International Operational and Logistical Strategies - Apple - Essay Example

?Topic: International Operational and Logistical Strategies Reflection of group presentation Our group presentation is related to Enterprise Resource Planning and can be defined as an enterprise-wide management system that deals with business processes and information. Generally, ERP integrates all decisions and databases from the organization and this ensures that results from one section are reflected in the planning and control systems of the remaining parts of the organization. The system has been developed with various aims but there are three main objectives of such systems. They include: 1) Integrating all system transactions with a similar system 2) Sharing common data and practices across the entire business enterprise 3) Production of relevant information that can be used during the process of making decisions. There are a number of benefits associated with Enterprise Resource Planning and they include: Automation of business processes which enhances performance. For instance, the system indicates the consequences of all the decisions. Reduces costs by reducing levels of inventory within the business processes. Ensures free flow of information among all business processes. Improves communication throughout the organization. ERP systems that are highly customized can deliver better opportunities for competitive advantage. Improves the relationship between the organization and its stakeholders. Provides easier import and export of data. ERP has a number of components that enable it work properly and improve performance among different business processes. Some of the components of ERP are listed below: Transactional database Management portal Business intelligence system Customizable reporting External access through the use of technology Search Document management Messaging Workflow management The above mentioned components posses the following general characteristics: Integrated system Real time Common database Support for all applications Constant and steady look Easy installation and application Financial management or accounting Management of human resources Manufacturing and production ERP systems have been very effective and efficient in the management and integration of business processes. However, there are a number of disadvantages associated with such systems. They include: High costs of switching to and from ERP systems Creates unnecessary dependencies Requires extensive training which may have high cost implications Unsuitable for production planning and supply chain management 2. Supply Chain and Application of supply chain and logistical tools and techniques This section gives an analysis of the operations management of Apple Inc with regards to it production, marketing, supply chain management and sale of its products. An assessment of the company will be done with respect to its background information, history and the types of goods and services that it sells in the industry that it operates. The supply chain characteristics of the firm will also be highlighted and evaluated so as to offer postulations on what ought to be done so as to increase its profitability (Apple Inc, 2012). Aspects relating to its competitive advantage in the global business, production processes and customer satisfaction will be highlighted. This means that the technology used and commitment to quality and excellence will as also be assessed. This is aimed at ascertaining the operational planning of the company with regard to major organizational models that enhance efficacy and success. History and Background of Apple Inc. Apple Inc. was initially called Apple Computer Inc, it is an internationally recognized company that produces and sells computers, computer software and other forms of consumer electronics such as iPods, iPads and iPhones. The firm is diversified and offers mobile communication and media devices as well as selling related software. It is an American corporation with its headquarters in Cupertino, California. The company has over 250 retail stores spanning in over ten different countries. The company was founded in 1976 by Steve Jobs, Steve Wozniak and Ronald Wayne (O’Grady, 2009). The mission statement of Apple Inc is to care for the ecological settings, health and safety of its employees, customers and the global communities where the company conducts its operations. The management of the company believes that through integrating sound environmental, safety and health management practices in all its business operations, income can be increased. This is based on the affirmation that the business can provide technologically innovative products and services while conserving resources for upcoming generations. The organization strives for continued development and improvement in environmental, health and safety management systems and in the quality of its products and services (Apple Inc, 2012). The vision statement of Apple Inc is to contribute to the society through making tools for the mind and that advance human kind. This has an implication that the firm is committed to offer the best personal computing experiences to learners, educators, creative professionals and consumers around the globe through its innovativeness in software development, hardware designs and internet provisions. This has an insinuation that the firm has a well documented vision statement that can be implemented with the set policies and strategies (O’Grady, 2008). The vision and mission statement are well connected and thus acts as an incentive to the employees to work towards enhancing customer satisfaction and facilitating profitability of the firm. Apple Inc’s Supply Chain Framework The supply chain model used by Apple Inc is effectively modeled so as to facilitate coordination and ensure that resources, information and funds are well managed so as to ensure effective provision of products to consumers. This means that the supply chain model used is aimed at increasing customer satisfaction as well as organizational return on investment (ROI). Suppliers are also considered and links with them are maintained so as to develop long term constructive relations for increased organizational profitability. The figure