Strategic Management Plan on Apple Plc Assignment

Strategic Management Plan

Table of Contents
INTRODUCTION...........................................................................................................................1
TASK 1............................................................................................................................................1
P1 applying appropriate frameworks to analyse the macro environment...................................1
TASK 2............................................................................................................................................4
P2 Framework analysis of internal environment........................................................................4
TASK 3 .........................................................................................................................................5
P3 Implementing Porter’s Five Forces model for Apple IPad....................................................5
TASK 4............................................................................................................................................1
P4 Bowman’s strategy clock model............................................................................................1
CONCLUSION................................................................................................................................2
REFERENCES................................................................................................................................3

INTRODUCTION
Business strategy can be defined as a set of decisions which helps employers of a firm in
achieving specific objectives. Management of a company is taken this as a plan used to gain a
competitive position at marketplace as well as carry business operations in an appropriate
manner. In addition to this, formulating and developing effective strategies in business also aid
entrepreneurs in running organisation in a systematic order. This would further help in gaining
high satisfaction of customers and achieve success of targeted goals of long-term in pre-defined
period of time. In this manner, a report has been prepared on Apple Plc. It is a multinational
technology company which is headquartered in California, UK. This firm used to design,
develop and sells electronic product, computer software and online services. This assignment has
entailed impact and influence of macro environment on business along with internal capabilities
of this organisation. In addition to this, Porter’s Five Forces, theories, concepts and models.
TASK 1
P1 applying appropriate frameworks to analyse the macro environment
PESTEL is an strategical tool used by companies for planning to launch new product and
services and to track the environment in which they operate. It is used to identify the external key
factors which may affect the business. Before implementing any kind of strategy or tactical plan,
situational analysis is conducted with the help of PESTEL at a regular interval to identify macro
environmental changes.
APPLE Inc. is a multinational company which designs, manufacture and sell hardware
such as computers, the iPad media player, the iPhone smartphones etc. and software such as iOS,
watch OS, tvOS etc. Apple's success and growth is linked with its effectiveness in addressing
external factors in its macro environment which help in formulating strategies to exploit
opportunities and to protect from various threats. PESTEL stands for
political,economical,social,technological,environmental,legal.
PESTEL analysis of Apple Political factors :- Political factors includes government policies, political stability or
instability in market,foreign trade policy etc. For example: Apple is highly dependent on
China as they are are getting lower manufacturing cost from this country , Political
problems arising in china has resulted in increase of manufacturing cost in America itself.
1

Apple is also dependent on number of countries outside US like China, Korea, Ireland
for manufacturing its parts.
 Economical factors :- Economical factors affect the profitability and functions of
organisations it includes interest rates, exchange rates, Increase in labour cost . For
example: Increasing labour cost in china- Apple's maximum manufacturing factories are
in china. With the passing time government of China has increased the labour cost.
China's government have fixed minimum wages of labour, it differs region wise with
inclusion of benefit like housing, overtime, food etc. Due to this economical change in
china, it completely affects the cost of the apple products and increased the cost of the
products.
◦ Value of US dollar keeps on fluctuating.
◦ Increasing labour cost
◦ Inflation adversely affect the revenue of company. Social factors :- This includes various traits like belief, attitudes of population and
customer preferences. Apple products are considered as a symbol of status in society,
leads to increase in market share. On the one hand where younger people are more
attached and attracted toward Apple products for its good brand value and highest
technologies, on the another hand young generation is giving more importance to the
larger screens smartphones which are available in the market in less prices (Kalyani and
Sahoo, 2011). Technological factor:- With the increasing technologies the apple is facing heavy
competition from other brands which are offering same latest technologies in different
manner with larger screens. Increasing share of smartphone users reduces the use of
Apple's personal computer. Apple has limited market offering as its customer's very less
& purchased by few kind of customers which are brand oriented. Environmental Factor:- China is constantly reduce greenhouse gases effect and limiting
fossil fuel leads to increase in electricity rates which directly increased manufacturing
cost to the company. Pollution and other environmental side effect leads to increase in
regulation and manufacturing costs in future. Increasing Global warming is delaying in
transportation which affects Apple's supply chain.
2

