Management Research Paper on Lean Manufacturing/Lean Systems for Apple

Lean Manufacturing/Lean Systems for Apple

Manufacturing has undergone tremendous change over the past few years. Many in the manufacturing industry have been working to create manufacturing processes that save on manufacturing cost and time, while at the same time improving the factory floor environment. One of the manufacturing processes that have been receiving accolades is the lean manufacturing system hailed for its improvements in productivity and reduction of costs in the manufacturing process (Campion 14). Overall, lean manufacturing and systems are a collection of principles and practices aimed at improving corporate performance and credited to the Toyota manufacturing process (Piercy and Rich 286). Although it is highly a Toyota association, other companies have taken up the processes, infusing them within their production systems to achieve improved efficiency, saving on costs, as well as improving manufacturing to market times in unprecedented ways. Apple is one of the companies that have taken advantage of this process. Although the company does not claim to be lean, it has some characteristic of the lean manufacturing processes and systems. In looking at lean manufacturing and systems, it is essential to consider Apple’s lean manufacturing and systems in comparison with Toyota’s processes. Indeed, apple has taken advantage of this process in its effort to reduce waste and streamline processes at Apple, and whether the process is eco-friendly.

Toyota is one of the world’s biggest car manufacturers with global manufacturing and operations. The Japanese car manufacturer introduced the lean manufacturing system through its Toyota Production System. The system’s genesis came from circumstances that surrounded the company from as far as 1902 at the establishment of the company (Art of Lean 3). Additionally, in introducing the Toyota Production System (TPS), it was the view of the company that the system would allow the company achieves four goals. One of the goals was to provide excellent quality and service to the customer; this meant putting the customers’ needs first in the production process at all times (Art of Lean 5). TPS also aims to develop the employee’s potential, basic the development on mutual respect, cooperation among the employees and between the employer and employee, and through trust. It also looks to reduce cost by eliminating waste, while ensuring maximum profit in the process. Finally, the last goal of TPS is the development of flexible production standards that would be able to respond effectively to market demand.

As one of the most admired and innovative companies in the world, Apple explicitly follows a lean production (Pressman). The company was founded in 1976, and over the years has transformed itself from a computer technology company to an electronics and innovation behemoth. As well, the Apple designs and manufactures a wide range of consumer electronic such as the iPhone, MacBook, iMac, iPods, Apple TV and most recently wearable technology in Apple Watch. Further, the company has an in-house software designing and creation in addition to providing a plethora of services to its customers across the world. Fundamentally, Apple’s distinction from the rest of computer manufacturing companies is the closed-system. Through the system, the company maintains oversight in the production and designing of its products, making its products stand out from the rest in build and customer experience. Apple’s stance as an excellent company also hinges on its manufacturing and supply chain management process, which is not only effective but also cost-effective, ideally bordering on the lean manufacturing and systems principles.

While it does not explicitly claim to be lean, Apple is one of the company’s with lean characteristics in its production. Knowing the challenge of integrating sustainability into lean operations and supply chains (Piercy and Rich 282), the enterprise has been keen on developing its lean systems. Regarding lean systems integration, Campion states, “Manufacturers must look for flexible systems that are easily modified and that also improve the process, save time, and reduce errors” (14). Lean manufacturing and systems integration proffer advantages to companies that adopt them. Among the advantages is that such integrations are that through them “System integration not only complements lean manufacturingprinciples, but propels the manufacturer towards continuous improvement for the benefit of the company as a whole and the main objective of minimizing waste” (Campion 14). At the center of lean manufacturing and systems, therefore, is the elimination of waste, while increasing production and lead times to customers.

Apple’s approach to lean manufacturing and systems, like the company’s philosophy was (and still is) in “thinking differently.” In minimization of wastes, Apple’s approach was in the design of its products and use of technology. Most Apple’s products (iPhone, iPod, iPad) have only five buttons, and at the launch of the iPhone, most of the smartphones at the time had full physical QWERTY keyboards. Indeed, Apple’s design minimized wastes by having only five buttons and a touchscreen- features that were missing in most phones at the time of the introduction of the feature (Kerr 7).  Additionally, most of its competitors had bloated operating systems, such as Windows Phone from Microsoft that was the full-blown desktop operating system crumped into the phone. In contrast, Apple’ iPhone and the rest of its products had (and have) an intuitive and simplistic user interface, coupled with the sleek design, which endears the company’s products to its customers.

Among the principles of TPS (Toyota Production System) and the lean manufacturing and system are Just in Time (JIT). The aim of the principle is “to produce and deliver the right parts, in the right amount, at the right time using the minimum necessary resources” (Art of Lean 6). The idea of running such a system is to reduce inventory in addition to prevention of early and overproduction. Moreover, using JIT companies can identify problems and find solutions for the problems fast, in addition to making improvements (Art of Lean 6). In essence, Apple uses a similar model, although the enterprise outsources its production while using third party shipment. Apple’s supply chain is designed to enable customers to order custom-built phones or computers and deliver them to their doorsteps in a matter of days at most. Moreover, Apple keeps a tight watch on its inventory regardless of the fact that it does not do its manufacturing in-house. Such a lean system means that the company can make changes on the products in case of problems.

