronic trading. IT in SCM offers a number of
benefits:
1. Reduce inventory levels
2. Faster and with high accuracy order processing
3. Lower transaction costs streamlining logistics flows
4. Improving customer service
5. Improving data accuracy

Increasingly more applications use cloud technology. It can be integrated with existing system in
order to increase efficiency. Cloud technology allows data to be updated and shared across the
supply chain through a collaborative platform. Use of cloud computing offers a number of
advantages such as lower costs for commoditization of resources, possibility to externalize of
maintenance, payment only what it is uses and removal of infrastructure costs. It offers also the
advantage that can that it can be implemented very quickly, requires no investment from the
participants, and costs for maintenance and update being limited to the costs of a monthly
subscription to access these services. The use of Internet brings many benefits in logistic
channel:
1. Reduce cost and increase efficiency by automatic processes.
2. Expansion of sales areas.
3. Providing new possibilities for communication.

LIMITATIONS IN THE IMPLEMENTATION OF NEW TECHNOLOGIES IN SCM

The positive effects of a CRM did not produce the expected effects, in some cases even causing
damage of long-term customer relationships. Failure of implementing of such a system may be
caused by insufficient knowledge of it. On the other hand, costs and risks of system
implementation and integration with existing programs in an economic entity are high.
Encountered problems in the functionality of SCM systems are:
1. Inaccurate data from other enterprise systems.
2. Lack of good collaboration between company departments.
3. Malfunction of collaboration with suppliers, customers or distributors.
4. Difficult to implement software tools.

An example of failure is „Hershey Foods‟, which has encountered problems in implementing a

new order management, supply chain planning, and CRM system which led to the loss of higher
orders. Implementing an Enterprise Resource Planning system can take several years and require
constant updates and maintenance. Moreover, costs can raise to tens of millions of dollars which
excludes for many companies the possibility of accessing such integrated systems. The rate of
successful implementation of such a system is still quite low; it‟s only about 33%. Failures could
be determined by multiple causes:
 Differences between existing systems and new systems.
 Insufficient staff training or lack of motivation or understanding of the new systems.
  Particularities of channel and logistic requirements of different participants in the
logistics channel.
 An insufficient understanding of the processes and the operation of each component of
logistics channel and its assembly by the software processes.
 Unjustified investment compared with the existing and potential demand.
 Underestimation of the complexity of planning, training and development for the
implementation of such a system.
 Lack of involvement of employees who will use the system in planning, systems
development and change.

Once the system is implemented, it can be accompanied by a number of drawbacks:

 Decrease in income
 Reduction in market share.
 Loss of orders.
 Incorrect registration of inventories.
 Failure of operation of information systems.

A not to be neglected problem is that the staff resistance to change, especially in situations where
old systems work for a long time or when the new system is perceived by employees a risk of
losing jobs. Certainly, their concerns are justified, because such a system reduces human
intervention throughout the supply chain.
There are certain difficulties pertaining to RFID Systems too, like:
 RF signals are affected by interference and reflective metal and electrical systems.
 Absorption of radio frequency signals in fluids.
 Low rates of tag receptivity.
 Existing barcode systems implemented recently and with relatively high cost which have
not yet been amortized.
 High investment costs to implement RFID, equipment costs, expenses for integration
with pre-existing systems and staff training in order to use this kind of systems.
 Problems of compatibility with existing applications.
 Data overload and data noise.
 Existence of a large number of RFID hardware and software vendors and the lack of
standardization of these components.
 Lack of qualified personnel in the management and use of RFID systems.
Slowness of reach- It is often observed how projects become complicated over time, due to the
addition of new functions and features. In the end it is ended up with an inflated project that is so
extensive that it will never be completed or that, if completed, we will not get a profit on solid
investment.
Weak leadership- When intervening multiple departments, supply chain projects need a strong
senior executive and that is capable of acting to eliminate those points of interdepartmental
disunity because there will be numerous challenges to be solved.
Implementing software in supply chain, developed by a service provider, requires also the need
to clarify the legal issues related to the security of confidential data. There are also a few
drawbacks, such as pricing and loss of control over data. Developing software is risky when
open source software and multiple options for application development are used. So, the
existence of different and not interconnected systems for managing departments or sets of
activities may cause errors, redundant data, which can lead to additional costs.

