INTRODUCTION Total Quality Management plays a pivotal role in such companies. It is indeed the lifeblood of an entity and, therefore, should be managed well for sustainable and profitable growth. ASQ defines total quality management as a system of management based on the principle that every staff member must be committed to maintaining high standards of work in every aspect of a company's operations or describes a management approach to long-term success through customer satisfaction. Total quality management is relevant because it aims to provide effort to all members of an organization participate in improving processes, products, services, the culture in which they work and It uses strategy, data, and effective communications to integrate the quality discipline into the culture and activities of the organization. In order to expand and broaden the researcher's knowledge and information regarding this matter, a research was conducted. The main objective of this study is to assess current developments and practices with regards to total quality management of such company. Apple Inc. is one of the
world's
leading
American multinational technology
company
that
designs, develops, and sells consumer electronics, computer software, and online services and other variety of product line. With this, the researcher seeks to analyze and discuss the company's total quality management. As such, this study will help to understand total quality management to the outmost.
PRESENTATION OF THE COMPANY
By creating innovative products that continue to define the world of computer design. Other computer manufacturers have attempted for decades to replicate the iconoclastic appeal of the Apple design. None have succeeded in the manner of Apple. When Steve Jobs assumed the post of CEO in 1998, he re-revolutionized the entire company. Apple introduced the iMac and iBook product lines for the more basic computer buyers and the PowerBook and G series computers for the advanced purchasers. Apple continues to forge ahead in design with the introduction of the iPod digital music player and the iTunes Web site for the sale and download of music. Among giant rival firms, such as IBM, Apple is on the forefront of a revolution of technology, integrating music, images, and animation.
NATURE OF THE COMPANY
Apple Inc. is the world’s leading American multinational technology company. They manufacture, designs, develops and sells consumers technology or electronic devices, operating software, application software and providing online services.
MOTTO Think Differently
VISION Apple ignited the personal computer revolution in the 1970s with the Apple II and reinvented the personal computer in the 1980s with the Macintosh. Apple is committed to bringing the best personal computing experience to students, educators, creative professionals, and consumers around the world through its innovative hardware, software, and Internet offerings.
MISSION Apple Computer is committed to protecting the environment, health and safety of our employees, customers and the global communities where we operate. We recognize that by integrating sound environmental, health and safety management practices into all aspects of our business, we can offer technologically innovative products and services while conserving and enhancing resources for future generations. Apple strives for continuous improvement in our environmental, health and safety management systems and in the environmental quality of our products, processes and services.
OWNER
Apple was founded by Steve Jobs, Steve Wozniak, and Ronald Wayne in April 1976 to develop and sell personal computers. It was incorporated as Apple Computer, Inc. in January 1977, and was renamed as Apple Inc. in January 2007 to reflect its shifted focus toward consumer electronics.
ORGANIZATIONAL STRUCTURE Apple's organizational structure is shown below. Steve Jobs is the CEO and is in direct control of the company. The nine senior vice presidents and their portfolio of responsibilities are specified. Apple manages its business primarily on a geographic basis, with offices in the Americas, Europe, Japan, and Asia-Pacific. In addition, Apple operates and separately tracks sales in 86retail stores with the majority located in the United States. Apple's products are primarily assembled in Sacramento, California; Cork, Ireland; and by external vendors in Fullerton, California; Taiwan, Korea; the People's Republic of China; and the Czech Republic.
