Implementing Supply Routing Optimization in a Make-to-Order Manufacturing Network
Massachusetts Institute of Technology (MIT) - Operations Research Center
London Business School
Nanyang Technological University
Chee Chong Teo
Nanyang Technological University (NTU)
École Nationale Supérieure des Mines de Paris
July 25, 2008
MIT Sloan Research Paper No. 4708-08
Dell's supply chain for desktops involves Asian vendors shipping components by sea to several U.S. plants. While suppliers are responsible for shipping enough inventory, Dell can re-route and expedite their shipments while in transit and also transfer on-hand inventory in order to balance supply across sites. This paper describes the development, implementation and impact of the process and optimization-based control system now used by Dell to address this supply routing challenge for its US-bound monitors. This new methodology is estimated to have reduced Dell's inventory re-positioning costs for monitors by about 60%.
Number of Pages in PDF File: 42
Keywords: Dell, supply chain, make-to-order manufacturingworking papers series
Date posted: August 7, 2008
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