COLLEGE

Foundation in Arts
INTRODUCTION TO BUSINESS (MANAGEMENT & MARKETING) PIB (M) 002

PROJECT 2011 (APPLE.INC)

Lecturer Name : Zurina Bt Ismail
Group Member : Nur Ain bt Shaharuddin : Hoe Wei Nian : Chin ChianYao : Preetha Sukumaran : Ang Synn Ee (11039260) (11034071) (11032802) (11028925) (11023538)

Name

Task

Nur Ain Bt Shaharuddin

Analyzing SWOT Analysis, Conclusion

Hoe Wei Nian (Nicholas)

Ways to implement new strategies, Evaluate current performance, Report

Chin ChianYao (CCWHY)

Introduction, Current Mission, Goals & Strategy and Slides

Preetha Sukumaran

Designing New Logos and Ideas, Survey Forms.

Ang Synn Ee

Define New Mission, Goals, Strategies, Formulating Strategies.

Page i) ii) iii) iv) v) Cover Page Group Members Introduction Page Table of Contents Introduction of APPLE.INC Define - Current Mission - Current Goals 5-6 1 2 3 4

Table of Contents

- Current Grand Strategy vi) vii) Current Performance SWOT Analysis - Strengths - Weaknesses - Opportunities - Threats viii) Define - New Mission - New Goals - New Grand Strategy ix) x) xi) xii) Implementing Strategy Logo & Design Survey for new strategy References/ Bibliography 16-17 18 19 20 13-15 8-12 7

Introduction
Apple Computers 30-year history is full of highs and lows, which is what we would expect in a highly innovative company. They evolved throughout the years into an organization that is very much a representation of its leader, Steven Jobs. Apple made several hugely successful product introductions over the years. They have also completely fallen on their face on several occasions. They struggled mightily while Jobs was not a part of the organization. Apple reached a point where many thought they

would not survive. When asked in late 1997what Jobs should do as head of Apple, Dell Inc.'s (DELL) then-CEO Michael S. Dell said at an investor conference: "I'd shut it down and give the money back to the shareholders. (Burrows,Grover, and Green) Well, times changed. Less than 10 years later, Business Week ranked Apple as the top performer in its 2006 Business Week 50. Apple attributes their recent success to robust sales of iPod music players (32 million in 2005). They are optimistic about the economies of scope with media giants, such as Disney and Pixar. (Business Week) Apple rarely introduces a new type of product. Thus, instead of being the pioneer, they are an expert second mover by refining existing products. Portable music players and notebook computers are examples. Apple increases the appeal of these products by making them stylish and more functional. They now appear poised to make significant strides in the home computer market and to creating a total digital lifestyle whereby the home is a multimedia hub.

CURRENT
1) Mission
Apple ignited the personal computer revolution in the 1970s with the Apple II and reinvented the personal computer in the 1980s with the Macintosh. Apple is committed to bringing the best personal computing experience to students, educators, creative professionals and consumers around the world through its innovative hardware, software and Internet offerings.

2) Goals
Providing updates of their efforts and accomplishments at least annually, most likely around this time of the year. And plan to bring other environmental issues to the table as well, such as the energy efficiency of the products in our industry. Theyre also beginning to explore the overall carbon footprint of their products, and may have some interesting data and issues to share later this year. Apple is already a leader in innovation and engineering, and theyre applying these same talents to become an environmental leader. Based on their tangible actions and results over time, hopefully their customers, employees, shareholders and professional colleagues will all feel proud of their ongoing efforts to become a greener Apple. The Company is committed to bringing the best personal computing, mobile communication and portable digital music and video experience to consumers, students, educators, businesses, and government agencies through its innovative hardware, software, peripherals, services, and Internet offerings.

3) Strategies
For several years Apple's product strategy involved creating innovative products and services aligned with a "digital hub" strategy, whereby Apple Macintosh computer products function as the digital hub for digital devices, including the Apple iPod, personal digital assistants, cellular phones, digital video and still cameras, and other electronic devices. More recently, the full impact of a very well throughout brand strategy has come into focus - and one in which customer experience is central

Apple has a branding strategy that focuses on the emotions. The Apple brand personality is about lifestyle; imagination; liberty regained; innovation; passion; hopes, dreams and aspirations; and power-to-the-people through technology. The Apple brand personality is also about simplicity and the removal of complexity from people's lives; people-driven product design; and about being a really humanistic company with a heartfelt connection with its customers.

