Strategic Management: Business and Functional Level Strategies

This report emphasizes on the different strategies such as business and functional level strategies. It is analyzed that due to this strategy the company is able to maintain its competitive advantage and also boosted the profit margin in the competitive market.

Strategic management

Strategic management
Executive summary
This report emphasizes on the different strategies such as business and functional level strategies.
It is analyzed that due to this strategy the company is able to maintain its competitive advantage
and also boosted the profit margin in the competitive market. It is necessary to focus on these
strategies as it can assist in giving tough competition to the competitors present in the market. In
this report it is also recommended that company should focus on Invest in the marketing
techniques and also reducing the cost of the products as it can assist in attracting more customers
towards the activities and services of the company.
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Strategic management
Table of Contents
Executive summary.........................................................................................................................1
Introduction......................................................................................................................................1
Functional level strategies...............................................................................................................1
Marketing.....................................................................................................................................1
Human resource...........................................................................................................................2
Finance.........................................................................................................................................2
Information management.............................................................................................................2
Public relations.............................................................................................................................2
Manufacturing..............................................................................................................................3
Research and Development..........................................................................................................3
Business level strategy.....................................................................................................................3
Innovation strategy.......................................................................................................................3
Apple emphasizes on design and functionality of the products...................................................4
Strengthening the Apple Eco system...........................................................................................4
Decrease dependency in context to the iPhones..........................................................................5
Differentiation strategy................................................................................................................5
Recommendations............................................................................................................................6
Low cost strategy.........................................................................................................................6
Invest in the marketing techniques...............................................................................................6
Conclusion.......................................................................................................................................6
References........................................................................................................................................8
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Strategic management
Introduction
In this report, the discussion will be made on the functional and business level strategy of the
Apple Company. It has been examined that these are the strategies that assist the companies in
maintaining the competitive advantage. The main purpose of the report is to highlight the
strategies that are considered by the management as it assists in availing the advantages in
relation to the competitors that are present in the market. The limitation focuses on the
information which is based on the secondary research. The scope is wide as there are different
strategies that are described which can help the company in controlling the basic functions that
are essential for growth in the highly competitive market. So, in this paper the strategies will be
described in relation to the Apple Company.
Functional level strategies
There are different functional units inside Apple and it has become essential for them to ensure
that they have applied best strategies to excel in these functions. Some of the major functional
level strategies in Apple are as follows:
Marketing
Apple focuses on their uniqueness and markets the things and they understand the value of
maintaining the brand name in the industry. This is the major reason why the company is now
having a huge fan total that is waiting in the long queues for their product. They do not promote
their product on traditional mediums but they are using some of the internet marketing mediums
to promote their product (Patel, 2018). Even this is also majorly done by their distributor. They
believe in creating buzz by conducting events such as launching events. Their pricing strategy
also acts as a part of their marketing strategy. Their branding totally depends on their premium
pricing strategy.
Human resource
They have a very good plan for their employees and their development. It is due to this, they
have been able to maintain high quality staffs at their workplace. They are hiring the staffs that
are good in research skills. Maintaining a research culture at the workplace also helps them in
bring innovation. They have created a separation of different departmental where each group of
people do not know what others are doing. This has helped them in maintaining intellectual
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Strategic management
property right which is very much essential in the modern day business. They have a rigorous
training program.
Finance
They invest a lot of their money on the research and development. They always want to stay
ahead of their competitors. Their investments are made according to the vision they have and the
goals they want to achieve (Johnson, et al. 2011). Since their financial capacity is big hence they
are easily able to invest their money in different parts of the world. The financial strategy
includes adding more numbers of investors in their pool so that they can easily fund all their
activities in the market (Marketinghrdpresentation, 2013). They also believe in adding financial
sources from different parts of the world so that when the financial problems arise in one part of
the world they may not face problems in adding to their financial resources.
Information management
They understand the value of information and this is the major reason why they have invested a
lot in the information management infrastructure. They have also invested their money on
building cloud infrastructure that ensures security and privacy of the data of the individuals.
Since the company has large numbers of people hence properly implementing this strategy is
slightly difficult (Rowland, 2019).
Public relations
Storytelling, product reviews, learning from their failures have been their prime public relation
strategies. Their leaders often come out and communicate with the public so that their vision is
clear to everyone. This reduces the chances of failure due to lack of communication. Their public
relations strategy involves people where they continuously communicate with their customers for
ensuring that they know what their customers want and their customers know what the plan of
the company is (Comcowich, 2017).
Manufacturing
Company believes that the quality of their products is the only thing that can make them win.
They do not manufacture their hardware on their own. They have given it to their partners. Their
major manufacturing partners lies in the Asian countries where the cost of manufacturing is low.
