Business Strategies of Organizations

This report analyzes the business strategies of two major organizations, Apple and Nokia, in the smartphone industry. It examines their competitive rivalry, value chain analysis, generic business level strategies, and international entry modes. The report also suggests solutions to improve their operations and overcome challenges.

Running head: BUSINESS STRATEGIES OF ORGANIZATIONS
BUSINESS STRATEGIES OF ORGANIZATIONS
Name of the Student
Name of the University
Author Note

1BUSINESS STRATEGIES OF ORGANIZATIONS
Table of Contents
Introduction....................................................................................................................2
Analysis of the two organizations..................................................................................2
Five forces and PESTEL............................................................................................2
Value chain analysis...................................................................................................4
Generic business level strategy..................................................................................5
Attack and response, Drivers.....................................................................................5
Corporate level strategy and level of diversification.................................................6
Restructuring..............................................................................................................6
International cooperative level and international entry mode....................................7
Strategic alliance and changes after that....................................................................7
Conclusion......................................................................................................................8
References......................................................................................................................9

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Introduction
The report will be based on the analysis two major organizations named Apple and
Nokia. Apple has been successful in the smartphone industry and Nokia has proved to be
unsuccessful in its operations. Apple is a multinational technology based organization of
American origin that develops different software and hardware products. The headquarters of
the organization are located in Cupertino, California (Apple.com 2019). Nokia is a Finnish
organization that has global operations and develops different technology based products.
The company was established in the year 1865 in Esopo. Both the organizations have been
operating in the technology industry and have faced competition from different smartphone
companies (Nokia.com 2019).
Analysis of the two organizations
Five forces and PESTEL
Five forces analysis of Apple
Competitive rivalry – The competitive rivalry that is faced by Apple in the
smartphones industry are high due to aggressiveness of the firms. Nokia faces high
competition in the smartphone industry and has failed to maintain its position due to
competition offered by Apple.
Bargaining power of the buyers – The buyers in smartphone industry are high and
this force is considered to be quite strong for the organization. The rising power of buyers
have affected sales and revenues of Nokia is a negative manner (Brix-Asala et al. 2018).
Bargaining power of the suppliers – The suppliers in the technology have low power
to affect the prices of products offered by Apple. Nokia is dependent on the suppliers for raw
materials that are offered by them for manufacture of high technology based products.
Threats based on substitution – The substitute products related to those which are
offered by Apple are not considered to be effective. The power of substitutes is low as it is
quite hard to find a substitute of mobile phones. This has reduced the level of this threat
(Buganza et al., 2015).

3BUSINESS STRATEGIES OF ORGANIZATIONS
Threats based on new entry – The threats based on entry of new organizations in
smartphone industry are low and this force is quite weak for Apple. The threat related to
entry of new organizations in the industry is low and this has an impact on Nokia as well.
PESTEL analysis
Political factors The improvement in trade policies have provided growth
opportunity to Apple in order to distribute more products in
different markets.
The regulations in production processes have a negative
impact on the operations of Nokia.
Economic factors The high levels of growth of emerging economies and the
stable economies have been able to support the growth of
Apple.
The downfall that has been faced by Nokia is based on
increase in turmoil in global economic condition (Dell’Era et
al. 2017).
Social factors The rise in usage of mobile technologies and social media
have improved operations of Apple.
The lack of understanding of customer needs have been able
to affect the revenues of Nokia.
Technological factors The trend based on cloud computing and levels of
technological integration have enhanced operations of Apple.
The high levels of creativity of products of Apple have not
been matched by Nokia in an efficient manner (Hanson et al.
2016).
Environmental factors The trends of sustainability and product efficiency are
effective for Apple and its growth.
The user friendly products of Nokia have been able to
enhance customers of the company.

