Apple Inc. is fourth on the Fortune 500 list, and is an industry leader in the technology industry. The
company is valued at over $2 trillion, and their mission and organisational objectives are presented and
explained how aligned they are. An analysis was done on the company’s existing operations and
quality management processes which include the Products, Services, Markets and
Distribution, Supply of Components and Research and Development. The analysis
continues using operations management tools such as flowcharts, control charts, FMEA and Six Sigma to
explore how Apple utilises these tools in two different scenarios. The current Information Management
Systems are explored and how these operations have affects any of the business operations. An AI
analysis was done detailing how Apple uses AI to enhance their overall business operations from both an
internal and value-add view, lastly giving recommendations on improving existing business operations.
1. Introduction
Currently fourth on the Fortune 500 list, Apple Inc., commonly referred to as Apple, is one of the
world’s most recognised and respected brands and a leader in the technology industry. Apple was
founded and created in 1976 as the brain child of Steven Jobs and Stephen Wozniak, with its first
standalone computer, known as the Apple II, being released and sold in 1977 (Levy, 2021).
Since then, Apple has quickly risen to become a market leader in the industry, currently having a market
value of more than $2 trillion.
Apple’s mission statement defines their purpose as a company “committed to bringing the best
user experience to its customers through its innovate hardware, software and services” (Apple Inc,
2018). This mission statement defines Apple’s business strategy in which they leverage their
“unique ability to design and develop its own operating systems, hardware, application software
and services to provide its customers products and solutions with innovative design, superior
ease-of-use and seamless integration.” The strategy further supports the community for any
offerings – software, hardware and digital content – that aligns with Apple. Furthermore,
expanding the brand through company-owned retail and online stores as well as a distribution network
including third-parties; and investing within itself for research, development, marketing and
advertising, forms part of Apple’s business strategy and organizational objectives. (Apple
Inc, 2018).
Ultimately, there are two elements that define Apple’s purpose: user experience and innovation;
both of which aligned to achieve the business strategy defined by the organisational objectives which is
further extended down into the company’s operational and quality processes. The first of the
operational processes is the Products where a new version of the product is released
year on year, utilising Apple’s own updated software and latest hardware. The second process is
the Services which is catered to their customers from a support and digital offering
perspective that includes advertising and various forms of digital content. Markets and
Distribution is the third process that allows Apple to broaden their reach within the
domestic and global market and build various partnerships with many third-parties to aid in the
distribution and marketing of all Apple products and services. Supply of Components is
the process that ensures all components utilised in the creation of any products are available and
created for Apple’s products that allow the company to deliver quality products. Lastly,
Research and Development ensures that the company will always adapt to any changes in
the industry, to remain competitive by developing and building new technology, subsequently improving
current products and services offered (Apple Inc., 2020).
2. Existing Operations and Quality Management
Apple’s success in the technology industry was the result of their branding, products and ingenuity
in industry itself. Jeffery L. Cruikshank studied Apple’s management and defined The Apple
Way into four categories that focus on: the product, the customer, marketing, and leadership
(Cruikshank, 2005). This focus aligns to Apple’s vision and mission of making exceptional product
and can be seen in all of their operations and quality management processes.
2.1. Decision Areas of Operations Management
The 10 decision areas of operations management can dictate the success or failure of a company if not
managed correctly. Apple is an example of how managing these 10 decision areas can lead a company to
success. The company has an allocated team of senior managers, each of which are dedicated to handling
the implementation of the measures addressing the 10 decisions areas which are:
Design of Goods and Services
Quality Management
Process and Capacity Design
Location Strategy
Layout Design and Strategy
Job Design and Human Resources
Supply Chain Management
Inventory Management
Scheduling
Maintenance.
Each of these areas are managed in a way that aligns to Apple’s vision and mission statements. For
example, Location Strategy and Layout Design and Strategy is a selective process when choosing a
location and depending on that location, what would a customer expect in a store of that calibre. Every
one of these decisions in operation management are considered very carefully before any implementation
occurs, which is why Apple has been successful and will continue to be successful in the industry
(Rowland, 2019).