 Legal factor:- Apple had been sued by various players like HTC, Nokia and Samsung for
infringement of contract. Government enhance privacy regulations to make organisation
and system function legally. Management provide duties and tasks to members in
according to their skills and abilities which help firm provide quality items and services
to people. Compensation to employees are given in according to their performance and
outcomes. Equality and discrimination are tactic taken care by administration.
Therefore, PESTEL analysis shows various threats and opportunities present in the macro
environment of Apple products and services which help company to develop strategies to
identify various risks present in environment that can hinder the growth of company.
Ansoff matrix for Apple Plc.
Market penetration- Apple has manufactured various innovative products at marketplace
which gives advantage to this firm to sell existing one easily. For further achievement, this
company needs to use some effective marketing tools like lower price, sales promotion and
advertising. It would help in attracting more new customers easily.
Market development- Under this sector, Apple needs to use different techniques of
marketing which is used to sell its existing products easily in new market area. It includes
expanding business in various geographical areas and can sell products in such places where
users seeks to get items in a different way. Thus, in this manner, Apple used to serve its services
in all over the world.
Product development- In this strategic technique, Apple used to create more innovative
products every year. These products are giving a tough competition to rivals which they never
copy. For example- Series of iPhone, iPod with 3G and 4G technology and more are helpful in
getting high satisfaction to customers.
Diversification- It refers to the most risky part as Apple needs to think to create more
strategies in production concept. It should manufacture more new products as well as introduce
them in new foreign marketplace. For example- Apple has launched a new feature in 2010 i.e.
iPad which reduces the need of carry a notebook.
3

TASK 2
P2 Framework analysis of internal environment
Internal environment: It can be define as internal working environment of an
organisation that includes employees, corporate culture, management etc. It create positive as
well as negative impact on firm performance as well as productivity in long run.
There are several internal environment factors are available like employees, value
system, mission & vision, corporate culture, unions, physical resource, organisation structure,
human resources and many other (Ackermann and Audretsch eds., 2013) These all together are
work and achieve common goals and aim in limited period of time. For example, Apple has
organising training program on time to time basis in order to enhance workers performance as
well as productivity in long run. Samsung is a biggest competitor of Apple, they use Apple
technology in their product and legal case has been made here, resulted Apple gain compensation
on this breach of law from Samsung.
VRIO analysis: It help to analysis necessary resources of an organisation that help to
compete competition effectively. This method identify whether available resources are enough to
achieve target or not, thus effect outputs negatively. Apple is a one of the biggest organisation in
the whole world and their aim objectives is develop or innovate new technology that are affected
Apple performance positively. VRIO model are detail as follows: Valuable: Resources like official retail store, innovation, control production of product
etc. has all are valuable in their nature. So that, Apple have important resources which are
effected positively their performance as well we productivity in long run. Rare: Apple resources like employees capabilities of innovation, lean manufacturing etc.
has all are rare in their nature no one another organisation have it. So that, firm are get
competitive benefits as compare to their competitors at market place (Annabi and
McGann, 2013). Imitable: Location of store, innovation in goods has imitable in their nature but control in
production as well as operations system has not imitable they are change time to time
according to requirement. Organized: Management of Apple iPad is organised all resources effectively to that they
are fully utilise each one available resources like retail location, innovation and controls
in production activities and operational work.
4

Resourced based analysis: Apple has valuable as well as rare resources through this they
are able to achieve competitive benefits in long run. All resources which are consider by
organisation in order to operate whole business activities effectively resulted achieve target in
limited period of time appropriately. Physical: Some physical resources like machineries, infrastructure, technology etc. has
available which are help them to run entire business activities effectively. Human: Human resources manager has select talented candidates and organising training
program to enhance their productivity as well as knowledge resulted they are work
effectively and achieve target in limited time period (Auzair, 2011). Financial: Apple is biggest organisation in the world so they have sufficient financial
resources to run their business activities effectively.
SWOT Analysis Strength: in this there is having a improvements in graphics by 2.5 times as well as they
promised the battery of 10 hours along with that also improving in rear camera and
equipped with touch ID scanner of fingerprint. Weakness: Its front camera is having 2.5 megapixel. It is very expensive. It is quite same
with existing Ipads along with that they improve the performance decline to 6 hours
while using higher applications. Threats: Apple industry is decline the sales of tablets as PCs and smartphones are
emerging as primary devices.
 Opportunity: They are tie up with the positions of corporate it as an business goods. They
are also improving the quality of front camera.
So it is concluded that, Apple have valuable resources which help them to run enterprise
effectively at global level. Apple strength has help them to achieve goals in limited time period.
TASK 3
P3 Implementing Porter’s Five Forces model for Apple IPad
Porter’s five forces model
It is an model for measuring business competitiveness. It shows from economy of
organisation to derive the five forces of model that identify competitive intensity and
attractiveness of electronic sector in the terms of profits. It is important tools for understanding
5

