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MYINT OO ISM BIT COURSEWORK

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MYINT OO ISM BIT COURSEWORK

  1. 1. Information System Management Apple Inc. Case Study 1 | P a g e Student Name: Myint Oo @ Amirul Hassan UOG Student Registration ID: 000805763 Coursework Title: Strategic Evaluation Consultation document for Apple Inc. COMP1646: Information System Management Due Date: 8 April 2014 Center: KMD (Yangon, Myanmar)
  2. 2. Information System Management Apple Inc. Case Study 2 | P a g e ACKNOWLEDGEMENT First of all, I would like to thank to my ISM teacher, Daw Moe Pale for her priceless suggestion to finish this coursework on time. Huge thanks to Mrs. Keeran Jamil, Greenwich Coordinator for offering us such a useful and valuable coursework from which I could know and learn many things I don’t know. Whatever I have learnt from this coursework has put ineradicable impression on my minds and it is my sincerity that this learning experience will always be a source of help in my practical life and professional career. Finally, yet importantly, I would like to express our heartfelt thanks to my beloved parents, for cooperation, help, kindness and blessings and my family and friends for their help and wishes for the successful completion of this coursework.
  3. 3. Information System Management Apple Inc. Case Study 3 | P a g e Table of Content Acknowledgement………………………………………………………………….………….…..….2 Chapter 1 1.1 Introduction 1.1.1 Establishment of Apple Inc……………………………………………………….……5 1.1.2 Competition with IBM and Apple’s difficulties………………………………...….5 1.1.3 Apple’s Downfall……………………………………………………………………5 1.1.4 Job’s return in Apple…………………………………………………………..……5 1.1.5 Apple’s step to electronic company………………………………....................….6 1.1.6 Introduction to iPhone…………………………………………….....................….6 1.1.7 Introduction to App Store……………………………………………................….6 1.1.8 Introduction to iPad…………………………………………….........................….6 1.2 Strategic Evaluation - Situation Analysis 1.2.1 SWOT Analysis………………………………………………………………..……6-8 1.2.2 PEST Analysis…………….……………………………………………….…....…8-10 1.2.3 Chapter Summary…………………………………………………….…………...…10 Chapter 2 2.1 E-Marketing Strategy 2.1.1 E-Marketing strategy that Apple adopted……………………………………..….…11 2.1.2 Offline promotion method…………………………………………………….....11-12 2.1.3 Online promotion method…………………………………………………….…..…12 2.1.4 Adopted strategy effects on Apple Inc………………………………………...…12-13 2.1.5 Chapter Summary………………………………………………………….….…..…13
  4. 4. Information System Management Apple Inc. Case Study 4 | P a g e Chapter 3 3.1 Legal and Ethical issues 3.1.1 Legal and Ethical issues on how Apple process data……………………..…….…14 3.1.2 Chapter Summary…………………………………………………………….……14 Chapter 4 4.1 Conclusion 4.1.1 Conclusion………………………………………………………………...….……15 4.2 References 4.1.2 Case study reference…………………………………………………………..…...16 4.1.2 Book references…...……………………………………………………….……....16 4.1.2 Website references...……………………………………………………………....16
  5. 5. Information System Management Apple Inc. Case Study 5 | P a g e Chapter 1 1.1 Introduction 1.1.1 Establishment of Apple Inc Apple Incorporated is an American corporation which was founded in April 1, 1975 by Steve Jobs and Steve Wozniak who are college dropouts. The company was set out in a family garage in Los Altos, California where they first started building computer parts. Its first product called Apple I was introduced. Then Apple II was released in April 1978 which sparks Apple to enter the PC industry and was a successful product. Apple became very famous and successful when it started producing Apple IIs at the end of 1980. Since then it was widely regarded as an industry leader. 1.1.2 Competition with IBM and Apple’s difficulties Apple didn’t stop and see and released Macintosh in 1984 when its first competitor called IBM obtained more market share and increased new standards and rules for the industry. Unfortunately after the release of Macintosh, apple was fallen into a worst disaster because of its slow processor speed and other incompatibilities. Because of the effective marketing skills of Scullery who is also a CEO, Pepsi-Cola, apple was back to its normal market position and it had $1 billion in cash and became the most commercial PC Company in the world. As Apple’s income fell by 34% to 14 points under 10-year average, Apple’s president replace Scullery by Michael Spindler. Under the administration of Spindler, Apple got 45% of oversea sales excluding United State. 1.1.3 Apple’s Downfall Due to the loss of $69 million in 1996, Gilbert Amelio took over as a CEO from Michael Spindler. Amelio proclaimed to obtain NeXT in December 1996 in order to develop a new OS based on NeXT software which was founded by Jobs after the departure of Apple. After the loss of $1.6 billion under the administration of Amelio, Jobs returned to the company to save it in September 1997. 1.1.4 Job’s return in Apple Jobs completely changed the working system of Apple by applying “Close door policy” which makes Apple the most valuable company in the world. On the Jobs’ return to Apple, it grossed $309 million profit in its 1998 financial year. In 2011, Apple released a new OS which was based on UNIX which cost approximately $1 billion to develop. Apple was the third biggest PC retailer in United State with an 11.0% unit share in 2011. In the same year 2001, Apple first opened its retail store in McLean, Virginia in 2001and it has more than 300 stores in 13 countries now.