HISTORY It was founded in 1976 in a garage in Santa Clara, California, Apple is the brainchild of Steve Wozniak and Steve Jobs, two college dropouts who sought to provide a user-friendly computer to a new and distinct market of small computer users. Between 1978 and 1980, sales increased from $7.8 million to $117 million, and in 1980 the company underwent its initial public stock offering. In 1983, Steve Wozinak left Apple. That same year Steve Jobs hired away John Sculley from Pepsi to be the company's president. After experiencing
several
product
failures,
Apple
unveiled
the
Macintosh
computer in 1984 to overwhelming success, setting the stage for Apple's rise and its recognition as a household name. By 1985, relations between Sculley and Jobs became contentious. Finally, the board of directors sided with Sculley, and Steve Jobs was forced from the company he helped found. Additionally, while CEO of Apple, John Sculley ignored Microsoft founder Bill Gates ‘appeal for Apple to license the Macintosh operating system to Microsoft. Gates had hoped to make the Macintosh platform an industry standard. However, with Sculley refusing to license the operating system, Gates purchased and developed the DOS operating system, which has become the international operating standard for more than 90 percent of all personal computers in the world. By the late 1980s, competition from Microsoft's Windows operating system and the abject failure of Apple's Newton handheld computer caused the earnings of Apple to plunge, forcing reduction in the Apple workforce and the resignation of John Sculley. In 1997, Gilbert Amelio, Apple's current CEO, orchestrated the purchase of the
company Next Step from Apple founder Steve Jobs. The NeXT operating system was a vast improvement over the then outdated Macintosh operating system. At the time of the purchase, it was hoped that the NeXT operating system could be used to upgrade and overhaul the Macintosh operating system. However, sales in the corporate and education sectors continued to fall, and Apple was forced to trim its, workforce by30 percent, canceling projects and trimming research costs.
PRODUCTS
iPhone - is a line of smartphones designed and marketed by Apple Inc. They run Apple's iOS mobile operating system. The first generation iPhone was released on June 29, 2007; the most recent iPhone model is the iPhone 7, which was unveiled at a special event on September 7, 2016.
iPad - is a line of tablet computers designed, developed and marketed by Apple Inc., which run the iOS mobile operating system. The first iPad was released on April 3, 2010; the most recent iPad models are the 9.7inch iPad pro released on March 31, 2016 and the iPad Mini 4, released on
September
9,
2015.
The user
interface is
built
around
the
device's multi-touch screen, including a virtual keyboard. The iPad includes built-in Wi-Fi and cellular connectivity on select models. As of
January 2015, there have been over 250 million iPads sold. iPad tablets are second most popular, by sales, against Android-based ones, since 2013.
Mac - the
Macintosh
(branded as Mac since 1998) is a series
of personal computers (PCs)designed, developed,
and
marketed
by Apple
Inc. Steve
Jobs introduced the original Macintosh computer on January 24, 1984. This was the company's
first
mass-market
personal
computer
featuring
an
integral graphical user interface and mouse. This first model was later renamed to "Macintosh 128k" for uniqueness amongst a populous family of subsequently updated models which are also based on Apple's same proprietary architecture. Since 1998, Apple has largely phased out the Macintosh name in favor of "Mac", and the product family has been nicknamed "Mac" or "the Mac" since the development of the first model.
Apple Watch - is a line of smart watches developed by Apple Inc. It incorporates fitness
tracking and
health-oriented
capabilities
with
integration with iOS and other Apple products and services. The original generation of the device was available in four variants: Apple Watch Sport, Apple Watch, Apple Watch Hermès, and Apple Watch Edition; each distinguished by different combinations of cases and firstor third-party interchangeable bands. Apple Watch relies on a wirelessly connected iPhone to perform many of its default functions such as calling and texting. It is compatible with the iPhone 5 or later models running iOS 8.2 or later, through the use of Wi-Fi or Bluetooth. Announced by Apple CEO Tim Cook in September 2014, the device was released in April 2015. The Apple Watch quickly became the bestselling wearable device with the supply of 4.2 million smart watches in the second quarter of the 2015 fiscal year. The second generation of Apple Watch, released in September 2016, includes two tiers: Apple Watch Series 2 and Apple Watch Series 1, which includes the S1P chip, but is otherwise identical to the original.
macOS - (pronounced previously Mac OS X, then OS X) is the current series
of Unix-based graphical operating
marketed
by Apple
Inc. designed
systems developed to
run
and on
Apple's Macintosh computers ("Macs"), having been preinstalled on all Macs since 2002. Within the market of desktop, laptop and home computers, and by web usage, it is the second most widely used desktop OS after Microsoft Windows.