The brand equity and customer franchise which Apple embodies is extremely strong. The preference for Apple products amongst the "Mac community", for instance, not only kept the company alive for much of the 90's (when from a rational economic perspective it looked like a

dead duck) but it even enables the company to sustain pricing that is at a premium to its competitors.

It is arguable that without the price-premium which the Apple brand sustains in many product areas, the company would have exited the personal computer business several years ago. Small market share PC vendors with weaker brand equity have struggled to compete with the supply chain and manufacturing economics of Dell. However, Apple has made big advances in becoming more efficient with its manufacturing supply chain, logistics and operations, and it can be assumed that as far as like-for-like hardware manufacturing comparisons are concerned, Apple's product costs are very similar to those of Dell. In terms of price to the consumer, Apple's computer products have an additional cost advantage: the company does not have to pay another company for operating system licenses.

Apple seems to approach the people as a more user-friendly person. Rather than giving people a straight up "Would you like to continue with this action or deny" Macs seem to be friendlier in some cases. -Personal Computers A Shift in Strategy

Apple has historically taken a far different path than the traditional Windows and Intelcombination. Microsoft provides the Windows operating system to separate downstreamhard ware producers such as Dell. Apple vertically integrated both the operating system software and hardware completely under Apple. A consumer running Microsoft Windows can choose from a myriad of systems based on the Intel processor, while a consumer running Apples OS X must purchase Apple hardware Apple is adjusting this strategy by migrating their microprocessors from IBM andMotorola PowerPC to Intel. Analysts believe that the Intel-based Macintosh may be able to run Microsoft Windows applications by the end of 2006. (Burrows)

Current Performance

Financial
Today Apples operations are as diversified as they were never before. With its currently 13,599 employees worldwide it generated a revenue of $63 million in the last quarter. It holds cash reserves of over $4.5 billion and has a ROIC of 3.05%.Apples operations are spread around the PC industry, computer peripherals and the software and service industry. In the overall PC industry Apples market share has diminished to a skinny 2.1%.Apple itself doesnt look itself at the overall PC market, as it has

defined 4 specific markets on which it currently focuses on. The market shares in these sectors are to some extent more significant.

Price Range of Common Stock

The price range per share of common stock presented below represents the highest and lowest sales prices for the Companys common stock on the NASDAQ Global Select Market during each quarter of the two most recent years.

Fourth Quarter

Third Quarter

Second Quarter

First Quarter

Fiscal 2010 price range per common share

$293.53 - $235.56

$279.01 - $199.25

$231.95 - $190.25

$209.35-$180.70

Fiscal 2009 price range per common share

$188.90 - $134.42

146.40 - $102.61

109.98 - $ 78.20

$119.68 - $ 79.14

Holders
As of October 15, 2010, there were 29,405 shareholders of record.

Dividends
The Company did not declare or pay cash dividends in either 2010 or 2009. The Company anticipates that for the foreseeable future it will retain any earnings for use in the operation of its business. Purchases of Equity Securities by the Issuer and Affiliated Purchasers

SWOT Analysis
1) Strength Technical savvy
Product lines are easy to use and stable which recent integration with Microsoft products lines and Intel processors demonstrate ability and willingness to adapt to a diverse customer base. However, such innovation would not be sustainable without a learning environment tolerant of mistakes. it becomes very costly to imitate when it exists within the socially complex,

entrepreneurial culture of Apple while the pure technical expertise alone is not a valuable or rare resource.

Financial vitality
Cash reserves remained robust and stable despite stagnant market share growth in the computer hardware and software arenas. Apple exploited this by resisting market pressures to reduce costs, tightly integrating product packages, and forming strategic alliances. As an example is securing the backing of all major music distributors in the support if iTunes.

Brand loyalty
The only way that Apple could maintain the financial vitality described above is via a fanatical, almost cult-like, affair with its customer base. Such brand loyalty is extremely costly and time-consuming to imitate.

Steve Jobs
As discussed earlier, Jobs proved to be a vital component to Apples success. During his absence in 1985 until 1996, Apple experienced the most turbulent whether in financial and innovative timeline in its history. Immediately upon his return, here placed most of the Board of Directors, pruned and focused the new product ideas, and delivered seven consecutive quarters of positive earnings to shareholders. (Linzmayer,289 -99) As such, Jobs is certainly a valuable, rare, and hard to imitate resource that Apple fully exploits.

