Lean Operations - Dell

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Lean Operations Today
- Case of Dell Computers Co. -


Instructor: C. Liassides
Thessaloniki, 18/5/10
City College, Business 2ab
Spring Semester
Lean Operations Today
- Case of Dell Computers Co. -

A corporation is a living organism; it has to continue to shed its skin.  Methods have to change.  Focus has to change.  Values have to change.  The sum total of those changes is transformation.  ~Andrew Grove

There is nothing so useless as doing efficiently that which should not be done at all.  ~Peter F. Drucker


As the lean manufacturing philosophy has gained a lot of attention in the modern industry, this paper will analyze some basic concepts of lean operations and the importance of “Lean Thinking” in a competitive market. However, besides providing its advantages, the paper will have a close look at some most common managerial mistakes in implementing lean operations. Furthermore, through the real life case of Dell Company we will see how lean operations operate in practice and what difficulties may arise.

- Table of Contents -

Literature Review – Lean Operations3
Dell – Lean to the Bone6
Reference List9
Figure 111


For the last few decades there has been a great talk about lean operations. Many companies have decided to implement lean operations as a result of the global competition and the shift from batch production to more personalized, individual production. However, even though the system promises numerous advantages, companies out there still fail to get the best out of it and in most cases experience various losses. The reason for such misfortune lies in the superficial examination of lean operations. To be more straightforward, one thing is to talk about it, and one thing is to implement it. Therefore, throughout the paper we will discus the basic concept of lean operations and some components of lean operations that managers usually tend to oversee. Furthermore, based on the real life company, Dell Computers, we will see what lean means in practice, what are its biggest advantages, but also what are its disadvantages and how it might suffer in the future.

Literature Review – Lean Operations

It all started after the WWII when the competitive Japanese market was recovering from the war crises. At that time the economy was experiencing raw material leakage, fluctuating customer’s demand, and no capital for automation. The need for a different production approach was necessity (Percy and Rich, 2004). The fist ones with a different production approach were Eiji Toyado and Taiichi Ohno of Toyota Motor Company who developed a lean production system ( i.e. Toyota Production System or TPS) or differently known as Just-In-Time (JIT) system (Stuart and Boyle, 2007).The system was nothing secret. It meant find the waste, eliminate the waste, have trucks deliver parts moments before they're needed (no inventory), and know the demand (Levans, 2006). Further on, as the manufacturing industry grew, many different elements and techniques had started to adding up to the definition of lean, including six-sigma quality, visual display, defect prevention, one-piece flow, Kanban, setup time reduction, quality at source, just-in-time supply, preventative maintenance, value analysis and value stream mapping, etc. (Stuart and Boyle, 2007). According to Womack et al. (1990), depending on the type of manufacturing process, lean includes all these practices, but in different degrees of importance and intensity. Nevertheless, lean system as an operational system also has to manage on how to integrate all the those elements so they can fit and work together in order to attain waste reduction, production and quality improvement, as well as high workforce engagement (Stuart and Boyle, 2007). Regarding to Womack and Jones (1996), this integration of elements in a...
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