Apple Supply Chain Essay Example | Topics and Well Written Essays - 1500 words - 1

Apple Supply Chain - Essay Example Apple Inc has able to develop a supply chain management that has been studied by most companies. With the recent earthquake in Japan, Apple is expected to face considerable supply issues but so far Apple has been able to survive the recent challenge. APPLE SUPPLY CHAIN MANAGEMENT Apple supply chain management is unique in the sense that they manufacture the parts of their products in Asian countries, especially China, and assemble and market its product in California. Apple Supply Chain management is successful because of their successful outsourcing and the make-buy decision. ‘Outsourcing is defined as the contracting of one or more of the company’s business processes to an outside service provider to help increase shareholder value, by primarily reducing operating costs and focusing on core competencies’ (Kulkarni and Sharma, 2004). Apple has made great use of the outsourcing alternative by keepings its core competency, that is, its design and user interface wit hin the company while outsourcing the production. In this way, Apple has considerably reduced its operating costs through this process without compromising on its positioning as the best technology. Before proceeding further, we need to understand the typical movement of Apple products from the origin to the end users. Products such as the Apple iPod, iMac, iPhone etc are first designed in the Apple headquarters located in California. Once the team of designers develops the unique look and design for the product, the supply chain team in collaboration with the engineers and designers decides the suppliers for the particular product. Most of Apple’s products are manufactured at Foxxcon, a Taiwanese electronic company. This company is responsible for the products of the parts of iPhone while Apple keeps the original blue print of the product with itself to prevent any copyright issues (Xu, Tjoa and Chaudhry, 2007). Once the products are developed, they are shipped to Apple Inc. headquarters located in California. Thus, California assumes the responsibility of marketing and distributing the product. With the increase in demand of Apple products internationally, the products are distributed almost everywhere in the world including China, which is turning out to be the most developing market for Apple products. Thus, ‘Apple serves as the supply chain coordinator, integrator, and provider of operations best-practices, innovations, and strategies for all its partners’ (Simchi-Levi, 2010) THE MAKE-BUY DECISION For a supply chain to succeed in the best possible manner, the make-buy decision is the primary and most crucial decisions for the supply chain manager. The supply chain manager needs to be aware of the products that the company would be making and the products that the company would buy from other suppliers. This decision is based on the knowledge of the core competencies. Core competencies are those factors where the organization excels at and the key areas where the organization has able to develop a unique selling proposition (Monczka,  Handfield,   Guinipero,  Patterson and Walters , 2010). . In the case of Apple, the core competency is its design and the user interface it has developed for the consumers. The technology comes in part and parcel of the design while the actual production is secondary. When consumers buy Apple products,