Products
Brand is all-important. Apple is one of the most established and healthy IT brands in the World, and has a very loyal set of enthusiastic customers that advocate the brand. Such a powerful loyalty means that Ample not only recruits new customers, it retains them i.e. they come back for more products and services from Apple, and the company also has the opportunity to extend new products to them, for example the iPod.

Conclusion:
Apple is a very successful company. Sales of its iPod music player had increased its second quarter profits to $320 (June 2005). The favorable brand perception had also increased sales of Macintosh computers. So iPod gives the company access to a whole new series of segments that buy into other parts of the Apple brand. Sales of its notebooks products is also very strong, and represents a huge contribution to income for Apple.

2) Weaknesses

Market share
Apple has historically been strongest in the US geographical and educational vertical markets. With the educational market facing tightening budget constraints and the US approaching a PC saturation point, Apple may need to burn cash more quickly and succumb to market cost pressures on its products without a strategic innovation, integration, or divesture.

Steve Jobs

For virtually the same reasons Jobs is a strength, he is simultaneously a weakness. The aggressive drive to bring innovative visions to life was noticeably absent and painfully felt, especially by shareholders during his departure. The apparent absence of succession planning coupled with a lust for the limelight positioned Jobs as Apples single consciousness in the eyes of consumers and shareholders.

Conclusion:
It is reported that the Apple iPod Nano may have a faulty screen. The company has commented that a batch of its product has screens that break under impact, and the company is replacing all faulty items. This is in addition to problems with early iPods that had faulty batteries, whereby the company offered customers free battery cases. There is pressure on Apple to increase the price of its music download file, from the music industry itself. Many of these companies make more money from iTunes (i.e. downloadable music files) than from their original CD sales. Apple has sold about 22 million iPod digital music players and more than 500 million songs though its iTunes music store. It accounts for 82% of all legally downloaded music in the US. The company is resolute, but if it gives in to the music producers, it may be perceived as a commercial weakness. Early in 2005 Apple announced that it was to end its long-standing relationship with IBM as a chip supplier, and that it was about to switch to Intel. Some industry specialists commented that the swap could confuse Apple's consumers.

3) Opportunities Consumer electronics

With the startling success of the iPod and iTunes, Apple entered the consumer electronics market. By expanding the iTunes concept to downloadable mobile phone features and movies podcasts, the door is now open to develop new and potentially profitable strategic alliances with peripheral component manufacturers such as speaker, home stereo, and etc. While the media transmission giants such as Disney, TBS, Verizon, and etc.

PC hardware and software market growth

With cross-licensing of operating system platforms in place, Apple entered the high-volume business environment traditionally dominated by Windows-based PCs. The introduction of Intelbased processors prompted businesses to replace PCs with iMacs. They did this to gain a level of stability andre liability in their business applications that PCs failed to provide. An example is Japans Aozora Bank Ltd., who is replacing 2,300 PCs with iMacs. Wing field, Apple must establish themselves as a credible player in business desktop applications to overcome the desktop publishing stereotype.

Conclusion:
Apple has the opportunity to develop its iTunes and music player technology into a mobile phone format. The Rokr mobile phone device was developed by Motorola. It has a colour screen, stereo speakers and a advance camera system. A version of Apple's iTunes music store has been developed for the phone so users can manage the tracks they store on it. Downloads are available via a USB cable, ands software on the handset pauses music if a phone call comes in. New technologies and strategic alliances offer opportunities for Apple. Podcasts are downloadable radio shows that can be downloaded from the Internet, and then played back on iPods and other MP3 devices at the convenience of the listener. The listener can subscribe to Podcasts for free, and ultimately revenue could be generated from paid for subscription or through revenue generated from sales of other downloads.

4) Threats Legal risks

In a market that literally changes at the speed of thought, patent and copyright infringement risks remain high. As long as operating systems and support software packages continue to converge and remain relatively easy to imitate, present and future lawsuits are inevitable. The Apple records claim against iTunes remains unresolved.

Competition

This threat occurs primarily on two fronts: PC hardware/software and consumer electronics. For the same reasons discussed in the opportunities section, the threat of limit ability increases such as cloning, pirating and etc. As relative newcomers to the consumer electronics arena, will Apple retain a competitive advantage as they diversify their offerings

Conclusion:
The biggest threat to IT companies such as Apple is the very high level of competition in the technology markets. Being successful attracts competition, and Apple works very hard on research and development and marketing in order to retain its competitive position. The popularity of iPod and Apple Mac are subject to demand, and will be affected if economies begin to falter and demand falls for their products. There is also a high product substitution effect in the innovative and fast moving IT consumables market. So iPod and MP3 rule today, but only yesterday it was CD, DAT, and Vinyl. Tomorrow's technology might be completely different. Wireless technologies could replace the need for a physical music player. In 2005 Apple won a legal case that forced Bloggers to name the sources of information that preempted the launch of new Apple products. It was suspect that Apple's own employees had leaked confidential information about their new Asteroid product. The three individuals prosecuted, all owned Apple tribute sites, and were big fans of the company's products. The blogs had appeared on their sites, and they were forced to reveal their source. The ruling saw commercial confidentiality as more important as the right to speech of individuals. Apple are vulnerable to leaks that could cost them profits.

