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BOLAJI OJO
A Lesson From Apple: Simplify
Bolaji Ojo, Editor in Chief
7/9/2012 (7) comments
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PRINT If your supply chain is more complex than the leading competitor's
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processes, you've got a major problem. The simpler a manufacturing and
order fulfillment process is, the nimbler it will be and the more
competitively it will help your company achieve its goals.
Many people may not realize this, but Apple Inc. (Nasdaq: AAPL), the world's leading
consumer electronics company, operates one of the leanest and simplest supply chain
operations in the world. At Apple, the same clean look-and-feel customers experience
when they use the company's most successful products is mirrored in the design and
supply chain processes that support the devices. In its manufacturing, procurement, and
repair and warranty fulfillment operations, Apple may be as above the competition as it is
in winning products it sells.
Nowhere is this more obvious than in its retail operation, which, in my opinion, is one of
the more public manifestations of Apple's lean supply chain operations. While other
retailers are complaining about the weak economy, Apple's outlet stores remain buoyant
and are considered among the most successful retail operations on earth. The retail
division had 357 stores in 2011 and for the year posted sales of $14.1 billion, up 44
percent from $9.8 billion in 2010. That growth puts it in a distinct class compared with
other retailers globally.
At any of these Apple stores, the look-and-feel is that of ease of access and neat display,
combined with free and unhindered flow of products and people. Clutter is literally non-
existent; even at the stores' busiest, the sense of order and ease of use remain obvious.
You don't believe me? Perhaps it will sound better coming from Apple itself. Here's a
comment from Apple's last annual Securities and Exchange Commission filing: "The
stores are designed to simplify and enhance the presentation and marketing of the
Company’s products and related solutions." Apple's retail outlets, in my opinion, take their
cue from the company's supply chain.
Here are the key features of Apple's supply chain and why they reinforce the idea of a
simple yet highly effective winning system:
1. Highly defined, limited, and contiguous products: Apple sells only a handful of
products, and although it has expanded these over the years, most of what the
company markets can be easily packed into a small box container. It sells PCs,
smartphones, digital music players, TV box, and a handful of peripherals and digital
products. The products are highly contiguous in terms of the supply chain needed to
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