below gives a representation of the supply chain model used by Apple Inc Corporation (Linzmayer, 2004). Infm. flow/ giving visibility Infm. flow Infm. flow Giving visibility giving visibility Infm. Flow. Giving visibility. Fig.1: Diagrammatic representation of the supply chain used by Apple Inc. Key to abbreviations: ERP: Enterprise resource planning SRM: Supplier relationship management CRM: Customer relationship management Apple Inc has always been on the forefront in innovation and this has made it to adopt a supply chain that meets the needs of clients as well as offset business challenges that could ensue from its operations. The firm has moved from the cost-based, back-office operations based supply chain to an integrated model that ensures that customers’ satisfaction is prioritized while profitability of the firm is also enhanced. This can be viewed from aspects such as internet and telecommunication technology that are considered to be pivotal tools in revamping supply chains in various top 500 Forbes organizations. This is based on effectiveness that is created through closer linkages between producers, suppliers and consumers as a single and virtual organization. This means that through adoption of these tools Apple Inc is able to enhance efficacy in its operations through quickly delivering products/services to consumers (Langevin & Riopel, 2005). Apple Inc has implemented an integrated/networked supply chain management model; it is an integrated make-to-stock supply chain model that enables Apple to reduce its inventory and its related overhead costs. This is an imperative model that enables the firm to make real-time planning decisions and quick delivery of products to consumers. Through use of this form of supply chain, an online payment mechanism can be due to the streamlined operations leading to increased income as well as customer satisfaction. This system ensures that coordination among the suppliers is enhanced and that consumers can also manage their purchase experiences due to the application of the online order placement and supply chain portals. This model aims at tracking the demand of Apple’s products in the market in real time so that production can be done to restock the finished products and offer quality services. Online sales are used due to the advent of e-business and e-commerce, implying that Apple Inc has embraced the use of internet and telecommunications in its supply chain model. The online order placement model used by Apple Inc Corporation is portrayed in the figure below; Online Order placement and Supply Chain Model for Apple Inc. The performance of this supply chain model is of high standards, efficient and cost-effective. These assertions are based on the assertion that the flow of information is fast and this facilitates proper planning and execution of tasks by the firm. The system is automated and this means that scheduling operations, inventory planning and control through use of MRP and ERP can be facilitated. There is a need to improve the availability of online services so that 24/7 operations can be instituted to facilitate efficacy in handling consumers’ diverse needs. Apple Inc also ought to establish stores in many parts of the world so that in case of the need to have personal technical service, consumers can physically go to the stores if the online services fail. Apple Inc’s Maintenance of Competitive Advantage Apple’s approach to increasing its competitive advantage in the market is based on aspects such as innovativeness, concern for the environment and commitment to customer satisfaction. For instance, it is indicated that devices manufactured by Apple Inc are stylish and fashionable due to product differentiation and portability. These product characteristics suit the needs and expectations of the customers in different settings; students, professionals and researchers for different occasions (Miller, Vandome & McBrewster, 2009). The devices manufactured such as iPads, iPhones, iMacs and Apple PCs have clear and colorful cases that make them set apart from other manufacturers. This has an implication that Apple Inc focuses on differentiation of its products based on quality and style so as to facilitate customer satisfaction. The company has also diversified its products and services so as to meet the information, communications and technological needs of its clients in the most effective way. For instance, products are made to be small and elegant thus creating an impression that Apple’s commodities are beautiful and worth owning (Camerinelli, 2009). The portability and diversified products (PCs, iPhones, iPads, iMacs) and services such as iTunes among other internet and media players make Apple to attain a competitive edge in the market around the globe. Technological advancement and innovativeness have made Apple Inc to win the loyalty of its clients through provision of elegant of electronic devices, media players, iTunes and easy-to-use software for music and video composition/downloads. Apple Inc has a well established competitive plan matrix that consists of key success indicators of appropriate and sound management policies, innovativeness, product quality standards and enhancement of customer satisfaction. Production Processes and Customer Interactions at Apple Inc Apple-developed products (software and hardware) are the basis for its own production process. The firm has achieved unparalleled performance through the 64-bit architecture, integrated distinctive elegance with multi-colored devices such as iMacs and redefined intuitive operation with the iPod. The production of the devices at Apple is underpinned with hi-tech design processes that ensure that products are efficient and meet customers’ needs. The company has established links with suppliers who are expected to meet the highest standards for all goods and services (Gourdin, 2006). This means that suppliers ought to be committed to the tight schedules and rigorous quality assurance so as to ensure the highest quality standards and social responsibility. The organization is also dedicated to diverse supplier base and takes social and environmental responsibilities seriously. Apple’s sourcing process is designed to ensure equal and fair treatment of suppliers