2.2. Products
Apple’s line of products include their line of smartphones: the iPhone®; the personal
computers: the Mac® which are both desktop and laptops; the multi-purpose tablets: the
iPad® range; wearable technology: the Apple Watch; the audio product range:
AirPods® and any of the products in the Beats® range; home and streaming
devices: Apple TV ® and HomePod®; and Apple’s virtual assistant
Siri® (Apple Inc., 2020). From a software perspective, each one these products, those that
require an operating system, all execute and run Apple’s various operating systems that Apple have
developed and continuously updated to bring consumers a constant stream of improvements and features.
Apple’s new range of devices always include new hardware such as better and faster processors,
improved cameras and storage capabilities, higher resolution screens, etc. The constant release of new
smartphones, tablets and personal computers year-on-year align to Apple’s business strategy of
designing and developing their own software, hardware, operating systems etc.
According to their last published fiscal results, Apple’s iPhone had decreased by 3% in
2020 due to no new model being introduced into the market. Going forward, with the release of the iPhone
12 and its variations in 2021, Apple should be on board to improve on these sales. The Mac
sales had increased by 11% due to their new laptop, as well as their iPad sales increasing by
the same amount. AirPods and the new Apple Watch had increased the sales of the
Wearables, Home and Accessories division by 16% (Apple Inc., 2020). It can be seen that year-on-year
Apple’s sales continually increase, and a larger increase is seen in years when Apple introduce
newer products in their product line. Based on their current organisational operations and processes,
Apple will continue to grow in a sustainable manner as long they continue to innovate their products and
constantly utilise and develop the latest technology. This introduction and continued innovation will
allow Apple to mitigate their risk of the constant introduction of new technology and its application to
Apple products (Apple Inc., 2020).
2.3. Services
The services operations within Apple cater not only to the company but the customer as well. These
operations form part of quality management processes as well. The first of the services that are offered
is the advertising that Apple use to not only boost the company itself but it includes arrangements with
numerous third-parties that will utilise the Apple advertising platform. The Cloud Services are
part of the offerings that Apple provides for the customers that not only allows for customers to store
data on the cloud but allows all of the products owned by customers to receive the most recent content
across multiple platforms. Apple also provides Payment Services which include their cashless
payment and branded credit card. The Digital Content is the large umbrella that works on
multiple platforms that allows customers to download and use various applications and access and use
digital content such as electronic books, music, media, gaming and podcast content. These work alongside
a subscription-based service that is offered to the customers across the various platforms and works
hand-in-hand with third-party developers to create and publish the various content. The last service
offered is AppleCare which is the fee-based service and support catered to customers from a
quality management perspective. This allows customers to gain support from the company for technical
matters, both software or hardware related as well as coverage similar to that of insurance (Apple Inc.,
2020).
Over the last fiscal year, the Services operations saw a 16% increase, with a constant growth projected.
Apple’s agreement with multiple third-parties will allow the company to maintain customer loyalty
while increasing the offerings provided through any of their products and services offered through the
agreements with various third parties. By continuing agreements with multiple third-parties to utilise
the various platforms that Apple services provide as well as continuously improving the platforms
themselves; Apple can sustain their growth of the business through their services operations, allowing
them to mitigate the risks identified with the ongoing COVID-19 pandemic. This sustainable growth would
also mitigate the dependency on various third-parties that provide products, services and content to
Apple who form a major part of Apple’s financial success (Apple Inc., 2020).
2.4. Markets and Distribution
As described in the book The Apple Way, category two is focused holistically on the customer
(Cruikshank, 2005). Given the products and services provided by Apple, the customers range from the
general consumer market to businesses of all sizes, including the education sector as well as the
government. Apple is able to bring their products and services as well as other third-party products to
market and directly to the customer through multiple distribution channels that include their own
physical stores, an online store and multiple third-party businesses. These include network carries,
various wholesaler, retailer and even verified reseller stores (Apple Inc., 2020).