about these forces of model which provide a competition shape within in this domain. It is useful
in adjusting techniques that aid in competitive surroundings as well as also help in improving the
level of profits. Additionally, structure is analysed within Apple organisation is undertaken to
identify proper and better advantages of competitive sources (Azar, 2011). Organisation is
continuously addressing their rivals as well as barging power of their customers which are most
important external factor influence the company. In order to analyse the five poster forces of
model of Apple industry which is given in detail below:
(Source: Porter’s five forces model, 2018) Threat of substitute services and goods: It is a weak which affect the industry of Apple.
It determine the strength of their substitute goods in attracting their high numbers of
customers. In this case of Apple, it exert weak force which is based on external factors
are : High substitutes availability having a moderate force and low substitute performance
having a weak force (Bharadwaj and et. al., 2013). In this model, Apple do not require to
prioritize the substitute treat within process of business such as product and marketing
design as well as development. Threat of entry of new entrants: Experiences of Apple that is having a moderate forces
of threat of fresh entrants. This element of model indicates the possibility as well as effect
of new rivals entering within a marketplace. In this case of Apple, new entrants exert a
force which is moderate as it is based on external factors are high needs of capital, high
development of brand cost and capacity of potential new entrants.
6
Illustration 1: Porter’s five forces model, 2018

 Bargaining power of suppliers: It I having a weak force experience of Apple of
bargaining with their suppliers. This elements which impact on suppliers which are
imposing their demands. In this they are having a weak bargaining power based on the
factors of external are higher numbers and overall supplier are having a weak force.
 Bargaining power of customers: In this having a power of bargaining of their customers
are very strong which affect on the business of Apple. Elements of this model determine
the influence of business. In the case of Apple, there is having a strong power of
bargaining on the following external factors are small size of particular customers is
having a weak force and low switching price is having a strong force.
Porter’s Five Forces model for Apple iPad is mainly concentrating their attention on their
competitors as well as having a customer bargaining power. Apple is applying this model within
their industry in its external factors (Bucolo and Matthews, 2011). Therefore, giving higher
efforts is having a strength position against rivals along with that they keep on attracting buyers
to Apple goods.
Advantages of applying this model is help in competing with their competitors and rivals
as well as it aid in attracting higher numbers of customer within Apple industry. This five forces
of model help in analysing external factors.
Disadvantages of Five forces of models are also having sheds lights on which Apple
industry does to make sure of despite leadership is having a negative impact in competitive
landscape as well as they are by having low times. Their external factors also impact on Apple
industry. In this they are having a weak force of bargaining.
Apple iPad is using this method for making their organisation success as well as
maintain their goodwill within the company. It will aid in attracting higher numbers of customer
al9ong with that also help I competing a rivals within a marketplace (Klettner, Clarke and
Boersma, 2014). They are concentrating on Apple IPad as they are modifying their goods for
competing with their substitutes.
7

TASK 4
P4 Bowman’s strategy clock model
Strategic planning is a kind of process that is used for defining strategy or directing them and
also it assist company in making proper decision in regards to allocating resources for future
strategies. Therefore, strategy includes processes through which company majorly focus on
coordinating both formulation and implementation.
Porter's generic strategies are incorporated by companies in order to get competitive
advancement by lowering down cost as compared to rival organisation. Further it can be divided
into two parts i.e. “Cost Focus” and “Differentiation focus”. Apple for their product IPad are
using this strategy for doing comparison between their competitive companies so that they can
fix an appropriate price for their products (Grover and Kohli, 2013).
Therefore, the best model that company has adopted is Bowman's Strategy Clock Model
that are explained below for having better understanding:
Bowman's Strategy Clock Model:
This model is highly used by most of the companies in order to designing and
formulating marketing strategy which can be analysed for position in market area as compared to
rival companies. Further this model has given three ways by which they company can give tough
fight with their competitors and to provide customer's satisfaction. Mainly Bowman's Strategic
Clock consist of eight strategic position that are mentioned below:
Position 1: Low Price/ Low added Value: This sort of segment can be considered as an
effective tool which is not been taken under in use by business organisation when it comes to
competitive level. Another name of this approach is Bargain Basement. Organisations mostly do
not wants to be at this position because competition stays at zero level.
Position 2: Low Price: It has been analysed that this option is being taken under in use
by organisations when there is less competition at workstation. Profit margins at this stage stays
really very low where organisation keeps on looking into different aspects so that sales can get
improved.

