Apples Strategic Technology

Running header: APPLES STRATEGIC TECHNOLOGY PLAN MUSIC INDUSTRY

Apples Strategic Technology Plan Supporting the Music Industry

Jocelyn Nicholson
Managing The Technology Enterprise - ITMGMT 540
Professor: Tony Wolf
City University of Seattle
December 5, 2010

Apples Strategic Technology

Apples Strategic Technology Plan Supporting the Music Industry

In South Korea, it's not just iPods but phones that let you instantly choose and listen to new
music while walking around (Lesk, March/April, 2007). Innovations in technology have
completely changed the sound of music, music distribution, listener acquisitions, how music is
heard and shared (Karr, December 3, 2010).
The 21st century has developed the preferred method of listening to music through digital
on line access capabilities on the World Wide Web. Apple products (i.e. iPhone) fall in the
category of preferred methods and the company is well known for being a leader in the music
revolution. According to Lesk (March/April, 2007), Mobile phone sales in Korea grew six times
between 2004 and 2005, and first half of 2006 saw sales of 39.2 billion wonmore than 2005's
entire revenue of 33.7 billion won.
Music, as the old saying goes, makes the world go round. In other words, music can be
found in all cultures globally. The variety of music whether Blues, Jazz, R&B, Classical, Opera,
Pop, and Country will be experienced by all cultures to some extent. The advancement of
technology (i.e. digitization, virtualization, and personal creations) has expanded the field of
music drastically and globally.
Critical to technology advancement is the understanding of varying cultures. Regardless
to ones personal beliefs, cultures, background and heritage, we are all one human being. Thus
common comparisons and differentials will be found within the music industry.
The intent of this paper is to explain Apple Incorporations strategic initiatives in
development of music ventures. The cell phone (i.e. Apples iPhone 4) and music will be focused
on to outline processes to follow in developing a strategic plan. Imagine what it would be like to
have technology advancement (i.e. features of Apples iPhone, iPad 4G wireless and live

Apples Strategic Technology

concerts) capabilities anywhere, anyplace, anytime. A further reach, picture the ability to access
live musical concerts, sports packages and a boxing match from ones cell phone. Lesk
(March/April 2007) points out record sales in 2004 were roughly $12 billion, whereas concert
ticket sales were roughly $2 billion.
The television, DVD, and CD players would soon become obsolete. Furthermore, the
ability to reduced cost to support increase storage and increased computing power could be the
new wave of the future. Musical technology functions will be researched and analyzed. Apples
business growth could expand further, with integration of live musical concerts and iPhone and
wireless innovative solutions. Lets start with the features of the iPhone 4, currently one of
Apples latest technology releases.
Features of iPhone 4
Facetime
The idea one can actually video call to someone anytime, anywhere, anyplace in the world is
absolutely amazing. The ability to video chat on the Apple iPhone has made this dream come
true compared to the older conventional way of video conferencing. For example, imagine
accessing a music concert and video chatting with friends through the use of Apples iPhone 4.
The ability to purchase a concert ticket by scanning a barcode with the iPhone and having online
live access could be the next innovative technology advancement, yet to be discovered.
According to Apple (2010),
The human race has dreamed of video calling for decades. iPhone 4 makes it a reality.
With just a tap, one can wave hello to ones kids, share a smile from across the globe, or
watch ones best friend laugh at ones stories iPhone 4 to iPhone 4 or to the new iPod
touch over Wi-Fi. And it works right out of the box.

Apples Strategic Technology

Retina Display
The Retina display on iPhone 4 is the sharpest, most vibrant, highest-resolution phone
screen ever, with four times the pixel count of previous iPhone models. In fact, the pixel
density is so high that the human eye is unable to distinguish individual pixels. The
feature makes text amazingly crisp and images stunningly sharp.
Multitasking
iPhone 4 introduces a whole new way of multitasking. Now you can run your favorite
third-party apps and switch between them instantly without slowing down the
performance of the foreground app or draining the battery unnecessarily. This smarter
approach to multitasking is available only in iOS 4.
HD Video Recording and Editing
Shoot your own movies in high definition. Capture impressive video even in low-light
settings, thanks to the advanced backside illumination sensor and built-in LED light.
Then edit and create your own mini-masterpiece right on iPhone 4 using the new iMovie
app with Apple-designed themes, titles, and transitions. Its available on the App Store
for $4.99.
5 MegaPixel Camera with LED Flash
Take beautiful, detailed photos with the new 5-megapixel camera with built-in LED flash.
The advanced backside illumination sensor captures great pictures even in low light. And
the new front-facing camera makes it easy to take self-portraits.
Ready for Business
Businesses around the world are choosing iPhone for its enterprise-ready features and
powerful security. iOS 4 works with Microsoft Exchange and standards-based servers to