The rise of the COVID-19 pandemic has affected the company in multiple ways, forcing many of the stores
to close and all staff to work remotely from home. While this has been handled successfully, Apple still
has a dependency on network carriers, wholesaler, retailer and reseller stores to continue managing the
operations (Apple Inc., 2020). By maintaining their platforms and agreements, the company can
potentially mitigate this risk by constantly monitoring global and regional markets as well as the
pandemic. This will allow Apple and their relevant third-parties to maintain a successful marketing and
distribution network that would ensure continued growth and success (Apple Inc., 2020).
2.5. Supply of Components
In order for Apple to develop and create their products, the company requires essential components that
are available from multiple sources with some being sourced from limited vendors. Given the
hypercompetitive environment in the technology industry, Apple competes with multiple rivals over
components, that creates a major dependency on the component, its respective suppliers and the market
itself. However, some components that allow Apple to maintain a competitive advantage over their
competitors are custom and are generally available from a singular source. Depending on how new the
technology is, this component may be subject to limited supply and supplier constraints. Although Apple
has agreements with all their suppliers, there is no guarantee of any extension, renewal or
similar-termed agreements with the suppliers. This does create a dependency risk for the company on
these suppliers. Along with this, the company outsources all hardware related components, located
primarily within the Asian continent (Apple Inc., 2020).
These two risks could be mitigated by ensuring that Apple has the correct agreements in place with all
suppliers as well as identifying potential alternatives for some components; which could result in a
much less scarcity issue arising with regards to any and all components. Apple could also continue to
create more custom components which will allow them to become more innovative, and remain competitive in
the market itself.
2.6. Research and Development
Like many technology companies, research and development play a vital role in a technology
company’s ability to stay relevant, competitive and successful. Apple’s research and
development operations are constantly adapting, testing and utilising the latest in technology. In doing
so in a continuous and timeous manner, Apple is able to maintain a competitive advantage in all their
products and services. Research and development also include intellectual property and licensing it such
that it can be offered as a service through their digital content. Furthermore, this entails Apple
acquiring third-party businesses and subsequently the corresponding technology that will allow Apple to
utilise it within their own operational and quality management processes (Apple Inc., 2020).
Over the last 5 years, Apple has increased their research and development expenses by 86%, using 2% more
of their total net sales from 2018 to 2020 (Apple Inc, 2018) (Apple Inc., 2020). The constant investment
within the company itself has increased the costing requirements, however it has allowed Apple to
maintain a strong competitive advantage in the market and remain a business constantly improving in both
technology and value provided.
3. Operations Management Tool Analysis
Evaluating how various operations management tools contribute to the success of Apple’s
organizational objectives will be done using two scenarios:
The creation and development of a new product.
The testing of reliability and safety of products.
3.1. Flow Charts
Flow charts, or process flow diagrams, present a sequential and logical order of steps within a process.
Primarily used to describe how a specific process flows, define the steps and order of steps, time
frames, decisions and dependencies (ASQ, n.d.). Using the creation and development of a new product,
Apple does this in a specific manner as depicted in Figure 1.
Flow charts, or process flow diagrams, present a sequential and logical order of steps within a process.
Primarily used to describe how a specific process flows, define the steps and order of steps, time
frames, decisions and dependencies (ASQ, n.d.). Using the creation and development of a new product,
Apple does this in a specific manner as depicted in Figure 1.
Fig.1 - High Level Process Flow of Product Creation and Development (Kahney,
2019)
As seen in Figure 1, the process is a very high-level view of how a product at Apple moves from inception
to manufacturing. As per Apple’s core value, Steve Jobs had ensured that when a product is being
created, it begins with the Industrial engineers, in the design stage. New products and ideas are
designed and prototypes are made during the first three stages which is made up of the Industrial Design
team; the Product Design team consisting of electrical and mechanical engineers and Device Software
group; and the Operations team (Rowland, 2019).
