Embed Size (px)
DESCRIPTION
Made and presented for the course Management Information Systems at Viadrina University, winter term 2012/2013. 1. What is Supply Chain Management about? What has to be managed? 2. Why is effective supply chain management (SCM) crucial for companies like Apple? Give examples for Apple’s successes related to effective SCM. 3. Analyze Apple’s supply chain management. How does the company use SCM to achieve operational excellence? Mention some interesting tricks used by Apple. 4. What other companies rely heavily on SCM? Give one concrete example.
Citation preview
Management Information Systems
17.12.2012
Apple’s SC Secret? Hoard Lasers
Outline
1. What is SCM about? What has to be managed?
2. Why is effective SCM crucial for companies like Apple?
3. How does Apple use SCM to achieve operational excellence?
4. What other companies rely heavily on SCM?
Apple
o Founded April 1, 1976 by Steve Jobs, Steve Wozniak, Ronald
Wayne
o 394 retail stores
o Worldwide operations
o Electronic devices with own software and hardware
o Famous for: iMac, MacBook, iPhone and iPad
o Biggest company on the world based on market capitalization
Supply Chain Management
Managing flow of... ... in both directions.
SCM Goal Competitive advantage
o Increasing effectiveness and efficiency operational
excellence
o Decrease operational costs
o Communication and relationships in a network of companies
CompanyCompany
Importance and value
Companies like Apple:
oHighly innovative
oShort product life cycle
continuous improvement
oHigh number of competitors
oLimited number of suppliers
oInvestments needed
oTrade secrets
oWorldwide operations
oDecreasing margins
Operational Excellence as
competitive advantage
oHigh control over costs and
information
oSpeed product time to market
oDelivery based on demand
oIncreased sales and margins
oHigh quality
oReduce inventory levels
Example of Apples success related to SCM
o Design requirements: Light shining through aluminum, holes
invisible to human eye cut with hoard lasers
o Exclusive contract with laser manufacturer (impact on
competitors supply chains)
o Long-term commitment, dependability of supplier on Apple
o High volume, pressure on prices, negotiation high margins
“They have taken operational excellence to a level
never seen before.”
Driving factors of their effective SCM
1. Closed ecosystem
2. Big discounts – due to Apple´s volume
3. Mentality to spend exorbitantly
Apple´s SCM
4. Apple engineers work close with suppliers – optimize industrial process
5. Focus on a few product lines – do little in the way of customization
6. Big weapon - $80 Billion in cash and investment
7. Tough bargaining with suppliers
o demands detailed price quoteo requires key suppliers to keep two weeks of inventory o does not pay as long as 90 days after delivery
Apple´s SCM
8. Control reaches peak before announcement of new product
o factories work overtimeo surveillance to track efficieny / ensure pre-launce
secrecyo every handoff point is monitored
9. Retail stores give it a final operational advantage
o track demand by store / houro extra spending to get around bottlenecks
Enormous profits and margins due to their
operational edge
Enormous profits and margins due to their
operational edge
Apple´s SCM
o innovative production techniques
o buy up all available air freight – handicapped rivals
o manufacturers are busy with Apple orders – rivals like HTC fall behind
o ship product in tomato boxes to avoid detection
Tricks Apple uses
Toyota – SCM at its highest point
o „Toyota Production System“ - pioneer of „Just in time
delivery”
o world´s top carmaker
o hyper-efficient supply chain
Well-intentioned BUT carries also unintended
consequences
be exposed to supply chain surprises
can compromise quality
e.g. Toyota´s massive recall in 2009
Thank you!
