The relationship between supply chain management and financial performance: Supported by Dell and HP analysis as evidence

Abstract

Supply chain management (SCM) makes firms intensively link their operations by building strong relationships with their customers and suppliers. This link can be established through investing in IT services, supplier relations, customer services, and other aspects related to the effective management of their activities or processes. By doing so, firms can increase their profitability while reducing their costs and waste. The purpose of this study is to identify how SCM can influence a firm’s performance and how its theories apply to the real world. Therefore, this study examines the relationship between SCM and the firm’s performance, analyzing Dell and HP financial reports and SCM strategies to support the results. For data collection, all the related information was gathered through Thomson One, Bloomberg, and BBC News. To analyze this data, DuPont analysis and the Business Model Canvas have been used. The findings of this study were as follows: a direct relationship between SCM and return on assets (ROI) and profit margin, and an indirect relationship with return on investment and market share.