Apple's Global Supply Chain

The world's largest digital library

Try Scribd FREE for 30 days to access over 125 million titles without ads or interruptions! Start Free Trial Cancel Anytime.











Global Supply Chain Management [Christos Papanagnou]

[Dilipsinh Jadeja] | [International Business] | @00509412]











Contents

1. Introduction. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .03 2. Apple's Global Supply Chain. Chain. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2.1 Characteristics. Characteristics. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2.2 Barriers Barriers . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2.3 Challenges . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3. Integration and Collaboration Collaboration . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 4. Advance Technology used by Company . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 5. Conclusion . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 6. References . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .











Introduction:

2.0

It is nearly 30 years since the term "Supply Chain Management" first appeared. Since then there has been a revolution has been in the way that organisations view their upstream supply process and their downstream routes to marketplace. marketplace. Still there are major gaps between the philosophy and the real scenario of supply chain management management but there is no doubt that it is an important essential in most compan companies ies today (Mangan et al., 2002). Global Supply Chain is a network which comprises a firm's relations with other business units like raw material material suppliers, financial, financial, manufacturing manufacturing faculty, sales sales and market, market, logistics and other units which takes part in flow of materials. However, inputs can be in different modes like data or information, finances, raw inventory and services regarding materials. Inputs in supply chain continuously flows around whole network in forward and reverse flow from the original producer to fi nal customer to increase profitability through efficiencies and utmost the customer satisfaction.

This report contents how Gartner's top ranked supply chain since 2007 and tech giant company Apple leads their sectors and build supply chains that are closely aligned with their business objectives.











Apple's Global Supply Chain Characteristics: One of the significant changes in Apple's supply chain management management is to focus was primarily on cost cost reduction and is now appear that, that, properly managed, managed, these these ideas, can can deliver to enhanced enhanced consumer consumer delight.

(Source: - SlideShare)

There are two flows of Global supply chain. One is Information flow and other is Material flow. Information flow comes from the customer to manufactu manufacturer rer and material flow goes from manufacturer to customer. Apple works with its strategica strategicall global supply chain and its characterised as below1. Asset Management: -

Apple's essential character in global supply chain is the asset management. Tim











emphasis focus upon other flows of supply chain. In 2012, Apple Inc. was said to turn inventory every Five days, Half of turnover in compare to other business organizations (Clara Lu,2013).

2.

Information Management Management and Continuous Data Analysis: Data analysis is process which determines customers' customers' response and suppliers' details.

Apple collects vast amount of information from 'end-to-end' sources and it helps company to its supply chain to meet the customer's requirement and reduced the cost (Merc.e.u-tokyo.ac.jp, 2017) . 1. Understanding demand and supply requiremen requirements. ts. 2. Analyzing cost 3. Achieve operational excellence 4. Improving decision making 5. Forecasting chain supply 6.maintain sustainable inventory

3. Procureme Procurement: nt: -

Procurement (Apple.com,2017) (Apple.com,2017) is is the key aspect for each company to represent itself in front of its suppliers, customers and stake holders. It's always been a mojo for Apple to procure delight to customers and suppliers through its excellence. Apple' Inc stated in its website that the goal is to obtain stellar products and services within short timeframes, at a reduced cost and in a way, that values its customers and shareholders. Apple being the largest producers of electronic gadgets has its flagship supplier Foxconn, a Taiwanese company, is one of its strategic supply partners that churn out 10,000 of Apple's























4. Supply chain Planning: -

Supply chain planning contains all of the information regarding all departments, flow of materials and data, research rese arch and analysis regarding the future, present and the past products, analyzing cost and scopes of respective work-forces in supply chain of Apple.

It also concludes below components as well, Customer Focus: Customer focus is the main character of supply chain and Apple invest more time to provide customer-oriented product, gives after sale services and collect feedbacks. fe edbacks. That is the reason Apple has the most loyal customers in its market and vice versa. Order Processing: -











5. Supply Chain Strategy: -

Supply chain strategy comprises the way of dealing the things, what would be the company'ss approach in certain levels and building some criteria for being responsive company' r esponsive against the undesirable situation.

6. Logistic management and reliable sources: Global supply chain can only complete after logistic management. It shows how reliable suppliers company has and how company maintains the relationships with all of its transport and logistic modes. Apple's key characteristics characteristics of supply chain is its trusted suppliers across the globe. Apple r esearche esearchess and designs their product in USA but for resourcing it goes abroad in many countries and for that Apple has collaborated with its trustworthy suppliers and uses prepaid facilities to negotiate raw materials, pricing terms, and guarantee high volumes of production. It also helps Apple to maintain competitive market for its - competitors (Aicd.companydirectors.co (Aicd.compa nydirectors.com.au,2015). m.au,2015).











Barriers: -

Barriers in forms, not in levels: - There are many factors which reduces the Apple's global supply chain in various forms. It can be distinguished in each level but as Apple is focusing on Designing and Developing product, below barriers described described in particular form which is affecting affecting Apple's global supply supply chain.



Supplier's Risk: Suppliers' Risk is a major concern for Apple as it does not manufac manufacture ture its own













Competitiveness: Apple is lone device maker of its i ts own operating system and other major brands like Samsung,

Sony, Google and Nokia uses Android operating system. It’s reasonable that Apple has its own monopoly in products and designs designs with standard standard rate iOS products products but customers customers also prefers prefers cheap cheap rate gadgets. gadgets. That is the reason competitors are battling it out in medium range gadgets gadgets



Geographicall Environme Geographica Environment: nt: -

Every country is following its own traditions and for that particular r eason Apple needs to adapt countries' culture. One of the mai n service Apple provides in its product is Facetime and its video calling facilities that allows apple users to do video calling but i n UAE it is disabled.FaceTime disabled.FaceTime is a data-based service that would, the carriers argue, reduce their revenues. Both Du and Etisalat prohibit users from calling via VoIP services such as viber and WhatsApp. This includes FaceTime FaceTime which which is disabled on all iPhones bought in the UAE UAE in in the software itself. It reduces customer's interest for not availing all the services.



