Apple Inc.

A project report on Apple Inc. in context of Diagnosis model on organizational level.

Submitted toMiss. Smita mam

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Submitted bySanjay Kumar Verma

Contents1. Acknowledgement 2. About the company 3. Mission, vision strategy 4. environment 5. Industry analysis 6. SWOT 7. Competitors 8. Michel E. Porter 5 forces model y Rivalry among existing firms y Threat of new entrance y Threat of substitute product y Barging Power of buyers y Barraging Power of suppliers 9. Design components y Company structure y Industry strategy y Technology y Human resource y Measurement system 10. Six Sigma 11. Culture 12. Outcome 13. Bibliography
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Acknowledgement

Apple inc. is largest Electronics Company and producing better quality Cell phones, Computers, Software, Hardware, Music devices, IPad And few other Products. I have learned many more things to complete this analysis about the apple like as what is company do how they do that how they working for the environment, culture, buyers and suppliers, SWOT, and some other things. I have seen some financial terms like Annual reports and B/S of the company and the most important which kinds of Strategy Company are adopting for their competitors. I would like to thanks Smita Mam for giving this opportunity to do diagnosis about the company.

About the company

Apple Inc. Formerly Apple Computer, Inc. is an American multinational corporation that designs and sells electronics, computer, and personal computers. The company's best-known hardware products are the Macintosh line of computers, the iPod, the iphone and the iPod. Its software includes the Mac OS X operating system; the iTunes media browser; the life suite of multimedia and creativity software; the i Work suite of productivity software; Aperture, a professional photography package; Final Cut Studio, a suite of professional audio and film-industry software products; Logic Studio, a suite of music production tools; the Safari web browser; and iOS, a mobile operating system. As of July 2011, Apple has 357 retail stores in ten countries, and an online store. It is the largest publicly traded company in the world by market capitalization, overtopping ExxonMobil by some $60 billion, as well as the largest technology company in the world by revenue and profit, worth more than Google and Microsoft combined As of September 24, 2011, the company had 60,400 permanent full-time employees and 2,900 temporary full-time employees worldwide; its worldwide annual sales totaled $65.23 billion, growing to $108.249 billion in 2011. Fortune magazine named Apple the most admired company in the United States in 2008, and in the world from 2008 to 2011. However, the company has received widespread criticism for its contractors' labor, and for its environmental and business practices. Established on April 1, 1976 in Cupertino, California, and incorporated January 3, 1977, the company was named Apple Computer, Inc. for its first 30 years. The word "Computer" was removed from its name on January 9, 2007, as its traditional focus on personal computers shifted towards consumer electronics.

Mission, Vision, & Strategy

Apple s mission statement emphasizes that the company made major innovations in the personal computer industry in the past and links strength to its present strategy. Apple ignited the personal computer revolution in the 1970s with the apple IInd 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. The digital hub that is what Steve jobs (founder) identified as objective for Apple s strategy in the future. Herewith, all three sectors Apple is currently operating in will get closer and closer together and showing a high interdependence. Where seamless integration of all components is vital to win customers. Apple is the only company providing a bundle of solutions which are perfectly adjusted and fine tuned to complement each other to, for other companies, unattainable degree. By designing such high end products Apple is corresponding to external and internal environment, which in the high technology sector are changing more rapidly than anywhere else. Though out its diversification efforts, Apple keeps its design and innovation focused line by the equally adapting performance and price positions to changes in the external environment. The following analysis of internal and external environment will allow the reader to gain a detailed picture of Apple itself, its industry and the SWOT associated with them.

Environment
Since 2006, Apple has assessed the full life-cycle greenhouse gas (GHG) emissions associated with every product shipped and has been working continuously to reduce those emissions. We know that as much as 98 percent of our total emissions come from the greenhouse gas emitted from the production, transport, use, and recycling of products. Our corporate facilities represent 2 percent of our total GHG emissions. Consistent with Our industry leadership role, Apple carefully manages the environmental impact of everyday operations around the globe and we make significant investments in energy efficiency and clean-technology solutions. Our environmental, health, and safety (EHS) management system helps ensure ongoing compliance with regulations and company standards across all Apple facilities. This report documents the environmental impact of Apple s worldwide facilities, including Apple Retail Stores, corporate R&D facilities, and operations and data centers; and it highlights the activities under way to reduce energy and water consumption and waste production. The Global Reporting Initiative (GRI) Sustainability Reporting Guidelines (G3) was considered during the preparation of this report.

