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Questions
18-1. Although Apple’s inbound logistics began with Apple controlling the assembly of its
computers, it shifted to having suppliers acquire raw materials with contract manufacturers
handling most of the production and assembly of final products. Why did they do this, and what
are the major challenges Apple faces?
18-2. Foxconn, a major contract manufacturer for Apple, is by far the largest ODM/EMS
(original design manufacturer/Electronics Manufacturing Services) company in the world,
dwarfing U.S.-based Flextronics, which is the major manufacturer and assembler of Samsung
phones. In 2013, Foxconn was contemplating opening operations in the United States. In what
way could this be a challenge for Apple Inc.?
Teaching Tips: Review the PowerPoint slides for Chapter Eighteen and select those you
find most useful for enhancing your lecture and class discussion. For additional visual
summaries of key chapter points, also review the figures in the text.
CLOSING CASE
Nokero: Lighting the World
Nokero is a born-global social enterprise that markets solar light bulbs to over 120 countries.
The organization was started by Steve Katsaros, an inventor and entrepreneur. Upon receiving a
patent for his bulb technology, he received start-up capital from investors in Hong Kong and
China. The company maintains the goal of delivering environmentally friendly solar products
that are affordable to those most in need. The product was designed to reduce the use of
kerosene and diesel in regions that have shortages of electricity. Nokero has engaged
corporations, governments, international agencies, and NGOs on collaborative social programs
related to environmental sustainability, renewable energy, poverty alleviation, and disaster and
relief projects. The company has benefited from dozens of favorable stories in print media, TV
networks, and social media around the world. Consequently, demand for the product has
increased significantly. The organizational headquarters are located in Denver, Colorado, but the
sole supplier of the company’s product is located in China. Sales are driven through direct,
Web-based sales and through licensed distributors around the world. Katsaros understands that
the success of Nokero’s business hinges on its ability to address critical supply-chain issues and
some operational issues related to supply-chain management.
dispersed.
QUESTIONS
18.3 What type of manufacturing strategy should Nokero pursue? Should it continue to
supply all of its light bulb orders from a single factory in China?
18-4 In terms of distribution networks, should Nokero maintain fulfillment warehouses in
Africa, Asia, and Latin America? How should Nokero address the last mile issue of
accessing people in the most remote locations?
