Apple Inc. has experienced tremendous growth through careful strategic planning including competing on uniqueness rather than price. The company maintains its competitive advantage through high quality, unique products and strong brand loyalty. Strategic management at Apple involves analysis of operations to ensure effective decision making supports goals and objectives. While some criticize Apple's higher prices, their focus on quality and ease of use has made them a leading technology company globally.
Strategic Analysis of Apple Inc's Managerial Tasks
1. Managerial Tasks in Strategy Execution
Ernestine DeWitt-Yancy
Argosy University
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Apple Inc.
Strategic Elements
http://collegemouse.com/jobs/how-to-become-an-apple-
technician.html
Apple Inc. started April 1,1976 and has consistently
changed the way communication and processes of business to
business transactions transact twenty four hours a day, every
day of the year. Over the years Apple Inc. has experienced
tremendous growth. The growth occurs with careful strategic
planning. One of Apple Inc. strategies plans is to compete with
their competitors by being different rather than comparing
prices of products. Maintaining their uniqueness of products
whereby there is only one company that creates high end quality
products that ties in with careful strategic planning for
expansion in the global economy.
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2. Company Culture
Executing Managerial Tasks
Minimize Disruption
Exert control over the schedule
Reduce pain of change
Involve employees involved in planning change
Build teamwork at all levels of the organization
Establish a foundation for change that will make future changes
easier.
Change is inevitable and is going to happen. For many
businesses that grow change is the driving force behind being
competition. If Apple had stopped changing after the Mac, we
wouldn’t have the iPad and Apple would have gone out of
business. Since change is going to happen, you have two
choices. You can manage change or you can let change just
happen on its own. A quote in the 80’s from Steve Jobs, "Man is
the creator of change in this world. As such he should be above
systems and structures, and not subordinate to them.” (Kraemer,
Linden, & Dedrick, 2011).
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Critical Strategic Goals
Strategic HR Training
Strategic Planning
HR Management
Business Strategy
Strategic Plan
3. http://www.rittmanmead.com/training/
Strategic HR training involves the perspective to create an
effective talent management system that helps employees feel as
if they are part of something bigger than their current job.
Strategic Planning involves having full executive support from
all levels of management. Human Resource management helps
both management and employees learning all aspects of
company goals and mission of the business. Business strategy is
communicated with all stakeholders (including employees) of
Apple Inc. Strategic Plan is formulated by CEO’s and
management of Apple Inc.
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Performance Indicators
http://dazeinfo.com/2014/01/28/apple-inc-aapl-scored-record-
breaking-revenues-q4-2013-well-paradise/
Apple’s stock prices eventually soared mid-September in 2012
before taking a downward turn then an upward trend closed the
year of 2003. Apple Inc. had a strong financial performance in
2013 along with company stock price had a dip in profits during
the second and third quarter of 2013. Apple’s strong financial
performance was due to large amounts of sales with iPods,
iPads, iPhones, and MAC computers. About money reports
Apple “sold 74.5 million iPhones in its fiscal first quarter ended
Dec. 27, while many analysts had expected fewer than 70
million. Revenue rose to $74.6 billion from $57.6 billion a year
earlier.” (2015). Apple Inc. is the only public traded company in
history that had the largest earnings, ever (About money, 2015).
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4. Initiatives of Strategic Effect and Cost
Eco friendly packaging
Keeping high end jobs in the U.S.
Cutting cost by outsourcing manufacturing
Unique high end products
Pollution reduction
Use of Resources
Creating jobs for recycling
Apple has changed their competitive advantage by implementing
an eco friendly packaging of their products. Apple insures
maintaining effective strategies by ensuring they meet goals and
objectives by keeping their product line uniqueness with
competitors with creating high end products that meet the need
of consumers (Wu, Finck, Walker, & Li, 2015). Apple uses
outsourcing as an effective strategy in maintaining lower
production costs.
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Key Performance Indicators
Enterprise Valuation
Sell more product in Global Market
Add value and increase profit
5. Maximize Shareholder Profit
2013 Apple Inc. Performance
Record breaking sales obtaining revenue as high as “54 billion”
in sales 2013. Large contributor, hardware business of Apple
Inc. Velazo reports, “6.4 million iPhones 5s” were sold in a
quarter in 2013 (2013).
