Managing Innovation in Business: An In-depth Report on Apple Inc.

This report provides an in-depth analysis of Apple Inc.'s innovation management strategies, starting with a brief history and overview of the organization. It explores the timeline of innovations incorporated into iPhones, examining both external factors (political, economic, social, technological, legal, and environmental) and internal strengths and weaknesses that influence Apple's innovation performance. The report also discusses Apple's value chain network, highlighting primary and secondary activities, and concludes with an overview of the technological industry in 2018 and potential future innovations for Apple to maintain its market leadership. The analysis emphasizes Apple's focus on product innovation and its ability to leverage technological advancements to enhance its product offerings and customer satisfaction.

Managing Innovation in Business
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Executive Summary
In this report, a detailed description about Apple Inc. and its operations has been discussed. The
ways in which the organization can increase its market share and manage its business has been
discussed here. A brief history of the organization has been provided in the first part of the
report. Next, the timeline of innovations that took place in the organization and how they were
incorporated in the various iPhones have been discussed in the report. The external and internal
factor which helps Apple to incorporate innovations in its business has also been discussed. At
the end of this report, the current scenario of the technical industry has been provided along with
the future innovations that can be achieved which will help the organization to grow.
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Table of Contents
Introduction......................................................................................................................................4
Purpose and Structure of the Report................................................................................................5
The Organization & Industry Overview..........................................................................................6
a) The organization and its innovation history.........................................................................6
b) The organization’s existing Innovation Performance and Capabilities................................7
c) The industry in 2018...........................................................................................................10
Conclusion.....................................................................................................................................13
Reference List................................................................................................................................14
Appendix........................................................................................................................................16
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Introduction
This report focuses up on the innovation taken up in the technical industry. Apple is a market
leader when it comes to computer hardware and software. The organization is well-known
among the people in UK as well as around the globe. In this project various topics have been
discussed which has given a critical analysis on the innovations made in the organization since
its inception. All the external and internal factors have been highlighted which helps in brining
innovation into the organization.
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Purpose and Structure of the Report
The purpose of this report is to conduct an innovation audit for Apple Inc. The report will
examine Apple’s innovation history. The resent level of innovational activities of Apple Inc. will
also be discussed. The innovations required for the mentioned organization will be highlighted
upon in this report. The innovation audit for the chosen organization will include macro and
micro environmental factors. The upstream and downstream supply chain participants will also
be discussed.
In this report, an overview of the chosen organization and industry will be given. The next points
that will be highlighted are how the existing innovation is helping the company to grow and what
the opportunities that lie ahead for the organization are. The current scenario of the technological
industry will be also evaluated.
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The Organization & Industry Overview
a) The organization and its innovation history
Apple Inc. belongs to the technological industry. The technological industry has advanced by
multiple folds since the last decade. Artificial Intelligence has been incorporated in the
technological industry on a huge scale. Apple is a multinational conglomerate which
manufactures computer hardware such as Macintoshes’. Computer software’s, cell phones,
laptops, and music players are all manufactured but Apple Inc. Apple Inc. was previously known
as Apple Computer, Inc. Steve Wozniak and Steve Jobs started Apple Inc. in 1976. The first
computer from the organization Apple I was sold in 1976 (Jones, 2016).
Innovation is the core element of the business model followed in Apple Inc. Every product from
the organization is much more developed than the previous ones. The organization always looks
for incorporating innovation in their business. Apple serves a niche customer base. Therefore, the
demands of the general customer base are not kept in mind while incorporating technological
elements into the products (Jones, 2016). Every organization considers innovation as a vital
element for its functioning. Since its inception, Apple has introduced a lot of innovations into its
business. The innovations have developed in product development as well as the satisfaction
among the users. One of the most famous products of Apple Inc. is iPhone. iPhone has
revolutionized the cellular industry worldwide. Since its inception, iPhone has gone through
various innovations in its life span. The first iPhone was manufactured in 2007. Since then, many
models of iPhone have been manufactured with various innovations being incorporated in it
(Jones, 2016).