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Legal factors The privacy regulations and telecommunications based
policies have provided challenges to Apple.
The regulations in different countries have a negative impact
on sales of Nokia (Haucke 2018).
Solution – The solution that can be provided to Nokia is based on the development of
policies in such a manner that can help the organization to face high levels of competition.
Value chain analysis
Primary activities
Inbound logistics – The supply chain of Apple is huge and the inbound logistics are
also effective in order to maintain the production process. The in-bound logistics of Nokia are
based on product development phases.
Operations – The manufacturing based operations that are performed by Apple are
based on development of products. Operations of Nokia are related to the service and
manufacturing processes (Hitt, Ireland and Hoskisson 2016).
Outbound logistics – The outbound logistics developed by Apple is based on the
string distribution channel of the organization. The growth objectives of Nokia is based on
the development of proper competitive advantage.
Marketing and sales – The brand value of Apple has been enhanced effectively with
the help of its marketing and sales activities. The differentiation and benefits of sales and
marketing are related to costs based on promotions of Nokia (Kapoor and Agarwal 2017).
Products and services – The sales support that is provided by Apple is related to the
ways of increasing awareness based on the products. The after sales services offered by
Nokia are able to affect the revenues of the organization (Kim 2016).
Support activities
Technology development – The investments made by Apple on research and
development are high. The value chain of Nokia is able to provide support in formation of
new and improved technologies.

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Human resource management – Human resource management is based on the ways
by which employees provide support to Apple. The HR aspects of Nokia are based on
motivation and commitment provided to employees (Newyorker.com 2019).
Procurement – The relationship of Apple with suppliers is a major part of the
success. The development of a major supplier base is able to support the procurement process
of Apple.
Firm infrastructure – The infrastructure of Apple is considered to be an important
factor in success of the organization. The infrastructure that is developed by Nokia is helpful
for proper manufacture of the products (Paik and Zhu 2016).
Solution – The infrastructure and levels of operations that have been developed by
Apple are much stronger in comparison to that of Nokia. Nokia thereby needs to improve the
infrastructure in an effective manner in order to develop revenues in the smartphone industry.
Generic business level strategy
The business level strategy that has been implemented by Apple is based on the
development of best level of products. The company mainly focusses on innovation which is
a part of the differentiation strategy. The focus of Apple on innovation has helped the
organization to develop unique and high end products in order to help in the development of
effective levels of revenues in the industry. Innovation has been an important part of the work
process that is followed by the organizations in Apple (Paik and Zhu 2016).
The generic business level strategy that has been implemented by Nokia in order to
maintain its operations in the smartphone industry is cost leadership strategy (Pearlson,
Saunders and Galletta 2016).
The implementation of broad differentiation strategy has been helpful for the
development of a sustainable competitive advantage in the smartphone industry. The
implementation of cost leadership strategy on the other hand has led to the decline in the
quality of products offered by Nokia.
Solution – Nokia needs to improve the quality of products that are offered to the
consumers in order to develop high levels of differentiation in the smartphone industry (Peng
and Liang 2016).

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Attack and response, Drivers
Apple has been able to depict immense levels of growth based on the revenues that
have been earned due to average selling prices of the products that are offered by the
organization. The services offered by Apple have also led to the strong growth in revenues
from App store of the organization. The wearables that have been offered by Apple are
important factors related to growth of Apple (Trabucchi et al. 2018).
Major growth drivers of Nokia are related to the strong presence that the organization
has been able to develop in the smartphone industry. Growth that has been gained by Nokia
in the industry is also based on the licensing division of the organization. The partnership that
had been made by Nokia with Microsoft had a negative impact on its operations.
Solution – Nokia can improve the levels of growth in different countries with the
support provided by the reliable products of the organization (Vuori and Huy 2016).
Corporate level strategy and level of diversification
The corporate strategy that has been implemented by Apple in order to maintain its
operations in the smartphone industry is named as constrained diversification. This had
allowed the organization to use the resources in limited number of products that are offered to
the consumers including, iPhone, iPod and iPad.
Nokia on the other hand has implemented the strategy of high levels of diversification
that is based on the focus that is provided on the divestment of business units, the product
lines and plants. The participation in joint ventures is also an important part of the strategy
that has been implemented by the organization (Zhang, Liang and Wang 2016).
The high levels of diversification based activities that have been performed by Nokia
have led to major issues in the revenues that have been earned by the organization in the
industry.
Solution - The solution that can be offered to Nokia in this case is based on the
development of diversification strategy in such a manner that will help in concentrating the
resources in small number of products (Trabucchi et al. 2018).
Restructuring
Apple has restructured its operations from time to time in order to maintain its
growth pace with the changes that have taken place in the external environment. The venture

