An In-Depth Analysis of Apple's Global Corporate Strategy Report

This report provides a comprehensive analysis of Apple's global corporate strategy. It begins with an introduction to global strategy and then delves into Apple's innovation strategies, differentiating between open and closed innovation models. The report examines factor endowment, particularly focusing on labor costs and availability in China, and its impact on Apple's production. It further analyzes global and local demand for Apple products, highlighting the advantages and disadvantages of serving both markets. The report also evaluates Apple's business strategy, emphasizing user experience and the company's approach to hardware, software, and service integration. Additionally, it assesses the role of senior management and CSR practices within multinational corporations, concluding with an overview of the key findings and implications for Apple's future global operations.

GLOBAL CORPORATE STRATEGY

TABLE OF CONTENTS
INTRODUCTION...........................................................................................................................3
Question 1: Innovation by Apple and factor endowment as well as business strategy of Apple....3
Question 2 Global and local demand...............................................................................................7
Question 3: Evaluation of the senior management and CSR practices of MNC's...........................8
Question 4........................................................................................................................................9
CONCLUSION..............................................................................................................................10
REFERENCES..............................................................................................................................11
Figure 1Apple product sales........................................................................................................................5

INTRODUCTION
Global strategy is means a course of action that is chosen by an entity for competing and
expanding its business into global market. It refers to the plan that an enterprise needs to develop
target growth across is its borders. It acts as the strategic guide for the corporation towards
globalization. Such connected world, provides business revenue that need not be confined by the
borders. Company employs the global business strategy for recapping rewards of the trading in
the worldwide market. The present report is based on Apple, an American multinational
corporation headquartered in Cupertino, California which designs, sells, develops consumer
electronics, online services and computer software. The company's online services of this
company involves iTunes stores, Mac App, Apple music, iOS store, iCloud etc. Furthermore, it
the study provides deeper insights in relation to the strategies adopted by the company at a global
level with difference between open and the closed innovation. Moreover, the report also
highlights the benefits and the limitation of an internationalization and the CSR practices
adopted by the company with evaluation of the role of management authorities.
Question 1: Innovation by Apple and factor endowment as well as
business strategy of Apple
Innovation is the one of the 21st century buzzing word as most of the business firms
whether they are small, large or medium in size are focusing on innovation of their business.
Some business firms innovate their product line and some innovate their business operations. In
past few years it is observed that those firms whose product are not innovated legged behind in
the competition and failed to survive in the market. For example Nokia once had leading position
in the mobile sales but it does not innovate its operating system and due to this reason its
products sale decline (Heracleous and Papachroni., 2016). Ultimately, market was takeover by
another players. Kodak camera is another example of business failure where main reason behind
business failure was non innovation of the business operations.
There are two types of innovation namely open and closed innovation, as both are
opposite to each other. Open innovation refers to the situation where business firm does not
depended on internal resources like technology, infrastructure and human resources. In this sort
of innovation business firms usually make use of both internal and external resources so as to do

innovation in best manner. As part of external resources firm take feedback from the customer,
purchase technology from other firm and hire experts that acts as freelancer or working in any
other business firm. It can be said that such kind of innovation is highly used by the firm. This is
because business firm can never have all of the required resources and intellectual property at the
workplace. It is the open innovation that provide access to the business firm to outside resources
and conduct innovation in better manner. Joint venture many times is determined by the business
firms to innovate their existing product line and increase market share (Pisano, 2015). Thus, it
can be said that there is huge importance of the open innovation in today era.
Closed innovation is the inverse of the open innovation and under this one does not make
use of external resources to do innovation in the business. In this company prepare alternatives
and evaluate all of them. After evaluation of alternatives best one is selected by the company. In
this regard multiple tools and techniques are used by the business firms and best one is chosen by
the manager. There is difference between open and closed innovation. One of the major
differences is that in case of closed innovation idea, inventions and investigations as well as
development required to place a product in the market. Usually, in close innovation business
firms share technology with each other. This is done because firm is specialized in the specific
technology and in same way other firm is specialized in another technology. Thus, by sharing
technology one obtain new infrastructure that promote business growth in the future time period.
Apple is following strategy of the closed innovation in its business. Under this strategy
company basically using its internal resources. Over last couple of year’s firm do lots of
innovation with limited resources. Company has expert intellectuals which are highly talented
and paid professionals (Gehani, 2016). Earning of higher amount of profit assist business firm in
making huge investment on its innovation project. Hence, it can be said that firm already have
excellent advanced technology infrastructure with high standard intellectual property and due to
this reason company is doing closed innovation.
Factor endowment is the one of the most important term that is used by the business
firms. In context of Apple this thing apply as it can be seen that on large scale firm produce it
Smartphone and I pods in the China. It can be observed that labor cost in China is 10 to 60 USD
cheaper then USA. Moreover, Apple get more workforce easily in China then USA. When
Apple needed 8700 engineers to look after workforce of size 200000 that are involved in making

I phones then in that case it will take 9 months in USA to find relevant employees. However, if
same thing is done in China then in that case same labor at low price and with relevant skills in
required number is easily available to Apple in China. Thus, it can be said that labor cost is low
and availability of labor as factor is high for the Apple. Sufficient amount of land is available to
the Apple in the China at low price. Thus, it can be said that factor of production are available at
cheaper rate to the Apple.
Supporting industry to Apple is IT sector. This is because with applications and internet
mobile or I pod is nothing as it seems zero or useless. Applications that are in the Mac play store
time to time have important updates which make them more relevant for the people (Kim and
Jun, 2015). Global IT industry is growing at growth rate of 9% on yearly basis which is high. It
is the mobile applications that make use of mobile necessity for the people. Decline in
innovativeness of the telecommunication industry and IT sector may have negative impact on
sale of the company product. It is the consistent preparation of new applications which make use
of I pod and Smartphone attractive for the people and lead to fast growth in the demand of the
Apple products.
Figure 1Apple product sales

