Apple’s Global Supply Chain Changes

A New York Times article (January 24, 2011, B1) describes changes to Apple’s global supply chain orchestrated by the COO, Tim Cook.  It claims that when Apple owned plants in California, Ireland and Singapore, the supply chain had 90 days of inventory. But when Apple shut its plants and outsourced manufacturing to suppliers, inventories dropped to 60 days, then 30 days then just-in-time delivery.  All this when Apple introduced products like the iphone and ipad whose volumes ramped up at an astonishing rate and were difficult to predict.  How did Apple manage to decrease inventories when the supply chain ownership got more fragmented ? Did suppliers absorb the demand risk ? Or did Apple make growth commitments that, because they were realized, ended up with no cost to the firm ?

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About aviyer2010

Professor
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