  6. 6. Information System Management Apple Inc. Case Study 6 | P a g e 1.1.5 Apple’s step to electronic company Apple started taking its step towards to the electronic company in 2001. iPod was first introduced in 2011 which would later holds more than 70% of the U.S. MP3 market in 2012. Apple opened an iTunes Music Store with a view to provide more satisfactory services to its users which provides more than 6 million songs. 1.1.6 Introduction to iPhone In January 2007, Apple introduced an extraordinary device called iPhone which cost approximately $150 to develop. The second model was released in 2008 and kept releasing upgraded iPhone series every 12 to 15 months. 1.1.7 Introduction to App Store Apple launched App Store in 2008 which would later holds more than 585,000 by 2012 with a view to provide easy access to its users to download applications. 1.1.8 Introduction to iPad Apple released iPad in 2010 which completely change the digital world. It’s announced that over 55 million iPads were sold which grossed $35 billion profit. 1.2 Strategic Evaluation - Situation Analysis The following offers information concerning existing situation of Apple’s products market position, strengths and weaknesses and also its possible future situations, threats and opportunities. 1.2.1 SWOT Analysis Strengths Due to the innovative and user friendly designs and ease of use of the functions, Apple’s products are the most popular and attractive products. So, Apple has already gained customer trust and loyalty as it applies close ecosystem. In the mobile technology, Apple is the leader of the market and the most profitable company in the world. In order to gain more profits, Apple invested 9% of sales to research and development in comparison to other competitors.
  7. 7. Information System Management Apple Inc. Case Study 7 | P a g e Apple’s adopted e-Marketing strategy helps Apple to set out more than 300 stores in 13 countries which help reach its products to the customers in a short span of time while other competitors doesn’t have any retail stores. The role, management and marketing strategy of Steve jobs in developing Apple products such as iPhone, iPad and iPhone are unbelievably. As a result, customer satisfactions and brand reputation of Apple products are on the rise because of its continuing use of high technology and regular support. Apple’s has no debt and $10,000,000,000 in cash.. App Store is one of the well known services which make Apple products worth the price. Apple produces its own software and hardware for its devices which makes Apple an ideal industry. Weaknesses As Apple manufactures its products with closed operating systems, its customers don’t have a choice to download application from other sources but App Store while android customers have. Because of which, only limited people can use Apple products as they are sold with high prices. Apple has smaller life cycle on the products introduced which evaluates that the research and development team must be continually maintained, which needs massive resources. Unfortunately, Apple’s CEO, Steve jobs is no more in the world which has caused an excessive damage on developing innovative products. His absence completely effects on its annual income. The uses of high technology on Apple’s devices make them expensive and may make customers unable to buy the products. Because of which Apple decreases market share. Opportunities World’s population is on the increase which will widen many new markets and technology is on the rise as well which will attract and pursue most of them to use Apple’s luxury products. So, the demand of Apple products such as iPad series and iPhone series are on the rise which will increase Apple’s market share, will build up firm’s viable advantage. The interest of other rival customers will likely turn into Apple’s products because of its brand reputation and customer satisfaction. Due to having customer trust and loyalty, Apple can have broad customer base in the future.