Once the team is happy with the prototype, the process moves onto the Product Design, whereby the various
electrical and mechanical engineers work to ensure all necessary components can fit within the design
itself, also known as Packing the Suitcase. While the Product Design is working on the design of the
internal components, the Operations team begins to evaluate the product and begins assessing how the new
product and its introduction will affect the current supply chain, in conjunction with planning how the
product will be catered for mass production (Rowland, 2019).
By including Operations in the design early into the process, will allow the team to constantly adhere to
the limitations of what can and what cannot be mass produced. Operations begins to manage the tools,
fixtures and develop the process for the production of the product. This involves designing the parts
that are crucial to the manufacturing dedicated to specific components of the product, such as the
battery. Once approved, Operations take over completely and begin to scale the manufacturing process on
a global scale monitoring where and how the cost can be reduced in all areas (Rowland, 2019).
3.2. Control Charts
Control charts are plotted points of data that allow the user to study how a process changes over time
within set threshold limits. These charts can aid in identifying and correcting various problems as they
occur, determining whether the process (in this case product) is stable and testing quality (ASQ, n.d.).
For Apple, the scenario of testing the reliability and safety of their products will be used.
Within the Apple operations exists two dedicated engineering groups, called Reliability and Safety. These
teams perform multiple, often exhaustive tests on the various products; with the focus of the test being
on the extreme conditions. For example, AirPods are placed into synthetic sweat and this is
done to simulate the gym environment and how well would the product itself survive in these
environments. Given the highly unlikely, yet possible scenarios, such as dropping the laptop on solid
concrete or a phone in a urinal; these sorts of tests are done so to evaluate the product’s
quality in extreme conditions (Rowland, 2019).
Apple can utilise control charts to monitor the data and progress of their products being able to
estimate potential lifespan of products, and how should business evaluate and cater their services
provided through AppleCare. With testing in this manner, the Reliability and Safety teams must
have proposed solutions as problem arises, which could be unknown until testing such as this is done
(Rowland, 2019).
3.3. FMEA
The Failure Mode and Effect Analysis is a tool that is used across multiple industries as part of the
Lean Six Sigma methodology, that allows a team to identify potential problems and its impact that could
arise after the production and analyse and address them in the development stage (Forrest, n.d.).
Continuing with the testing of reliability and safety scenario, Apple can utilise FMEA to analyse and
identify potential issues that could arise with the new iPhone scheduled to release later in the year.
Table 1 presents an example of FMEA for this scenario.
Table 1: FMEA Example for iPhone in development
Process Step
Potential Failure Mode
Potential Failure Effect
Severity
Potential Causes
Occurrence
Current Process Controls
Detection
Risk Priority Number
Cracked screen and back
Unusable touch screen
Unhappy customer
6
Phone dropped or thrown
3
Develop shock absorbent case and glass screen protector
10
180
Irresponsive screen
Dissatisfied customer
6
Heavy object knocked phone in pocket
3
7
126
Loss of display, i.e. screen not turning on
Disgruntled customer
8
User tripped and fell with phone in hand or pocket
4
10
320
Data integrity is compromised
Authentication failure
Concerned and unhappy customer
5
Network failure
5
Automatic switch between WiFi and cellular data)
3
45
Unauthorised access
Angry customer
10
Phishing attack, keylogging, hacking
8
Set up two-factor authentication
8
640
Battery longevity not as predicted
Expanded battery (close to explosion)
Injured customer
10
Incorrect charger used
1
Supply the correct charger and cable to regulate the correct voltage
6
60
Phone stuck in safe mode
Endless loop of safe mode
Unhappy and disgruntled customer
10
Incorrectly installed operating system
3
AppleCare and in store technicians as well as at home factory resets available
10
300
7
Unwanted third-party application
2
Factory reset
5
70
3.4. Six Sigma
The Six Sigma approach was initially developed in the late 1980s by Motorola, with the goal to eliminate
errors by improving the systems that handled quality and measurement. While Six Sigma is focused on
constant improvement of value for the customer based on their experience, it makes it a useful tool for
Apple to use as it treats the customer as king. Although similar to Lean Manufacturing, Six
Sigma’s approach is to look at variation and performance (GoSkills, n.d.). Using the first
scenario of creating and developing a new product, specifically an iPhone, Apple can use the five phases
of the Six Sigma in developing a new iPhone, seen in Figure 2.
