Global supply chain management ppt

Make Supply Management PPT

Apple's Supply Chain

What is it?

In the tech industry, Apple Inc. is hailed as one of the most prolific companies. It is the market leader in design, marketing, research and development, and software ecosystems (Black). Apple’s success is largely attributed to its sophisticated but effective supply chain management. A supply chain map can be used to illustrate Apple Inc.’s systems from point of origin to the end consumer. It is evident that the company “strives to keep the inventory low while generating colossal sales revenues” (Jorgensen; “Is Apple’s Supply Chain Really the No. 1?”). Jorgensen has described Apple’s supply chain as an “asset-light” strategy since its core objective is to keep the inventory as low as possible.

Why Does it Matter?

In August 2018, Apple’s market capitalization reached an all-time high of $1 trillion (Jorgensen). Generally, this is unheard of in the tech industry. In 1985, Steve Jobs left the company and before returning back in 1997, Apple Inc. was nearing bankruptcy. He oversaw the company’s rise back to prominence. The entrance of Tim Cook into Apple Inc. changed the future of the company. Cook led the operations restructuring and streamlining process that has now metamorphosed into a global supply chain success (“Apple”). As an outstanding supply chain expert, Cook has managed to recreate Apple’s supply chain management, and as of today, it is the most powerful in the world. It enables retail stores to effectively and swiftly collect cash from buyers or consumers while aggressively keeping the inventory low (Jorgensen). In the process, Apple’s supply chain is extremely effective in generating sales revenues, and hence, it the reason the company has been experiencing unmatched financial success.

Its Competitive Advantage (Niche)?

A supply chain is successful if the demand by the end consumers is high. As a result, the suppliers experience high inventory turnover. At Apple Inc., the demand of the electronics and software is exceptionally high. This is attributed to the company’s commitment to delivering value and quality. In product design, Apple Inc. is the legendary leader in the tech industry. This is the same in marketing and branding. Apple has a strong sense of originality and it delivers unique products. It never copies designs and utility features when making its products. This is a strong area in which Apple Inc. has managed to compete against companies such as Samsung that are known for copying designs and utility patterns of other tech companies (Jorgensen). These are key strengths that have made Apple’s supply chain remarkable. In addition, Jonathan Hamilton (IT Consultant) has been quoted saying that “A great amount of Apple’s supply chain success can be attributed to continuing to design their products in California while leveraging the lower cost of outsourcing manufacturing to China” (Black). In brief, the competitive advantage of Apple’s supply chain is an amalgamation of strengths on many fronts.

2018 Projected Margins and 2019 Growth

The company’s annual income statement prepared by MarketScreener shows the 2018 projected margins and 2019 growth. The operating profit (EBIT) and net income in 2018 were estimated to hit $70, 898,000,000 and $59, 531,000,000 respectively (MarketScreener). In 2019, the operating margin and net margin are estimated to increase by 25.2% and 21.6% respectively (MarketScreener).

An Operations Flow Chart

Supply Chain Model of Apple

Works Cited

"Is Apple’s Supply Chain Really the No. 1? A Case Study - Supply Chain 24/7." Welcome to SupplyChain 24/7, www.supplychain247.com/article/is_apples_supply_chain_really_the_no._1_a_case_study. Accessed 15 Jan. 2019.

Black, Kelly. "Apple: A Global Leader in Supply Chain Management – Social Media for Business Performance." Social Media for Business Performance, 25 June 2015, smbp.uwaterloo.ca/2015/06/apple-a-global-leader-in-supply-chain-management/. Accessed 15 Jan. 2019.

Jorgensen, Barbara. "Apple's Supply Chain Relationships: 'It's Complicated?" EPS News, 23 Aug. 2018, epsnews.com/2018/08/21/apples-supply-chain/. Accessed 15 Jan. 2019.

MarketScreener. "Apple: Financials, Earnings Estimates and Forecasts for Apple | AAPL | MarketScreener." Stock Market Quotes and News: Equities, Indexes, Commodities, Forex on MarketScreener.com, www.marketscreener.com/APPLE-4849/financials/. Accessed 15 Jan. 2019.