Apples New Mission

1) Apples products used among classes, different layer in the society.
For example: students, designers, music producer, business, and even pilots to use Ipad as their checklist. To satisfy unlimited human wants to maximum their satisfaction. Apple need to create more creativity product compare to others .Example : Slim and lightest ,High tech and better quality .Other than that ,if want to success in their future they should do some certain survey to analyze what type of category of products they should focus on.

2) To meet the future generations demand for high technology products and to cultivate users in adapting rapid changes in Technology.
As future is changing vigorously, the demand for high Technology products is getting stronger in the market for the consumers .This will also cause the quality of lifestyle getting higher. Other than that, as new inventions being developed everyday people will slowly adapt to the rapid changes in the Technology .Besides that, Apple is no longer just to organize the worlds technology, but to meet the demand of technology with information and to produce products to serve the demands of users in the fast paced Technology. As planning and management of department is also important for every Apples product.

Apples New Goals

1) To meet peoples expectation
Based on the consumer needs, we should focus on meeting what people expect from Apple .Besides that, they should place the future as a priority at the first place, this is interpreting what is present today and what tomorrow generation may want to remain competitive in the industry .Future generation is the future users of Apple where they are placed first, in order to innovate something that is so new, futuristic and modern. In other way, Apple can get survey from consumers to know their needs. Lastly, we need to carry out research into customer requirements to make sure that they provide those products and services which best meet customer expectations in the relevant market segment.

2) Before 2013, the human begin will be having at least 1 apples product with themselves.
As ages of century grow, humans needs are unlimited and always go for the popular side .According to the research, almost every family now at least have one Apples product with them. So Apple expected that every family will be having at least one apples product with them before 2013. This is not only because of the population but the quality of high technology. In the future, Apple predicted will become the success full company as their sales revenue increasing every year .This could be a big achievement among all the high technology company.

Apples New Strategy

1) Apple One-Station Service
As new products also need a new strategy to success in the future because creation is different in every year. Apple must full control over the services to show how efficient management product from apple .Detailed information for every products is also important so that will make sure all the consumers clearer about all the information on the products. This will help the organization made easier to know what they need to improve. Besides that, every Apple users can get free repair software services but there is a certain charges may apply for specific software.

2) Psychological research department

The objective is to study how to manage and plan for the company in the future. In addition, we can also easily analyze the behavior of employees to control the company and make sure the organization of company is going smoothly and take corrective action when it is needed. Such department will hold the simple formula of User+ Future = Apple. Lastly, this will take Apple into the leaders quadrant in the future and making them the toughest competitor in the industry.

3) Opening 5 branches of Apple Caf in Malaysia

Apple company are planning to opening 5 branches of Apple caf In Malaysia. We are planning to open the 5 branches of Apply Caf in KL, Petaling Jaya, Johor Bahru, Penang and Kuching, mostly are the crowded places. The objective of opening the branches it is because Apple caf can help to attract more customer from different layer of the society or the community to know more about Apples products. This will not only increase the revenue but more recognizing as a main trademark for the company. This will turn and create a new revenue stream for the caf and eventually create a new production line for the

company .Besides that, we need a good management as branches in caf because it will be more risky because there are many competitors of caf in the market. We will also need some comprehensive training for the employees so that can avoid those mistakes and learn from the others.

Implementation of new Strategies

1) Leadership / Culture The leaders like the CEO,CFO, COO or the managers will try to cooperate with the employees
and if possible, not to use coercion method for the employees unless is necessary.

 The leader must be aggressive, creative, innovation and has the ability to change the culture or
the behavior of the employees.

Office environment should be in a relaxing and comfortable condition to improve or to innovates

the employees creativity and creating ideas.

Invest more money to let everyone of the employees know how to lead, public speaking, and
have confidence in themselves.