iOS - (formerly iPhone OS) is a mobile operating system created and developed by Apple Inc. exclusively for its hardware. It is the operating system that presently powers many of the company's mobile devices, including the iPhone, iPad, and iPod Touch. It is the second most popular mobile operating system globally after Android. iPad tablets are also the second most popular, by sales, against Android since 2013.
macOS Sierra – macOS Sierra (version 10.12) is the thirteenth major release of macOS (previously OS X), Apple Inc.'s desktop and server operating system For Macintosh computers. The successor to OS X El Capitan, it is the first version of the operating system issued under the June 2016 rebranding as macOS. Sierra is named after California's Sierra Nevada mountain range. The mountain in the default desktop picture is Lone Pine Peak. Its major new features concern Continuity, iCloud, and windowing, as well as support for Apple Pay and Siri.
Keynote - is a presentation software application developed as a part of the iWork productivity
suite
by Apple
Inc. Keynote
7.0
was
released
on
September 20, 2016 and is the most recent version for the Mac. On January 27, 2010, Apple announced a new version of Keynote for iPad with an all-new touch interface.
Pages - is a word processor developed by Apple Inc. It is part of the iWork productivity suite and runs on the macOS and iOS operating systems.
Final
Cut
Pro -
is
a
series
of non-linear video
editing
software programs first developed by Macromedia Inc. and later Apple Inc. The most recent version, Final Cut Pro X 10.3, runs on Intelbased Mac computers powered by OS X El Capitan or later. The software allows users to log and transfer video onto a hard drive (internal or external), where it can be edited, processed, and output to a wide variety of formats. The fully rewritten Final Cut Pro X was introduced by Apple in 2011, with the last version of the legacy Final Cut Pro being version 7.0.3.
Ipod Touch, nano and shuffle
CURRENT INDUSTRIES STATUS The chart below reflects the Apple’s net sales from the year 2000 to present. The charts have been adjusted to reflect the non-GAAP accounting rules.
PRESENTATION OF TOTAL QUALITY MANAGEMENT Total Quality Management involves all the internal and external members to the supply chain to meet all the customer requirements at the lowest achievable cost. Apple Inc. implements Total Quality Management with commitment and support by maintaining a customer centric focus in all of its services, products and processes.
APPLE SUPPLY CHAIN The supply chain is also having a big part at Total Quality Management of a company. Apple is famous for innovation and design. But few people know that the way Apple handles inventory is also a factor that led to success. The research firm Gartner ranks Apple’s Supply Chain as the best supply chain in the world every year from 2010 to present. Source of Raw and Packaging Materials for Apple
Delivery of Raw and Packaging Materials to Factory Warehouse
Warehousing
Production of Appls Finished products
Dispatch of apple Finished products to Distribution Centers
Return
Apple starts from the sourcing of raw materials and packaging materials for the main product. Followed by the delivery of raw materials and packaging materials to the factory located at China. The factory warehouse
is located at Elk Grove California. Then, warehousing follows. The production of Apple will be done and will be considered as finished products. The next process is the dispatching of Apple finished products to distribution centers. Lastly, distribution of Apple finished products to end users or return if there is a product errors.
APPLE HUMAN RESOURCES HR policies The policies should reflect the mission, values, and culture of a company. They have a direct impact on the external perceptions about the company by the apparent treatment of and attitude towards its staff and therefore shape the corporate image and identity. A positive image then can reinforce a competitive advantage increasing customer value, as people associate positive values with the company. Apple meets this need of creating a favorable image of a company by implementing equality of
employment and promotion opportunities through partnership arrangements around the world.
Human Resource performance In pursuing the above mentioned objectives of getting the best employees to work for Apple, the company has installed several measures to increase productivity as well as effectiveness. A cornerstone in the employment relationship is the regional partnership program with different originations like skill net in Ireland (A body comprising both employer and employee organizations) aiming at facilitating mutual involvement of management and employees/unions in organizational development.