Position 3: Hybrid: Under this stage, organisations do comes which carries less prices of
products and services. At this phase, companies that are coming under carries a good reputation
where organisation may face a little competition (Jocovic and et. al., 2014).
Position 4: Differentiation: At this phase, companies that are carrying some different
products where their factors stays totally different from their rivals.
Position 5: Focused Differentiation: This consist to be the most essential element of this
theory. In this organisations offers high perceived value products in against of high prices. This
strategy is effective for those organizations whose buyers purchases goods and services that are
based on perceived value alone.
Position 6: Increased Price and Standard Product: Products price along with, their
quality stays high where competition also gets enhanced. It has been analysed that, at this phase
organisation mostly deals in different sections as well and rivalry stays high.
Position 7: High Price/ Low Value: At this stage, it has been analysed that prices of
products stays high but its value gets down which can be considered as a best suitable phase
because this leads firm to generate revenue for a longer period of time.
Position 8: Low Value/ Standard Price: Under this stage, it is being located that pursues
this type of market strategy will definitely lose market share. If company has a low value product
or services, the only way company will sell it is on price (Kalyani and Sahoo, 2011).
CONCLUSION
It has been concluded from this report that business strategy is useful in achieving the
long term profitability of a company. It is required by each and every enterprise to develop its
strategies on regular period of time so that targeted goals and objectives of business can be
gained in an efficient and effective manner. In addition to this, for accomplishing such target, it
is necessary for manager of a firm to give proper guidance and direction to employees so that
they can understand roles and responsibilities of them. It would help in gaining high commitment
and support of workers in success of business in a set period of time. But before developing
policies and strategies it is necessary for employers also to make proper analyse of internal and
external environment. Further this present report also discuss a wide range of concepts, models
and theories as well as devise and interpret a strategic planning.
2

REFERENCES
Books & Journals
Ackermann, S. J. and Audretsch, D. B. eds., 2013. The economics of small firms: A European
challenge (Vol. 11). Springer Science & Business Media.
Annabi, H. and McGann, S. T., 2013. Social media as the missing link: Connecting communities
of practice to business strategy. Journal of Organizational Computing and Electronic
Commerce. 23(1-2). pp.56-83.
Auzair, S., 2011. The effect of business strategy and external environment on management
control systems: a study of Malaysian hotels. International Journal of Business and
Social Science. 2(13).
Azar, O. H., 2011. Relative thinking in consumer choice between differentiated goods and
services and its implications for business strategy. Judgment and Decision Making. 6(2).
p.176.
Bharadwaj, A. and et. al., 2013. Visions and voices on emerging challenges in digital business
strategy.
Bucolo, S. and Matthews, J. H., 2011. A conceptual model to link deep customer insights to both
growth opportunities and organisational strategy in SME’s as part of a design led
transformation journey. Design management toward a new Era of innovation.
Grover, V. and Kohli, R., 2013. REVEALING YOUR HAND: CAVEATS IN
IMPLEMENTING DIGITAL BUSINESS STRATEGY. Mis Quarterly. 37(2).
Jocovic, S.V. and et. al., 2014. Modern business strategy Customer Relationship Management in
the area of civil engineering. In Applied Mechanics and Materials (Vol. 678, pp. 644-
647). Trans Tech Publications.
Kalyani, M. and Sahoo, M. P., 2011. Human resource strategy: A tool of managing change for
organizational excellence. International Journal of Business and Management. 6(8).
p.280.
Klettner, A., Clarke, T. and Boersma, M., 2014. The governance of corporate sustainability:
Empirical insights into the development, leadership and implementation of responsible
business strategy. Journal of Business Ethics. 122(1). pp.145-165.
Johnson, G., 2016. Exploring strategy: text and cases. Pearson Education.
Porter, M.E., 2011. Competitive advantage of nations: creating and sustaining superior
performance (Vol. 2). Simon and Schuster.
Scholes, M.S., 2015. Taxes and business strategy. Prentice Hall.
Sumer, K. and Bayraktar, C. A., 2012. Business strategies and gaps in Porter's typology: a
literature review. Journal of Management Research. 4(3). pp.100-119.
Tavitiyaman, P., Qu, H. and Zhang, H.Q., 2011. The impact of industry force factors on resource
competitive strategies and hotel performance. International Journal of Hospitality
Management.30(3). pp.648-657.
Williams, B. and Figueiredo, J., 2011, June. Strategy and technology management: An
innovation-leader case study. InTechnology Management Conference (ITMC), 2011
IEEE International (pp. 806-811). IEEE.
3

4