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APPLE INC.
Table of Contents
1. Introduction.............................................................................................2
2. Strategic position....................................................................................2
SWOT analysis..........................................................................................2
3. Business strategy....................................................................................3
4. Strategic options available to Apple........................................................4
5. Strategic evaluation................................................................................4
5.1 Suitability...........................................................................................5
5.2 Feasibility...........................................................................................6
Resource Deployment......................................................................6
5.3 Acceptability......................................................................................7
Analysing Risks................................................................................7
6. Conclusion...............................................................................................8
References...................................................................................................9
Appendices................................................................................................10
Appendix A.............................................................................................10
1. Introduction
Apple Inc is a US based public limited
company which is popular for making
innovative
electronic
products
for
purposes.
Apple
was
position,
strategy,
and
current
business
strategic
options
available
to
Apple
using
strategic
management
relevant
tools
and
al. (2010)
to
international
growth,
innovation
expansion.
The
or
entire
Scholes
framework
which
is
depicted in figure 1.
2. Strategic position
SWOT analysis
The SWOT analysis is conducted in assignment 1 (group report) where
each element (i.e. strengths, weaknesses, opportunities, and threats) of it
was explained thoroughly. As mentioned in figure 1 that strategic
evaluation of strategic choices available to Apple are based on SWOT
analysis. Therefore, it is inherent to present here the summary of SWOT
analysis which is derived from the assignment 1.
Strengths
1. Customer loyalty combined
Weaknesses
1. High price
ecosystem
OS
decline
3. Brand reputation
4. Research and Development
(R&D)
5. Digital hub for focused
differentiation
Opportunities
1. Emergence of the new
Threats
1. Price pressure from Samsung
provider of application
processors (product
2. Strong dollar
development)
3. Android OS growth
penetration)
3. Obtaining patents through
acquisitions (market
development)
3. Business strategy
In 1996, Bowman reconsidered Porters generic strategy framework
consisting
of
cost
leadership,
product
differentiation,
and
market
is
to
explore
unexplored
markets
by
considering
market
competencies, and the large size of two regions, the product development
strategy best suits to Apple Inc.
5. Strategic evaluation
Two strategic options for Apple can be
Market development for international expansion; and
Product development for growth purpose
The internal or organic development can be the best method when
considering product development strategy. This method is recommended
on the basis of companys strengths. In fact, in developing innovative
products, the company spends a large amount of its budget each year on
R&D activities for achieving competitive position. In order to launch
cheaper smart phones with relatively low prices, Apple neither requires
arranging massive capital nor depending on third party investment. In
addition, the company is also capable to use its core competencies in
technical areas.
Furthermore, the suitable method for adopting market development
strategy is joint ventures and alliances (Henry, 2011). Apple can establish
strategic alliances or acquire mobile companies currently operating in new
unexplored markets in Asia and Africa. In this regard, Apple can
revise/modify existing business strategy (see section 3) according to the
conditions of new markets. This will indirectly assist the company in terms
of attracting customers and achieving their satisfaction. This strategy is
also appropriate for Apple as the company will not involve high
investment.
In the subsequent sections, the market development and product
development strategies are analysed critically on the basis of suitability,
feasibility, and acceptability framework proposed by Johnson et al. (2008).
5.1 Suitability
Suitability usually refers to appropriateness of strategic option in
assessing whether it addresses the key weaknesses and threats of the
company associated with its strategic position (Johnson et al. 2008).
The strategy of product development needs extensive support of the
existing management. The management needs to carry out support
6
5.2 Feasibility
Evaluating strategic options in terms of feasibility means to verify whether
a company is able to deliver the strategy. This ability is assessed on the
basis
of
companys
core
competencies
and
resources.
The
core
P e rs o n
a liz e d
S e r v ic e
G
B
A
D
E
e
e t
u y
To
W it h
i ff e r e n t
x p e r ie n c
T h in k O n
A
D i ff e r e n t
L e v e l
H ig h
Q u a
lit y
will
not
suffer
from
additional
burden
with
market
5.3 Acceptability
Acceptability mainly deals with the anticipated performance results of the
strategy. The acceptability of any strategy can be analysed on the basis of
risks and return (Johnson et al. 2008).
Analysing Risks
Risks are evident in any business. No business can run its operations
without the element of risk. So, it is extremely imperative to take into
account risk factors during the planning and implementation of strategic
options. For this, the most important step is to estimate the likelihoods
and impacts of success or failure of a strategy (Barnwell and Best, 2008).
In considering product development and market development options,
several internal and external risk factors can be taken into account.
In the present business scenario, new market development is one of the
best strategies to be implemented for Apple. Based on situational
analyses (i.e. SWOT and PESTEL) conducted in the group assignment, it is
apparent that the finest strategy for Apple is to expand internationally.
Apple can adopt the market development strategy aggressively by
establishing strategic alliances in order to move forward. The strategic
alliances method carries minimum risks for the company in terms of
financial loss. So, Apple can enter into the unexplored markets without the
fear of huge losses.
On the other hand, the company needs to be careful in terms of product
development strategy. There is no doubt that Apple is fully capable of
developing new products due to advanced R&D activities and also has
competencies
of
technical
advancements;
but,
reducing
costs
of
operations and choosing new vendors for new product can be challenging.
9
6. Conclusion
The two strategic options available to Apple are market development and
product development. The product development strategy embraces longterm growth of the company and it also provides foundation for new
innovative technology. Based on assignment 1, there are some evidences
for Apple entering into the emerging markets like China and India. This
shows companys proactiveness and continuous involvement in market
research and market development. However, companys position is weak
in some markets like Russia, Egypt, and Brazil. This position can become
better with product development strategy. Conclusively, it can said that
the integration of both strategies (i.e. product development plus market
development) can generate remarkable results in terms of expanding
market share, increasing customer base, competitive advantage, and
higher projects.
10
References
Annual Report and Accounts (2011). Apple Inc. [online]. Available from:
http://www.annualreportowl.com/Apple/2011/Annual%20Report?
p=27 [Accessed: 09 April 2014]
Apple Inc. (2014). A store like no other. [online]. Available from:
http://store.apple.com [Accessed: 09 April 2014]
Barnwell, H. and Best, N. (2008). CIMA Official Learning System Test of
Professional Competence in Management Accounting. 5th edition,
Butterworth-Heinemann
Caulfield, B. (2011). A Decade After Steve Jobs Positioned Mac As A 'Digital
Hub,' iCloud Could Bury PC. Forbes, 06 March 2011
Henry, A. (2011). Understanding Strategic Management. Oxford University
Press
Johnson, G., Scholes, K. and Whittington, R. (2008). Exploring Corporate
Strategy: Text & Cases. Pearson Education
Johnson, G., Scholes, K. and Whittington, R. (2010). Exploring Corporate
Strategy with MyStrategyLab. Pearson Education
Majeed, M.T. and Ahmad, E. (2009). An Analysis of Host Country
Characteristics that Determine FDI in Developing Countries: Recent
Panel Data Evidence. The Lahore Journal of Economics, 14(2), pp.
71-96
Proctor, T. (2014). Strategic Marketing: An Introduction. Routledge
Thomson, N. and Baden-Fuller, C. (2010). Basic Strategy in Context:
European text and cases. John Wiley & Sons
Wilkinson, I. (2010). Business Relating Business: Managing Organisational
Relations and Networks. Edward Elgar Publishing
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Appendices
Appendix A
12