Apple's Competitive Advantage: Strategy, Innovation, and Analysis

This report provides a comprehensive analysis of Apple's competitive advantage within the smartphone market. It begins with an introduction highlighting the crucial roles of innovation and strategy in business development. The main body delves into Apple's internal resources and capabilities, such as production management, resource utilization, human resource management, and quality management, which contribute to its competitive edge. The report then examines the external environment using PEST analysis, assessing the impact of political, economic, social, and technological factors on Apple's entrepreneurial activities. Furthermore, it applies Porter's Five Forces model to evaluate the bargaining power of buyers and suppliers, the threat of new entrants and substitutes, and competitive rivalry. The conclusion emphasizes the importance of innovation and strategic planning for business success, drawing insights from Apple's practices.

Strategy,
enterprise and
innovation-1

Contents
INTRODUCTION...........................................................................................................................3
MAIN BODY..................................................................................................................................3
Internal resources and capabilities that gives competitive advantage to Apple..........................3
External environment analysis and how it impacts on entrepreneurial activities of Apple.........4
Porter’s five forces model analysis..............................................................................................6
CONCLUSION................................................................................................................................8
REFERENCES................................................................................................................................9

INTRODUCTION
Innovation and strategy always play a crucial role in the development of a business in a
precise manner. With the help of innovation for a business, it is easy to provide new quality
techniques while selling products and services at the marketplace (Aldea, 2018). In the
functioning and operations of a business, strategy is always beneficial to choose right type of
strategy. In this report critical analysis of internal resources and capabilities that provides a
business competitive advantage is provided. In this report key drivers of change in external
environment and their impact on entrepreneurial activities is taken into consideration. This report
also includes porter’s five forces analysis along with a precise conclusion. In report example of
Apple is taken into consideration which is Smartphone manufacturing company and
headquartered in California.
MAIN BODY
Internal resources and capabilities that gives competitive advantage to Apple
In the era of stiff competition it is major responsibility of a business to strengthen
its internal resources and capabilities in order to gain a competitive advantage. Optimum
utilisation of resources always plays a critical role in development of business which is
major responsibility of a business. With the help of professional strategic management
and policies it is always possible for Apple to give proper focus on internal resources and
capabilities. The internal resources and capabilities that gives competitive advantage to
Apple are mentioned below:
 Production management- This is considered as one of the major part of internal
resources and capabilities of Apple in order to provide competitive advantage.
Production management is referred to the management which is concerned with
the handling of production. As Apple majorly manufactures Smartphone,
innovative and professional production management develops a competitive edge.
Production management is effective in dealing with fulfilment of several demands
of customers (Amara, 2019). The customers of Apple sometimes raise the demand
which is essential to fulfilled in an immediate manner. The production
management thus play an effective role in fulfilment of various demands which
arise at the marketplace from time to time.

 Optimum utilisation of raw materials- The main task which is performed at
Apple is optimum utilisation of resources. In order to utilise resources with best
practices, Apple focuses on utilisation with help of professional workforce.
Manpower and effective workforce is famous strength of Apple in order to
achieve good quality from the available resources. The optimum utilisation of
resources is essential in a business in order to fulfil the major demands and needs
of the customers. In order to gain competitive advantage at the marketplace,
Apple always focus on various developmental issues which are concerned with
effectiveness and performs operations with efficiency. In order to develop all the
major typical aspects which are meant for optimum utilisation of resources, Apple
has also formulated a separate team in order to utilise various available
 Human resource management- In the era of stiff competition, human resource
management is considered as backbone for a company. In determination of
internal strength of company, human resource management play a crucial role.
The internal strength of a company is majorly dependent on human resource
management which helps in providing competitive advantage to the company. In
order to develop workforce and manpower for the competitive market human
resource management of company contributes immensely. In order to develop a
competitive advantage at the marketplace, Apple must deploy expert and
professional human resource management.
 Quality management- Quality management matters the most for a business, in
order to satisfy different needs of the customers. Apple always maintains genuine
quality in its products and services in order to increase satisfaction of the
customers. The quality management of company is competent enough to develop
a precise manner in the operations and functions of the company (Lin, 2019). It is
very much essential for the company to maintain quality of products and services
in order to gain competitive advantage at the marketplace.
External environment analysis and how it impacts on entrepreneurial activities of Apple
External environment of a company play a major role in the development as well as
functioning of a business. There are several factors which are present in the external environment
of the company and they generally impacts on the performance of the company along with the