The first technological innovation that was incorporated in iPhone was the Apple Retail store. It
was developed in the year of 2001 and was incorporated in the iPhone which came out in 2007.
iTunes music store was developed in the year of 2003 (Jones, 2016). The phone which came out
in 2007 by Apple has a personalized digital music store as iTunes. Such kind of a digital music
store was not available on the Android software. App Store was developed in 2008. It was a
digital store which has iTunes and iBook as an integral part of it. The concept of App store was
introduced in iPhone 3GS which came out in the market in 2009. Siri was the last technological
advancement which was done under the leadership of Steve Jobs. Siri made the concept of
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personal digital assistance come into reality. This was a voice-to-computer interaction which was
firstly incorporated in iPhone 4S which came out in 2010. The TouchID was a technology
through which a nphon e could be unlocked by the help of human fingerprints. This took the
security of the phones to another level. This technological innovation was developed in iPhone
5S. This was a huge technological innovation which was brought by Apple into the cellular
market. In 2014, the Apple Pay was invented. This was an electronic wallet payment method.
The evolution of TouchID helped the Apple Pay to grow. Apple Pay was firstly introduced in
iPhone 6S which came out in the market in 2015 (Jones, 2016).
Analyzing the innovation history of Apple has helped in understanding that among the 4P’s of
innovation that is product innovation, process innovation, position innovation and paradigm
innovation, Apple mostly concentrates in product innovation. This can be inferred because since
the inception of the company, the brand has focused of developing and implementing unique
features resulting in product innovation (Heisler, 2016).
b) The organization’s existing Innovation Performance and Capabilities
The external factors of the environment have a huge impact on the innovations done in an
organization. The political, economic, social, technological, legal and environmental factors are
considered as external factors. An analysis on how the external factors impacts on the
technological innovations in Apple id done below:
Political Factors: Brexit has opened up markets for business expansion. Apple should
incorporate ways for expanding its business outside UK (Hunt and Wheeler, 2018). All the
countries of the European Union consist of potential market where iPhone and other products
from Apple can have huge revenue generation. The free trade policies have been improved in
UK. Apple can take advantage of this policy and spread its market outside the boundaries of UK
Economic Factor: Economic Factors is a major factor that helps in bringing innovation in an
organization. Innovation requires a lot of financial assistance (CIPD, 2017). The economic
stability of developing countries like UK creates opportunities for Apple and other organizations
to incorporate innovation into the business model. The economic opportunities in the developed
countries should be well exploited by Apple
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Sociological Factor: The population of UK is quite young. The socio-cultural and the social
factors in UK are all favorable to the business of UK (CIPD, 2017). The increasing use of mobile
phones among all the age-groups in UK is providing a huge market for Apple. Apple should
incorporate easy to use mobile devices so that people from all age groups can use the phones
which are manufactured by Apple. Apple has already taken few measures to exploit this
opportunity.
Technological Factors: The technological factors are favorable for Apple to incorporate
innovations into its business. UK is a technologically advanced country. Everyday new
innovations are taking place and Apple should take steps to include these technological
advancements into its business. Cloud computing trend, technological integration and the
growing market for different applications are the technological innovations (CIPD, 2017).
Legal Factors: There are some legal regulations which limit technological innovations to be
incorporated in a particular organization. The privacy issues are connected to the use digital
technology. In the current scenario, Apple has been imposed by more and more privacy
regulations. This is an obstacle in the way of bringing innovation into the organization as the
flow of private information stops due to privacy laws (CIPD, 2017).
Environmental Factors: The environmental factors in UK, are favorable for incorporating
innovation into the operational model of Apple. Opportunities are being provided by the
ecological factors to Apple. Apple to trying to maintain the sustainability in its business by the
help of recycling program (CIPD, 2017). The materials used in the iPhones are environmental
friendly and this is all due to innovation. Apple has invested in including eco-friendly material in
its various products.
The Internal factors as well as external factors all have helped Apple to include innovation into
its business. Analysis of the strength, weaknesses, opportunities and threats which have an
impact on the innovational strategies on Apple has been discussed below:
Strengths: Some of the biggest strengths of Apple has that helped to bring innovation into the
business of the organization are the strong brand image, the high profit margins and the process
of bringing in effective and innovative measures.
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Weaknesses: The inadequacies in the company can be considered as the weaknesses. The high
selling prices of Apple products, the limited distribution chain and sales which is limited to high-
end market are all the weaknesses that Apple have to face.
