Introduction It has been said that Hewlett Packard (HP) has been ahead of its peers in giving back to the community, showing concern for work/life balance, and acting to preserve the environment long before it was the “in” thing. Currently, HP is the largest technology company in the world, shipping 3. 5 products per second. What supply chain models will help us grow faster? From the development of SPaM, HP realized other areas within their supply chain that needed improvement.
With the possibilities of suppliers being late with their shipments, or the incoming materials being flawed, production process breaking down, etc. It is imperative that HP created a team to deal with these supply chain problems before they became a reality within its organization. Some of the strengths of the supply chain used by HP was in using WINO, HP found that demand uncertainties impacted inventory greatly, which prompted them to consider redesigning products and processes to lessen the impact of demand uncertainties on its supply chain performance.
Also the analysis was effective in identifying opportunities for operational improvements. Because of the systems used it created a high payoff in the forecasting processes, the realignment of the manufacturing and distributing strategies and redesigning of the product and processes. How do we match our channel structure to customer requirements? The fact that HP are working with its dealers is a major step in the continued success of HP and is key in determining what customers want. They have worked very close to improve the performance of the overall supply chain.
HP should continue to utilize SPaM’s supply chain modeling. They have increased customer satisfaction, production innovation and differentiation. Based on the number of projects HP had, it revealed that demand uncertainty resulted from forecast errors and was the key source of inefficiency in the supply chain. With HP expanding into distributing channels and including supplies both upstream and downstream, their sales force and dealers has led to a win-win situation for HP, its dealers, suppliers and customers (Lee, H. L. , & Billington, C. 1995).
What supply chain structures would help us reduce costs further at the same time offer greater product variety to our customers. WINO (now SCAT) is still a structure that HP should utilize in reducing costs. According to Lee, H. L & Billington, C. (1995), HP extended WINO to quantify how much inventory could be reduced at two locations, while maintaining the same service target for customers and the results were successful. Incorporating their supply chain with E-commerce is what will reduce costs further and increase customer strength. Customers want right now products.
HP going forward Going forward Hp has recognized to further reduce cost, increase consumer strength, manage demand and increase profits, developing an internet store is the next thing to do. HP has sold the majority of its consumer products through traditional retail channels and to address its customers’ growing desire to order products via the Internet HP listened. The strategy was to find a logistics service company that would help them strategize and quickly implement the new Internet sales channel with minimal resource utilization and risk. HPshopping. om asked FedEx to develop a comprehensive solution that would manage the entire process from order management to order fulfillment. “Once the order is authorized, it is accepted by HP, confirmed, and routed to the fulfillment center by FedEx. FedEx also contracted a call center provider to manage the services required to support HP customers that prefer purchasing products via a toll-free number. To complete this component of the solution, FedEx and the call center collaborated on information technologies that would support the necessary integration of the order and inventory management systems” (Woraphan Atikomtrirat, 2011).
This process seems to be very efficient and doing well as HP was ranked number #1 in business with online retailing. The key is keeping customers happy and willing to change the supply chain as demand changes. References Lee, H. L. , & Billington, C. (1995). The Evolution of Supply-Chain-Management Models and Practice at Hewlett-Packard. Interfaces, 25(5), 42-63. Retrieved from EBSCOhost Woraphan Atikomtrirat. (2011). HP Supply Chain. Retrieved from http://www. slideshare. net/tung148/hp-supply-chain