They have ensured that a fast mechanism is included at the workplace. They manufacture
software for their hardware. In order to improve their production capacity they have moved
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Strategic management
towards automation strategy and they have also invested a huge amount of money on building
their production capacity so as to meet the demands in their organisation (Gammelgard, 2019).
Research and Development
This is the thing on which Apple invests the most. Their research and development unit are fully
furnished. Their primary strategy has been to remove the things in the product that is not
necessary so as to provide maximum effectiveness for their products. In their research they focus
on adding value to their products. This is necessary for increasing the profit margins of the
company. Adding new technology within the research unit has been their primary strength. It is
due to this that company is focusing not only on development of external capabilities of the
organization but also on the internal capabilities of the organization (Forbes, 2018).
Business level strategy
Innovation strategy
It has been analyzed that business level strategies focuses on considering the concept of
innovation that does not mean that it emphasizes on creating the products but the focus is
towards bringing improvisation in the existing portfolio of the products. In the present era, the
company does not rely on the revenues that are driven by the new products but it focuses on
bringing improvisation in the existing line. For example: The new iPad Models that focuses on
the innovation process is improving the resolution capacity and also reducing the size of the
products. Also, it has been observed that in iPhone there is improvement and innovation in the
existing models. Innovation is one of the essential factors that are considered by the company to
expand the software applications that are provided by the Apple Company. By having the App
Store and also existing applications for the products they sell it has been seen that they are
driving innovation and also offering the benefits to the customers (Apple, 2015).
Apple emphasizes on design and functionality of the products
In relation to business strategy, it has been examined that company has considered the different
features and capabilities of the products and services that helps to attain the competitive
advantage. There is a wide list of innovation that was introduced by the company but it is not
only limited with the introduction of iPad. The first device introduced by the company stored
thousands of the songs with the overall capabilities through different songs. The first computer
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Strategic management
that is used by the company considered the graphical interface and also it launched the iMac that
ripped the computer design rule book. It can be stated that the first mover advantage is the other
factor of the Apple Company. It has been observed that company competitive advantages are
considered as challenging in relation to sustaining for the long time perspective. But it can be
examined that the management has been failed in relation to ensuring the overall innovation
features and capabilities in the new version of the products and this it has compromised with the
competitive advantage (Goffee and Jones, 2015).
Strengthening the Apple Eco system
This is one of the business level strategies of the Apple Company that can be stated as the
vertical integration. It is examined that company has advanced experts in the field of software,
hardware and also services. One of the important factors of the company relates to the vertical
integration that has set the company apart from the high level of competition. Apple has been
attaining the benefits from the vertical integration and also there is an essential source of the
company that helped in maintaining the competitive advantage. The essential source of the
company focuses on the competitive advantage in relation to the ecosystem which can be
enabled through different integration (Mitchell, 2014).
The devices and software of the company can be sync easily and it can also function well. There
are various applications that work on the multiple devices of the Apple but there is no much
difference in context to user interfaces. There are same items that do not pair with the products of
the other organizations and it also creates the links of the closed ecosystem. The Apple
ecosystem also maintains the switching costs for the customers in relation to the competition that
is prevailing in the market. The ecosystem also offers the opportunities to leverage the relations
with the present customers to provide the products and services in the market (Northouse, 2017).
Decrease dependency in context to the iPhones
The main business strategy of the company is transitioning from focusing on the sales of the
iPhone that helps in prioritizing the overall services of the business and also of the other
divisions. John Giannandrea has focused on promoting the machine learning and AL role. It is
important to consider the efforts that showcase the positive results. The services of the company
have generated the record revenue of USD 10, 9 Billion IN THE QUARTER OF 2019 which has
boosted the sales by 19% (Heib, 2015).
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Strategic management
Differentiation strategy
Apple has taken into consideration the broad strategy related to differentiation strategy. It is the
strategy that showcase that company has given up on getting the low reduction in the cost. The
company has also tried to make the costs as lower as possible and it was still high if comparison
is made with the competitors. The company has differentiated by offering innovation and also
the unique design that has helped in maintaining the large customer base. It has been examined
that the company has targeted the different customers and also the customers with the social
needs such as graphic design (Pine II and Gilmore, 2016). It can be stated that Apple has also
emphasizes on the product design that has assisted the company to maintain its competitive
advantage from the overall competition level that exist in the market. There is various unique
sample design and features considered that has attracted the loyal customers towards the
products. Also, because of the brand loyalty the customers considered the purchasing the
products. There are also various stores that are opened by the company (Frost, 2014).
The company has been successful in maintaining the differentiation of the products in the market
and also it has played a great role in boosting the sales of the products in the highly competitive
market. It is examined by offering different products in the market the company has also
maintained the high stability among its customers which has also offered the advantage of higher
profits. It is necessary for the company to focus on maintaining the differentiation strategy as it
can help in competing with the competitors present in the market (Rauf, 2014).