Apples Strategic Technology

deliver over-the-air push email, calendar, and contacts. iOS 4 protects your data by
encrypting information in three separate areas: in transmission, at rest on the device, and
when backed up to iTunes. You can securely access private corporate networks through
industry-standard VPN protocols. And companies can easily deploy iPhone across an
enterprise using configuration profiles.
Mission Statement
According to Investor Relations FAQ (2010), Apples mission statement is comprised of
the following information:
Apple designs Macs, the best personal computers in the world, along with OS X, iLife,
iWork, and professional software. Apple leads the digital music revolution with its iPods
and iTunes online store. Apple reinvented the mobile phone with its revolutionary iPhone
and App Store, and has recently introduced its magical iPad which is defining the future
of mobile media and computing devices.
Vision Statement
Apples newest vision is to reach a global society with products capturing the music
industry and empowering the customer base. Attain productive excellence and quality with
insourcing support and outsourcing of low product development. One will capture a large
percentage growth rate of the market by accessing live musical concerts online, broadening the
market range and continuing technology advancements for the iPhone.
Strategic Perspectives
A strategic planning workshop will be used to focus on the strategic themes for
resolution. The Information Technology (IT) Governance Board will sponsor, support and
provide funding for the latest strategic plan phases and deployment. The process of matching

Apples Strategic Technology

strategic themes to available resource will be carried out by designated employees and core
planning teams. Software Engineering Institute (SEI) assessments will address current concerns
and problems for resolution by identifying, documenting, tracking and measuring results.
Strategic Themes and Results
Apple must be able to identify effective strategic themes and results to maintain the
company mission and vision statements. The following strategic themes and results will carry
Apple into a newer generation of technology advancements. Apples strategic themes will focus
in on operational excellence, outstanding customer satisfaction, empowering working
environment and strategic partnerships (Rohm, H., 2008).
Strategic Objectives
In developing a strategic plan the creation of processes to follow is a crucial approach to
success. According to Hamm (2007), making innovation an essential part of a strategy can be
essential to attain increased revenue gains. In the next 3 5 years, Apple will focus on the
following list of objectives explaining how to make innovation part of the strategic plan:
Picking the right type of innovation for the company
Each company needs to figure out what innovations (i.e. technology, engineering,
business processes, software services) is best for the business. The choice of technology
advancement will be the approach taken to move Apple products further into the innovative
developments of the music industry. For example, imagine accessing a live musical play through
the use of Apples iPhone 4.
Strive for breakthroughs
The process of incremental innovations produces a steady flow to keeps Apples
organizations energized. An example, hiring a consulting company to work with employees,

Apples Strategic Technology

during brainstorming exercises (onsite and offsite), to identify strategic ideas. The process of
documenting each idea and establishing action plans is one approach to maintaining incremental
releases throughout the year.
Consultants can work with employees encouraging thinking out of the box creativity and
innovative. Teaming exercises are great techniques to energize new ideas for expanded market
reach and development. In addition, consultants are good at conducting best practice
benchmarking surveys and publishing the results (Hamm, 2007, pg. 161).
Invest like a venture capitalist
By investing in small groups, offering special incentives (i.e. stock, stock options, and
cash awards) and giving one the permission to fail will be another approach to reach newer
musical technology advancements. Establishing a website for company employees to gain insight
on the various incentive programs would be a great way to keep innovative ideas flowing within
the company. Ensuring special incentive processes, policies and procedures are readily available
is the key to maintaining a successful approach.
Make everybody responsible for innovation
Techniques such as Six Sigma and Information Technology Infrastructure Library
Methodology (ITIL)/Lean disciples will be used to initiate creative ideas and improve
operational excellence. Each employee will have innovation listed as a goal on ones annual
performance evaluation plan. In addition, innovative goals will be listed on senior managers
business performance scorecard as a way to keep all involved.
Give innovators room to think
An established research and development (R&D) lab will be encouraged for funding and
full time employees will be hired to support innovative grassroots ideas. The process of allowing