operations. In order to gain competitive advantage at the market place, a company should
definitely analyse its external environment. It is essential and necessary to analyse the external
environment of a company as it also impacts on all of its entrepreneurial activities (Meng-wei,
2017). In the era of stiff competition, external environment is compulsory to be analysed, which
will increase efficiency and effectiveness of Apple. In order to perform external environment
analysis of Apple, PEST Analysis is taken into consideration which is mentioned below:
 Political factors- These factors are generally determined due to role and influence
of current government in the functioning of a business. These factors are generally
related to the rules and regulations on business functioning in an economy. Apple is
affected majorly with the presence of several political factors which impacts on its
functioning and working. To deal with entrepreneurial activities which are
impacted by the influence of political factors in an economy, Apple formulates
different strategies. With the help of proper strategic management a company can
easily deal with the political factors. The trade and business regulations which are
imposed by government affect most of the entrepreneurial activities of Apple.
 Economic factors- In the external environment of a company there are several
factors which are concerned with the economic aspects of a company. There are
several factors like national income, gross domestic product and economic policies
which impacts on the entrepreneurial activities of Apple. These factors are
generally present in all of the countries where Apple performs all of its operations.
In the development of economic conditions in countries, the concerned government
play a crucial role.
 Social factors- These factors are present in the external environment of a company
due to influence of society. The standards of societies are different in several
countries which impacts on the entrepreneurial activities and major functions. As
Apple is a global company it performs its operations in different countries with
maximum efforts. Social factors play a crucial role in the enhancement of a
business if the business performs all of its operations with effective strategies. In
the functioning of social aspects which are necessary in formation of effective
developmental goals are required by Apple. In order to get a competitive advantage

at the marketplace, Apple has to briefly analyse its internal environment as well as
external environment.
 Technological factors- The technological factors are considered as one of the
major factors which influence the functioning of a business. As Apple is a digital
company there is an immense role of technological factors in enhancement of its
business activities. The use of advance software and techniques related to
development of the business is required by the business in order to survive at the
marketplace. In the development of business activities, Apple has gained an
immense growth at the marketplace with the use of several technological
advantages (Shuai, 2021). The use of technological factors in an advanced manner
is required by Apple in order to gain a competitive advantage at the marketplace.
Also with the use of Artificial intelligence technology, it will be easy for the
company to perform most of its digital operations in a precise manner.
Porter’s five forces model analysis
Porter’s five forces model is a effective and universal tool in the development of all
major business activities. In order to gain company competitive advantage at the
marketplace, it is essential for Apple to perform a competitive analysis. With the help
Porter’s five forces model analysis, it will be easier for apple to compete at the market
place with maximum efficiency. This is a need in the global market for competition
analysis as there are several competitors which are present at the marketplace. The analysis
of Porter’s five forces model for Apple Company is given below:
 Bargaining power of buyers- The bargaining power of customers play a crucial role in
the development of a business. According to the intensity and level of bargaining power
of buyers for Apple, the revenue generation and growth of the company are affected. As
whole, according to the current situation the bargaining power of the customers for Apple
is very low. This eventually means that company has major strength over its competitors
in order to gain competitive advantage at the marketplace. With the help of low
bargaining power of its customers, Apple can earn huge amount of profits at the
marketplace (Pérez, 2017). The low amount of bargaining power will lead to stable cost
of its products and service at the marketplace. In order to increase efficiency of the
company this is a major advantage available at the marketplace.

 Bargaining power of suppliers- As Apple Company takes supply from various
distributers which are present at the marketplace. Bargaining power of suppliers is
also low which is a major advantage to Apple in terms of gaining edge over
competitors. The bargaining power of suppliers matters more for a business in order
to tackle various advantages related to performance of a business. This power of
buyers is helpful in development of various aspects which provides company major
competitive advantage at the marketplace.
 Threat from new entries- As Apple is a major established company at the
marketplace, there are fewer threats which are faced Apple at the marketplace. In
order to access threats from new entrants company have to analyse future market.
The threats are minimum which establishes a competitive advantage at the
marketplace. The new entrants which are present in the development of business play
a crucial role in increasing efficiency and effectiveness at the marketplace. New
entries will require more efforts at the marketplace in order to develop a precise
business like Apple.
 Threat from substitutes- Threat from various substitutes for the company play a
major role in affecting performance of the business. Availability of substitutes at the
marketplace impacts majorly on the functioning and operations which are performed
by the company. The different threats from substitutes shifts tendency of customers
towards other products and services. Customers generally shift to other company’s
products if the products are available at cheap rates and are of better quality. For
Apple threat of substitutes is there as several companies are trying to compete with
Apple at the marketplace. In order to deal with threat which is arising due to
substitute products, Apple has to develop a comprehensive approach by developing
its operations and functions.
 Competitive rivalry- The role of competitive rivalry in a business is the major
element in the analysis of competitive market. In the market, there are several
companies which are putting immense efforts in order to compete with Apple. The
investment power and capabilities of the companies which are competitive rivalry for
Apple are generally Samsung, MI, Motorola and Nokia. These companies give tough
competition to Apple and are marked among the list of major competitors for Apple.

In the era of stiff competition between companies, the competitive rivalries which
are present in the external environment of Apple play a crucial role.
CONCLUSION
From the above stated report it can be concluded that innovation and strategy both play a
crucial role in development of a business. Innovation at Apple helps in delivery of products
with precise innovation and techniques. This report concludes that for a business
organisation it is effective to formulate a precise strategy in order to compete at the
marketplace. The various internal resources which impacts in the functioning of a business
play a crucial role in the formation of internal environment. This report concludes that
various entrepreneurial activities which are there in a company generally impact the
operations of the company. This report also concludes that with the help of porters five
forces model analysis it will be beneficial for Apple to compete at the marketplace.

REFERENCES
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