The value of integrating innovation and operations
As I write this department, there still are countless articles being published on Steve Jobs and his imaginative genius for design, innovation, and new products. And although everything being said certainly is true, Apple would not be where it is today without also having a superb operations and supply chain management organization.
Consider the sheer number of iPhones and iPads produced: That requires a well-oiled machine. Combine that with the actual launches and the number of products available on a global basis, and it’s even more impressive.
The Bloomberg Businessweek
article “Apple’s Supply Chain Secret? Hoard Lasers” paints an interesting picture of the company’s supply chain. There are valuable lessons therein, which every operations or supply chain management professional should learn:
- Pick a good leader. Steve Jobs selected Tim Cook as the supply chain vice president. He came from a first-class supply chain operation (IBM). Cook was experienced and competent, and he built a competent organization around him.
- Break the rules. Apple flies material around the world instead of just via ocean shipping. This offers all sorts of speed advantages and means Apple takes space on planes that then is unavailable to competitors.
- Work with your suppliers. Apple sends teams to supplier locations in order to overcome design and production concerns—with team members often spending weeks or months working to smooth out any issues. True innovation requires face-to-face interactions. This was true 20 years ago (for example, co-location) and is more true now that teams are global.
- Build a great team. Apple designers, supply chain professionals, manufacturing engineers, and supply personnel work effectively together. Problems naturally arise; but they are managed. Together, all of these groups have created a highly effective entity that achieves superior on-time delivery in quantities of millions on a global basis with high quality and cost control. These aren’t good teams; they are great ones.
It’s also important to note that Apple’s principles are not all that revolutionary—the company just applies them consistently.
So what does all of this mean for us non-Apple people? First, take operations seriously—especially the partnership between engineering and supply—to master the fast and continuous launch of new products. Any company that is going to survive and prosper in the next century will master innovation and deliver a constant stream of new products and services on a routine basis. A new product or service every quarter likely will be the minimum. It’s imperative to carefully create a plan to build the processes necessary to accomplish this goal.
Competent, motivated employees who know their specialty and can work with others effectively also are essential. Tomorrow’s successful businesses will be the ones that find these people, nurture them, and keep them. There’s going to be a lot of competition, so it won’t be easy.
The supply chain should be built around an outstanding cadre of suppliers—those who understand lean operations, continuous improvement, and teaming. And perhaps most importantly, companies must view operations as a strategic necessity. Too many business leaders say they believe this, but their actions do not reflect that principle.
I wish you luck as you work to implement these key tasks.
Philip E. Quigley, CFPIM, PMP, is a senior application portfolio manager for Computer Sciences Corporation. He teaches at Chapman University’s Argyros School of Business and Economics and California State University at Fullerton. He may be contacted at email@example.com.