Language Barrier: it is difficult to deal with different languages in different countries. Language barrier barrier is

major issue to interact with the suppliers and customers and it affects all the companies for not responding in JIT approach.













Challenges: -



Sustainability: -

Sustainability means a supply chain who maintain the three key factors which is Social, Environmental and Economical. Being a largest company on its sector, Apple has to focus these factors for future generations and eco-friendly environment and also it has to maintain its economic value.



Transparency: -













Globalisation:

Globalization comprises change in politics, economics, social and technology around the world. It does affect Apple Inc. and it is beyond its control to manage it but to adjust. There is no doubt apple is globally accepted by their loyal customers but in some countries people prefers cheaper products apart from standard and luxurious product. product. If US's relations with another county is not good then it directly affects the demand of united state of America's products. Tax and Tariffs might be the challenge for the company to deal with as varies country by country.



Competitors:











3.0

INTEGRATION OF INTER ORGANIZATIONAL RELATIONSHIPS REINFORCEMENT : Definition of Supply Chain Integrat Integration(SCI): ion(SCI): -

SCI is a term that concretize different communications channels and knots with a supply networks. It is the alignment and interl inking of organisational process and it should not be mystified with collaboration. Collaboration means a relationship between supply chain partners grown over a business duration. Collaboration is not possible without integration but Integration is possib le in the absence of collaboration (Mangan et al., 2002).













Internal integration: -

Above Graphs suggests (Merc.e.u-tokyo.ac.jp.,2015) (Merc.e.u-tokyo.ac.jp.,2015) how Apple take care of its privacy privac y through highly secured internal supply chain integration. It is customer -centred chain that inspects the market needs and then further processes regarding product's designing.it also responds new customer's hidden demand and requirements. planning is starts after researching the marketing, sales department and maintenance service department's information. All of apple's departments are virtually integrated so perfect product will be the outcome of its private process. After the visualization of design information, confirmed design has been done and its ready for the external collaborative suppliers. 

Internal integration processes of Apple enable:

(1) Frontend Development: - deriving product concept; (2) Design information by Product Design visualizing; (3) Design information by Procurement and Manufacturing M anufacturing through media choices; (4) Design information through appealing customers by Sales and Marketing;













Apple's Collaboration with Global Organisations: -

Sharing information beyond the firm's boundaries can be critical. Therefore, it is very important for Apple Inc. to select their suppliers and business partners very cautiously. It sounds strange but the fact is Apple does not acquire any manufacturing plants of iPhones in its country of origin America. Apple outsources its product in China.Apple esta blish alliance with the global electronics manufacturing services (EMS) leading firm, Foxconn.Apple Inc., which has maintained No.1 position in achieving supply chain effectiveness. It is the number one customer of Foxconn. Through Foxconn's effective logistical configurations, Apple fascinated the worldwide customers by its innovative products like iPhones and iPads. There are three main reasons behind this strategic alliance

-

(Umguiangacollege.files.wordpress.com, 2017).

1.Cost - Apple avail cost advantage through minimising administrative, maintenance and inventor y costs 2.Manufacturing - Apple can easily focus on demand fluctuations and changing their requirements through













Multiple Global Suppliers: -











4.0

Advanced Technology utilised by Apple within the sector to maintain the its competitive advantage: -



Data Analytics:











Apple follows its traditional strength- product design and its unforthcoming part is Big Data. With collective information, Apple determines that where, when and how iPhones, iPads, MacBooks and now Apple Watches are used. Thus, Apple uses it in a fair way to increase customer satisfactions and what users are expecting from the devices they are using (Use of Technology, 2017).

One of the most popular feature of Apple devices is Siri. It is just synonym s ynonym of Big Data Analytics as the voice captured b y the device is uploaded to iClouds platforms and Apple stores this data for two years and tagged it with unique anonymous anonymous indicator. analytics performer then compares the captured voice with millions of other voices t o recognize individual voice pattern to ensuring user privacy. Cloud Storage:





















Conclusion: Above report suggests how Apple see their supply chain as a vehicle for value-added delivery and as a powerful tool for increasing competitive advantage in the m arket. Apparently storing computers is like storing milk: you don’t want it on the shelf in your warehouse for too long. Apple is very good at essentially taking devices from factories and immediately selling them to customers. Future success of its supply chain depends on how well they will manage relationship with suppliers and how far they go to innovate its product and use its mojo to attract and satisfy the users. As of now Apple is leading the supply













References: 

Aicd.companydirectors.com.au. (2017). A (2017). A case study of Apple's supply chain. chain. [online] Available at: http://aicd.companydirectors.com.au/advocacy/governance-leadership-centre/governance-driving performance/a-case-study-of-apples-supply-chain [Accessed 15 Nov. 2017].



Apple, (2017). Apple (2017). Apple and Procurement - Apple. Apple. [online] Available at: https://www.apple.com/procurement/ [Accessed 19 Nov. 2017]. Lu, C. (2015). [online] Tradegecko.com. Available at: https://www.tradegecko.com/blog/apple-had-

Apple's Global Supply Chain

Recommend Documents