INDUSTRY STRATEGY Expansion through concentration The apple concentrates to the one segment to make digital devices. Focus customer The apple focuses only the high-middle class customer. Differentiation The apple adopts differentiation in their products like as Iphone, IPod, IPad, and IMac and customize products according to region. Expansion through internationalization The company adopt expansion not only the country rather than Beyond the country.
APPLE MEASUREMENT SYSTEM Product Quality Apple Certified Refurbished Products are pre-owned Apple products that undergo Apple's stringent refurbishment process prior to being offered for sale. While only some units are returned due to technical issues, all units undergo Apple's stringent quality refurbishment process. Each Apple Certified Refurbished Product:
is fully tested (including full burn-in testing). is refurbished with replacement parts for any defective modules
identified in testing. is put through a thorough cleaning process and inspection. is repackaged (including appropriate manuals, cables, new boxes, etc.).
Includes the operating software originally shipped with the unit and the custom software offered with that system. See each product "Learn More" for more details.
is given a new refurbished part number and serial number. is placed into a Final QA inspection prior to being added to sellable refurbished stock.
Refurbishment procedures follow the same basic technical guidelines as Apple's Finished Goods testing procedures.
APPLES SWOT (Strengths, Weakness, Opportunity Threats)
Strengths of apple The strengths of apple they made digital innovative quality products they always focus to come with new technologies. Weakness of Apple The weakness of the apple they never to reduce their price of products.
Opportunity Apple have opportunity to capture the global market through customize their product according to low price therefore the cay capture the maximum market share. Threats Apple is the only company which makes world class product and having a strong brand image but apple have a small market share so they can increase the market share.
APPLE SUPPLIERS PROCUREMENT Apple has a procurement website over the years. Their main goal is to develop an entire ecosystem of suppliers who support business operations. And in a nutshell, is to obtain stellar products and services within tight timeframes, at a cost that represents the best possible value to our customers and shareholders. Apple Inc. is proud to the strong relationships they have built with their suppliers, many of whom have been working with them for many years. And there are always looking to expand the supplier base to accommodate the rapidly growing customer base. At that end, they periodically review the relationships and add new suppliers as needed.
Suppliers at Apple Apple requires each of its suppliers to meet the highest standards for all goods and services. There requirements include a commitment to rigorous quality assurance. In addition, suppliers must be committed, as they are, to ensuring the highest standards of social responsibility. The ideal suppliers are those who understand our culture and expectations. They value suppliers who take the time to learn about and understand the business and who look for ways to add value. These suppliers know the importance of making and meeting commitments and delivering the highest quality goods and services. The business environment is competitive and fast-paced. The suppliers must understand this dynamic and be agile and flexible in responding to changing business conditions. Above all, Apple values innovation. Apple appreciates suppliers who truly understand and share in our challenges, and who help them find the best possible solutions. Supplier Diversity Program Apple takes social and environmental responsibilities seriously. A good example of it is strong and longstanding commitment to a diverse supplier base. Apple’s Supplier Diversity Program was formally established in 1993; since that time the company has continued growing and supporting the long list of suppliers that participate. Apple actively participates in the program through the National Minority Supplier Development Council (NMSDC), the Women’s Business Enterprise National Council (WBENC), and Veteran–Owned Business Expositions, as well as Supplier Diversity Business Opportunity Trade Fairs around the country. The businesses they categorize as diverse suppliers are MinorityOwned, Women-Owned, Veteran-Owned, and Service-Disabled Veteran-
Owned Small Businesses, as well as businesses located in Historically Underutilized
Business
regions
(HUBZone)
and
Small
Disadvantaged
