Apple's Operational Strategies and Success

This assignment requires an analysis of Apple's operational strategies, focusing on their impact on the company's success. Students are to examine Apple's supply chain management, process improvements, and how these contribute to its competitive advantage. The analysis draws upon a range of academic sources and online resources.

On-line Discussion and Essay
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TABLE OF CONTENTS
INTRODUCTION ...............................................................................................................................3
TASK 1.................................................................................................................................................3
Week 1. Discussion of how Operations and Supply Chain Management can benefit operations of
Apple and its competitors................................................................................................................3
Week 2. Role of Tim Cook in Apple and contribution of his disciplinary background informed
his strategy.......................................................................................................................................4
Week3: Comparison and contrast of process design of Apple and Samsung store and its impact. .5
Week4: Impact of positioning on operational aspects of the company...........................................6
TASK 2.................................................................................................................................................7
CONCLUSION ...................................................................................................................................9
REFERENCES...................................................................................................................................10
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INTRODUCTION
Tactical and strategic operations decisions identify how well a company is attaining its
business objective and goals. It delivers an opportunity to the firm to accomplished unique
competitive advantages that can easily gain the attention of the customers and hold them for the
long time (McCubbrey, 2016). In order to gain competitive advantage, operational and supply chain
both are playing an important role in the organizations. To quickly respond on consumers demand,
it becomes essential to make the modifications in operational procedures and improves supply chain
concept (Geuens, 2016). The present essay is based on role of operation management in sustaining
the competitive advantage. To understand its importance within the organization, Apple is taking
into the consideration.
TASK 1
Week 1. Discussion of how Operations and Supply Chain Management can benefit operations of
Apple and its competitors
Apple knows for its innovative products that combine advance functionality, deliver
exceptional experience to its users and give more attention over the designing of the products. It is
very well known that cutting edge products need an innovative approach at the time of
development. In this direction, Apple is one of the companies which understand this concept very
well. At the ending of first fiscal quarter i.e. 26th December 2015, it has determined that the cited
form has generated 58.73 billion pound and net profit has 14.48 billion pounds have recorded in 26
January 2015 after the sales of iPhone, iPad and Mac. Services. Along with this, the services such as
app store, iCloud, AppleCare, and Apple Pay has grown by 26% year by year (Apple's Process
Improvements Make it a Global Supply Chain Leader, 2016). This has only possible because of low
cost manufacturing options that use by suppliers of Apple.
Apple has been took the steps in the direction of managing its supply chain and operations
which has delivered several benefits to organization itself and its competitors. In this context,
company has determined the list of expectations of its suppliers by creating exclusive agreements in
the exchange of guarantees. The good developed relationships with the vendors have assisted the
cited firm to carry out scale operations in order to meet the customers’ demands. This strategy has
helped Apple to improve business operations and supply chain management process.
There are various competitors of Apple such as Samsung, Motorola, Microsoft, BlackBerry,
Sony etc. Operations and Supply Chain Management can deliver several benefits to operations of
Apple and its competitors (Jacoby, 2010). First one is a well managed operations and supply chain
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management will help cited firm and its rivals such as Samsung etc to ensure the quality of products
from starting stage of manufacturing to deliver it to the customers. With the application of these,
defects and rework situations that increase the costs of doing business will decrease (Schönsleben,
2016). Along with this, operations and supply chain management concepts will deliver profit to
Apple and its competitors like Samsung, Sony etc to manage their inventory level in such a way that
can easily minimize inventory holding costs by completely meeting the demands of the end users.
This will deliver enough flexibility to company and its opponents to complete orders of customers
in the case of less number of available inventories because inventory buffer levels will assist in
analyze the historical trends of the sales of products (Craighead, Ketchen, Dunn and Hult, 2011).
On the other side, operations and supply chain management will facilitate Apple and its competitors
to mitigate various risks levels by identify them in right manner. On the basis of determined
potential hazards, different risks mitigation strategies will carry out by the firms and its rivals
(DeBenedetti, 2016). Therefore, from the above discussion, it can be sated that operations and
supply chain management can deliver several benefits to Apple and its opponents such as Samsung,
Sony, Motorola etc.
Week 2. Role of Tim Cook in Apple and contribution of his disciplinary background informed his
strategy
Tim Cook has the former COO of Apple and he has an industrial engineer and developer. He
has given high contribution in the organization which has positively leaded the business at success
direction. As per Tim Cook, there are two kinds of profit margins: charging high prices or reducing
costs of final product. Company has applied both of them with the situation of marketplace. Former
COO has wanted to keep operational costs under control by meeting the needs of the customers. He
has depended over the tight team of operation executives who have been joined the company at the
time of joining of Tim Cook. The role his has given various benefits to Apple in the terms of
development of new technologies and systems (Murphy, 2016). To serve the customers in more
effective manner, former COO has decided to train the sales persons.