so that they can fully participate in a competitive procurement process. Customer interactions are also noticeable from the operations of Apple Inc as the firm believes in keeping a place in customers’ heart and mind; the customer loyalty is a great strength to the organization. The strong relationship between the company and its customers is explicated through effective customer service and the nature of the products that fulfills the need of today’s stylish persons. In fact, it is affirmed that Apple created a virtual love affair with its customer base by delivering technically superior products and aggressively pursuing hardware and software updates. From it its automated and integrated operations, the actions of the firm are well known to customers especially in cases relating to online free iMac users who need various software downloads and updates for free. This means that the customer relationship developed ensures that customer service is presented with an intention of surpassing client expectations. Apple’s Commitment to Quality and Excellence Apple Inc strives to ensure that quality products and services are offered to consumers so as to meet their diverse needs. Quality and excellence in operations of the firm is enhanced by selecting suppliers that meet highest standards in terms of meeting schedules and being innovative just as Apple Inc is. Consumers are also categorized into categories such as home, small and medium sized business, corporate, education and government so as to enhance delivery of hardware and software that meets or even surpasses their expectations (Langevin & Riopel, 2005). The company has a huge customer base and its innovations are geared towards the attainment of the organization’s set goals. This is attained by manufacturing the electronic devices based on clients’ needs and tastes and preferences and they have created a brand name making customers to purchase their products as they are perceived to be icons of the digital industry. Excellence in operations of the firm is enhanced by using suitable marketing and advertising strategies. Distinctive marketing campaigns have been the organization’s strategy to attract consumers and spread the information among them. Television commercials, Print Advertisements, Posters in Public areas, wrap advertisements campaigns and online marketing through social media networks have been successful strategies of outshining new products/services. The company enhances excellence through automated online operations, especially the use of online order placement that allows better virtual interaction between clients and the organization. Inventory Model and Operational Planning Policies for Apple Inc Apple values its inventories based on first-in-first-out (FIFO) or market model; implying that it states its products at the lower cost so as to increase revenues/profitability. It is also affirmed that if the cost of inventories exceeds their market value, provisions are made currently for the difference between the cost and the market value. The organization uses this model so as to ensure that earnings are recorded when persuasive evidence of an arrangement for sale of the commodities exists, delivery has occurred and the sales price if fixed or determinable (Gourdin, 2006). This means that collection of the funds from the sales is probable once the products are delivered to the consumers, implying that both direct and indirect inventorial approaches are sued due to short term investments. The operational planning policies are well outlined to ensure that all stakeholders are involved to ensure customer satisfaction, employee satisfaction and increased profits to the organization. Setting short-range objectives and stratagems aimed at how they can be accomplished are implemented so as to have the organization attain competitive edge in the market. Innovations and setting up stores in different countries around the globe has been instituted so as to facilitate an increase in profitability of the firm. For instance, aspects relating to operations, marketing, finance and human resource are well synchronized so through appropriate strategic management. This ensures that the organization’s corporate strategy, business and functional strategies are used in analyzing the environment, recruitment and staffing as well as setting objectives in line with the organizations’ mission and vision statements. Apple’s Movement to Lean Processes Apple Inc has instituted lean processes in its that involve identification of activities that create value for the customers, determining the sequence of production processes eliminating hindrances to value creation and allowing clients to make choices of their products as well as enhancing efficiency in operations. All these activities have been implemented through application of e-commerce and e-business services through the use of globalization. The integrate supply chain model also plays an imperative role in facilitating efficacy in operations and maximization of profits (Apple Inc 2012). References Apple Inc., 2012, http://www.appleinc.com/ Blanchard, D., 2007, Supply chain management: best practices [Wiley best practices], John Wiley and Sons. Camerinelli, E., 2009, Measuring the value of supply chain: linking financial performance and supply chain decisions, Gower Publishing, Ltd. Gourdin, K., 2006, Global logistics management: a competitive advantage for the 21st century, California: Wiley-Blackwell. Langevin, A. and Riopel, D., 2005, Logistics systems: design and optimization, Chicago: University Press. Linzmayer, O., 2004, Apple confidential 2.0: the definitive history of the world's most colorful company No Starch Press Series. Edition2, No Starch Press. Miller, F, Vandome, A. and McBrewster, J., 2009, Apple Inc.: Apple Inc. History of Apple, Apple Inc. Litigation, Timeline of Macintosh Models, Timeline of Apple II Family, Apple-Intel Transition, Timeline of Apple Products, List of Products Discontinued by Apple Inc., IPod, IPhone, Apple TV, Alphascript Publishing. O’Grady, J., 2008, Apple Inc Corporations that changed the world, ABC-CLIO. Stadtler, H., 2008, Supply chain management and advanced planning: concepts, models, software, and case studies. Edition4, Springer. Read More