IDEA GENERATION

Supply chains around the world are being transformed. External pressures, technology trends and
internal evolution are prompting companies to reevaluate their network to determine how their
future supply chain should be structured, both in terms of capacity and capability. The type and
capabilities of supply chain technology is expanding and technology will only grow more
efficiently in an effective supply chain management. From the increased demand to data driven
decision-making through the industrial Internet of things (IIoT) to the use of cloud-based
technologies, supply chain technology will advance in the coming months. Some new technology
and emerging trends in supply chain management are:

1. Data-visualization Will Shorten Delivery Times:

Data visualization is technically a technology, but it is so much more than that. Data
visualization can be applied to any supply chain process that presents users with information
enabling the immediate adjustment of operations or sharing of information. In other words, the
simple act of providing reports to executives and upper-level managers could be considered a
form of data visualization, and better reporting will be a fundamental improvement in supply
chains. Having more information will enable faster decision-making and help supply chain
entities take advantage of value-added services and jobs, including services offered by third
parties

2. Supply Chain Management Will Finally Have a Standard Certification Process:

Supply chain management has been a very complicated topic in recent years, and it seems like
the number of platforms and services available has expanded exponentially. Every system is
different, but this is merging into a single cohesive set of systems that can be integrated through
the Internet of Things (IoT). As a result, supply chain management is approaching the point of
having a defined standard certification process created. This will help encourage effective,
efficient deployment of new systems and services, while helping to curb the existing skills gap.

3. The Role of Social Media in Supply Chain Management Will Increase:

Supply chains have used mobile technology for years, but in last some years we can see
increased use of social media accounts and marketing tools to increase supply chain management
effectiveness. Since consumers sharing negative or positive product information through social
media has a direct impact on cells, it is only natural for supply chain managers to look at social
media use in greater detail. As a result, supply chain entities already began using social media as
a primary means of connecting with consumers, beyond traditional online, browser or app-based
shopping experiences.

4. Supply Chains Will Go Digital:

2018 was the year in which new supply chains abandoned older supply chain management
strategies and principles in favor of digital processes and technologies. Supply chain entities will
develop specialized teams to focus on innovation and better ways to deploy digital technologies.
In addition, more companies will continue to invest in innovation, and in a recent survey shows,
94% of supply chain respondents cited competency in technology as a distinguishing factor when
considering outsourcing supply chain processes, including the use of third-party logistics
providers (3PLs). It is not enough for supply chain managers to invest in technologies available
today. They must take a proactive a step in watching for technologies on the horizon, such as
drones and autonomous trucks, or their competitors will quickly draw customers away.

5. New Devices and Mobile Systems Will Become Integral to Supply Chains:
New smart devices are being released every day from voice-controlled systems to tablets with
faster processing capability, and the systems will become integral to supply chain management
and operations in the coming year. Smart devices are actually growing smarter, with more
companies seeking to use advanced supply chain technologies such as artificial intelligence,
mixed reality, machine learning, or augmented reality in existing systems and operations.

6. Mass Adoption of the Cloud:

While considering automation, it is important for supply chain managers to remember the
amount of processing power necessary to manage automated technologies. Legacy systems and
even systems that were new several years ago may not have the processing power necessary to
handle the continuous stream of data going in and out of systems. Therefore, more manufacturers
will begin adopting cloud-based technologies. More importantly, the speed of migration from
analog systems to cloud-based systems will increase exponentially, and more than 80% of supply
chains are expected to have some portion reside within the cloud by coming two or three years.

7. Smart glasses:
They are providing manufacturers and supply chain partners with information without the need
to handle bulky order processing systems through augmented & virtual reality, known as mixed
reality, and the use of freight matching apps for full truckload moves are giving supply chain
managers various ways to accomplish more without spending more. It sounds confusing, but
these transformative supply chain technologies tend to generate growth and increased
profitability when used across a global scale by enterprises with complex supply chains or even
domestic companies looking to gain efficiency which in turn leads to bottom line savings.
8. Artificial intelligence:
A.I. can help consumers make decisions and virtual reality has the promise of revolutionizing
how companies design, develop, and produce products. The same is true with 3-D printing. This
fundamental shift will result in increased competitive advantage among companies that use
disruptive technologies, and cross-platform systems will rise to make existing disruptive
technologies compatible with new and legacy systems. This will create immersive experiences
and enable the creation of digital twins for existing products, services and systems. We can
imagine a digital world that mirrors the real world. This gives developers and supply chain
partners an opportunity to experiment with different scenarios and select the solution that will net
the greatest savings and increase profitability.