Opportunities: The opportunities that lie ahead of Apple in the market are the network
expansion and its distribution. In the market there is rising demand for high-end mobiles and
tablets. Apple has invested in the manufacturing of a new product line.
Threats: The competition in the market is increasing every day. This is the most important threat
for Apple in the market. Many companies are imitating the technological advancements that
Apple is coming up with. The plants of Apple are mostly situated in developed countries where
labor costs are increasing at a high pace.
Apple uses the Value chain network in its organization.
Figure 1: Value Chain Analysis of Apple
(Source: Kraemer, et al., 2011 )
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The primary activities include inbound logistics, operations, outbound logistics, marketing and
sales and services. Inbound logistics consists of the automatic receiving systems which help
apple to get the raw materials on time. Operations include design and conceptualization. The
design team of Apple is highly efficient. The bring out the best design possible in their products.
The outbound logistics include the attractive packaging of the Apple products. The marketing
and sales team of Apple is very efficient. They are high equipped with great product positioning
strategies. Services like extended warranty and free consultation makes Apple stand tall in the
crowd of competitors (Kraemer, et al., 2011).
The secondary activities of the value chain network in Apple consist of general administration,
human resource management, technology development and procurement. The general
administration in the organization is quite good. The work flow is not hindered and services are
provided on time to the consumers. The satisfaction among the employees of Apple concludes
that the activities of the human resource department are satisfactory and employee friendly.
Technical innovation is the backbone of the business in Apple (Kraemer, et al., 2011).
Apple is a market leader when it comes to innovation in the telecommunication industry. The
operating system used in Apple products is known as IOS. This particular operating system
cannot be used by any other products other than those of Apple. One cannot customized this
software like Android. This is an area where other organization’s cannot compete with Apple.
The products from Apple conceived, sourced , designed and manufactured in such a process that
cannot be copied by other companies. Procurement is satisfactory in Apple (Kraemer, et al.,
2011).
c) The industry in 2018
The technological industry of UK has witnessed record investment after Brexit. The worth of the
technological industry in UK is about 180 billion dollars. With creative advertisements,
minimalistic designs and technical innovation, Apple has made itself the most sought after brand
in the world. The leadership has Steve Jobs has helped Apple to achieve this position in the
market (Euromonitor International, 2017).
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The success of the organization can be translated into its well-built brand loyalty. The growth of
revenue generation of the company has grown to 230 billion dollars in the present from 8 billion
dollars in 2004. UK is a technologically advanced country. The innovation of cloud computing
and technological integration has helped the technical industry to grow my multiple folds
(Euromonitor International, 2017).
TOWS Analysis
Strengths and Opportunities (SO): The brand image of the organization is quite high in the
market. The profit margin for the organization is quite high in the market for Apple. This is due
to the high price range of Apple Products. Apple serves a niche market base in the market. So the
company has no issue reading the price of its products because the brand loyalty is quite high for
the brand.
Weaknesses and Opportunities (WO): The market share of Apple products is quite high due to
its high end products which have got the recent technical advancements in it. The distribution
chain of Apple is limited but the demand of the Apple products is quite high in the market. The
organization can improve its distribution chain to cater to the growing demand of Apple products
in the market.
Strengths and Opportunities (ST): The brand image and brand loyalty for Apple is quite high
in the market. People who use products from Apple are loyal towards the brand. The technical
advancements that are present in the products from Apple are not available elsewhere. This
makes it popular among the consumer base. The growing competition in the market is not a
threat to the organization. The strong brand image and customer loyalty will help the
organization to wade through the competition in the market.
Weaknesses and Threats (WT): Apple has problem regarding its distribution channel. Many
people in the market cannot buy product from Apple as they are high-priced. This weaknesses
should be immediately met or they will make the situations grave in the organization. Apple
should focus on to increase its distribution channel so the growing demand in the market could
be met. The organization should lower down its prices of the products. In this way the market
share of Apple will increase by multiple folds.
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Apple is a technogically advanced organization in the technical industry. The company should
focus upon product innovation and product positioning to have a greater market share. New
markets for Apple are coming up in the developing countries and Apple should focus up on
opening up manufacturing plants in these developing countries.
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