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Strategies  for competitive  advantage

3 Further examples  of competitive   strategies 

Managing costs needs both resources and competences.  For example, free acca study materails modern, flexible machinery can cut production time and costs; having the competence to organise an efficient just-in-time inventory system will save inventory costs.

rI1   Illustration   on cost efficiency   (Dell)

Dell Computers is widely admired for its inventory and production system that has enabled the company to become one of the most successful and resilient computer manufacturers in the world. free download for pdf It sells good quality computers at very competitive prices. There is great emphasis on cost efficiency.

Broadly, their system is as follows.

(1)  Orders are received by phone and over the web. The orders are exam preparation & tutoring consolidated every 15 minutes and orders for the parts needed are automatically transmitted to suppliers.

(2)  The suppliers supply the components within an hour and a half.

Suppliers all have to have their own plants close to Dell's so that supplies can be made quickly. (Note that if orders are consolidated every quarter of an hour, there will be four deliveries per hour.)

(3)  The suppliers' lorries wait at the Dell factory. When an assembly line runs low of components, a forklift takes a pallet from the appropriate lorry. Only when the forklift crosses a specific white line in the factory does Dell take ownership of the goods. That's where the brief life on inventory starts.

(4)  The ordered goods are assembled, acca study materails tested and dispatched. The only inventory is the work-in-progress, the units being tested and the

units being shipped.

(5)  Every member of staff is involved in at least one Business Process Improvement project, which are all aimed at squeezing out costs. Typically, parts snap into position rather than needing screws, thus shaving 20 seconds or so from assembly time.

(6)  The time between receiving an order and dispatch is between four and eight hours.

(7)  Dell's manufacturing in the USA free accounting books is no more expensive than manufacturing in a low labour-cost country.

 

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FREE ACCA P2 KAPLAN TEXT BOOK 2018-2019 - Acca Lsbf Video Lectures Free Download

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