Environmental, Health, and Safety Policy Statement Apple is committed to protecting the environment, health, and safety of our employees, customers, and the global communities in which the company operates. We recognize that by integrating sound EHS management practices into all aspects of our business, we can offer technologically innovative products and services while conserving and enhancing resources for future generations. Apple strives for continuous improvement in its EHS management systems and in the environmental quality of our products, processes, and services. Renewable Energy For over 10 years, Apple has participated in the purchase of renewable energy sources in locations around the globe. Today, facilities located in Austin, Texas; Elk Grove, California; and Cork, Ireland are powered by 100
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percent renewable energy resources.3 In addition, in November 2010, we added onsite biogas-powered fuel cells to offset the power requirements at our Cupertino, California, campus. The fuel cells will help Apple avoid more than 1.2 million kilograms of CO2e emissions per year. These programs have converted more than 48 million kWh s worth of consumption per annum to local renewable sources, which represents more than 13 percent of Apple s facility-related electricity consumption. Approximately 27.5 million kilograms of CO2e emissions were avoided through the use of renewable energy programs in fiscal 2010. Apple will continue to look at adding renewable energy to our energy portfolio. Transportation Apple has established commuter transit programs for each facility to minimize the environmental impact of home-to-work travel. The Apple U.S. Commute Alternative program provides incentives for using public transportation and reducing the use of single-occupancy vehicles. For example, Apple provides a transit subsidy for all U.S. employees, up to US$100 per month, and encourages carpooling between commute locations. For our largest facility, located in Cupertino, California, Apple has reduced single-occupancy car use by providing employees with numerous shuttle options, including free bus service from train stations as well as bus service from local cities. Each day, over 900 employees take advantage of our free biodiesel commute buses. We estimate that our commute programs have eliminated the CO2e equivalent of 1,906 single-occupancy cars from the roads each day 10,135 metric tons of CO2e avoided per year. In fiscal 2010, total emissions for air travel, U.S. automobile fleet, and employee commute were 135,040 metric tons of CO2e. Waste and Recycling Apple does not generate a significant amount of solid or hazardous waste from its business operations. To minimize the environmental impact of the small amount of waste we produce, we ve created robust recycling and composting programs. In 2007, Apple s Cupertino facilities established a composting program in the company cafeteria to divert food waste from landfills. As part of the composting program, a majority of our disposable tableware and containers were transitioned to biodegradable or compostable alternatives.
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Industry analysis

The computer industry includes a wide variety of products, from mp3 Players and printers to personal computers and powerful servers. Companies have trouble operating within the computer industry, namely due to the dynamic nature of technology. Moore's law, formulated by Gordon Moore in 1965, states that the numbers of transistors per square inch on integrated circuits will double every 18 months, and prices will be reduced. This means even the largest firms must stay on their toes, as the industry is constantly changing and redefining its Parameters. Apple Computer Inc. has recently made headlines by breaking into the portable music market with its introduction of the Apple iPod and iTunes software. Apple also carries a long line of computer products including personal Computers, computer accessories, servers, networking solutions, and software packages. Currently capturing a market share of 65% among the portable music market, and holding a profitable 2% of the personal computer market, Apple has consistently kept his name in the industry. Apple has stayed afloat in the industry by keeping an eye for aesthetics and creativity, coupled with user friendly and innovative products.

SWOT (Strengths, Weakness, Opportunity Threats)

Strengths of apple
The strengths of apple they made digital innovative quality products they always focus to come with new technologies.

Weakness of Apple
The weakness of the apple they never to reduce their price of products.

Opportunity
Apple have opportunity to capture the global market through customize their product according to low price therefore the cay capture the maximum market share.

Threats
Apple is the only company which makes world class product and having a strong brand image but apple have a small market share so they can increase the market share.

Competitors
Apple has become a major digital asset management company. It has created an OS and UI that makes it very easy for users to manage, aggregate, distribute and even share personal content throughout an Apple-designed digital ecosystem. Because of that, I asserted that Apple is unstoppable: When it comes to providing a complete solution for the consumer, Apple has created a position for itself that makes it nearly impossible for other companies to compete head on. Apple is first company who introduce digital media library the name was ITunes. There are some competitor came in the market. 1. 2. 3. 4. 5. 6. 7. Blackberry Google (Android) Nokia Samsung Sony IBM Microsoft Some player also exists in the E-market like HTC but apple doesn t affected.

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Michael E. Porter 5 forces model.

