Michael Dell of Dell Computer Explained

question 12

Essay

Michael Dell of Dell Computer explained:
We tell our suppliers exactly what our daily production requirements are so it is not,"Well,every two weeks deliver 5,000 to this warehouse,and we'll put them on the shelf,and then we'll take them off the shelf." It is,"Tomorrow morning we need 8,562,and deliver them to door number seven by 7 am."
How does the supply chain management software allow this to happen? And how does it save Dell money?

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Definitions:

Recessionary Gap

A scenario in which the actual GDP of an economy falls short of its potential GDP, showing that resources are not being fully utilized.

Aggregate Demand

The total demand for all goods and services within an economy.

Real GDP

The total value of all goods and services produced by an economy over a specific time period, adjusted for inflation, reflecting the true economic output.

Price Level

The economy’s aggregated price level for its full gamut of goods and services produced.