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of Apple into the development of smartphones was at the time when the use of smartphones
had started rising with a huge pace. The organization had however started its operations in the
development of personal computers for various types of customers in different parts of the
world (Bbc.com 2019).
Nokia is also famous in the industry for the development that the organization has
implemented in its business operations in order to maintain its operations in the highly
competitive industry. The different divisions that had been formed by Nokia after effective
restructuring include, multimedia phone, mobile phone, networks and enterprise solutions as
well (Paik and Zhu 2016). The company had however made major investments in different
types of businesses that had led to immense pressure on the resources that have been gained
by the organization in order to maintain its operations in the smartphone industry. The
decline in growth of Nokia was mainly based on the pressure that had been developed on the
resources of the organization in the smartphone industry (Buganza et al., 2015).
Solution – The restructuring operations that have been developed by the organization
has been quite effective for Nokia, however, the improvement in operations can lead to
increase in revenues of the organization.
International cooperative level and international entry mode
The market entry modes that are used by Apple Inc. in order to increase the levels of
presence in different countries include, exporting, importing and licensing. The risk related to
usage of licensing in order to develop the operations of the organization in a different country
are low and the organization has full control over the development of its products (Hitt,
Ireland and Hoskisson 2016).
The market entry mode that has been implemented by Nokia in order to enter a new
country or market is the contractual manufacturing strategy. The organization thereby gets
the products manufactured by different independent local companies on a contractual basis.
Solution – Nokia can try to implement many other market entry modes in order to
increase the levels of presence in different countries (Hanson et al. 2016).
Strategic alliance and changes after that
The major strategic alliances that have been developed by Apple in order to maintain
the operations include, the partnership with Disney in order to improve the performance
levels of stores of Disney, alliance with HP in order to deliver the branded music players and

8BUSINESS STRATEGIES OF ORGANIZATIONS
alliance with Microsoft to develop the Office software for its Mac computers. The alliances
have proved to be successful for the operations of Apple in the highly competitive
smartphone industry and the development of other products as well (Hitt, Ireland and
Hoskisson 2016).
A major strategic alliance that is made by Nokia is based on joining its operations
with Microsoft. This alliance had proved to be major drawback for the ways by which Nokia
has faced decline in the smartphone industry. The competition that had been faced by the
organization in the organization had led to different hasty decisions were made. The
ineffectiveness of the alliance has affected the profit levels and revenues in the industry for a
long period of time. The style of the merger had led to major issues in the operations that
were performed by Nokia. This alliance is most significant factor based on losses that have
been faced by the organization (Brix-Asala et al. 2018).
Solution – The alliances developed by Nokia can be increased in order to gain support
for its future operations in the industry.
Conclusion
The report can be concluded by stating that the two organizations namely Apple and
Nokia had been operating in the same industry since their inception. Nokia had been a leader
in the industry for many years. However, the competition that was faced by the organization
from a huge organization like Apple had led to the development of many wrong decisions
that further led to the decline of the sales of Nokia. The alliances that were made by Nokia
and different strategies had a negative impact on the ways by which the organization tried to
face competition in the smartphone industry.

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References
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[Accessed 14 May 2019].
Bbc.com 2019. Five big things that have made Apple. [online] BBC News. Available at:
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Brix-Asala, C., Geisbüsch, A.K., Sauer, P., Schöpflin, P. and Zehendner, A., 2018.
Sustainability tensions in supply chains: A case study of paradoxes and their
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Buganza, T., Dell'Era, C., Pellizzoni, E., Trabucchi, D. and Verganti, R., 2015. Unveiling the
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Newyorker.com 2019. Where Nokia Went Wrong. [online] The New Yorker. Available at:
https://www.newyorker.com/business/currency/where-nokia-went-wrong [Accessed 14 May
2019].
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[Accessed 14 May 2019].
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