- Buyer's Guide
Supply chain management is based on the idea that most every product that reaches an end user represents the cumulative effort of multiple organizations, collectively referred to as the supply chain. While supply chains have essentially existed since the start of business, the field of supply chain management, or logistics, has not been thoroughly studied until fairly recently.
As companies have looked to spread their production around the globe to cut costs and build their customer base, effective supply chains have been found to often raise efficiency and assure products reach their end user as quickly as possible.
"Businesses don't compete; supply chains compete," says William Verdini, associate professor and chairman of the Supply Chain Management Department at Arizona State University's Carey School of Business. "Now, supply chain officers are getting in on the strategic decisions that are being made."
Because of the growing role of supply chain managers in business, MBA programs in supply chain management and logistics have experienced a recent surge in growth. New job openings, competitive salaries and a strong potential for advancement in the growing field have inspired many MBA programs to take notice.
Lehigh University's College of Business and Economics recently reported the most undergraduate supply chain management majors in the program's 10-year history, while North Carolina State University's Poole College of Management is weighing the possibility of establishing a supply chain concentration within its undergraduate accounting program.
Currently, the U.S. News and World Report's top-ranked supply chain management program is at Michigan State University's Broad College of Business. At Michigan State, supply chain MBA faculty integrate topics including manufacturing operations, purchasing, transportation and physical distribution into a unified course of study. The school leaders tout their balanced and holistic approach to supply chain management with a program "designed with the realization that essential breakthroughs in business productivity and quality must be process based and such processes must transcend traditional business functionality and embrace the need for cross-organization relationships." The program also works to incorporate environmental challenges into their philosophy, as sustainable use of resources and effective supply chain building often involve similar efficiency-raising end results.
Among supply chains in the business world, Apple's has been widely examined as a nontraditional example, with a number of advantages and disadvantages. Because of Apple's great industry clout, the company is able to demand of suppliers a detailed accounting of a manufacturer’s estimates for labor and material costs, as well as projected profit. Manufacturers with quality issues and warranty claims can then get hit with penalties, allowing for nearly unprecedented levels of transparency.
However, the popularity and high standards of Apple's products have also created very steep expectations that can be difficult to meet let alone exceed, at times leading to strenuous working conditions. While Apple's supplier responsibility progress report states that the company's labor policy is for workers to work a maximum of 60 hours per week and get at least one day off per week, 93 of its suppliers and more than 50 percent of workers were found to have exceeded those limits.
At Foxconn, Apple's partner for final assembly of many core components, conditions have become bad enough that press reports of accidents, suicides and labor strife have haunted the company.
Like many high-profile tech companies, portions of Apple's supply chain also maintain a high-risk profile. Several key components come from northern Taiwan, and the company relies on many massive factories in China for final assembly. Any man-made conflict or natural disaster in these areas could prove devastating to Apple's supply chain.
With the recent launch of the iPhone 5 and the impending holiday season, Apple's complex supply chain will soon be put to the test. Like many large corporations in today's global marketplace, the supply chain at Apple may make a great deal of difference to the bottom line amid growing competition.
As schools continue to build their supply chain management courses, a new crop of graduating supply chain professionals may soon be steering the direction of business at global corporations like Apple and businesses throughout the globe.
About the Author
Valerie Harris is an education expert who blogs about resources for people who want to advance their career. Visit www.mastersdegreeonline.org for more information.