Businesses (SDB). So how does a business join Apple’s Supplier Diversity Program? That’s simple: You start by registering as a prospective supplier. Following a swift verification and screening process to ensure a good fit between supplier strengths and capabilities and Apple’s current and future requirements, Apple reviews the supplier information. The business then becomes a potential supplier who may be used in the procurement process as business needs dictate. In the interest of encouraging the success of our diverse supplier base, to work with the Supplier Diversity Program participants help they develop their businesses. This often involves working with a number of organizations that offer training and feedback. Suppliers who wish to participate in Apple’s Supplier Diversity Program should register as a Prospective Supplier so their information is available in Apple’s prospective supplier database. They have included special areas within the database to alert our supplier diversity team and relevant procurement professionals about the availability of qualified participants in Apple’s Supplier Diversity Program. This helps increase the visibility of these suppliers and can improve their potential for engagement. Sourcing Process Apple’s sourcing process is designed to ensure equal and fair treatment of suppliers so that they can fully participate in a competitive procurement process. They ask suppliers wishing to participate in the process to register in Supplier Connect, a secure online database that Apple maintains with regularly updated information on current and potential suppliers. Supplier Connect enables Apple procurement professionals to access key information about potential and current suppliers, including capabilities, Supplier Diversity certifications, product/service descriptions,
Universal Standard Products and Services Classification (UNSPSC) codes, contact information, and so on. The First Step The first step any supplier should take in seeking opportunities to do business with Apple is to register in Supplier Connect. If your company registers in Supplier Connect and there’s a need for the type of products or services you provide, an Apple procurement professional can then contact you to explore potential opportunities. If there’s no immediate opportunity for engagement (as sometimes happens), the information will remain in Apple’s confidential Supplier Information Database for six months or for as long as you continue visiting Apple’s procurement website to keep your company’s information up to date. Apple always informs the prospective supplier that all purchases are made in the competitive marketplace. Registering; the company in Supplier Connect does not automatically place the company on a “bidder’s list,” nor does it constitute approval of your firm as an Apple supplier or obligate Apple to solicit requests for quotations. APPLE GREEN LEAN SIX SIGMA In this case, the Apple Company discussed the application of greenhouse gas emissions to the methodology of Six Sigma. A few Six Sigma concepts were outlined, including fishbone diagrams, design for Six Sigma (DFSS), voice of the customer (VOC), and design for x (DfX). The fishbone diagram that the group produced shows the DFSS process and ways that the processes can be improved to reduce greenhouse gas emissions. This also takes into account the voice of the customer because the customer will want a product that is environmentally friendly. Apple uses DfX by designing their manufacturing
processes
to
focus
on
environmental
awareness
and
greenhouse gas reduction. The fishbone diagram, shown in sections below,
outlines how each department will format their procedures to reduce emissions. Manufacturing Manufacturing contributed to 61% of carbon emissions, of which polyvinyl chlorides (PVC’s) is the biggest factor. Therefore, eliminating PVCs will reduce Apple’s carbon footprint. On the other hand, Apple successfully banned harmful chemicals like benzene and Nhexane which are harmful to humans.
Product Use Product Use is an external one but is very important as it ranks second after manufacturing in terms of carbon emissions. The way a device is used determines its energy usage. By identifying the causes for product use, this can be used to lower emissions in the long run.
Transportation Apple has done a great job in terms of reducing transportation as this is seen in Apple’s new strategy to reduce emissions. The company only uses air travel to ship products which is economical and reduces effect on the environment. Apple does not account for damage while transport which can be a factor to reduce emissions as energy used to fix damages is wasted and can be avoided if the right precautions are taken
Facilities Using the fishbone diagram, it was mapped out the defects with the facilities which resulted in the causes. Using coal fired plants is definitely among the high contributors to greenhouse gases and should be powered by renewable energy sources. In Apple’s favor, the company built its data centers which are running on 100% renewable energy. Also something the team overlooked had it not been for the fishbone diagram is the amount of energy consumed by retail stores and offices. This should also be renovated to use renewable energy sources like geothermal, wind, and hydroelectric energy.
Recycling Apple uses recycling to their advantage, and has started taking more measures to improve the efficiency of their recycling processes. They are trying to make their proprietary screws recyclable. This will result in more efficient recycling of all Apple products. Apple is also looking into alternative types of glue base which would be recycled. The company is trying to make all of their products EPEAT Gold certified, which means that the product falls under the category of “green electronics” .
