CHAPTER 1

INTRODUCTION

1.1 Background of the study

Apple inc. is a very well-known company worldwide and a multinational corporation that
creates consumer electronics, personal computers, servers, and computer software, and is
a digital distributor of media content. This company has been operated for decades and
their products are recognized by all consumers around the world. However, Apple inc. do
faces some problems throughout their business and able to overcome them to maintain
their company until now. Even now in 2017, they still face a lot of problems. Therefore,
the objectives of this study is to identify their problems and ways to overcome it so that
the company can continue their legacy.

1.2 Problem Statement

The problems that concern this company are mostly based from their products. If we
were to count all the problems that need to be settled, the numbers are too high. So, we
will only be focusing on some major problems that Apple inc put much time to improve
which are :
Products Price & sales
Organizational culture
Invention of new ideas

1.3 Purpose of the study

To identify the main problems that are faced by the company

To indicate and provide the best solution to solve the problems in the company
 CHAPTER 2
COMPANY BACKGROUND

2.1 Background
Apple computer was established on April 1, 1976 by a three man team in the likes of
Steve Jobs, Steve Wozniak and Ronald Wayne. Few months after the establishment of Apple,
precisely on the 3rd of January 1977, Apple was incorporated as Apple Inc. In 1980, Apple
launched its initial offering (IOP) of stocks to the public, a stride that gave Apple a huge success.
(Harrison and Rose 1998). The company is committed to bringing the best personal computing
and music experience to students, educators, creative professionals, businesses, government
agencies, and consumers through its innovative hardware, software, peripherals, services, and
Internet offerings. The company's business strategy leverages its unique ability, through the
design and development of its own operating system, hardware, and many software applications
and technologies, to bring to its customers new products and solutions with superior ease-of-use,
seamless integration, and innovative industrial design. The company's products are sold online,
through third-party wholesalers, and through its own chain of stores. The company has
experienced a tremendous growth since it introduced an iPhone smartphone in 2007. Apple Inc.
brand is the most valuable in the world worth over $170 billion. Apple is considered to be the
most successful electronics company in the world.

2.2 Objectives
Apple inc has target their objectives in 3 categories which is Products, Place and Price.

Products

Apple plans to Continue to create groundbreaking products. Apple has made a name for
itself becoming a trend setter in the market with every one of their products introducing
something new and exciting to the world and at the same time innovate and dictate the
movement for future world.

Place

Expand nationwide chain of Apple stores globally. They also want to make their products
available in every other possible retail channel, ex. Online, Big Box retailer
Even though the Apple store leads in sells, Apple must make sure its products are
accessible to every consumer since their demand is so high.
 Price

Enter and sustain premium pricing while attempting to gain market share and at the same
time Continue push to lower cost to make products while sustaining the same retail price
in the market and this will increase their Increase profit margins.

2.3 Company Policy

Apple conducts business ethically, honestly, and in full compliance with all laws and
regulations. This applies to every business decision in every area of the company worldwide.
Apple's success is based on creating innovative, high-quality products and services and on
demonstrating integrity in every business interaction. Apple's principles of business conduct
define the way we do business worldwide. These principles are:
Honesty. Demonstrate honesty and high ethical standards in all business dealings.
Respect. Treat customers, suppliers, employees, and others with respect and courtesy.
Confidentiality. Protect the confidentiality of Apple's information and the information of our
customers, suppliers, and employees.
Compliance. Ensure that business decisions comply with all applicable laws and regulations.

2.4 Location

Apple Inc has 498 retail stores (2017) worldwide. However, the founder and the headquarters of
Apple Inc is at Cupertino, California, United States
2.5 Organizational Structure

Apple organizational structure can be described as hierarchical. Such a structure has been
developed by its founder and former CEO late Steve Jobs in order to ensure focused realization
of his innovative ideas and clear vision for the business. Apple organizational structure has been
subjected to certain modifications since the leadership role was assumed by Tim Cook on August
2011. Specifically, Mr. Cook embraced the decentralization of decision making to a certain
extent in order to encourage innovation and creativity at various levels. Nevertheless the
structure remains to be largely hierarchical. Apple Inc. Board of Directors consists of eight
members with a solid leadership background in a range of industries. Three members are acting
CEOs and two members are former Chairman and CEOs of global companies. The current CEO
that holds Apple Inc is Tim Cook and the expected numbers of employees is 116,000 wordwide

Figure 2.5 : Organizational Chart for Apple Inc

2.6 Products

Computer hardware (Mac, iMac, Mac Pro, MacBook, MacBook Air)

Computer software (iOS, OS X, Safari, iLife, iWork, iMovie, iPhoto)
Consumer electronics (iPod, iPhone, iPad, Apple TV and Mac products)
Digital distribution (iTunes store, iCloud, App Store, Mac App Store).

Figure 2.6.1: Apple Products Ecosystem

 Figure 2.6.2: Apple revenue breakdown

As the results shown above, it is obvious that the products that sells the most is Iphones
compared to other products. As most of the people know, Apple products are considered a bit
pricy since their products usually cost more in the same category. So why are people still buying
apples product? In my opinion, Apple makes excellent phones, but more importantly, they
created the strongest phone brand in the world. So people want to own that brand. Due to
brilliant advertising they successfully convinced the world for decades that Apple is a product
with class.
So the fact of the matter is that the vast majority of iPhone owners never compare
features (hardware or software). iPhones are not the best phones. But they are excellent and
satisfy the the needs of most people. In a 2015 Pew Internet reported that the most common uses
of smartphones, in all age groups, are texting, browsing, calls and emails. Some Features are
Popular With a Broad Spectrum of Smartphone Owners; Social Networking, Watching Video,
and Music/Podcasts are Especially Popular Among Young Users Because all phones do these
things very well, the extra features play less of a role.
2.6.1 Iphone

2.6.2 Imac Computers and laptops

2.6.3 Ipads

2.7 Competitors

Since Apple Inc involved themselves in a lot of electronics categories, their products vary
from Phones to laptops and even app. Because of this, their competitors will also be a lot and
Apple Inc has to convince users why their products better than the others and what differences
they have to offer. The categories are divided into three and their large competitors are also
listed:
Personal Computers and Laptops:
Apple has maintained a loyal following of users who report high satisfaction with the
company's Macintosh computers and Safari operating system. Major competitors in this
space include Dell, Acer, HP, Sony, and Toshiba

Smartphones
Apple has been competing with Blackberry during its old days and now, Androids are
their biggest competitors with Apple Inc being the only Phone with no androids features.
Major competitors : Samsung, Xiomi, Lenovo, Sony and HTC.

Entertainment Media and Applications

he two major players in this space are Apple and Google. Each operating system
interfaces with iTunes and the Google Play Store respectively, allowing users to
purchase music, books, applications and other media.
 CHAPTER 5
CONCLUSION

Based on the study, we can see that Apple Inc is a huge company and very well-known
worldwide. Despite that, they still face some problems and is struggling to improve their
products and ways to overcome them. Apples SWOT analysis indicates that the company
possesses major strengths that can be used to effectively address organizational weaknesses. The
company can also use these strengths to exploit the opportunity to expand its distribution
network. In addition, Apple can use its strong brand image and rapid innovation processes to
successfully develop and launch new product lines. However, the firm faces the significant
threats of aggressive competition and imitation, which are major challenges affecting players in
the industry. A suitable course of action is to address these threats through a stronger patent
portfolio, along with continuous innovation to ensure the competitive advantage of Apple
products even when competitors try to catch up.