Competitive Force 1: Rivalry among Existing Firms

The two main areas within the computer hardware industry in which apple Competes are the personal computer and portable music markets. The personal computer market is fairly well developed and growth in this market will be moderate. According to the Credit Suisse First Boston, it is estimated that personal computer growth in 2005 will be approximately 8%, which is 3% lower than 2004.There is a high degree of concentration in this market which is controlled by a few very large competitors who have a great deal of capital invested in the firms, namely, Dell, HP Compaq, Gateway, and Apple. Personal computers are quickly becoming a commodities market due to virtually identical products produced by the leading competitors. This has placed an increased emphasis on competitive pricing, which has drastically reduced profit. This is forcing companies to be cost leaders to maintain a reasonable profit margin. Apple s bread and butter has always been achieved through product differentiation, and in a market where everyone except Dell has struggled to make money, Apple has long been highly profitable with only a 2% market share. In 2005, Dell and Apple are speculated to have the most potential to increase market share in the PC market due to lack of new product introductions by other firms and the anticipation of Microsoft Longhorn in 2006.7 If Apple is able to increase its market share by a few percentage points, its profits and ability to spend on marketing, and research and development (R&D) could allow them to become a much more serious player. Switching costs for the customer have been the main deterrent in Apple s quest to attain a more sizeable market share, due to their higher prices and perceived incompatibility with other software. Recently, a fairly new and less developed market within the parameters of the computer hardware industry has emerged through portable music, which was a substantial portion of Apple revenue in 2005.5 This market provides a great deal of opportunity and high growth potential for firms. Currently, Apple dominates the portable music industry music market with an estimated 90% for hard disk based players, and 65% of the total portable music market.9 This advantage allows them to set and enforce the rules of competition. Apple has capitalized on its product differentiation, and is charging two to three times the market price of conventional mp3 players for its iPod (A price that consumers are
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more willing to pay). Competitors are struggling to offer up a product that is a technological/innovative equivalent to the iPod, and until they can produce one that surpasses it, they will not be able to dethrone the portable music juggernaut. Apple is in no danger of losing market share in the short term and has continued to pour money into its R&D to support its long-term strategy. Since the release of the iPod, Apple has released the iPod Mini and the iPod Shuffle which has tightened its grip on all areas of the portable music market. Switching costs for the consumer are low allowing customers to flow from product to product based on price, but Apple will continue to rely on brand identification, differentiation, and innovation to maintain a firm grip on market share. In both the personal computer and portable music markets, component costs are large part of the total hardware costs, but through Apple s product differentiation and higher pricing they are able to counteract the price wars that usually ensue under such conditions. Finally, there are little to no exit barriers in either market, which could be advantageous in ousting some of Apple s competition in the future.
Competitive Force 2: Threat of New Entrants

Within the personal computer market there are a few well-established companies that consume most of the market share. These companies are: Dell, HP Compaq, and Gateway. There are large economies of scale in the personal computer market and this limits new entrants. A company would need to have access to an enormous amount of capital in order to effectively compete with the few well-established market leaders. The large economies of scale make it nearly impossible for new start-up companies to gain any type of significant market share. In the personal computer market there are basically two main operating systems offered on personal computers: Microsoft s Windows and Apple s Mac OS X. A new company would have to create competitive software that is one step ahead of the rapidly changing technological advancements within the computer software market. Another barrier that new entrants would have to face are legal barriers; mainly in the form of patents. The main market leaders have numerous patents on computer designs as well as technology, which make it extremely difficult for new entrants to enter the market without large amounts of start up capital to create new and innovative advancements in technology. Apple is the most dominant company in the portable music market. The
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portable music market is relatively new, and as a result there are a fairly large amount of competitors. The main competitors in the MP3 sector are: Apple, Rio, Nike, Sony, Creative, Napster, and Dell. There is more of a threat of new entrants in the MP3/Portable Music market than there is in the personal computer market. While portable music hardware still requires significant capital investment to develop and produce the hardware units, the portable music websites (i.e. Napster, iTunes) have relatively small startup costs. This leaves Apple susceptible to new entrants who could possible steal away a portion of its iTunes market share. Apple is enjoying the first mover advantage in the hardware side of the market with their iPod. While numerous portable music players have been released within the last 5 years, Apple was the first to combine style, usability, and large capacity into a single unit, and because of this they are enjoying the first mover advantage with the introduction of the iPod. Even though the iPod is most expensive portable music player on the market, it is highly sought after by customers because of the ground breaking technologies it employs. Customers are pleased with the quality of Apple products thus far and they continue to look to Apple for future innovations (iPod mini, Shuffler, and accessories). Although this creates an obstacle for new entrants, it is possible for them to establish themselves within the market. Due to the potentially high growth rate of this market, it is still profitable for companies to invest the capital involved in breaking into the market. It will be essential for companies entering the portable music market to innovate beyond the standard set by Apple. Even though the main market leaders already have many patents protecting their technologies, new entrants can develop pioneering technologies due to the relatively young nature of the market. Finally, Apple should be aware of the threat of a counter culture of customers which shy away from Apple s products due to their dominance in the market. This phenomenon is best represented by the counter culture that developed with Microsoft that led some customers to Linux. A counter culture of this sort has not yet asserted itself into the portable music market, and is of no immediate threat.
Competitive Force 3: Threat of Substitute Products

