Case: Apple’s Make-vs.-Buy Decision

In a turnaround from a trend in which high-tech (and other) manufacturers have outsourced the making of important components in order to increase efficiency and focus on what they do best, Apple has recently made moves that seem aimed at bringing the design of microchips back in-house. Apple is known for innovative design, and along with that, it tends to keep details of what it makes highly secret. Making chip design a company process, rather than a product to buy, gives Apple more control over the process-and over the secrecy. Of course, the decision to handle its own development has huge implications for human resource management. The company needs all-new labor forecasts, a larger labor force, and an intense push to bring in technical talent. Recently, Apple has been hiring many new engineers. Products they could be assigned to include microchips that require less power to operate iPhones and iTouch devices, as well as circuitry to improve the graphics displayed in games and videos played on its devices. A top-notch team could, at least in theory, come up with unique improvements that will take rivals by surprise. One way to acquire a lot of talent fast is to acquire entire companies and make them part of Apple. And that’s one move Apple has been making. The company recently acquired P.A. Semi, a start-up company that designs microchips. Its products could be used to run iPhones and iPods. Observers are guessing that chips developed by P.A. Semi could take the place of chips Apple has been buying from Samsung for its iPhone. Samsung had customized the chips to Apple’s specifications. Apple could be worried that a company such as Samsung might intentionally or unintentionally start applying some of Apple’s ideas to chips made for competitors’ products. Another bit of evidence about Apple’s hunt for talent is visible