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Newton’s Law….the Apple falls??

Posted by dalipraheja on May 13, 2010

Here is another classical example of a major Supply Chain failure (NOT a Supply Base failure!!!).  The essence of it is that the demand for the iPad was so enormous that Apple has had to delay the launch in many parts of the world.  The reason cited is that Apple did not predict the type of demand that materialized and therefore they ran out of product.

WOW…Apple blows a major product launch???  Why are all the icons falling so fast? This is also a learning moment that we should pause and reflect on as it raises some very interesting comments and questions…n’est ce pas?

  • One more time, it clearly demonstrates that the effectiveness of a Supply Base is clearly dependent on the customer’s(Apple) Supply Chain which in turn is clearly driven by demand planning(or lack thereof).  How many more times do we need to see this in our organizations before we all start acting on this issue?
  • Clearly, the promise of ERP systems and everything that followed them have fallen short(surprised anyone?).  I was there in the early, early days of the maturation of the ERP market (I know I look much younger 🙂 ) and I remember the promises made around end-to-end integrated, seamless planning
  • How come almost ALL planning processes never, ever plan for success?  We all have contingency plans that revolve around failure.  This would mean that the Supply Base and perhaps the Supply Chain was not designed to be flexible enough to handle a successful launch?  Was the Supply Base and/or the Supply Chain perhaps too LEAN??  Was too much cost squeezed out?  Yikes, did I really say that?  Ummm, yes I did and I meant every word of it.
  • From the conspiracy theorists:  Could this be an artificially created shortage to generate more buzz?  Could it be Apple’s way of buying some time to fix some of the problems they’ve been having with the iPad?  I seriously doubt that any of these are true and merely bring them up to dismiss them.
  • This will allow their competitors a little bit of extra time to sow some F.U.D. regarding the iPad and to launch their competing products.  And in this day and age, when product life cycles in consumer computing are shrinking rapidly(Kindle?), months can mean a lifetime.

If an icon like Apple(who has had a fairly good record of successful product launches) can have something like this impact what is clearly a ground breaking technology, it should make you pause and think.

Are we, as Sourcing/Supply Chain professionals, focused on the real value generators for our companies?  Or, are we focused on the short term tactical goals for price and TCO?

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