Employees In addition to the five topics above, the employees also contribute to the carbon footprint of the company. The employee section of the fishbone diagram is shown below. Most of the impact that an employee can have depends on how they are educated in the subject. Before they start working for Apple, they are taught the correct ways to handle machinery and the safest ways to handle harmful chemicals in the manufacturing plants. Apple also encourages employees to be environmentally responsible in their
personal lives. They can do this by carpooling to work, recycling, and using more fuel efficient cars.
APPLE SIX SIGMA
ANALYSIS OF CURRENT TOTAL QUALITY MANAGMENT Without a doubt, Apple Inc. manages its Total Quality Management very well and superb. Apple has remarkable production facilities and they have also enjoyed the healthy market share for the last years. One of the reasons of the success of the organization is their vendor management and the intelligent distribution system. For me one of the standout TQM of Apple
Inc. is the Supply chain, because it was managed by the organization by having excellent relationship with their channel members and logistics. Their distribution network makes sure that every product is distributed in the required areas at the required time and the demand and supply does not have any gap. Their distribution setup is synced with their production system therefore they do not have to manage the inventory of the product for the longer period of time. Aside from that, their procurement department has selected the reliable and a quality vendor that includes provides the best quality of raw materials/products to the company. In line with this, Apples promotes activities
which
help
establish
awareness
on
the
importance
of
environmental protection, transforming this awareness to conviction and sustainable actions among its employees, business partners and other stakeholders not only in business but even on personal level. And so, it is expected that Apple Inc. would continue their Green Lean Six Sigma or improve this environmental concern for it is one of the top companies in the world. Also, Apple did a great job in implementing the Value Chain and Measurement System in product quality so that Apple can re-assess its material issues and maintain sustainability.
RECOMMENDATIONS
I have no any doubts why Apple Inc. is one of the leading companies in terms of quality technology and consumer services. Because I see that how they are stable in providing world class products. My initial total quality management analysis involved establishing the supply chain especially the flows of product of the remaining business streams and modeling the costs of alternative warehousing and transport options. Having established the right supply chain strategy for change, it is recommended for them to have Logistics consultants to undertake a more detailed and the operational implications of providing an improved service to Apple’s customers and stakeholders. Apple Inc.
should take advantage to improve the active logistics
strategy. Apple Inc. can adopt Quick Response approach too. The distribution process between the organization and the suppliers is focused in Quick Response. By using this approach Apple Inc. can improve the speed of inventory replacement through closely understanding and monitoring the customer buying patterns. To implement the QR Apple Inc. has to share its sales details with suppliers for specific products across its supply chain to assist the availability of the right level inventory when and where it is required.
Apple Inc. also sees the Lean thinking, because it emphasizes on operating with minimum wastes in the supply chain. Lean identifies seven wastes namely
the waste of overproduction; producing too much
the waste of waiting; not utilizing and resources properly
the waste of transporting; moving goods between processes
the waste of inappropriate processing; incapable of meeting quality standards
the waste of unnecessary inventory; not keeping too much of inventory
the waste of unnecessary motion; unnecessary movements within the warehouse
the waste of defects; producing defective products
By improving lean management process Apple Inc. has, it can be more efficient in terms of cost effective and better quality to the customer.
Apple Inc. should also
have a close monitoring to all
its supply chain partners. With
this,
evaluate
each participant and improve
the
conditions
of
they
will
be
able
to
their business relationship. And last is Apple Inc. should have a close monitoring and fast customer service so that all the concerns of the consumers will be assists and solve as soon as possible.
UNIVERSITY OF THE EAST – MANILA COLLEGE OF BUSINESS ADMINISTRATION
FINAL REQUIREMENT IN
TOTAL QUALITY MANAGEMENT
Submitted to: PROF. MARISSA L. LANUZA
Submitted by: PULANCO, JAMES EDLYN P.
Feb, 17, 2017