The efficiency of JIT was especially evident for Apple in 2010, in what became famously known as the ‘Antennagate.’ For this incident, the iPhone 4 lost signal when held by the lower-left corner—the point where the iPhone’s antenna sat (Chamary). Only the first batch of iPhone 4s experienced the problem, as the company corrected the mistake with the subsequent batch of iPhone 4s that came from the production line. Besides, Apple gave its customers free bumper cases to the first batch of customers who had complained of the phones losing signal (Chamary). The fact that Apple managed to produce so many bumper cases at such short notice, and the fact that subsequent iPhone 4s did not have similar problems attest to the fact that like Toyota, Apple uses the JIT principle as part of its lean approach to supply chain and production.

Jidoka (build quality) is another of Toyota’s pillars of lean manufacturing under the TPS model. Jidoka stresses on build quality during the process of manufacturing and offers a distinction between humans and machines in the working environment (Art of Lean 6). The principle aims at not only the minimization of wastes but also the automation of the production process. Ideally, as part of TPS, jidoka “aspires for processes that are capable of making intelligent decisions and shutting down automatically at the first sign of an abnormal condition such as a defect, or other problem” (Art of Lean 6). The argument for this is that “it is better to stop a machine at the first sign of trouble than to keep on producing the problem which only generates more waste” (Art of Lean 6).

Apple follows a similar approach, whereby it not only produces high quality, highly innovative products but also employ automation in their production processes. It collaborates with Foxconn, a Taiwanese manufacturer responsible for the production of most of the company’s (Apple) products (Dou). In the production line, Foxconn also uses automation on its assembly lines, although given the abundance and cheapness of labor in China, where most of its production factories are located, the company employs human labor. However, even in deploying human labor, Foxconn has line arrangement and short cycles, which then reduce the need for communication and training among the workers. The approach highly reduces the cost of production, and stoppage of any problems within the assembly line is easy, much like it is the case in TPS. Moreover, using such a system not only minimizes wastes but also streamlines the production process.

The purpose of lean manufacturing and systems is to reduce the cost of production for the company, and in so doing increase profitability while reducing waste. On the other hand, the green initiative aims at the sustainable use of resources and care for the environment, especially in the reduction of pollution and emission of greenhouse gases from the manufacturing process (Hartini and Ciptomulyono 40). Often, there is an assumption that lean manufacturing is green. While some of the elements of lean manufacturing and systems support green initiatives and objectives, it does not necessarily mean green. However, lean manufacturing processes provide a framework and platform towards environmental sustainability. In fact, research studies show that implementation of lean manufacturing methods leads to waste and pollution reduction, especially emissions (Hartini and Ciptomulyono 40). Similarly, an awareness of environmental factors and issues can also be a precursor to the adoption of lean manufacturing models. Especially important is the idea that “focus on environmental improvement may create a more system-focused approach to management generally” (Hartini and Ciptomulyono 40). Evident in this case is the fact that the two (lean and green) mutually inform on one another in that lean inadvertently leads to sustainability through the undertaking of sustainable use and management of resources, as well as the adoption of sustainable processes.

Part of the reason for a lot of attention on lean manufacturing processes is the impact that manufacturing has had on the environment. Most multinational corporations are including sustainability and environmental aspects into their overall business strategies, especially given that more consumers than before are not only concerned about the end product, but the processes the products undergo in their production. Consumers demand environmentally sustainable processes and raw materials, with some threatening to boycott products that are not environmentally friendly. Furthermore, as a company operating in the consumer electronics industry, there have been concerns over the industry’s impact on the environment. Part of the reason for the concern of the consumer electronics industry on the environment is its booming at the start of the 21st century and their lack of consideration for the environment for the better part of their operations. Additionally, concerns have followed what most environmentalists regard as “negative impact on the environment during manufacturing, usage, and disposal of consumer electronic devices related to the consumption of a large amount of energy, the use of toxic and hazardous materials and the scrapping of outdated consumer electronics” (Lock and Yao 3).

Aside from the impact of the industry on the environment, Apple had previously been on the receiving end on its lacks of environmental sustainability. Woody explains that the company (Apple) continuously had bad reviews especially from Greenpeace that accused the company of not releasing any details of its carbon footprint in the manufacture of its products. However, in the recent years, the corporation has been keen on its environmental impact, and many have hailed it as one of the leaders in environmental sustainability. Apple’s environmental sustainability initiatives are visible through its “Environmental Sustainability Strategy” that looks to reduce its carbon footprint while contributing to the restoration of the environment.

The first of the strategy is the reduction of climate change through it manufacturing process as well as the usage of its products. It is especially evident that as a consumer electronics company, the manufacturing process accounts for a large portion of the company’s carbon footprint. Indeed, Apple’s manufacturing processes account for 72 percent of the company’s total carbon footprint (Lock and Yao 3). Although the business does not own its manufacturing and supply chain facilities, opting to outsource the processes instead, it has worked closely with its partners to reduce the carbon footprint. Therefore, in the reduction of its environmental impact, Apple “improved its efficiency by reducing the carbon intensity linked to manufacturing and product use” (Lock and Yao 3). Additionally, given that it designs both the software and hardware of its products, Apple collaborated with its business partners in generating higher energy efficiency in its products through the efficient power supply, efficient hardware as well as including efficient power management in its software.