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References
Kraemer, K., Linden, G., & Dedrick, J. (2011). Capturing value
in Global Networks: Apple’s iPad and iPhone.
University of California, Irvine, University of California,
Berkeley, y Syracuse University, NY.
Velazco, C. (2013), Apple’s Mixed Q1 2013: Revenue Up
17.7% to $54.5B, $13.1B In Profit, Earnings Of $13.81/Share
Wu, B., Finck, B., Walker, T., & Li, Y. (2015). Improving
Environmental Standards strategies.
Group Case: Snead’s Dry-Cleaning Company
Sheldon Snead’s uncle has owned and operated a dry cleaning
6. business in a residential area near downtown Washington, DC
for 30 years. It has been successful enough for his uncle to raise
a family, send three children to college, and save enough for an
OK retirement.
As Sheldon’s uncle plans for retirement he finds that no one in
the family is interested in the business. Sheldon worked for his
uncle during the summers while in high school and began
working there again after his recent layoff from a management-
consulting firm, which allowed him to look for other work.
Sheldon’s uncle asks him whether he would like to take over the
business and to eventually buy it. This is a good situation for
his uncle, because he can continue to work for a while and still
earn money, delaying retirement, and he can better plan the
succession of the business. Sheldon see the merits of the
situation, too, and starts to think about it seriously.
Some details about the business:
· One location in a neighborhood zoned for residential and
commercial activity near many professional office buildings.
· The business has between 400 and 600 regular customers, and
about 800 names in its computer listing.
· The dry cleaning equipment is co-located to the storefront.
The equipment is at its end of life and in need of replacement
probably in the next 3-5 years
· The business owns the building and land, valued at about
$250,000. There is a small improvement loan outstanding on the
property
· The business profile is roughly as follows
· Income statement (See attached)
· Balance sheet (See attached)
· The storefront area also requires renovation: new floors,
countertops, computer and point of sale (POS) equipment,
management system, etc. The total investment in new
infrastructure is as follows:
7. · New Equipment: Purchase price $100,000 -$125,000
· New POS equipment: $10,000-$20,000
· Renovations in storefront: $15,000-$30,000
· No family members are interested in working there, and
Sheldon will need to hire employees at rates higher than his
uncle ever paid.
· A major dry cleaning chain has just opened a modern
establishment a few blocks away and its rates are between 5%
and 20% lower than Snead’s. Its cleaning and laundry are done
in a different building 20 miles away.
As Sheldon thinks about the business more, his uncle advises
that he will need to expand the business in order to be different
and to add services that are trendy. His uncle recommends:
(1) Some sort of concierge pickup and drop off service?
(2) Tailoring and repair?
(3) Collaboration with shoe and luggage repair?
(4) 8-hour turnaround service?
(5) Other?
Sheldon is not sure about all of these recommendations, but
some might work. He sees a facility that could use modern
equipment and that could handle more throughput, perhaps by
expanding operating times from the normal 8-9 hours per days
to a 12-16 hours per day with 1.5 or two shifts of staff.
Through an acquaintance at the office building where he
previously worked, Sheldon knows of a small retail space on the
ground floor entrance that is available for a very low cost
(about $3500/month) and where he could set up a receiving
operation for dry-cleaning and laundry that would be further
processed at the main facility.
The new equipment costs concern him, because Sheldon knows
that he will not qualify for a loan and he would need his uncle
to remain in the business for that reason alone. He recognizes
8. the immediate threat of the discount establishment nearby and
will need to develop a plan to retain his customers and attract
new ones. He also sees that this is a business where there is not
much growth in scope. He wonders if there are any other
subcontracting opportunities, but he doesn’t know. Then, of
course, he will need to generate enough revenue to be able to
buy the business from his uncle. He hopes that in a few years
of operation, he will be able to qualify for his own loan and
become fully independent. His assets will always consist of
only the building, any equipment and tools, and his cash flow.
From his experience with the business, he knows that he will
need to maintain an earnings target of at least 15%, but to
qualify for loans in the future, he will need to get to and
maintain a 17% to 20% ratio.
