《供应链系统设计与管理》课程教学课件（讲稿）Lecture 9（Chapter 6）Supply Chain Integration

Designing and Managing theSupply ChainLecture-9(Chapter 6): Supply Chain Integration主讲王长琼Whatisintegration

Designing and Managing the Supply Chain Lecture -9 (Chapter 6): Supply Chain Integration What is integration 1 主讲 王长琼

Case:DellPCSupplyChainUnderstandingDell'smanufacturingpattern Contract manufacturing,Contract manufacturers(CMsDellassemblingplantsCMs,in ChinaInUsMBIntegratingCustomerIn ChinaChassis

Case: Dell PC Supply Chain  Understanding Dell’s manufacturing pattern  Contract manufacturing,  Contract manufacturers(CMs) 2 MB Chassis Integrating In China Dell assembling plants In US Customer CMs, in China

CriticalComponentsof aDesktopPC&MajorComponentManufacturersMotherboardASUSFoxconnIntelMiTACDesktopPCAcerDesktopChassisAppleASUSDellFlextronicsFujitsuSiemensFoxconnGatewayMiTACHPLite-OnLenovo/IBM

3 Critical Components of a Desktop PC & Major Component Manufacturers Motherboard ASUS Foxconn Intel MiTAC Desktop Chassis ASUS Flextronics Foxconn MiTAC Lite-On Desktop PC Acer Apple Dell Fujitsu Siemens Gateway HP Lenovo/IBM

CriticalComponentsofaDesktopPC&MajorComponentManufacturersChipsetntAMDIntelMotherboardPrinted CircuitBoardBTIElectronicsCompegGCELAN ChipPlatoElectronicBroadcomIntelCompanylistisnotcomprehensive.Imagesusedonthispagebelongtotherespectivecompanies

4 Critical Components of a Desktop PC & Major Component Manufacturers Chipset AMD Intel Motherboard Company list is not comprehensive. Images used on this page belong to the respective companies. LAN Chip Broadcom Intel Printed Circuit Board BTI Electronics Compeq GCE Plato Electronic

Read the Fig. 6-2 and Fig.6-3 on Page 162-163PCassembly Levels

Read the Fig. 6-2 and Fig.6-3 on Page 162-163  PC assembly  Levels 5

L6 vS. L5-CustomizedpartsL6MB5Weeks0oChinaDellCustomerSupplierIntegrationManufacturingLogisticsCenterChassisL53rd PartyIntegrator(managedbyEquipmentManufacturers)L5 additional costMB1WeekDellSupplierManufacturingChassisLogisticsCustomerCenter5Weeks

L6 vs. L5 L5 MB Chassis 5 Weeks 1 Week Dell Manufacturing Customer Supplier Logistics Center 3 rd Party Integrator (managed by Equipment Manufacturers) L6 MB Chassis 5 Weeks China Integration Dell Manufacturing Supplier Customer Logistics Center : L5 additional cost ~~Customized parts

L6 vs.L5: Value ComparisonL5L6:Integrated inside a Dell facilityIntegrated offshore & outside a DellfacilityChassis shipped on water.Integratedmotherboard-insidechassis? MBs shipped by airshipped on water+ Increased SCflexibility+Labor savings-Increased MB air-freighting costs+MBair-freighting costs areeliminated- 3rd-party integration cost in US+ReducedMB packaging costsSeparatelogistical costsfor-Reduced SCflexibilitychassis and MBs-MoreMBs need tobere-worked intheeventofanMBECNL6 is more cost-effective than L5

7 L6 vs. L5: Value Comparison L5 • Integrated inside a Dell facility • Chassis shipped on water • MBs shipped by air + Increased SC flexibility – Increased MB air-freighting costs – 3 rd -party integration cost in US – Separate logistical costs for chassis and MBs L6 • Integrated offshore & outside a Dell facility • Integrated motherboard-inside chassis shipped on water + Labor savings + MB air-freighting costs are eliminated + Reduced MB packaging costs – Reduced SC flexibility – More MBs need to be re-worked in the event of an MB ECN L6 is more cost-effective than L5

ManufacturingCosts:L5>L6.CostsCommontoL5andL6Costsofdoing eitherL5orL6:TypeMaterialsRawmaterialcostsLogisticsChina materialstransportation costsLaborChinaassembler'scost(FoxconnperformingL1-->L5)Chassisocean-shipping costLogisticsLogisticsChassisUStransportationcost(trucks,rail)Chassis inventoryholdingcostat SLCInventoryHoldingLaborUSassembler'scostatDell(fromL7-->L10)L6OnlyCostsCostsofdoingL6,ratherthanL5TypeLaborChinaassembler'scost(FoxconnperformingL6)L5OnlyCostsCostsofdoingL5,ratherthanL6:TypeMaterialsMotherboardpackagingcostMotherboardair-freight/expeditecostLogisticsLogisticsMotherboardUStransportationcostMotherboardinventoryholdingcostatSLCInventoryHoldingChassis&motherboardUStransportationcostLogistics(fromSLCtolocal/regionalintegratorandback)LaborLocal/regional integrationcost(Accurate,Saberex)MotherboardreworkcostatDellLabor/QualityDellL5mgmtcost(e.g.ExpediteCouncil)Labor

8 Manufacturing Costs: L5 > L6. Costs Common to L5 and L6 Costs of doing either L5 or L6: Type Raw material costs Materials China materials transportation costs Logistics China assembler's cost (Foxconn performing L1->L5) Labor Chassis ocean-shipping cost Logistics Chassis US transportation cost (trucks, rail) Logistics Chassis inventory holding cost at SLC Inventory Holding US assembler's cost at Dell (from L7->L10) Labor L6 Only Costs Costs of doing L6, rather than L5: Type China assembler's cost (Foxconn performing L6) Labor L5 Only Costs Costs of doing L5, rather than L6: Type Motherboard packaging cost Materials Motherboard air-freight/expedite cost Logistics Motherboard US transportation cost Logistics Motherboard inventory holding cost at SLC Inventory Holding Chassis & motherboard US transportation cost (from SLC to local/regional integrator and back) Logistics Local/regional integration cost (Accurate, Saberex) Labor Motherboard rework cost at Dell Labor/Quality Dell L5 mgmt cost (e.g. Expedite Council) Labor

ProblemStatementSince July 2004, Dell and its contract manufacturers (CMs)have had to adapt an increasing % of L5 manufacturing:1. Empty chassis are shipped by ocean (L5) to Dell US &Europe first. MBs are then air-freighted to Dell US &Europe.2. Dell incurs MB expedite/air-freight cost and 3rd-partyintegration cost.3. CMs incur cost for idle labor dedicated for MB-chassisintegration

9 Problem Statement Since July 2004, Dell and its contract manufacturers (CMs) have had to adapt an increasing % of L5 manufacturing: 1. Empty chassis are shipped by ocean (L5) to Dell US & Europe first. MBs are then air-freighted to Dell US & Europe. 2. Dell incurs MB expedite/air-freight cost and 3rd -party integration cost. 3. CMs incur cost for idle labor dedicated for MB-chassis integration

L6MB5Weeks.0ChinaDellCustomerSupplierIntegrationManufacturingLogisticsCenterChassisMake to stockMake to orderPushPullIntegration?Components production planning?Product production planning?

L6 MB Chassis 5 Weeks China Integration Dell Manufacturing Supplier Customer Logistics Center Make to order Make to stock Integration? Components production planning? Product production planning? 10 Pull Push