Tim Cook has focused over the opportunities to sells to enterprises where the result of this,
the sales of the goods have increased and it has crossed all previous records of Apple. The level o
revenue has risen with the passing of time. The same story happened with the profitability by
increase the sales of Apple iPhone. It has the best selling products of all the time and it has given
major contribution in enhance the level of sales. Tim Cook contribution as a COO has increased the
sales of iPhone over the last five years.
Tim Cook has done his MBA from Duke University and a Bachelor of Science Degree in
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Industrial Engineering from Auburn University. His disciplinary education has helped in
formulation of strategies. With the use of this, at the position of COO, he has changed the culture of
Apple which has made work place culture more effective and positive. He has learned some
operation skills during his education and work experience. On the basis of this, Tim Cook has
developed an operational strategy by which the company has sole more than 300 million devices in
2015 fiscal year. On the other hand, Apple has come in the market with large screen iPhones as
compare to its competitors. At the same time, the sales of iPad have decreased over the past seven
quarters which has enabled the cited firm to maintain its market share in this area. But with the help
of developed strategy, Tim Cook has suggested to make modifications in iPod and raise the number
of production volume of Mac (Jones, 2015). The result of this, Apple has seen the growth in both
the items in terms of sales and revenue.
Week3: Comparison and contrast of process design of Apple and Samsung store and its impact
Process design means developing a process or strategies to carry out the business. This is the
activity through which workflow, equipment needs and particular process is design. Process design
mainly consist of a flowchart which a company use to provide their services (Gruber and et.al.,
2015). Samsung store follow a process design in which customer calls at their store when the phone
line is busy customer has to wait in a queue to get in touch with the customer service provider so
after waiting customer hang up the call and service is not provided. The customer who are on the
line problems are solved by the line manager but the problem of other customers are not solved.
While in apple store the problem of every customer is solved with service desk all the cases are
reported than problems are diagnosed by first line management. And then case is resolved and after
resolving reviews of the customer are taken. The process which both the company are using should
be continuous process so as to satisfy the needs of the customer. Customer should get 24*7 services
which will increase the customer satisfaction.
Impact of Samsung store on customer is not good as the customer has to wait in line if the
line is not connected to customer service provider and if the line is connected than the problem is
solved otherwise the problem is not solved. So for increasing satisfaction of customer Samsung
should work hard to provide good service while the customer are satisfied with the process of apple
as they are very helpful to each customer as all the cases are reported and taken into consideration
and firstly diagnose and than solved by the first line manager and after that reviews of customer are
taken. Impact of Apple store is good but it can work more to improve their services so as to increase
more goodwill of the outlet which will ultimately increase the profit of the outlet (West and Mace,
2010).
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Process which both the outlets are using is directly affecting the competitiveness of
Samsung and Apple as the satisfaction of customer is very important for success of any business.
Samsung outlet must work on providing more customer service representative so that the customer
can get the line and problems of the customer are solved so that competitiveness of Samsung can
increase. Apple customer are more satisfied as compare to Samsung so Apple outlet is more
successful than that of Samsung. Success increase the profitability of the business and trust of the
customer also increase when the business is successful (Mahadeo, Soobaroyen and Hanuman,
2012).
Week4: Impact of positioning on operational aspects of the company
Positioning is the effort which an organisation do to impress the customer and change the
perception of brand. Every brand wants to occupy a unique and advantageous position in the mind
of the customer so as to increase the selling and profitability. Same is with brand Samsung and
Apple they are positioning in the market to increase the brand image. Samsung is selling both
premium range and affordable range product so that both rich and middle class people can use the
product (Mollenkopf, Frankel and Russo, 2011). But Apple is the brand which sale only premium
range products which only rich people can buy.
When it comes to cheaper" water down" products Samsung operational activities is not that
much good as Samsung takes so much time to provide services to the customer when they are
facing problems with the product while Apple provide quick services to their customer when they
face problem with the product. They directly change the product if there is any defect in the
problem. Even while reselling the Samsung product, the value of product get decreased very badly
as Samsung launches variety of products every year so the product value become cheaper. While its
opposite with Apple products the value of products doesn't decrease that much with the passing
year. Apple maintain its brand image and sale only premium range product.