Apple’s environmental sustainability strategy also includes the use of renewable resources. The company is looking to use 100% renewable energy in its facilities and has so far done so in its retail stores in the U.S. The company plans to have its stores worldwide run on 100% renewable energy. Additionally, it built a 20-megawatt photovoltaic array to supply energy to its billion-dollar data center, in addition to a five-megawatt biogas-powered farm to supply electricity to it iDataCenter (Woody). Apple’s use of renewable resources has also included the use of sustainable virgin fiber and small packaging for its products. Through the specification for it virgin fiber, the company has been able to strike a balance between virgin fiber and recycled fibers for making the packaging for its products (Lock and Yao 3).

Apple’s environmental strategy also includes the use of recyclable resources. Its manufacturing process reuses and recycles some of the resources within the process such as water (Lock and Yao 4). Furthermore, the company has changed its design process, making thinner, smaller, lighter and energy efficient products. The products then require less material but last longer. A specific example is the company’s notebook batteries, which continue to serve the consumer five years from their purchase, in addition to the ability of the company’s old products to install and run latest software and application. Such abilities on the products mean that consumers do not need to buy new products to enjoy the latest software and application offers from the company.

Implementing the strategy has had a great impact on the company’s carbon footprint. Between 2010 and 2015, Apple’s carbon footprint has reduced tremendously (by 64 percent). Further, the company has moved from one of the “least green,” to one that champions sustainability in operations. While the manufacturing process still has one of the highest carbon footprints, the company has become almost sustainable, with the bulk of its operations in the U.S. running on renewable energy. Even more is that Apple’s approach to sustainability has challenged other tech companies to follow suit, with companies such as Google running on renewable energy, as well as investing in wind farms for the production of renewable energy for its worldwide operations.

Indeed, manufacturing has evolved significantly. Currently, companies are after manufacturing processes that reduce the cost and period of production. One of the manufacturing processes that have been largely hailed is the lean manufacturing system. The system is praised for its improvements in productivity and reduction of costs in the manufacturing process. Although the process is largely associated with Toyota, other companies have taken it up and fused it with other processes of manufacturing. One such company is Apple. Although there have been pitfalls regarding the corporation’s use of the technology, the process has largely influenced the business positively.

 

 

Work cited

Art of Lean.Toyota Production System: Basic Handbook.Art of Lean, 2016.

Campion, Shawn. “System Integration Meets Lean Manufacturing.” Quality, 2017, pp. 2-14VS,15VS, ABI/INFORM Trade & Industry. Accessed from https://search.proquest.com/docview/1860275700?accountid=1611.

Chamary, J., V. “Apple didn’t learn from the iPhone Antennagate scandal.” Forbes, October 31, 2016. Accessed from  https://www.forbes.com/sites/jvchamary/2016/10/31/iphone-antenna-performance/#634292d7604d.

Clark, Don. “HP Goes Lean to Draw Premium Buyers; PC Maker Wants to Polish its Image as Innovator, as Sales Shrink.”Wall Street Journal (Online), Apr 03, 2016, US Newsstream. Accessed from https://search.proquest.com/docview/1777837420?accountid=1611.

Dou, Eva. “How the iPhone Built a City in China; Zhengzhou, Once Dominated by Farmland, Now has 250,000 People Working to Assemble Apple’s Smartphone.”Wall Street Journal (Online), Jul 03, 2017, US Newsstream. Accessed from https://search.proquest.com/docview/1915404741?accountid=1611.

Hartini, Sri, and Ciptomulyono, Udisubakti. “The relationship between lean and sustainable manufacturing on performance: literature review.”Procedia Manufacturing, vol. 4, pp. 38-45.

Kerr, John. Apple Inc. (AAPL). Henry Fund, 2015. Accessed from http://tippie.biz.uiowa.edu/henry/reports15/AAPL_fa15.pdf.

Lck, Fiona, and Yao, Yihong.Apple’s Environmental Sustainability Strategy: Considering Innovation for Everything.Centennial College, 2015, Accessed from https://www.centennialcollege.hku.hk/f/upload/2137/Apple_Environment_15_004C.pdf.

Piercy, Niall, and Nick Rich.”The Relationship between Lean Operations and Sustainable Operations.” International Journal of Operations & Production Management, vol. 35, no. 2, 2015, pp. 282-315.

Pressman, Aaron. “Business lessons from the iPhone’s first decade.” Fortune, January 9, 2017. Accessed from http://fortune.com/2017/01/09/business-lessons-iphone-first-decade/.

Woody, Todd. “How Apple went from environmental laggard to leader.” Forbes, February 22, 2012. Accessed from https://www.forbes.com/sites/toddwoody/2012/02/22/how-apple-went-from-environmental-laggard-to-leader/#6da104977715.