  8. 8. Information System Management Apple Inc. Case Study 8 | P a g e The quality of Apple’s products will be more trustworthy and better as Apple has invested 9% of sales in the research and development. Apple can expand its iCloud services as the use of cloud computing is increasing. Having many retail stores in different countries, Apple could focus on introducing new products and services rather than advertising its products. Threats A widely used mobile OS called Android can reduce the popularity and influence of iOS and stop customers from using Apple’s products. As a result, the expensiveness of Apple products will stop getting broad customer base. On the influence of iTunes, many companies such as Amazon and Wal-Mart come out to provide similar online music services because of which Apple overcomes difficulties. But, Apple holds a strong reputation and image on technology that may make all its rival companies to keep an eye on it to produce clone devices which can cause a huge damage on its reputation. Likewise, US governments may increase tax rate for Apple as it holds strong image and higher income. On losing Steve Jobs in Apple, it will be difficult to stand on existing reputation and image. Many of the apple customers download free applications from App Store which will effect on paid applications from which apple take 30% of sales. Apple made half of its income from oversea so that the exchange of dollar against other currencies can effect on potential profits which come from oversea. 1.2.2 PEST Analysis Political Factors The distribution and production of several important components is carried out by only- sourced outsourcing partners in the US, Asia and Europe. Apple’s outsourcing partners of Asia fix its hardware products. It may be difficult to produce in these locations or distribute or arrange shipment to another location for various reasons such as not restricted to, human’s mistake, natural disasters, system failure, economic or military action, business, environmental, labor, public health or political issues. War and terrorism and other similar disruption have damaged to international market and business. Hence, this could cause a bad effect on Apple, its stakeholders such as suppliers, customers, channel partners etc. Apple doesn’t have any control on these factors.
  9. 9. Information System Management Apple Inc. Case Study 9 | P a g e Apple has built up presence and relationship with worldwide. Some countries are developed, some developing and some under developed. But different countries have different rules and regulations, tax rates. Some rules and regulations are very strict and some tranquil. However, in order to start business with the foreign countries, Apple has to follow their imposed rules and regulations. Otherwise and advertising and selling products may be banned. Economic Factors As Apple is an internationally recognized company, the international economic situation has become an important factor which influence Apple Inc. Inflation, currency and recession are the most critical factors which affect Apple Inc positively or negatively. For instance, within the period of inflation in the United State, customer’s purchasing rate and Apple’s sale rate will go down. As the value of US dollar is always changing which cause an adverse effect on Apple Inc, it has purchased itself foreign currency. Therefore, the impact of global economy on Apple Inc is decreased. By doing so the revenue of its products has increased in the global market. Social Factors Innovative design and quality of Apple products are the key social factors which can effect on Apple Inc. As Apple products are perceived to be highly reliable, they have held a strong position in the global market. The rate of purchasing of the products such as iPhone series, iPad series have also gone up in several markets around the world. Using or holding these products are widely said to be as status symbols in different societies which also raises the sale rates of Apple products. The rapid increase of music industry is another social influence to Apple products that have raised markets on the internet. The biggest online music store is iTunes so that Apple can profit from the social factors because it started creating a unique lifestyle which fascinates everyone. Technological Factors As the rapid growth of technology, the markets get wider and the rival companies will also increase. Every technological company is competing with each other by producing new innovative product so that Apple must keep upgrading its products to outdo its rival companies easily. Otherwise its market position will be snatched by other market leaders. Apple has invested 9% of its sales to the research and development to improve product quality. For instance, Apple manufactures its products with its own operating system which increases manufacturing cost. Thus, Apple product holds the top ranking and customer satisfaction in mobile world. Research and Development cost of Apple is going up yearly. $1.8 billion in 2010, $2.4 billion and #3.4 billion in 2012 which is an important factor to be considered.
