Ford Company Case Study

1. Identify and explain 3 challenges Ford faces that Dell does not face. 15 points
• Number of Suppliers and their IT capacity: Ford employs a tiered system of suppliers, whereby they order complete systems from the tier one suppliers. The tier one suppliers then manage the relationships with the tier two and tier three suppliers (who supply the parts for the tier one complete systems). Dell 's supplier base relatively small and have solid IT capacity as the vast majority of them are IT organizations. The size and scope of organization is too big and not easy to handle (suppliers, vendors, networks, geography).
• Purchasing Activities: Purchasing at Ford is organizationally independent of product development, which means that engineers are

This concept created the big change that causes the competitive advantage. Dell eliminated reseller 's markup and the expenses and the risks associated with conveying huge amount of inventories. This could not have happened without many other action that Dell has taken into consideration. So, other companies had to had to create all the components themselves. Indeed, all the various pieces of the industry had to be vertically integrated within one firm. These companies needed to manufacture enormous structures to create everything a PC required. They had no real option except to end up being expert in a wide array of components, some of which had nothing to do with creating value for the client. On the other hand, Dell has a different approach that they establish a partnership with different companies to help them produce their products. So, they have fewer things to manage, fewer things to go wrong, which enabled them to manage their inventories. As a result, this model the direct model has allowed Dell to leverage their relationships with both suppliers and customers, which helped them to build a much larger firm in no