Fig.2 - Five Phases of Six Sigma (DMAIC) (GoSkills, n.d.)
Apple needs to release the next generation of the iPhone, using the latest technology and
addressing all customer concerns. In order to understand the problem, Apple can receive feedback from
customers on what would be desired in the next iteration of the iPhone. For example, customers
may request a better or more camera options; customers have found that the battery life could be
improved; Apple’s phones do not have the capability to “fast-charge” their phones
unlike their competitors; the screen glass cracks too easily. Using this type of feedback from
customers, will allow Apple to define their problem, and begin to design and implement a better
smartphone.
3.4.1. Define
Now knowing what the customer requires in the next iteration of the smartphone, Apple can now measure its
current performance and what is currently happening from a customer experience point of view. This will
allow Apple to see the true measurements of their current generation of iPhones and will be
able to create and set baseline values that can be compared to. This is done to ensure that the new
product will be improved or not.
3.4.2. Measure
Now knowing what the customer requires in the next iteration of the smartphone, Apple can now measure its
current performance and what is currently happening from a customer experience point of view. This will
allow Apple to see the true measurements of their current generation of iPhones and will be able to
create and set baseline values that can be compared to. This is done to ensure that the new product will
be improved or not.
3.4.3. Analyse
Using the current data that Apple has gathered and currently has, the team can now begin to analyse the
data by identifying where and how performance is currently being hindered. A thorough analysis must be
done as the goal is not to simply analyse and identify where the problem is, but rather identify,
analyse and resolve the root cause of a problem. For example, battery life could not be performing as
desired because of an excessive use of mobile applications, so by analysing, the team can determine that
use of less applications will create a longer lasting battery. However, this does not identify the root
cause of the problem, as smartphones are constantly being used, and so an investigation and analysis
must be done on which mobile applications are causing battery degradation and look at catering for this.
3.4.4. Improve
Once the root causes of all variations have been identified, the team can now begin to plan and design
the necessary improvements required. These changes must then be tested and the team must ensure that any
and all changes made are resolving the problems identified and defined in the first phase.
3.4.5. Control
In the final phase, the changes made must be implemented and by doing so has a ripple effect on all
systems required to develop and make the changes. This is done so in a sustainable manner and with
continued monitoring, the team can determine if all the changes and improvements made are still being
realised.
4. Management Information System (MIS) Analysis
Management Information Systems form the backbone of an organization’s operations consisting of
software and hardware; constantly analysing data, reporting on it and ultimately aiding in making
decisions (Shopify, n.d.). Apple’s major types of information systems are presented in Figure 3.
Fig.3 - Apple's Major Information Systems (Barzani & Nabaz, 2020)
4.1. Transaction Processing Systems
TPS is defined as information that monitors transactional data and transforms that into a database
system. This type of system is key when running an online store (Barzani & Nabaz, 2020).
Apple’s Market and Distribution operations include their own online retail store as well, and
utilising a system like TPS allows Apple to track online sales of any products. Given the COVID-19
pandemic, and multiple stores being forced to close, Apple still saw an increase in sales of their
products, which could indicate the use of the online platform in purchasing the products. The gross
margin of the products increased from $68.887 billion in 2019, to a gross margin of $69.461 billion in
2020 (Apple Inc., 2020).
4.2. Office Automation Systems
The Office Automation Systems are those that enable all employees of Apple to utilise personal computers
and systems to perform business activities. For example, all computers present within the Apple
headquarters in California, granting all employees access to the necessary information (Barzani &
Nabaz, 2020). With majority of the workforce being forced to work from home and remotely, this system
has extended into the cloud, allowing the employees to work remotely while still achieving objectives
and adding value to the customers.