Other Information about Snead Dry-Cleaning Company
-1-
9. Running head: Strategic Analysis: Organizational &
Competitive
Strategic Analysis: Organizational & Competitive
9
Strategic Analysis: Organizational & Competitive
Ernestine DeWitt-Yancy
Argosy University
Strategic Analysis: Organizational & Competitive
Managing strategic planning will be the most important aspect
for a organization such as Apple Inc., especially being the
second largest technology business in the world. Apple is a well
known technology organization that has successfully pioneered
the international market. Apple Inc. has done a terrific job so
far with implementing well thought out strategic planning
management with CEO’s of the organization. Apple’s paid
attention to the needs of the market and continue to develop
products in regard to these needs. Apple Inc. mission statement
reflects truly what has come to fruition in stating, “The power
to be your best” (Dowling, 2000, p. 82). Apple Inc. values in
relations with management verses employees in the United
States and abroad have been faced with what most business
have, culture relations and subculture relations continue to be a
work in progress (Dowling, 2000). This paper describes the
strategic analysis Apple Inc.’s uses in the organization and
speaks about their competitiveness in the technology market.
Strategic management refers to the grouping of efforts within a
business that support decisions, ultimately has a positive effect
for the organization. Apple Inc. strategic management requires
careful analysis of their entire hubs of operations ensuring that
the right business decisions have been made. Apple Inc.
operations can be labeled as successful in terms of being
effective with strategies, goals, and objectives (Song, 2015).
Apple Inc. is regarded as a top-notch organization `when it
comes to production of technological devices. Apple is a
10. leading producer of personal computers, phones, tablets, and
IPods. Apple Inc. has been in existent for several decades and it
ensures that all its products are in line with the prevailing needs
of the market. Apple Inc. has been dedicated to anticipating
high standards of responsibility to customers in all the products
they produce. The organization ensures it provides high quality
products and ensures it provides a level of technology that does
not intimidate the people who are not well versed with the MAC
computer. In addition to the provision of highly effective
technological products, the organization has ensured that it
provides a favorable working environment for its employees in
order to improve the social responsibility of the organization
and its image in the market. Apple Inc. has also focused on
innovation as one of the major aspects that determine its access.
Apple has been dedicated in making good products that satisfy
their customer base through pioneering innovation of products
that are efficient than their competitor, Samsung. Through such
a framework, Apple has become a leading organization in the
technology market whose drive for excellence as a Technology
organization (Mellahi, 2014). Apple Inc. has been recorded as
the most profit making technological organization due to its low
production costs since most of its production services are
outsourced.
Apple has been criticized for higher cost of its products.
Although, the products are of high quality in relations to
Personal Computers (PC), many customers have stated that
Apple products are more expensive and customers prefer the
more affordable PC brands. Additionally, the software used in
the creation of the Apple products has been criticized for its
incompatibility with other software from other companies.
Anyone with knowledge of computing technology can contest
that MAC are of higher quality with performance. Apple
organization has already built a reputation in the technology
industry that their products are of high quality.
Apple has maintained their competitive advantage in their
respective markets. Apple has gained competitive advantage
11. mainly because of the quality of its products and the uniqueness
in its products. Apple provides unique products of high quality
whose software cannot be compatible with other software from
other companies. Users view Apple products as an indication of
social status, making everyone want to have an apple product
(Thompson, 2013).
Apple Inc. biggest goal set was to capture the educational realm
with supplying all schools with MAC computers and smart-
boards for educational purposes (Dwyer, Ringstaff, Haymore, &
Sandholtz, 1994). Brilliant strategy and it worked. MAC
computers are more reliable than PC, which justifies the
increase in price. Another goal for Apple Inc. is to keep
creating technical tools to help aid innovation success.
Apple recognized that customers demanded high quality
products that allow for ease of use and allow for growth in the
usage of the products. Apple did not want to have a wide market
but concentrated on a narrow market that appreciated its high
quality products. Apple also realized that there was a need to
develop a brand name that would be recognized by the masses
of users. Through such a strategy, Apple has become a highly
profitable technological organization globally (Thompson,
2013). Apple has become excellent in keeping effective
strategies in reach ensuring that they attain their goals and
objectives. Apple Inc. creates unique products whose software
is not compatible with other software from different companies.
The product line ensures customers remain loyal, not by choice
but by the way in which their products have been designed. This
means Apple has created approving products for customers,
which ensures all the profits of sales are reinvested in the
organization (Song, 2015).
