Supply chain operations plays an important role for any business as it assists in procurement of materials and final delivery of products to the customers. Any business which is looking to establish its presence on digital level needs to have a strong online presence.
For the purpose of this analysis, Apple Inc has been selected as the company which operates as tech and customer electronic giants.
The business of Apple has successfully expanded its operations outside its home turf (USA) in several nations and therefore it can be said that the business has a sound supply chain operations.
The analysis would be focusing on identification of some of the key drivers which are responsible for evolution in supply chain in the consumer electronics Industry.
Moreover, the analysis would be highlight some of the ethical challenges which are applicable in supply chain operations for Apple Inc. Further the assessment would be cover the digital strategy and supply chain strategy which the business pursues and how successful it has been for the company (Lockamy III, 2017).
In addition to this, the assessment would identify some of the current issues which supply chain operations of Apple Inc faces and how the management is making an effort to minimize the same.
Discussion
Drivers of Evolution of Supply chain in Consumer Electronic Industry
The drivers of evolution of supply chain in global markets are appropriately listed below in detailed format:
- Innovation in Consumer electronic Industry: The level of innovation which has taken place in consumer electronic is immense as new cutting-edge technology are in place. This is one of the reasons that demand for better products with more features are more in the market. It is not just brands like Apple Inc who are looking to innovate but other players as well. This enhances the demand in the market and induces companies to invest in their respective supply chain so that the market can be captured. In the of case of companies like Apple Inc, the business utilises its technology advancement to develop unique product and further looks to meet the demand in the market to its effective supply chain network.
- Diversity in Products: Consumer electronic market is quite vast and it covers different electronic products and each of such products have different generations. Therefore, consumers have numerous choices. A typical consumer behaviour would be to look for products which are close to them or which are popular. With effective supply chain companies can reach their target markets and even penetrate new markets. Big players like Apple Inc tend to look for countries where appropriate infrastructure is available to set up supply chain operations. Therefore, it can be said that as Apple offers more products, it looks to develop a more systematic supply chain network so that the inventory can be sold and revenue can be generated.
- Globalisation: With globalisation, international markets have opened up and allowed businesses to enter new markets and develop their infrastructure so that growth can be achieved. For the business of Apple, the company has expanded its operations to countries like the UK, Middle East and Asia due to evolution of supply chain through globalisation. The annual report of Apple Inc shows that the business successfully expanded its operations in several nations and this consistently contributes towards the revenue of the business. With the international markets opening its door to other nations, companies have the opportunity to take advantage of the situation and capture new market shares so that the business can achieved growth (Clarke & Boersma, 2017).
- Availability of Workforce: The process of Apple usually covers a detailed market research on the market where the business is looking to expand its operations. The business thereby needs skilled employees who can manage the supply chain networks and inventory of the company in an appropriate manner. The business of Apple has set up service centres in most of the nations so that appropriate after sale services can be provided and overall reputation of the business can be developed in the market.
The above-mentioned drivers affect the supply chain operations for any business and these factors must be considered before a supply chain strategy is set.
Ethical Issues in Managing Global Supply Chain and Approaches Implemented by Apple
| Ethical Issues | Impact on Global Supply Chain | Approaches undertaken by Amazon |
| Concerns Raised Over Human Rights | One of the concerns which was identified in the supply chain was the violation of human rights relating to overtime compensations. There have lawsuits filed against Apple for the safety hazards for workers who are on their supply chain management process especially in underdeveloped nations (Liu et al., 2023). An ethical supply chain promotes fairness in the workplace and ensures that the safety of the employees is given due priority | The business model of Apple also states that maintaining fairness and equality in the operations is one of the priority areas. Due to the several law suits, the business has committed itself to ensure that workers are operating in a safe environment. The business has set up an investigation committee so that they can identify the areas of concerns and take actions to mitigate the same. |
| Privacy of Information | Apple Inc is one of the leading technology companies in the world and thereby have access to data of customers and suppliers in huge volume. The company has in the past lost some data of the suppliers and this has affected the confidentiality principle for the business and thereby had a profound effect on the supply chain operations (dfreight.org,. 2023). The supply chain operations of any company is effective as different elements within the supply chain collaborates | One of the founding principles of Apple Inc is confidentiality where the business ensures that data of the customers and suppliers are protected at all costs. The business has strengthen its digital networks and securities so that no data loss occurs in the future. The business has extended alliances with third parties in international markets so that some support can be available. |
| Environment Challenges | An ethical supply chain network means that the supply chain does not have an severe impacts on the natural resources or the environment. As per 2019 dataset, Apple Inc was regarded as one of the lowest contributors towards sustainable practices. There was concerns regarding the use of PVC in its phones and power cords. Further it was highlighted that the carbon foot prints of Apple is on the higher which needs to be reduced (Maharani & Mursitama, 2023). | The environmental challenges are a serious concern for the business and therefore has decided to follow SDGs For removing the usage of Carbon footprint, the business has placed costs separately on its power cords and further alternative activities are being undertaken so that positive contributions are made towards the nation. |
Supply Chain Strategies of Apple Inc
Apple is one of the most valuable brand in consumer electronics and therefore it is quite natural that the company has solid supply chain. The complicated and complex system in place for producing and distributing Apple products is called the supply chain.