4.3. Knowledge Work Systems
The Knowledge Work System acts like a library for the employees of Apple. This allows all members of the
company to learn from others with different skillsets, on how to perform various tasks and complete
objectives. It assists the company in knowledge sharing and knowledge organisation while allowing team
members to upskill themselves without any cost to company (Barzani & Nabaz, 2020).
4.4. Management Information Systems
The MIS system in this case is more of a process, which begins with searching for information, storing
the information, monitoring and identifying conflicts and issues and developing solutions for any that
arise. In the case for Apple, the MIS is used for customer satisfaction (Barzani & Nabaz, 2020).
With customer experience being the focal point of Apple’s mission and vision, the use of an MIS
allows the company to maintain a positive customer satisfaction score by addressing any and all concerns
experienced by the customers. This system would form the backbone of Apple’s growing success.
Year-on-year, Apple increases their spending in the R&D operations of their company, with a 16%
increase from 2019 to 2020 (Apple Inc., 2020).
4.5. Decision Support Systems
By collecting data, analysing it and reporting it in more readable and understandable format, the
Decision Support System assists the necessary stakeholders in decision making situations and scenarios
(Barzani & Nabaz, 2020). The use of these systems has become vital in a company such as Apple, as
decisions made by management can ultimately affect the company itself in terms of value and earnings.
4.6. Expert Systems
Expert Systems are one of the most complex ones as they contain elements of AI in its use. Expert Systems
are those that are used to simulate human reasoning, analysing and identifying patterns and create
reasoning with them. Apple uses the company “NEXPERT”, who are responsible for developing AI
applications, specifically in the financial payment world (Lozano, et al., 2016). The use of the Expert
System allows Apple to extend their operations and services that are offered to their customers, in this
case the use of ApplePay.
4.7. Overall Analysis
Apple being a leader in the technology industry, indicates that they utilise their Information Systems to
the maximise by investing more and more into research and development. The constant and increasing
investment in research and development has allowed Apple to develop more products in their range making
them better and allowing them to maintain a commanding presence in the market itself. The use of the
systems, whether it is for decision making, production, or upskilling, has allowed Apple to increase
their revenue over the last year regardless of the COVID-19 pandemic from $98.392 billion in 2019 to
$104.956 billion in 2020 (Apple Inc., 2020).
5. AI Analysis
Artificial Intelligence (AI) is being implemented more and more in the world today in all industries to
help gain a competitive advantage of competitors or assist in many business operations within the
company itself. Apple does use AI in numerous ways both in an internal perspective, but more within the
products that they produce, i.e. affecting the Services operations of the business in what is being
offered. The virtual assistant Siri is the most notable form of AI that Apple has, making it a desirable
feature in all of Apple’s products as it can be utilised with all products offered in perfect
synchronisation.
Over the years, Apple has continued to develop Siri from a basic question and answer programme to one
where it is able to identify callers not on your contact list; or predict the next application you may
open based on what you have done before; or even presenting a map location based on reservations you
have made. Apple’s AI has evolved from just Siri to each product having their own “Apple
brain” inside each of the products. The use of the various AI tools and techniques such as machine
learning, deep learning and neural networks are constantly running on any of the products and being
constantly utilised to aid the user in everyday tasks, such as detecting if a person is currently
exercising due to an increase in their heart rate (Levy, 2016).
Apple’s development in AI has aligned to their organisational objective of creating a much more
user-friendly and personalised user experience. But this does not only include software on the
smartphones and tablets but goes further into the actual hardware. The research and rapid development of
AI in the products, have given rise to more innovate components being used to enable more machine
learning techniques to be used (Levy, 2016).
The machine learning experts within the company do not only focus on implementing various algorithms on
the products and services alone, but rather are used throughout the entire company. The machine learning
teams are encouraged to work with other teams within the company to help solve other problems and even
play an important role in idea creation. Although experts are found within the company, many of those
that utilise the machine learning and AI have no experience in it and have been upskilled to utilise it
in any of their business operations (Levy, 2016).