  10. 10. Information System Management Apple Inc. Case Study 10 | P a g e As long as the changes of technology exist, Apple Inc could benefit by producing new products to the markets that finally lead the market. 1.2.3 Chapter Summary In this chapter, based on the case study, Apple’s strengths, weaknesses, opportunities and threats are clearly discussed including examples from the case study. Then how these four factors called political, economic, social and technological can effect Apple Inc is discussed. Word count for chapter-1 - 1900
  11. 11. Information System Management Apple Inc. Case Study 11 | P a g e Chapter 2 2.1 e-Marketing Strategy 2.1.1 e-Marketing strategy that Apple adopted Apple Inc is providing its services and increasing the sales of the products by setting out its retail stores in different cities of the different countries. Having retail stores in different locations, Apple can easily introduce and display new products and deliver to the customers at the right time. Even if it has more than 300 retail stores, it doesn’t have its retail stores in some developing countries where customers have difficulties to buy and get services directly. As a result, Apple is also losing plenty of its golden customers. Apple offers skilled retail floor employees to chosen seller’s stores. Apple has also made an alliance with other companies to supply its products and services. The e-Marketing strategy Apple has adopted is Internet Market Research because rival companies are increasing year by year due to the rapid growth of technology. So, it’s very important for Apple to know what its competitor companies are doing and the requirement of customers. What most important is to extend retail stores to the remaining areas by collecting data through its own website and other resources. As Apple always kept an eye to Competitors Company to manufacture unique products and customer needs, Apple products hold the higher market position in mobile technology field. Apple retail stores are the most popular and successful because Apple is very good at internet marketing research. As Customer’s needs are always changing and increasing and technology is always changing, Apple must keep focusing on internet market research. It also invested 9% of its sale in research and development to introduce newer quality products. Almost every country wants to have Apple retail stores because it provides direct customer experience of Apple’s brand products. The visitors of Apple retail store get absorbing good care, can learn more about Apple products and get satisfactory services and help for their purchased products from the employees at their domestic stores. These are the reasons why Apple is the leader of the mobile technology market. 2.1.2 Offline promotion method Apple Inc is very strong and energetic in both offline promotion and online promotion to increase the sale of its products. Apple logo is one of the most attractive and recognizable logos in mobile technology. Apple promotes its sales by providing training to employees working at retail stores and customer’s instruction. Apple builds strong relationship with its customers by offering more discounts and other options such as free delivery, accessories gift and so on. This will make its customers satisfied and eager to buy more products. Another way of offline promoting for increasing its sale is to display all its products at its retail stores for the public to let them know more about and
  12. 12. Information System Management Apple Inc. Case Study 12 | P a g e experience the products at the same time which is lower purchase price and repayment which permitted its customers to be liberally and comfortable with Apple products. Apple always targeted its customers especially to the university students who have already enrolled by providing free iPods to those students who purchased Mac Book laptop which can not only get the purchasers attention but also other students to purchase more products from Apple Inc. 2.1.3 Online promotion method Apple launched its own websites to advertise its new products and promote its direct sales online as the users of internet are on the rise. As soon as new Apple products are available, it also displays its products on its website to attract the online customers to buy its products. Online customers as well as customers who don’t have retail stores in their area could also get help for their purchased products through its website. Not only it increase sales but also gets new online customers. Another online promotion strategy of Apple is the establishment of iTunes online music store in 2003 and App Store in 2008. iTunes has become the number one online music store which not only increased the customers but also the sale of Apple products especially iPod because of its music selection and ease of use. According Walt Mossberg of Wall Street Journal, “the App Store is what makes your device worth the price”. Apple provides many free applications to its users though App Store which attracts its customers as well as potential customers because of its best services. So, Apple increases its sales and promotes its products through its own websites, iTunes and App Store. These three are the energy of Apple to increase its sales online. In conclusion, based on the above facts described, it can be said that Apple Inc has balance measurement on online and offline promotion. 2.1.4 Adopted strategy effects on Apple Inc The adopted strategy caused a hug impact on the performance of Apple business such as business becomes wider by extending retail stores in different countries around the world, distribution of Apple products to different areas become faster, introduction and display of new products to the customers become easier, brand name become more popular and attraction of potential customers are increasing. Because of the strategy adopted, Apple has opened more than 300 retail stores in key cities around the world and extending to the remaining locations where its products are introduced and sold officially. By doing so, its business gets wider and wider in different locations around the world which makes apple lead the market. Apple retail stores are the reasons how internet market research effects on Apple.