Apples Strategic Technology

company employees to focus primarily on grassroots ideas, in a safe, quiet environment is

important. The approach will give one the satisfaction of acknowledgment and thinking out of
the box achievements towards innovative solutions.
Spread the (innovation) wealth
The process of feeding new creative innovation directly into core businesses and giving
rise to new ones will be mandated. Example, the ideas and technologies that are being developed
by R&D labs will be distributed throughout the organization. Surveys and assessments will be
used to gain feedback on R&D developed ideas, to gain suggested improvements and or
innovative ideas from all employees in the working environment.
Augment R&D and Partnering and Development (P&D)
The process of bring new efficient products to market faster will be relied on by others.
Example, Apple moving client products (i.e. outsourced product development, open source
software) from concept to the marketplace will be an approach. Lower fees up front for a chance
to get a share of the profit once a product goes to market will be the approach to increase revenue
and market growth.
Transform your company and your customers
Sharing company secrets and capabilities with others instead of hoarding and holding
back will be a new process agreement. The reinventing of the Apple Inc. and helping ones
customers (i.e. music industry) to do the same is a new way of doing business. For example, UPS
reinvented the company from delivering packages anywhere in the world to synchronizing global
supply chains for companies large and small (Friedman, 2007, pg. 167).

Apples Strategic Technology

Technology Priority Process

The approach to prioritizing IT initiatives (i.e. outsourcing, in-sourcing, and off-shoring)
will be accomplished with a IT governing board consisting of management team members,
sponsors, senior executives, and CIOs. The process for prioritizing technology processes will be
the function of the governance board. The plan of action will define how, when, and in which
order one gets there.
The governance board will be responsible for the accountability and authority of IT
decisions. A board responsible for reviewing, prioritizing and approving IT resources (i.e.
organization, staffing, spending, projects and management attention) to support strategic business
initiatives is crucial (Baschab & Piot, 2007). The governance board is a forum in which a
structured, constructive dialogue with business leaders can take place daily, weekly or on a
monthly basis (Jakubik, 2005).
Keep in mind; communication among managers and employees is crucial for the
organizational business. Therefore, effective communication will occur when cultural differences
are studied and understood among business personnel. Failure to overcome these types of
obstacles will result in negative impacts to both employees and the company (Baschab & Piot,
2007, pg. 481).
Technology Analysis
The technology analysis will be based on typical perspectives such as financial /
stewardship, customer / stakeholder, internal business processes, and organization capacity. The
following analysis (i.e. Figure 1.0) explains the internal strengths, internal weakness, external
opportunities and external threats.

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Figure 1.0 Technology Analysis (Mind Tools, 2010).

Internal Strengths

External Opportunities

* Technology Advancements

* Growing revenues - online music concerts

* Digital Music Leader

* Online music concerts accessibility

* DirecTV, Cable and Satellite music market

Internal Weaknesses

External Threats

* Customer base

* Economic changes (i.e. wars)

* Cash

* Terrorist impact to company

* Music trends
* Unemployment rates
Strategic Analysis and Choice (Figure 2.0)

The globalization impacts, such as economic changes, technology advancements and

social behaviors are only a few issues which the music industry will encounter. For example,
economic impacts will affect the product advancement of Apples products (i.e. iPhone, iPod,
iPad) or other competitor such as Window and Japans DoCoMo. All competitors will fall suite
to the changes required to further the advancements of ones products.
DoCoMo is working with other companies to provide one the ability to scan a bar code
(i.e. from a Madonna poster) to purchase a concert ticket and or Madonnas new CD. This is a
prime example to meeting customer satisfaction ratings. Apple and Windows competitors will
soon fall suite engaging with the latest technology advancements. Figure 2.0, identifies and
analyzes Apples strengths, weakness, opportunities and threats (SWOT) to reach on line live
music ventures (i.e. live concerts, boxing, sports packages) as the choice strategy.