Although Apple uses AI to its benefit, unlike their competitors, they do not disclose any of their
research to the public, however they counter this disadvantage by purchasing small companies and
increasing their manpower. This allows Apple to maintain a competitive advantage against all their
competitors by utilising the skillset of the smaller companies and developing more advanced versions of
their AI, that would not have been possible at any earlier stage (Levy, 2016).
The major concern that faces Apple and it’s AI is around data privacy. Although encrypted, the data
that is given and used by the team is not the complete set of data involving user’s personal data.
The first question that is asked is what happens to the information used in training and developing the
neural network? The second question asks how can a neural network be developed and trained to predict
behaviour without know personal user information? Apple has addressed both concerns utilising their
product as a whole, i.e. both software and hardware. The highly personal information is stored locally
on the device itself, thus not exposing it to any other forms of data leaks. The second concern is
addressed by analysing how users utilise their own device. For example, based on the number of times a
person opens an application and in what order is it opened is all calculated and trained in the neural
network to predict the probability of that application being the next one the person decides to use. It
can also be seen in analysing typing patterns and words used, which is how predictive text works on any
of the Apple devices (Levy, 2016).
Ultimately, Apple is able to address challenges that AI places on them by developing and training the
various neural networks, deep learning and machine learning algorithms on the device itself, protecting
users’ privacy.
6. Recommendations and Conclusion
6.1. Recommendations
Apple is constantly improving their operations and quality of products delivered to all their customers.
By focusing on the customer experience and aligning all operations to the organisational objectives,
Apple has continued to succeed in the technology industry maintaining a strong market share and
competitive advantage. In order for Apple to maintain their current growth, it could be suggested that
Apple continues to innovate all products and services in a more aggressive manner utilising more recent
and experimental technology.
Apple could continue innovating by creating more custom components used in their products to allow them
to gain a bigger competitive advantage over competitors. It could also be recommended that Apple
considers publishing research to the public like their competitors. Given the dependency of multiple
third-party developers; Apple’s aggressive corporate approach of buying smaller companies that
utilise AI in other ways; Apple publishing their research could invite more third-party developers to be
more innovative giving Apple a much larger competitive advantage.
Apple’s ongoing and growing investment into research and development increases all
headcount-related expenses. The company could utilise their existing AI team that develops machine
learning, deep learning and neural network algorithms and align the team to the research and
development. By utilising the various forms of AI, the company can begin to continue to innovate and
improve on the research and development of all operations, while reducing the constantly increasing
headcount expenses.
6.2. Conclusion
Apple is fourth on the Fortune 500 list, and a leader in the technology industry, with their
organisational objectives being aligned to their mission statement. The company’s operations and
quality management processes were divided into five major categories, namely, their Products, which
group all their devices and wearables together; their Services, by which they focus on digital content,
support, value-add and licensing services offered to various third-parties and customers; their Markets
and Distribution, where Apple focuses on selling their product and services through various channels;
the Supply of Components, in which they use to develop their innovative products; and research and
development, whereby they constant ensure the company adapts to the rapidly changing industry and
environment.
The report looked into four operations management tools and how they are used within Apple’s
operations from a scenario perspective. The tools used for the analysis included: flowcharts, control
charts, FMEA and Six Sigma. The company’s Information System was analysed and explained, looking
at how each of these systems contributed to increasing Apple’s gross margin to $104.956 billion,
even throughout the COVID-19 pandemic. An analysis was done on AI and how it is used to enhance
Apple’s operations including their products and services and how any challenges faced were
addressed. Lastly, recommendations are given to Apple on how to remain an industry leader and maintain
the competitive advantage while benefitting the business and not impacting any existing operations.
Apple Inc. (2020). Form 10-K 2020. Available from:
Barzani, W. & Nabaz. (2020). Management information system in apple company Wilayat Salih
Mustafa In Partial Fulfillment of the Degree of MASTER OF ARTS (MA) IN BUSINESS MANAGEMNT. [Online]. Information System in Management. Volume 1. pp. 1-8.