The use of A.I. will lead to better responsiveness by customer service representatives, and since
the technology hinges on automation, order accuracy will increase, which will enable better
spend analysis and cost reductions through newer, more advanced analytics. Since up to 79
percent of supply chain managers surveyed cited cost reductions as a top area of concern,
investments in and use of AI will increase.

CONCLUSION

The result and findings show that Dell Inc. is expert in ITs and can play important roles in its
supply chain management. Dell has succeeded in harnessing IT, particularly Internet, Web
technology (e-commerce), ERP, SCM software, EDI, etc. to transform and streamline its SCM.
Till now, IT is an important aspect of the electronic supply chain management (SCM). IT is just
one component of Dell overall strategy which simply extends the firm‟s reach, and it must be
integrated into the overarching strategy the firm uses to reach and interact with its customers.
Even at Dell, where the firm operates at the phase four level of e-commerce i.e. full transaction
capability – the Internet is just one approach to the marketplace.

The effective IT implementation has enabled Dell to match supply and demand through excellent
information sharing. This allows Dell to know what he must be able to supply in real time and
then very quickly and precisely meet that demand while maintaining low inventory. Dell‟s
strategy is to provide customized, low cost, faster, and quality computers that are delivered on
time. Dell successfully implemented this strategy through its efficient manufacturing operations,
better supply chain management and direct sales strategy and also saves time on processing
orders that other companies normally incur in their sales and distribution system. This helps Dell
to plan for future besides better managing its supply chain.

Dell has succeeded in exploiting the advantage of the IT to improve performance, and establish a
unique e-commerce model by embracing IT in its supply chain. Dell brings products to market
faster than its competitors and uses direct sales via Internet, whereas traditional PC
manufacturers previously assemble PCs ready for purchase at retail stores. Actually, PCs have
life cycles of only a few months and thus, Dell enjoys early-to-market advantage.
Dell computers are a good example of a successful supply chain management system which has
led to a successful business. They also incorporates a highly efficient built-to-order business
model which buyers can click through Dell and assemble a computer system piece by piece
based on their budgets and needs. Dell employs supply chain tools to provide global views of
forecasted product demand and materials requirements as well as improved factory scheduling
and inventory management. Although, Dell has successfully integrated new IT and human
knowledge for success, but due to super competitive markets, it recommends that Dell should
need to continuously design and develop new and innovative products, product development and
enlargement, and technology innovation to meet customer satisfaction.

The challenge for Dell is to commit to the green environment or „The Green Supply Chain
Management‟. Dell believes in the future. Most countries or people prefer friendly environmental
products and technologies. Many experts predict that we will see a major expansion in „green‟
supply chain initiative whereby companies are committing to design, source, manufacture, and
manage the end-of-life stage for all of their products in an environmentally and socially
responsible manner. Other initiatives include developing green packaging and refurbishing
products to avoid or minimize landfill waste. Study showed that for many manufacturers,
between 40% and 60% of a company‟s carbon footprint resides upstream in its supply chain
from raw materials, transport, and packaging to the energy consumed in manufacturing
processes.

Dell recently deployed i2TradeMatrix,a CPFR supply chain tool, further enhancing the
company‟s global supply chain management and demand fulfillment processes. The team
completed the testing before selecting a platform based on Dell servers running on Windows NT.
This means Dell has made the selection process and the architecture designed to run the i2 tools.
Cloud Computing has become the latest IT trends, because it reduces complexity, lower costs,
and improve scalability.

REFERENCES:

1. A case study on „Information Technology in Supply Chain Management‟, by Ming-Lang

Tsenga and Kuo-Jui Wub.
2. A study on „Information Technology and Supply Chain Management Practices in Global
Business Organizations‟, by Mangesh P. Waghmare and Dr. M. B. Mehta.
3. „Challenges of Information Technology and Supply Chain Management in logistic sector‟, by
Riste Temjanovski.
4. „Information Technology in Supply Chain Management‟, by T. N. Varma and D. A. Khan.
5. „Examining the impact of Information Technology on Supply Chain Management: An analysis
of hospitals in Jordan‟, by Mohammad Abdul Qadir Obeidat.
6. „Role of Information Technology In Supply Chain Management‟, by Devinder Kaur.
7. https://linchpinseo.com/supply-chain-technology-marketing-trends/
8. https://www.reliableplant.com/Read/7129/dell-supply-chain