On the personal computing side of Apple s market are a number of products from various competitors. Each of these competitors has a wide range of computing systems designed for various types of users. Dell is
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marketing its Dimension line of computers for desktop users and its Inspiron line for laptop users. Both the Dimension and Inspiron lines differ in features and power to provide varying selections for customers with diverse needs.2 The same can be said of Hewlett-Packard s Pavilion/Presario desktop and laptop PCs, as well as Gateway s 3200/5200/7200 series desktop computers and M210/M320/M520 series laptops.3, 4 It would immediately seem that Apple has a wide array of substitutes in the market, but the proprietary nature of Apple s products sets itself apart from its competitors. While HP, Dell, and Gateway each use the Microsoft Windows operating system and an Intel/AMD based CPU, Apple s computers use their own in-house OSX operating system and an IBM derived Power processor CPU. This separates the computers in how they function, which inevitably means the software packages and overall functionality differs greatly. While Dell, HP, or Gateway could out perform Apple in both speed and in price, Apple has set itself apart from these other computer manufacturers by keeping itself unique in the market and gathering around itself a loyal group of users. Regardless of this, Apple will have to continue to stay innovative and price Conscious as new and existing computer owners begin to make the decision of whether their new computer is a PC or a Macintosh. Within the portable music market, Apple s hard-drive based MP3 player has many possible substitutes within the market. Some examples include the JetAudio iAudio U2, Creative Nomad, iRiver iFP-790, and Rio Forge. These MP3 players are similar to the iPod, but are flash-memory based, meaning they typically hold less mp3s but consequently cost less. This doesn t seem to be making a substantial impact on Apple s iPod sales as buyers are getting more mp3 capacity per dollar using the iPod and do not have to worry about upgrading their players with additional memory cards in the future. Apple has responded to the flash-memory based market with its recent introduction of iPod Shuffle. However, the iPod Shuffle is a new product and it has yet to be seen if it can capture market share away from the flash-memory units already on the market. Finally, portable CD players and radios are still on the market, though they pose a very small threat to the iPod as they lack the ability of storing your music in digital mp3 files.

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Competitive Force 4: Bargaining Power of Buyers

Apple focuses on differentiating its products in both the personal computer market and the portable music product. Both the Macintosh line of products and the iPod have a signature style and innovative features that set them apart from their competitors. This makes buyers less price sensitive when it comes to buying the iPod and Macintosh, as it is very difficult to find a product that has the same features or stylish look. If customers want to avoid Microsoft software and Intel/AMD based PCs, the only alternative would be to purchase a Macintosh computer, creating a niche market out of Apple and in turn making buyers less sensitive to price. Additionally, buyers of the iPod and Macintosh computers have low relative bargaining power considering they would have to buy in very large volumes. There is no Wal-Mart of electronic stores, so there is no way for individual resellers such as Best Buy, Circuit City, or CompUSA (to name a few) to bully Apple into lower prices. Apple also has 98 national and 4 international retail stores, in addition to its own online store carrying the full line of apple products.6 The internet is also a huge selling point for iPod and Macintosh products via Amazon.com and Buy.com (to name a few) with the popularity and benefits (tax free) of at-home shopping.6 Businesses have some relative bargaining power when it comes to purchasing Macintosh computers in bulk for office use, but home users have literally no control over Apple when it comes to their pricing. On a final note, once Apple sells to the end user it has essentially secured future sales of its hardware and software due to a lack of third party options. This gives buyers even less relative bargaining power to shop for better prices or alternatives for their software/hardware needs.

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Competitive Force 5: Bargaining Power of Suppliers

Apple uses a large variety of suppliers for manufacture of its computers and portable music players. In most cases, Apple is not limited to a single supplier for the various components used in the process of assembly for its products. This leaves Apple s suppliers with less bargaining power concerning price in most cases. Apple uses both NVIDIA and ATI for video cards in its computers, so it has two choices concerning who to go to. This is the same for its motherboards (ASUSTeK and Ambit Microsystems), Display units (Samsung, Toshiba, and International Display Technology), storage devices (Hitachi Global Storage Technologies, Western Digital, Seagate), and CD/DVD drives (Samsung, Hitachi Global, and LG. Phillips Co.). In most of the other parts in Apple s Macintosh computers and iPod the situation is the same, giving Apple power to switch suppliers if needed. The only real exception to this is its current position with IBM and its G series processors, as moving to a new processor would have extremely high switching costs. A customized chip would have to be created to replace the G series processor as PC and Macintosh computers have complete different technologies concerning the CPU.

