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    Hà Nhi Lê
    The document discusses Apple's outsourcing of production to factories in China. It notes advantages like superior responsiveness, scale, flexibility and access to skilled workers. Disadvantages include quality control issues and criticisms over jobs in its home country. Factors for choosing countries include qualified employees, standardized facilities and technology. Government incentives could cause Apple to shift production to the US. Apple is more vertically integrated than other computer makers because it produces both hardware and software and has flexibility to rapidly change production.

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    56 views2 pages
    The document discusses Apple's outsourcing of production to factories in China. It notes advantages like superior responsiveness, scale, flexibility and access to skilled workers. Disadvantages include quality control issues and criticisms over jobs in its home country. Factors for choosing countries include qualified employees, standardized facilities and technology. Government incentives could cause Apple to shift production to the US. Apple is more vertically integrated than other computer makers because it produces both hardware and software and has flexibility to rapidly change production.

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    The document discusses Apple's outsourcing of production to factories in China. It notes advantages like superior responsiveness, scale, flexibility and access to skilled workers. Disadvantages include quality control issues and criticisms over jobs in its home country. Factors for choosing countries include qualified employees, standardized facilities and technology. Government incentives could cause Apple to shift production to the US. Apple is more vertically integrated than other computer makers because it produces both hardware and software and has flexibility to rapidly change production.

    Copyright:

    © All Rights Reserved
    Download as PDF, TXT or read online from Scribd
    Download as pdf or txt
    56 views2 pages

    This Study Resource Was

    Uploaded by

    Hà Nhi Lê
    The document discusses Apple's outsourcing of production to factories in China. It notes advantages like superior responsiveness, scale, flexibility and access to skilled workers. Disadvantages include quality control issues and criticisms over jobs in its home country. Factors for choosing countries include qualified employees, standardized facilities and technology. Government incentives could cause Apple to shift production to the US. Apple is more vertically integrated than other computer makers because it produces both hardware and software and has flexibility to rapidly change production.

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    of 2

    1.

    What are the advantages and disadvantages to Apple of outsourcing its production to factories in

    China?

    The advantages to Apple outsourcing its production to factories in China include superior responsiveness,

    superior scale, flexibility, diligence, and access to industrial skills. An example of the superior responsiveness,

    in assembly, to Apple’s needs is the impressive speed and flexibility of Chinese factories to accommodate a

    change request. Hiring qualified industrial engineers takes only days to precure compared to months for the

    United States. A positive impact to the entire supply chain comes from supply factories near Apple’s Chinese

    factory. Cost differential and cheap manual labor can contribute to Apple’s differentiation advantage or that

    lowers its cost structure. Disadvantages could include quality control, low quality materials, overcoming

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    language issues and mainly, Apple’s criticisms about failing to support employment in its home country.

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    2. What factors influence the choice of countries to which a firm might outsource its production?

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    Factors that influence the choice of countries to which a firm might outsource its production; supply chain,
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    qualified employees, standardized production facilities and investing in superior technology or scale. Key

    factors in the right outsourcing decision; keeping control of core competencies, intellectual property content,
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    product and services, and cost factors.


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    3. Is there anything that might cause Apple to eventually shift production back to the US?

    Government incentives, tax incentives, and lower regulations are some ways that might persuade Apple to
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    eventually shift production back to the US. Another is to invest in “industrial commons”—the shared
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    infrastructure, human capital, and other resources that make a country attractive to business and that can support
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    a company’s success.
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    4. Why is Apple more vertically integrated than many other computer makers?

    Apple is more vertically integrated than many other computer makers because of its decision to produce its
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    own hardware and software. Additionally, it instituted an upfront payment for technology and capacity. Apple

    found that using FoxConn factories n China to assemble its iPhones enable it to not only benefit by lower costs,

    but to also much more rapidly incorporate design changes and scale up production. The net result is that Apple

    develops superior flexibility and technological sophistication that its competitors cannot match.
    This study source was downloaded by 100000803644051 from CourseHero.com on 10-28-2021 07:36:54 GMT -05:00

    https://www.coursehero.com/file/30123703/Applepdf/
    5. What factors will help or impede Microsoft in matching the advantages Apple gains from its vertical

    integration strategies?

    Factors that will help Microsoft in matching the advantages Apple gains from its vertical integration

    strategies; continue to imitate Apple insofar as to its strategic outsourcing and producing its own hardware and

    software. Commitment for upfront investment might impede Microsoft in matching Apple and its vertical

    integration strategies because of the billions of dollars needed to buy production equipment used to outfit new

    and existing Asian factories. Another factor that impedes Microsoft in matching Apple is its underdeveloped

    ecosystem.

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    This study source was downloaded by 100000803644051 from CourseHero.com on 10-28-2021 07:36:54 GMT -05:00

    https://www.coursehero.com/file/30123703/Applepdf/
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