2) Human Resources
The Head of Department of the human resources must ensure that the employment of staff must be strictly done to avoid commercial spies. The list of the newly recruited staffs must be filter. The company should have employee integration to improve the skills and knowledge. Organizing annual dinner and company trip to ensure the employee knows about the current plan and strategies, the top management, and motivated by the new coming strategies.

3) Information
Provides a search engine, Imply human skills to the combat spammer issue, having a careless page rank caused by algorithms, and lastly provides a Report page button for the search engine.

Always update the websites news feed to let the consumers know more about the happenings of
the apple company.

Introducing more branches for one stop engine shop, but not having partnership with others. Create interesting advertisements that will attract the attention of the society or community.

4) Control System Research & Development

For the employees. To ensure that the employees is satisfied with current job or condition. For the consumers. To know more about customers or consumers satisfaction and feedback for products.

For competitors. Modify the strategies. Learn from their mistakes.

Total Quality Management Quality Circle. The employees about 6 to 12 people meets up regularly to discuss and solve
problems affecting the quality of the work especially for the branches among the world.

Benchmarking. Comparing with the competitors and try to copy the best from them. 6 Sigma. Emphasizes a relentless pursuit of higher quality and lower costs. Take discipline
methodology : DMAIC ( Define, Measure, Analyze, Improve and Control)

Reduced Cycle Time. Trying to reduce the process of the production or services.

LOGO AND DESIGN

As for the logo for our new company line, we have chosen the official apples logo but with the colour green . The reason behind this is because, green symbolizes a more peaceful and creative side of a person. Green symbolizes the nature and that indicates peace and since this new project of ours involves people coming to this cafe to release their tension and start working on an assignment or task of their own with a peaceful and creative mindset, therefore the colour Green is the most suitable colour and we are proud to have chose this colour to represent our new project line . The interior of our Apple Caf is also going to be the colour green. We have decided to use different shades of green in certain areas of the Caf and Cyber Caf , because we didnt want to set a monotone feeling which is boring , we want to mix things up and set a creative and innovative atmosphere for our customers . Our Customers will step into a new environment and feel energized and ready to start being creative and making new ideas.

SURVEY about Apple Caf

AGE RANGE

16-24

SEX

Female : 20 Male : 10

DO YOU KNOW ABOUT APPLE INC

30/30

DO YOU OWN A APPLE PRODUCT

15 Yes, 15 No

IF YES, WHATS THE PRODCUT

IPOD, IPhone, Macbook

IF NO, DO YOU WISH TO HAVE IT?

12 Yes, 3No

REASON WHY YOU DONT HAVE IT?

Too Pricey

APPLE CAFS IDEA

Yes: 20 No :10

The table above shows us the outcome of a Survey that we have done through the students in Sunway College. The survey is to see how many people are actually interested in this new strategy that we have came up with. The survey that has taken place indicates that many people these days own at least one of the product from Apple inc, and out of this 30 people, 20 people are actually interested in the new Apple caf project and 10 people arent interested and the reason for that it is, because they find Apple products is too expensive for them and they think the idea of the cyber caf wasnt appealing to them. Nonetheless, the survey shows that majority of people that are more interested and fond of this idea and people are willing to pay any amount to come to this caf.

References

1) http://en.wikipedia.org/wiki/Apple_Inc ( retrieved on 25-09-2011) 2) http://www.apple.com/pr/ ( retrieved on 25-09-2011) 3) http://www.apple.com/about/ ( retrieved on 25-09-2011) 4) Miguel Helft; Ashlee Vance (retrieved on 03-11-2011). "Apple Passes Microsoft as No. 1 in
Tech". The New York Times.

5) Apple Investor Relations FAQ, Apple inc. (Retrieved on 03-11-2011) 6) http://wiki.answers.com/Q/What_is_the_mission_statement_of_apple_inc#ixzz1Z9vRDQc1

(retrieved on 14-9-2011, 15-9-2011,16-9-2011)

7) http://what-is-what.com/what_is/apple.html (retrieved on 23-9-2011) 8) http://marketingteacher.com/swot/apple-swot.html (retrieved on 16-9-2011) 9) http://www.google.com.my/ (Retrieved on 1-10-2011) 10) http://www.umlib.um.edu.my/publications/APA-Guide.pdf ( Retrieved on 04-10-2011) 11) Zurina Ismail, Muhinsw Ari Govindasamy, Ruba Loshani Langa Singham (2010) Introduction to
business (Management & Marketing) (5 Edition). Malaysia. Sunway College Foundationin Arts (Retrieved on 16-09-2011)
th

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