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Design components
Company structure

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Industry strategy
Apple basically focus on the corporate and business level strategy

Expansion through concentration

The apple concentrates to the one segment to make digital devices.

Focus customer
The apple focuses only the high-middle class customer.

Differentiation
The apple adopts differentiation in their products like as Iphone, IPod, IPad, and IMac and customize products according to region.

Expansion through internationalization

The company adopt expansion not only the country rather than Beyond the country.

Apart from these strategy some other strategy adopt by apple to expand their business.

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Technology
Fits right in with your existing infrastructure. Mac OS X is the most compatible operating system on the planet. Which means integrating the Mac platform with IP-based networks and assets is surprisingly simple. Runs Windows, Linux, and UNIX. Powered by advanced Intel processors, Mac OS X is a fully certified UNIX operating system, conforming to both the Single UNIX Specification (SUSv3) and POSIX 1003.1. So creating a multiplatform lab environment is no problem. Works with just about any network or directory service. Every new Mac can automatically connect to almost any wired or wireless network, and integrate with almost any directory service including Microsoft Active Directory. Built on open standards for greater flexibility. Mac computers are standards based, so you can rest assured that your data and applications aren t locked into proprietary protocols and formats. Safer by design. With its rock-solid UNIX foundation, Mac OS X is highly secure from the ground up. Features like sandboxed applications and home directory encryption are unobtrusive, accessible, and easy to use.

All Mac desktop computers, notebooks, and displays have earned the ENERGY STAR rating for energy efficiency. And built-in power management features like Energy Saver can save your school even more money.

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Human resource

HR policies
The policies should reflect the mission, values, and culture of a company. They have a direct impact on the external perceptions about the company by the apparent treatment of and attitude towards its staff and therefore shape the corporate image and identity. A positive image then can reinforce a competitive advantage increasing customer value, as people associate positive values with the company. Apple meets this need of creating a favorable image of a company by implementing equality of employment and promotion opportunities through partnership arrangements around the world.

Human Resource performance

In pursuing the above mentioned objectives of getting the best employees to work for Apple, the company has installed several measures to increase productivity as well as effectiveness. A cornerstone in the employment relationship is the regional partnership program with different originations like Skill net in Ireland (A body comprising both employer and employee organizations) aiming at facilitating mutual involvement of management and employees/unions in organizational development.

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Measurement system Product Quality

Apple Certified Refurbished Products are pre-owned Apple products that undergo Apple's stringent refurbishment process prior to being offered for sale. While only some units are returned due to technical issues, all units undergo Apple's stringent quality refurbishment process.

Each Apple Certified Refurbished Product: y is fully tested (including full burn-in testing). y is refurbished with replacement parts for any defective modules identified in testing. y is put through a thorough cleaning process and inspection. y is repackaged (including appropriate manuals, cables, new boxes, etc.). Includes the operating software originally shipped with the unit and the custom software offered with that system. See each product "Learn More" for more details. y is given a new refurbished part number and serial number. y is placed into a Final QA inspection prior to being added to sellable refurbished stock. Refurbishment procedures follow the same basic technical guidelines as Apple's Finished Goods testing procedures.

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Six sigma & TQM

Apple uses six sigma tools

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Culture (work Environment)

Corporate culture defines the specific set of values and norms shared by people and groups within a company. Actually, values can be regarded as beliefs and ideas about what kinds of goals should be pursued and the appropriate standards of behavior for achieving these goals. On the basis of these values, norms are developed which constitute guidelines or expectations for appropriate behavior in particular situations and the control of the right behavior. As a result, it is the task of management to influence the values and norms of the organization. by taking a look at the role of top management in creating the culture of the enterprise, it becomes obvious that(in spite of the period of frequent changes of chief executives) no CEO could successfully alter the rebellious, defiant, against formal Business routines type of culture that characterized Apple when it was founded in the 1970. in fact, the company s culture could be described as individualistic at the beginning which means that it emphasized individual empowerment and creativity advantage.

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Outcomes
The final outcomes came in after these processes.

IMac IPod Iphone ITunes I cloud

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Bibliography

Apple (India) www.apple.com/in/

http://www.wikkipedia.com/

The Apple way(Book)

www.google.com

www.scribed.com

www.yahoo.com

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