It is an international network of distributors, manufacturers, and suppliers that work together to make sure Apple products are efficiently and promptly delivered to customers. The acquisition of raw materials marks the start of Apple’s supply chain.
Apple collaborates with international vendors to obtain the parts required to produce its goods. The business utilises such materials to develop the final products and store the same as inventory. The logistics operations initiates from the Apple’s distribution centre where final goods are stored.
The products are then distributed to merchants, Apple Physical Stores and online retailers so that the products are sold appropriately (Marshall et al., 2016). The business undertakes a quality assurance test for all its products so that it can be assured that the final products are appropriate.
The management of Apple Inc has also entered into tie up agreements with different online retailers and businesses so that supply chain networks can be formed in an appropriate manner.
Further the business of Apple invests a significant amount of its funds in market research so that an estimate is always available regarding the anticipated sales for the period. In this manner, the products prepared are sold off and resources are saved for the company.
The market research part is a time-consuming process. The business utilises third party for its logistics operations and these parties have a tie up with the business so this allows regular access.
The business model which is followed by Apple Inc also allows Apple to develop its supply chain operations with focus on transparency and accountability.
One of the success factors for Apple which also differentiates the supply chain is that it allows the customers the option to personalise their purchases (Alderei et al., 2022).
The business has always looked to enhance the experience of the customers.
In an overall basis, it can be said that the supply chain operations for Apple needs minor improvements in terms of its environmental policies and use of third party logistics solutions.
Impact of Digitalisation of Supply Chain and Future Trends
The process of digitalising the supply chain operations tends to improve the supply chain process by making its more transparent, consistent, speeds up the process and reduces chances for manual errors.
The business of Apple does have its own website where the customers can check the products which are on offer and even place orders for their residential addresses.
However, in terms of logistics operations, the management relies on the efforts of third parties to ensure that the products are delivered to the customers.
One of the most common ways for the company to get in touch with its customers is through the Apple Stores which are opened in different areas, The management of Apple Inc. is looking to innovate its supply chain process as well and undertake the delivery options themselves so that a level of efficiency is maintained in business operations.
Some of the future trends which can be expected from the business of Apple Inc is better innovation in the products and also innovative delivery options as well.
The business is also looking to make changes to its website so that the interface can be made more user friendly and more customers can be attracted.
Additional measures are in place to improve supply chain operations’ sustainability standards and guarantee that the company’s carbon footprint is kept to a minimal (Grimes & Sun, 2016).
It is anticipated that all of these initiatives would strengthen the company’s competitive edge and result in a considerably more effective supply chain network.
The company can incorporate all of these new technologies by modifying its applications, giving customers more choices, and even altering its delivery services to allow delivery partners from the business itself to do close-quarters deliveries.
In addition to this, the senior management also needs to play an important role in ensuring that aspects of the operations are met and clear communication is undertaken to further develop the supply chain network for the business.
Risks Exposures for Apple Inc and Recommendations
| Risk Exposure | Recommendations |
| The business has been criticized for its work conditions in certain nations and there has been law suit filed against the company for such violation of human rights. In 2019 the company was accused of making the worker work for overtime and not providing proper compensation of the same. All these aspects give the business a bad reputation and this can have its effect on the supply chain functions as well. | The recommendation which can be provided to the management of Apple Inc is to regular investigate and audit the scenarios where such violations has been reported and further take steps to ensure that a level of fairness is maintained in the operation (Russell & Taylor, 2019). The safety and security of the delivery partners should also be given with due priority and it is the responsibility of the management to ensure the same. |
| The management of the company has also been criticised for its sustainability practices as the carbon footprint for the business was on the higher side. The policies of the business to make the supply chain operations more sustainable has also not been sustainable. It is for such a reason that there is loss of confidence among the people for the same and steps needs to be taken so as to ensure that efficiency is achieved in the operations | The business needs to set protocols and ensure that sustainability criteria are closely followed in the business operations. The business has already removed the power cord from its sales of Iphones which is a big move for recognizing the environmental costs. |
Conclusion
The above analysis appropriately shows that supply chain functions play an important role in expanding the operations of a business and ensuring that its achieve growth.
The business of Apple Inc was considered in the assessment and it is shown that the business relies on its market research to initiate its supply chain procurement and delivery process. Further as per the strategy of the business, the management utilises third party logistic services to ensure that the products of the business are delivered to the customers.
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References
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