  13. 13. Information System Management Apple Inc. Case Study 13 | P a g e Having retail stores in various locations, Apple can supply its products in a faster way so that customers can get the right products at the right time which not only improve sales but also receive customer satisfaction and feedback. Apple had many difficulties to display its products before setting out its retail stores to foreign lands. It could also display products within the US only. After opening the retail stores in different areas, Apple can introduce and display its newer products in an easy way where Apple retail stores exist in at the same time which raise the reputation of Apple and its products. Because of which Apple becomes the most successful and profitable technological company in the world. As customers can know and experience more about Apple products physically at its retails stores in different locations and the trained staffs of Apple retail store patiently explain about the products, Apple brand name gets more popular which attracts potential customers to buy Apple products and increases the sale rates of Apple products. 2.1.5 Chapter Summary In this chapter, first of all, what type of e-marketing adopted in the Apple Inc. is discussed. Secondly, discussion on the balance measurement of online and offline promotion made. Finally, how the adopted strategy could effect on the performance of Apple’s business is explained. Word count for chapter-2 - 1117
  14. 14. Information System Management Apple Inc. Case Study 14 | P a g e Chapter 3 3.1 Legal and Ethical issues 3.1.1 Legal and Ethical issues on how Apple process data Apple Inc is an internationally recognized and the most popular company in the world so that it may be targeted to attack to gain access to its confidential information to destroy its reputation and image. Before gathering personal information from customers and employees for future analysis and business needs, Apple Inc needs to impose Privacy Policy or use Data Protection Act which as 8 principles in the company which covers how data will be collected, used, disclosed, transferred and stored of customer’s personal information to keep customers, employee’s information secure .When Apple gather data from the customers and employees, it needs to let them know that how their personal information will be used. Their personal information should be only used to identify and contact a single person. If Apple needs to share personal information to third parties such as service provider, it needs to seek permission from its customers and should convince them that their personal information will not used for marketing purposes but for national security, law enforcement and other issues of public importance. When it no longer needs the personal information of customers and employees, they should be deleted. Apple should make it easy for customers to keep their personal information accurate, complete, and up to date. Personal information should be kept for the period necessary to complete the purposes outlined in this Privacy Policy unless a longer retention period is essential or allowed by law. Only authorized employees should be provided access to the personal information of customers for the tight security. Serious actions should be taken according to the law if they abuse personal information. Apple Inc has the sole responsibility for the safety of its customers and employees. Once the information is stolen or misused, it might have a huge impact on its business. In conclusion, as information is the most important factor for the success of an organization or company, it should be processed legally and ethically. Only then organization will have many opportunities to move forward with success. The above facts should be considered for processing information in order to keep them secure. 3.1.2 Chapter Summary In this chapter, discussion on the consideration of Apple’s legal and ethical issues in relation to the information processing including examples and suggestions are described. Word count for chapter-3 - 388
  15. 15. Information System Management Apple Inc. Case Study 15 | P a g e Chapter 4 4.1 Conclusion and References 4.1.1 Conclusion In this report, firstly, background information of Apple is written Inc from which it can be known that how much effort, hard work and sacrifice had to be given to be the most successful company in the world. Secondly, I used SWOT and PEST analysis to observe much about Apple business. By analyzing with SWOT, it’s found that Apple has both good things and bad things. Good things like having strong customer trust, brand popularity, unique technology especially iPhone, iPad and strategic agreements with large telecommunication companies such as AT&T and bad things like having many rival companies, expensive products and many more. By using PEST analysis, it can be known that international market condition is not stable and a huge impact on Apple business due to the changing US dollar. By using an e-Marketing strategy called internet market research, it can be known that how Apple markets its products and extends its market position worldwide by setting out retail stores. Because of that Apple holds highest market position and becomes the most profitable company. Through offline and online promotion, it can be known that how Apple sells and promote its sales offline and how this effect on its business. Likewise, how it increases its sales online. Apple Inc benefitted from these two methods. In comparison with these methods, offline promotion is more effective. Finally, legal and ethical issues are discussed based on Data protection act, privacy policy. It can be known from the discussion that how Apple should process with the personal information and how it should seek permission from its customers and employees if it needs to share data with the third parties. Word count for chapter-4 – 277 Total Word Count – 3682 (Excluding Acknowledgement, Table of content, and references)
  16. 16. Information System Management Apple Inc. Case Study 16 | P a g e 4.2 References 4.2.1 Case Study Reference DAVID B. YOFFIE, PENELOPE ROSSANO, (2012). Apple Inc. in 2012. 1st ed. Boston: Harvard Business School. 4.2.2 Book References Dr John Ashcroft, (2012). Apple from the iPod to the iPad. 2nd ed. Manchester: Prentice Hall. Ahmad Al-Rubaie, (2010). Apple innovation; a case study. 1st ed.: EBTIC ETISALAT BT Innovation Center. 4.2.3 Website References Ovidijus Jurevicius (2014) SWOT analysis of Apple, Available at: http://www.strategicmanagementinsight.com/swot-analyses/apple-swot-analysis.html (Accessed: 20 March 2014). Ishfaque Faruk (2013) Apple: A SWOT Analysis, Available at: http://beta.fool.com/ishfaque/2013/06/14/apple-a-swot-analysis/36774/?source=TheMotleyFool (Accessed: 21 March 2014). Classiqu (2013) APPLE INC. – P.E.S.T ANALYSIS, Available at: http://www.classiqueblog.com/ (Accessed: 20 March 2014). Rajibul Hasan (2012) Apple Inc. - An Analysis , Available at: http://www.grin.com/en/e- book/206976/apple-inc-an-analysis (Accessed: 2 April 2014). Apple Inc (2014) Legal, Available at: http://www.apple.com/legal/ (Accessed: 1 April 2014).

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