Friday Rant: Flexible Supply Chains — Is Apple Too Secretive, Rigid and Arrogant For its Own Good?

We've written a good deal on solutions that enable collaboration between corporate, business units, suppliers, and even multi-tier interaction, including customer or end-user input. It looks like Apple needs to read some of those.

Some news from last week tells us that Apple has been fined for lying about, err, misrepresenting, product capabilities. Per the article:

"Apple has agreed to a Aus$2.25 million (US$2.22 million) fine for misleading Australian customers about the local 4G capability of its next-generation iPad, in a case brought by regulators. The Australian Competition and Consumer Commission (ACCC) told the Federal Court that the US tech giant had agreed to the penalty for implying in advertising that the 4G function on its latest iPad worked in Australia ... It is now advertised outside North America as "Wi-Fi + Cellular", with a clear caveat on its Australian site that "it is not compatible with current Australian 4G LTE networks and WiMax networks.""

Slap that wrist harder -- slap, slap, slap -- with a market cap of around $540BB. I don't think Apple quite felt that fine.

Per the above-linked article and our own analysis, Apple's problems are not confined to Australia. The exact same 4G incompatibilities exist outside of North America. In the UK and Sweden, for example, Apple is being investigated for the same problems. Maybe true 4G capability in Apple products only exists in North America?

This is clearly a case of marketing/design/engineering/procurement not collaborating sufficiently throughout the supply chain, or perhaps not talking at all. If there was not a more public breakdown of design, procurement and customer (i.e., both end-users and telcos) collaboration, we've not seen it. As root cause analysis (speculative), I say this looks like the typical pigheaded "we know best" attitude that you see in tech firms once they've had a few successes. Apple was clearly not using a collaborative product design process where all parties got to bring their KPIs to the table. Perhaps in design when it came to working with contract manufacturers and lower tier suppliers, but not with distributors and carriers.

Some good news for Apple's IT category manager -- a good collaboration tool will cost you less than $2M per year -- immediate ROI!

For our solution provider readers, please send us a note or leave a comment about how you would help Apple and similar firms not trip over their own feet when rolling out technology products with global appeal.

- Thomas Kase

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