Analysis of Apple Inc
Apple Inc is a multinational company that designs, develops, manufactures, and markets electronic devices. The iPod, iPhone, and iPad revolutionized the technology industry. These devices have changed the way people communicate, work, and listen to music. Apple business level strategies that are dependent on a single vital concept. In Apple, innovation is not only focused on the creation of new products but also improving the already established product portfolios. At present, the organization does not depend on revenues which are driven by the new products but on the improvement and consolidation of the existing lines. Illustratively, the latest iPad models are building on the innovation process as well as improving capacity and resolution and decreasing the size of the product. Additionally, improvement and innovation of products are still observable in the latest iPhone
Globalization entails the smooth flow of people and technology surpassing the constraints placed by geographical boundaries. Through globalization, Apple Inc. has expanded its global reach; enabling it to focus on a narrow range of core business. Additionally, it has developed distribution channels that offer the best value for the products that are on offer (Katragadda, 2017). The phenomenon has a great influence on the way the Apple Inc. operates. The organization started as an American company but due to globalization, it metamorphosed into a multinational operation company. A third of the sales of the firm comes from America while the remaining two thirds is amassed from the rest of the world, according to the 2016 Apple annual report (Katragadda, 2017). Apple has several flagship stores across the world.
Globalization has influenced Apple’s supply chain as it manufactures its products at a plant located in China. China has a huge population, both locals and foreigners; the large number of people offer cheap labor in the production of the Apple products. Since the company sources labor locally in China, the costs of production have tremendously been reduced. Thus, the firm makes huge profits on products assembled in China and supplied within the larger Asian region. Apple Inc. has liaised with various suppliers, including FedEx Who, who quickly move finished goods across the world thus enabling the organization to sell products globally. The effectiveness of the company’s supply chain is demonstrated by its ability to produce products at low prices and then sell them at high prices (Katragadda, 2017). Additionally, the corporation has overcome competition from its competitors such as Microsoft through robust supply networks (Mishra, 2017). Its products have proved to be so appealing to the mainstream market as customers prefer them to those that its competitors offer. Apple Inc.’s iPhone has had impressive sales and a significant market share as compared to the competitors who are in the phone industry. A combination of good marketing strategies and use of software has enabled Apple to gain an edge over its competitors.
Innovation enables the firm set trends and have unique feature4s that other organizations and firms do not have in their products. Through an innovative strategy, Apple sets the trend and creates new products which are more user-friendly and appealing to users. Additionally, the firm’s strategy of differentiation in functionality and design offer customers various products as well as different ways to access the product. Hence, it is also a vital product in the organizations long-term success.
Apple’s industrial-based model is also categorized as product differentiation in functionality and design. Its business strategy also entails expanding and building it as own online stores and retails as well as third distribution networks to reach more potential customers efficiently (Seghal, 2011). Through the expansion of its platform for the delivery and recovery of digital applications and digital content through iTunes, Apple improved is the business strategy.
In accordance with Apple’s business strategy, Apple tends to adopt advanced capabilities and features of its services and products as the base of the firm’s competitive advantage. Illustratively, the innovations list introduced by the firm include, but is not restricted by the establishment of iPad, which marked the first and unique device to store numerous songs characterized by simple shuffling abilities. The creation of Macintosh which is the first computer to utilize graphical user intereface4s as well as launching iMac that changed the rule book of computer designs. Vertical integration is also another character of industrial-based model in the manner that the organization entails advanced expertise in hardware, software as well as services (Seghal, 2011). Vertical integration does differentiate Apple from its competitors and has greatly benefited from its vertical integration. In particular, a vital source of the firm’s competitive advantage is related to the ecosystem which is enhanced by integration.
Resource- Based Model
Apple’s resource-based model is based on two types of diversification: constrained and linked. Firms utilize linked diversification while entering a new venture relating in various ways to other businesses the firm is already in but have no connection to the other business. On the other hand, firms using constrained diversification only entry into ventures that are based on the firm’s competencies and resources. Notably, organizations using linked differentiation tend to have minimal coherence top their entire strategy, but companies utilizing constrained diversification are more focused (Ireland. 2018). Additionally, constrained diversification enables a company to maximizes the impact of its resources since they tend to be shared.
In Apple’s case, the firm makes use of constrained diversification. Inherently, Apple is a software and hardware firm and the business make of its competencies in creating software and hardware. The iPad, iPhone, Macintosh, Apple TV, and iPod are computers that enable the organization to share the resources between businesses. Illustratively, iPad, iPod, and Apple Tv are all ran through OS X which is the companies operating the system. Additionally, rather than having a related business, each business entails a focused platform that lacks extraneous product types and products. For example, the Macintosh entails two forms, notebooks, and desktops. It is evident that the two different product lines share resources as well as complement. Additionally, the MacBook Pro and iMac are created from glass and aluminum which not only makes them resemble each other but also create some unity between the product lines.
Likewise, each platform in Apple does complement other platforms. Macintosh computers synchronize their data and media with other platforms. This is due to the factor that they are working effectively together, own products and services from every platform benefiting users through the creation of an experience where devices work effectively (Ireland. 2018). Platform advantages not only applies to the firm’s devices. Notably, through the users iTunes, users may purchase movies, music as well as television shows. The application store enables users to download applications for iPad and iPhones in spite of the geographical location. It is evident that Apple has chosen which business to venture in hence using platforms that reinforce each other and empower. This does create a full package for consumers to select from which is difficult for Apple’s competitors to choose from. Conclusively, the firm’s industrial-based model enhances individual’s business become valuable rapidly compared to separate entities.
Apple’s vision statement is centered on providing the best quality digital technology to usher in a new of technological revolution across the world. This vision statement shows its focus on providing the best possible services and products for customers.
Apple’s mission is to make a meaningful impact in this world by providing sustainable technologies that make life easier through quality and convenience. The firm believes in collaboration between its employees to initiate projects that change the perception of the world in regards to technology (Rowland, 2017). The mission demonstrates Apple’s commitment to excellence.
As a publicly listed company, the main stakeholders at Apple are the shareholders, who get a say in any major move that the company is planning through the annual general meeting. Another group of stakeholders are the employees, who execute the company’s mission and steer it towards its vision. The customers are also key stakeholders as they drive the company to profitability. Further, the public has vested interest in the company as its activities must be aligned to government regulations and must be socially conducive. On that account, Apple has to consider these stakeholders as it makes its decisions so that the considerations and requirements of each group its not left out; this enables the company to realize sustainable growth and be relevant in the marketplace.
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Katragadda, R. (2017). Apple and its competitive advantage – Ravi Katragadda – Medium. Retrieved April 10, 2018, from https://medium.com/@2ravitejak/apple-and-its-competitive-advantage
Mishra, C. S. (2017). Competitive Advantage Logics. Creating and Sustaining Competitive Advantage, 3-34. doi:10.1007/978-3-319-54540-0_1
Rowland, C. (2017, January 29). Apple’s Vision & Mission Statement. Retrieved from Panmore Institute: http://panmore.com/apple-mission-statement-vision-statement.
Sehgal, V. (2011). Supply chain as strategic asset: The key to reaching business goals. Hoboken, N.J: Wiley.