It can be stated that there are 390 Apple stores that offered in store experience and also
personalized customer service to its customers. The company also focused on maintaining the
customer service by solving the technical issues of the customers and also the introduction of the
iPod and iTune has enhanced the revenue of the company which has also boosted the sales of the
computer of the company. By focusing on the market trends, the company is known as the leader
of the market which consists of the PC market and also the smartphone market. There are also
various products in the market that has assisted the company in maintaining the profits. One of
the best examples can be of the apple in which it has been seen that it has failed in the music
industry and also still generate the revenue in the other markets (Chikhale and Mansouri, 2015).
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Strategic management
Recommendations
Low cost strategy
The company should emphasize on reducing the cost of the products so that it could be easy to
compete with the competitors present in the market. If the price of the products is reduced in
relation to the competitors then the company can attract the customers towards the products and
services of the company. It can be stated that this is one of the best strategy that can assist in
grabbing the large market share. The competitors such as Samsung pricing strategy should be
considered by the company so that growth can be attained in the market.
Invest in the marketing techniques
It is important for the company to focus on investing more on the marketing strategy as it would
not be possible to earn high profit margin only by the brand image. It is necessary for the
company to focus on marketing through social media networks such as Facebook and
INSTAGRAM as it can help in attracting the customers towards the overall activities of the
company. If marketing strategy is effective then it can be easy for the company to accomplish the
set goals and objectives in the highly competitive market. If focus is given on marketing
strategies such as direct marketing such as Face to face marketing should be considered by the
considered by the company. It can be stated that it is the necessary for the company to emphasize
on personally interacting with the customers so that they can explain more clearly about the
products of the company.
Conclusion
It can be concluded that Apple considers the effective strategies such as business level strategies
and functional level strategies. These strategies have given growth in the highly competitive
business world and it has also build the positive image in the market. The strategies such as
differentiation and strengthen the Apple Eco system has given positive impact on the overall
activities of the company. So, these strategies have assisted in maintaining the large customer
base in relation to the other competitors present in the market. It is recommended that the
company should focus on Low cost strategy and Invest in the marketing techniques. These are
the strategies that have assisted in reducing the high level of competition and also there are wide
choices offered to the customers. It can be said that these are important strategies that show the
right direction to the company and it should be considered so that profits in the competitive
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Strategic management
market can be boosted. So, it is concluded that business level and functional level strategies can
help in attaining growth.
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Strategic management
References
Apple, 2015.About us. [Online]. Available at: https://www.apple.com/sg/.[Accessed on 8 May,
2018].
Chikhale, M.M. and Mansouri, M., 2015. An agile and collaborative framework for effective
governance to enhance management in large-scale enterprise business systems: The case of
Apple Inc. Global Journal of Flexible Systems Management, 16(3), pp.283-293.
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Forbes, 2018. Is Apple's Soaring R&D A Sign Of Good Things To Come?. [Online] Available
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good-things-to-come/#336fc929b72b [Accessed on 08th May 2019]
Frost, J., 2014. Values based leadership. Industrial and commercial training, 46(3), pp.124-129.
Gammelgard, A. 2019. Lessons from Apple—what can small manufacturers learn from Apple's
success?. [Online] Available at: https://www.arenasolutions.com/blog/post/apple-ipad-bom-can-
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Goffee, R. and Jones, G., 2015. Why should anyone work here?. London Business School
Review, 26(4), pp.10-12.
Heib, J., 2015. From business motivation to business model and beyond: a customer value-driven
approach. In Business architecture management (pp. 53-74). Springer, Cham.
Johnson, G., Whittington, R., Scholes, K., Angwin, D. and Regnér, P., 2011. Exploring strategy.
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Mitchell, W., 2014. Why Apple’s product magic continues to amaze–skills of the world’s# 1
value chain integrator. Strategy & Leadership, 42(6), pp.17-28.
Northouse, P.G., 2017. Introduction to leadership: Concepts and practice. Sage Publications.
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Patel, N. 2018. 7 Key Strategies That You Must Learn from Apple’s Marketing. [Online]
Available at: https://neilpatel.com/blog/7-key-strategies-that-you-must-learn-from-apples-
marketing/. [Accessed on 08th May 2019]
Pine II, B.J. and Gilmore, J., 2016. Integrating experiences into your business model: five
approaches. Strategy & Leadership, 44(1), pp.3-10.
Rauf, M.A., 2014. Antecedents and consequences of leadership styles: Evidence from successful
entrepreneurial ventures. International Journal of Innovation, Management and
Technology, 5(5), p.378.
Rowland, C. 2019. Apple Inc. Operations Management: 10 Decisions, Productivity. [Online]
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