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Figure 2.0 SWOT Analyses (Mind Tools, 2010).

S-O

W-T

* Digital Music Leader and outsourcing

* Lack of market base and economic impact

* Technology advancement and wireless

* Lack of customer base and changing economy

* Grass root innovations and in-sourcing

S-T

O-T

* Digital Music leader and music trends

* Technology advancements and economic impacts

* Innovator and lack of market base

* Off-shoring, Iraq and Afghanistan war

W-O

S-W

* Lack of Market range & Technology Adv * Grass root innovations and music trends
Business Case
The approach in gaining management support and buy in will be accomplished by using a
common tool, called the Situation Target - Proposal (STP) statement, during IT Governance
meetings and reviews. The STP easily explains the following sections situation (i.e. the current
situations and or problems experienced), the target (i.e. the vision for improvements) and
proposal (i.e. the recommendations for approval). The STP is a great tool to summarize why one
believes there is a problem to solve (Ezine Articles, 2010). The following STP (i.e. Figure 3.0)
will be used to attain Apple executive committees buy in and budget approvals.
Figure 3.0 STP (Ezine Articles, 2010).
Situation
Live shows (i.e. musical concerts) are being overlooked as revenue gain for company.
Productions of live concerts are producing large revenue for music industry.
Supporting pay TV live programs is marketed by DirecTV, Comcast and Satellite companies.

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Target
Accelerate growth in-source and supply chain management of live programs (i.e.
musicals, boxing, sports packages football, baseball, basketball).
Develop new technology advancements (i.e. iPhone, iPad, live concerts, and wireless
technology) as future initiative solutions.
Gain increased revenue by off loading administrative tasks (i.e. sales department).
Support Six Sigma, ITIL/ Lean Principles - 20 percent cost savings annually (next 3 5 years).
Partner with DirecTV, Comcast, Satellite companies.
Proposal/Recommendation
Approve Research and Development (R&D) funding to identify innovative ideas and solutions.
Deploy ITIL, Lean and Six Sigma Methodologies.
Provide resources to support outsourcing, in-sourcing and off-shoring markets.
Ensure mandatory employee training in ITIL/Lean and Six Sigma.
Financial Comparison of Outsourcing Options
The options required to support the financial comparison will focus on comparing Apple
to competitive peers. Benchmarking company processes and performance against ones peers
will help with establishing the financial comparison. A standardized process will be followed to
assist Apple in ensuring efficient and effective outsourcing options (i.e. analysis of current state,
industry comparison, potential improvements and a financial model (Barrington Partners, 2010).
Garner Consulting Company and questionnaire surveys will be used to compare the perspectives
of potential risk associated with IT outsourcing. The survey will focus on large multinational
companies (i.e. Group 1 - Wipro) and (i.e. Group 2 - Cisco) business within the United States
(Carroll, J., Gatti, P., Greiner, E., & Gupta, A., (2007). Survey questionnaires with a return date

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will be sent to both international and domestic companies involved with IT outsourcing in the
past 5 years. Of course follow up emails will be sent out one to two weeks after the initial
surveys have been mailed. Figure 4.0 (see attachment A) Financial comparisons of outsourcing
provides survey data results. Based on the operating expenses comparison, the recommendation
is to outsoure (i.e. products and services) with Wipro Corporation.
Tactical Plan
The process of executing and linking strategy and tactics will be accomplished through
Six Sigma, ITIL and Lean Methodologies. Core Planning teams, IT Governance Boards, will use
employee surveys, score cards, performance plans, 360 degree evaluations and measurement
plans to establish week reports and evaluation results. The process will help maintain status of
each strategic objective for tracking and oversight.
Conclusion
Employee satisfaction and the results of survey data collection is one means to validating
the successful implementation of a company strategic plan. The partnering of the Apple iPhone
technology advancements and innovations with live musical concerts anytime, anywhere,
anyplace is bound to capture increased revenue. The reinventing of Apple Inc. outsourcing,
insourcing and supply chain management will be essential to continued growth opportunities.
Building strategic objectives tied to Apples company mission and vision statement ensures
success for the company, partners, customers and employees.

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References
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