Supply Chain Optimization

In iPad supply chain, display is found to be the most critical supply. The disruption is primarily due to the defects in the touch sensor module and greater lead time in the supply chain. This white paper is focused on optimizing the supply chain and increasing the turnaround cycle for display by the In-Cell Technology. In the Q2 2012, Apple sold 11.8 million iPad (a 151% increase compared to Q2, 2011). However, the demand for iPad during the period was more than 13 million. The inability of Apple's supply chain to scale-up the production within a short duration time created the supply constrain. Apple struggled to ramp-up its iPad production to cater the overwhelming global demand. iPad production have reported been limited by the supply of retina display. This is primary due to the lower yield rate and higher lead time in retina display supply chain. The defects primary occurs in the touch sensor lamination process and the visibility of the defects are found only when the display units reach tear one manufactures like Foxconn (i.e. a lead time of approx. 1 week). Hence with a higher resilience risk and higher supplier base presence (Probability of defect occurrence is high) creates constrain for production ramp-up.