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OM in the News: Apple’s Sustainability Move

April 17, 2018

Apple’s new HQ features rooftop solar panels.

“Apple has just announced,” writes The Wall Street Journal (April 10, 2018), “that it has achieved a decade-old goal of having its facilities world-wide powered exclusively by renewable energy, an achievement that will shift the company’s sustainability efforts to its supply chain, where about 10% of suppliers have made a similar commitment”.

The tech giant said it has improved to be 100% reliant on clean energy from 96% last year in part by contracting renewable energy for the first time in India, Turkey, Brazil and Mexico. The figure covers all of its retail stores, offices, data centers, as well as its new California headquarters, Apple Park, the spaceshiplike structure that is one of the largest on-site solar installations in the world.

Apple is just one of many global corporations trying to cut energy consumption and shift to renewable power including wind and solar, both to cut costs and slow climate change. More than 100 companies world-wide, including Apple, IKEA, Anheuser-Busch and Starbucks, pledged in 2014 to shift to 100% renewable energy. Many of these companies are now trying to accelerate efforts to convince their suppliers to join them.

Environmental experts said the bigger challenge will be making the manufacturers of the more than 200 million iPhones and 43 million iPads it sells annually wholly dependent on renewable energy. “We’re not going to stop until our supply chain is 100% renewable,” said Apple’s VP. Apple, which set that goal two years ago, said 9 more of its suppliers have committed to powering all production with 100% clean energy, bringing the total to 23 out of more than 200 suppliers. Apple also will be challenged to keep its own facilities at the 100% level in the years ahead, especially as it looks to add a new campus in the U.S. and $10 billion in data centers.

Classroom discussion questions:

  1. Why is Apple’s drive an OM issue?
  2. Why is the firm’s movement so important to industry?
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