Positioning impact allot on business as the profit of the organisation depends on the brand
image that is maintain by the company. In case of Apple the image is very good but all people can't
afford this brand product so it affect the sale as only rich people can buy it. While in case of
Samsung the brand image is good but the value of product is depreciated very quickly but all people
can afford to buy the products of Samsung so the sale of Samsung product is much more than that
of Apple. Increasing the profitability is the major objective of every business so Samsung should
focus on providing good services for their product and should also give good value at the time of
resale so that the goodwill of Samsung can increase more and While Apple can go for low cost
product so that company can target more customer and sale can be increased. Operations of
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business depends on the customer reactions so to increase the satisfaction of the customer is very
important to gain more profits and achieve the goals (Rahman, Laosirihongthong and Sohal, 2010).
TASK 2
On the basis of the above discussion on the company Apple it has been ascertained that there
has large impact of the environmental changes on the strategy and operational design of Apple.
From the above aspect I has assessed that strategic planning are very essential for Apple because by
strategic planning and design the operational activities business enterprise can address its growth
and success in the competitive market. Further , in order to set or design the strategic planning and
operational activities, I have to analyse internal and external environmental changes of business
organisation. In additional to this according to external and internal environment, corporation have
to set its strategy and operational activities. I have assessed in the environmental changes that there
are majorly two aspect that is internal and external which largely influence to strategic planning and
design operational activities. I have learnt that in the internal environment includes human
resources, organisational culture, organisational structure, management, company assets and
financial strength which may impact Apple operation. Internal environment are related to the
internal strength and capabilities such as resources, material, human resources, financial, and
physical resources. If in this aspect changes are occurred then Apple owner have to modified its
strategy and operational activities. For example, if company have lack of financial resources then it
directly affect the productivity because corporation may unable to acquire effective machines and
materials. By this quality of services and production may negatively influence. On the other hand
human resources are major part of the internal environment of Apple. If corporation have lack of
qualified and skilled workforce then strategic planning and operation may also negatively influence.
This may arise the issue of effective and quality services because skilled and productive employees
are not working in the organisation. I have learnt that in order to make effective strategic planning
and operational activities Apple have required an effective and quality workforce so this internal
changes may largely affect the process of operation of cited venture. On the other hand in the
internal environment, organisational culture and structure play a very crucial role. I have learnt that
culture refers to the value, beliefs, interaction of personnel at workplace. It defines that how
individuals are working and contribute toward organisation. If corporation bring changes in the
culture then it may largely affect activities and performance of employees at workplace. By this
strategic planning and operational activities may affected. On the other hand structure of
organisational also play a very important role in order to develop hierarchy in management and
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allocate roles and responsibilities. If corporation make any changes in the structure then it will
defiantly fluctuate in the allocation of roles and responsibilities of management. This may influence
the operational and strategic activities of Applet have observed that Apple is the world largest
technological corporation which deliver an effective and high quality product and services to its
customer. So in the internal environmental aspect, changes in the assets may also influence the
strategic planning and operational activities of cited venture. The availability of equipment is
another assets that can significantly impact on the internal environment. If equipment is in short
supply or not of the expected standards , then staff may be hindered in the performance of their
duties or if equipment is used by buyers then customer satisfaction will decrease. I have also
observed that management is another important component of the internal environment of Apple.
The capabilities of the management team and the leadership style employed by managers will also
have major impact on the morale of staff and organisation culture. More contemporary forms of
management involves workers in decision making processes and trusting that, although managers
and workers have different view points, they largely benefits by working to achieve the business
aim. I have also observed that not only internal environment but also external environment changes
affect the strategic planning and operational activities of Apple. In the external environment
includes political, economical, media, fashion, technology, climate and legal aspects. These all
aspects may largely influence the operational activities and strategic planning of Apple. I have
assessed that technological aspect play a very crucial role in the designing and development of
strategy because lots of activities of business are largely depends upon the technologies. If in the
country where organisation operate its business activities occurs new development in the
technology then it may lead new innovation in the production and manufacturing. By new
technological development, process of production may largely affect and it deliver an impressive
quality of product to potential customers. On the other hand if businesses do not adapt sufficiently
quickly to technological changes, they risk losing market share. This will affect the operational
activities and strategic planning of the Apple. Further more I have also analysed that political and
legal aspect in the external environment largely influence strategic planning and operational
activities. In this aspect includes taxation policies, consumer protection law, environmental law,
workplace health and safety, governmental policies etc. If any changes in these mentioned aspect
then it will directly affect organisational strategy and operational activities. Corporation have to
consider on the governmental tax policies, regulation,customer law, employment law etc at the time
of business operation. If in the UK any changes occur in these aspect then the process of operation
will changes. I have assessed that country government has increased the rate of tax so Apple have to
pay large amount of tax which directly affect company financial status. On the other hand according
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to the customer law and employment law, Apple have to consider on some rights and precise of
customer and employees and according to their right, the facilities and arrangement have to provide
by organisation. Further more, Apple have to follow all rules, code of conduct and legislation
changes in this aspect. I have also observed that at the time of development of new strategy for
Apple, owner have to consider on the climate changes. Designing of strategies and operational
activities may largely affected by the climate changes in the external environment. Climate changes
is an insidious challenge for Apple because in the process of manufacturing and production, natural
resources play a very significant role. If any fluctuation occurs in the climate or natural resources
such as water, air, sunlight, fuel, weather may positivity and negatively affect the process of
operation of Apple. On the other hand , media is another important external component which
largely affect the Apple strategic planning and operational activities. I have assessed that Apple is a
technological company which is largely based on the technology and innovation. In this aspect the
main driver is technology and internet, if it rise then company will beneficial to advertise and
announce the feature and benefits of product and services. In the country, if the uses of internet
increment then it become easy for Apple to promote its product and services in the market. So it can
be said that media and promotional activities any influence the proportional activities and strategic
planning of Apple.
