Documente Academic
Documente Profesional
Documente Cultură
Group 1:
Debayan Ghosh
Rosismita Laskar
Souvanik Batabyal
Swapnajit Banerjee
Synopsis of the case:
Apple is investing in its next generation of products potentially the first new major
products lines since Tim Cook took over from Steve Jobs. Analyst Jessica Grant needs to make
a presentation of pros and cons BXE Capital should make to their portfolio, based on the Apple
supply chain, to the vice president of her company. She found that apple managed a global
supply chain that operated on a real time-basis. A big factor of their success was due to the
combination of design, functionality, marketing and the ability to quickly modify the
production process based on consumer demand. Being the world’s largest company by market
capitalization, “Apple was able to gain better control over its supply chain by working with
new suppliers on proprietary parts for which Apple would provide upfront capital in return for
volume commitments and a lower overall price per unit”. Instead of outsourcing manufacturing
like typical retailers, Apple chooses to maintain full control of the supply chain internally. They
work in very close proximity to the suppliers in order to make any necessary tweaks for the
products that may change last minute. Gartner group voted Apple as the number one supply
chain; their composite score was 3.64 points higher than their closest competitor, McDonald’s.
The expert management of the supply chain is best displayed in an example of how the iPhone
5 was produced all the way inception to delivery to consumer. Going forward, the Apple
financial information was inspected all the way from 1996.
Problems Faced:
Product Development: with the incoming of various other mobile phone
manufacturers, the company is under constant pressure to release new products
within very short ranges of time.
Suffering Leadership Challenge: frequent changes of CEOs lead to a kind of
unstable atmosphere inside the organisation which in turn effected the
company’s performance.
Mass Production challenge: in order to have massive production at a lower
cost, Apple manufacture its products in Foxconn which is in China. Apple has
been criticized for using sweatshop labor and squeeze their profits. Sometimes
there are sudden increased in Apple products, and the workers have to work
overtime without extra pay. The working condition in Foxconn is poor also. It
adversely affect the image of Apple.
Control over Manufacturers: since they were taking the help of various parts
manufacturers, their control over their manufacturers was not very high.
Risky sourcing method: various suppliers had various ways of sourcing their
products and Apple was not being able to control all the methods undertaken by
their suppliers.