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Supply Chain Management In 6 Minutes | What Is Supply Chain Management | Simplilearn

Supply Chain Management In 6 Minutes | What Is Supply Chain Management? | Simplilearn

Introduction to Supply Chain Management

Alex is a major tech enthusiast who recently attended a virtual Apple launch event and witnessed the capabilities of the all-new iPhone 13 series. Instantly, he made the decision to get an iPhone 13 Pro. However, he missed the pre-booking deadline and has been waiting for this phone to hit the e-commerce sites ever since. After a long wait, he visited an offline Apple store where a store representative informed him about an ongoing delay in the production of iPhone 13 Pro due to supply chain inefficiencies.

Introduction to Supply Chain

Curious about how supply chains work, Alex began exploring the topic and spoke with his friend Rachel, who works at Apple Inc. Rachel explained that supply chain management involves multiple entities that must remain in consistent communication until the product reaches the consumer. These entities include raw material suppliers, manufacturers, and third-party logistics vendors.

The Five Stages of Supply Chain Management

Rachel explained that Apple Inc. has implemented a structured supply chain management strategy based on five key stages:

  1. Planning an Operational Strategy: Apple has always aimed to provide the best personal computing devices. This dedication to quality includes scrutinizing each app before launching it on the Apple App Store, making devices more secure.

  2. Sourcing: In this stage, Apple acquires equipment and materials from various suppliers. For example, screens are exported from Samsung, batteries from Foxconn, and processing chips from TSMC.

  3. Making: The manufacturing stage primarily occurs in an outsourced assembly plant in China. Once assembled, products are shipped to distribution centers around the world.

  4. Delivery: Products ordered online are shipped to consumers' doorsteps, while items for offline sales are sent to retail stores. This stage is mostly executed by third-party logistics vendors such as FedEx.

  5. Returns: Faulty or damaged products are sent back to the storage warehouses and then to the assembly plant for refurbishment.

Supply Chain Disruptions

Due to the recent worldwide chip shortage, Apple’s supply chain has been adversely affected. The COVID-19 pandemic caused many factories to shut down, leading to a scarcity of semiconductor supplies and increased demand for consumer electronics, forcing Apple to halt the production of 10 million iPhone 13 devices.

Conclusion and Quiz

Understanding these challenges, Alex became more patient about his desire to buy an iPhone. In our quiz, we asked viewers to identify which option does not fall under the stages of supply chain management. The options provided were:

  1. Planning an Operational Strategy
  2. Sourcing
  3. Making
  4. Disposal

The answer is "Disposal," as it is not one of the five key stages of supply chain management.

Importance of Supply Chain Management

A well-managed supply chain can lower operational expenses, improve corporate brand recognition, and enhance customer service. Because of its importance, companies invest heavily in supply chain management and hire professionals who are well-compensated. According to PayScale, the average salary for supply chain managers is $ 84,000 per annum in the United States and around 8.5 lakhs per annum in India.

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Keywords

  • Supply Chain Management
  • Apple Inc.
  • iPhone 13 Pro
  • Supply Chain Stages
  • Planning
  • Sourcing
  • Making
  • Delivery
  • Returns
  • Chip Shortage
  • COVID-19 Impact

FAQs

Q1: What are the five stages of supply chain management?
A1: The five stages are Planning, Sourcing, Making, Delivery, and Returns.

Q2: How has the COVID-19 pandemic affected Apple's supply chain?
A2: The pandemic caused factory shutdowns and a global chip shortage, delaying production and delivery of the iPhone 13 Pro.

Q3: What stage is not part of supply chain management?
A3: Disposal is not a stage in the standard supply chain management process.

Q4: What are some key benefits of a well-managed supply chain?
A4: Key benefits include lowered operational expenses, improved brand recognition, and enhanced customer service.

Q5: What is the salary range for supply chain managers?
A5: In the United States, the average salary is $ 84,000 per annum, while in India, it is around 8.5 lakhs per annum.

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