CONCLUSION
In attaining the business goals strategic and tactical decision play a vital role. Hence, it can be
analysed that for success of business decision making of the firm must be very good. Apple and its
Competitors must manage their supply chain for good distribution channel. Tim Cook contribution
in Apple Company has a good which has help in success of the business. Process design also play a
vital role for a successful venture. Positioning in market is also an important part because good
brand image is very important for more profits.
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REFERENCES
Books and Journals
Craighead, C.W., Ketchen, D.J., Dunn, K.S. and Hult, G.T.M., 2011. Addressing common method
variance: guidelines for survey research on information technology, operations, and supply
chain management.cIEEE Transactions on Engineering Management. 58(3). pp.578-588.
Jacoby, D., 2010. The Economist Guide To Supply Chain Management. Profile Books.
Schönsleben, P., 2016. Integral logistics management: Operations and supply chain management
within and across companies. CRC Press.
Rahman, S., Laosirihongthong, T. and Sohal, A. S., 2010. Impact of lean strategy on operational
performance: a study of Thai manufacturing companies. Journal of manufacturing
technology management. 21(7). pp.839-852.
Mollenkopf, D. A., Frankel, R. and Russo, I., 2011. Creating value through returns management:
Exploring the marketing–operations interface. Journal of Operations Management. 29(5).
pp.391-403.
Mahadeo, J. D., Soobaroyen, T. and Hanuman, V. O., 2012. Board composition and financial
performance: Uncovering the effects of diversity in an emerging economy. Journal of
Business Ethics.105(3). pp.375-388.
Gruber, M. and et.al., 2015. Managing by design. Academy of Management Journal. 58(1). pp.1-7.
West, J. and Mace, M., 2010. Browsing as the killer app: Explaining the rapid success of Apple's
iPhone. Telecommunications Policy. 34(5). pp.270-286.
Online
Apple's Process Improvements Make it a Global Supply Chain Leader. 2016. [Online]. Available
through: <http://www.usanfranonline.com/resources/supply-chain-management/apples-
process-improvements-make-it-a-global-supply-chain-leader/#>. [Accessed on 5th December
2016].
DeBenedetti, J., 2016. The Advantages of Supply Chain Management Systems. [Online]. Available
through: <http://smallbusiness.chron.com/advantages-supply-chain-management-systems-
77606.html>. [Accessed on 5th December 2016].
Geuens, J., 2016. Competitive advantage through operations management. [PDF]. Available
through:<https://ompartners.com/~/media/Main/NewsEvents/PdfFiles/2010/2010_04_Packa
ging_South_Asia_Article_JGE_GST.pdf>. [Accessed on 5th December 2016].
McCubbrey, D., 2016. Operations management provides competitive advantage. [Online]. Available
through: <https://www.boundless.com/users/235420/textbooks/business-fundamentals/
operations-management-7/operations-management-32/operations-management-provides-
competitive-advantage-167-15470/>. [Accessed on 5th December 2016].
Jones, C., 2015. Six Reasons Tim Cook Is Doing A Great Job As Apple's CEO. [Online]. Available
through: <http://www.forbes.com/sites/chuckjones/2015/11/22/six-reasons-tim-cook-is-
doing-a-great-job-as-apples-ceo/#64cb09392b72/>. [Accessed on 7th December 2016].
Murphy, M., 2016. The first five years of Tim Cook’s reign as CEO of Apple, in charts. [Online].
Available through: <http://qz.com/765360/the-first-five-years-of-tim-cooks-reign-as-ceo-of-
apple-in-charts/>. [Accessed on 7th December 2016].
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