Apples strongest strategy as a organization is their reputation of
brand name and loyalty among customers. Apple has already
established a brand name that is recognized globally and with
continued products being created, ex: smart televisions and
music systems, among other technological products. Through
diversification, it is highly possible for Apple to increased
12. creativity and innovation (Mellahi, 2014). Apple has been
successful with their strategies but has yet to learn how to
implement diversification throughout the core of the
organization because they need to learn other cultures values as
they see it. As the world is becoming more and more diverse
they have no choice but to keep learning how to capture the
bigger picture in the same light as Samsung has done.
Apple is successful in its corporate level strategies by
employing integration and outsourcing. Apple has been able to
acquire similar level companies by ensuring that it maintains its
brand name in the technological market. For example, Apple
acquired beats by dre, which had been a high profile headphone
manufacturing organization and its acquisition by Apple was a
giant success. In addition to its horizontal integration, the
organization has been able to use outsourcing as an effective
strategy in maintaining the production costs of the organization.
Due to the high labor costs in the US, Apple has been able to set
up manufacturing plants in China due to the availability of
cheap labor thus increasing the profit margins for the
organization. Through these strategies, Apple has emerged as
leaders in their respective markets (Luthans, 2012).
Apple has been able to take various action plans in addressing
unethical behaviors. On the other hand, Apple has also been
struggling with claims of unethical behaviors such as
environmental pollution, underpaying workers, and cases on
patent infringement with Samsung. In light of these allegations,
Apple decided to investigate and came up with a strong
framework that took care of all the employees in all the
manufacturing plants and ensured that their welfare had been
taken care of. Additionally, the organization also ensured that
all its waste products were safely disposed of and Apple did not
want to cause any harm to the environment. On the cases of
patent infringement, Apple decided to drop all their cases,
ending the patent war that had caused the organization millions
of dollars. Such ethical strategies by Apple enabled the
organization to handle all the allegations that have been made
13. against them, therefore being able to maintain their positive
image.
There are various strategies that Apple Inc. can adopt for
positive changes in the organization. One of the major strategies
Apple Inc. should adopt is being able to understand the specific
areas where the changes is going to make the greatest impact in
the operations of the organization. The organization should be
careful in analyzing the change and understanding the specific
areas that it will impact and the actions plans that are needed in
containing the change. During the analysis, it is also important
to develop effective communication to all the stakeholders in
ensuring that they understand the change and the implications
that it will have on the operations of the organization.
Undergoing any change, it is also important to create a analysis
of the influence that the change will have on the organizational
structure of the organization. During the implementation of the
change, it is also important to consider the market strategies
that will be engaged for ensuring that the products are providing
the needs of the market. Through these strategies, it will be
possible for the organization to create a agenda that absorbs
ambiguities or probabilities that may come with the
implementation of change within the organization (Hitt, 2013).
In conclusion, Apple Inc. as a technology organization has been
successful in the global market. Apple has been able to be
innovative, providing high quality products and ensuring that
they have built a product that the customers can appreciate. On
the other hand, Samsung have concentrated on low pricing and
diversity in ensuring that they diversify their risks while
increasing revenues. Maybe this is key in why Samsung is
making more profit than Apple Inc. Through such strategic
management practices; Apple Inc. emerged as the leading
technological companies on the planet.
References
Dowling, G. (2000). Creating Corporate Reputations: Identity,
Image and Performance: Identity, Image and Performance. OUP
14. Oxford.
Dwyer, D. C., Ringstaff, C., Haymore, J., & Sandholtz, P. D.
(1994). Apple classrooms of tomorrow. Educational leadership,
51(7), 4-10.
Hitt, M. A., Ireland, R. D., & Hoskisson, R. E. (2013). Strategic
management: Competitiveness and globalization; [concepts and
classes]. Mason, Ohio: Thomson South-Western.
Luthans, F., Doh, J. P., & Hodgetts, R. M. (2012). International
management: Culture, strategy, and behavior. New York:
McGraw-Hill.
Song, C., & Lee, K. (2015). The Samsung way:
Transformational management strategies from the world leader
in innovation and design. New York: McGraw-Hill.
Thompson, J. L., & Martin, F. (2013). Strategic management:
Awareness and change. London: Thomson Learning.