(Source: iPhone, iPad and iPod sales from 1st quarter 2006 to 4th quarter 2018.,
2018)
Stability is not observed for Apple products. In the current analysis in respect to demand three
products of the company taken into account are I pod, I phone and I pad. It can be seen from the
above chart then in one year demand goes high but in three years after that demand declined by
higher percentage. Interesting fact is that rise and fall in demand of the Apple these three
products is very high which is matter of concern for the business firm. At least there must be
stability in demand most of year (iPhone, iPad and iPod sales from 1st quarter 2006 to 4th
quarter 2018., 2018). Poor economic condition at global level may be one reason behind low
demand of the firm products.
As part of the business strategy now a days company is fully committed towards delivering
customer a good user interface experience. In this regard firm is focusing on innovating its
hardware, software and services. Firm is updating its technology infrastructure and under this it
is improving its own operating system. Apple is focusing on designing and developing its
products in better manner then before (Yun, Won and Park, 2016). Main aim of the business firm
is to make available customers products and solutions with innovative design, superior ease-of-
use and seamless integration. As part of its strategy, the Company continues to expand its
platform for the discovery and delivery of digital content through its varied products. Thus, such
kind of strategy will definitely lead to fast growth of the business firm
One of the major rivals of the Apple are Dell, Sony and Lenovo. These rivals are already have
strong presence in the personal computer and laptop market. In terms of personal computer and
laptop sale Apple is facing huge competition from Dell, Sony and Lenovo (Kim, Kim and Foss,
2016). It can be observed that Dell and Sony in past few years make heavy expenditure on their
technology infrastructure and due to this reason in many market and between specific sort of
people these firms have strong base. Even memory retention value of these brands is also higher
then Apple.
US Government is supporting heavily to the Apple in its business operations and due to this
reason on this front firm is not facing any sort of problem in its business.

Question 2 Global and local demand
It is very important to understand the meaning of global and local demand of the product.
Local demand refers to the demand of the product within the nation where company was first
established. On other hand, global demand refers to the condition where demand of the products
at global level is taken into account. It can be observed that Apple is the leading MNC and
operate in the multiple nations of the world. Different products have strong demand in the
different markets. Hence, much time meeting demand of the local and international market
become hard task for the business firms. Simultaneous meeting of demand in both domestic and
international market have some advantage and disadvantage which are explained below.
Advantage
One of the major advantage of the serving both domestic and international market is that firm is
able to develop loyal customer base in the both markets (Den Hartigh and et.al., 2016). In case due
to recession or any other factor demand of the company product decline in the foreign market
then in that situation there will be domestic market from where sales can be generated in easy
way.
Second advantage is that if firm is focused in both markets then in that case it can manage to
gain huge market share in the local market. People prefer to buy branded product and if they see
that local is getting huge success in the international market then in that case local people does
not give importance to the other rivals in the domestic market. Hence, by performing well in the
foreign market firm control domestic market.
Disadvantage
One of the major disadvantages of the focusing on domestic and international market at same
time is that many times customers of both areas are of different taste and preference. Such kind
of thing better apply on garments business. In such kind of situation it becomes very hard for the
firm to manage variety of people through multiple products. Hence, in an attempt to focus on
both area firm end with a situation where it failed to focus on domestic or foreign market.
Ultimately, it looses its market share (Lusch and Nambisan, 2015). Nokia is one of the best
examples as it think that India is the market where it will not lose its share but because of
widespread business it failed to pay attention on Indian market and wipe out of it by the rivals.

Hence, disadvantage is that if firm is not able to address both market altogether then it can face
huge loss in the business.
It will be better for the Apple to focus on both markets. This is because there are less or
no competitors of its products in the market. Second, in terms of technology advancement firm
products are already ahead of rivals and due to this reason firm is able to meet both domestic and
international demand and it must simultaneously focus on both areas.
In order to maintain leadership in the domestic and international market business firm
need to adopt multiple strategy like product differentiation and cost leadership. One of main
factor that motivate people to not purchase Apple products is that price is very high. In nation
like India where people now become technology and fashion oriented demand of Apple products
may be high if its products price becomes low or moderate (Hacklin, Björkdahl and Wallin,
2018). Apple is already following product differentiation strategy in its business as it can be seen
that over years firm is innovating its product line and offer people something new and different.
Hence, it can be said that such kind of thing will assist firm in elevating its business growth.
Question 3: Evaluation of the senior management and CSR practices of
MNC's
Apple company seems to be committed in bringing best experience to their customers
with the use of its innovative software, hardware services. An organizations strategies reflects its
unique ability in designing and developing their own operating systems. With respect to the
company's strategy, it continues for expanding its platform for delivery and discovery of the
digital content and the applications by its digital services that allows its customers in
downloading the digital content, Apple watch, IOS, TV applications and the books either through
Mac or personal computer. It provides a full support to the society for developing the third party
hardware and the software product that complements with an enterprise offerings. Apple believes
a high quality experience of buying with the knowledgeable salesperson who conveys value of
corporation's services and the products that greatly enhances ability in retaining and attracting
the customers (Yamazaki, 2019). Thus, strategy of company involves expanding and building its
own online stores, retail stores and third-party distribution network for effectively reaching more
and more customers. In addition to this it facilitates them with high quality he experience and

sales. The firm believes an ongoing investment in the R&D, advertising and marketing is crucial
for development and sale of an innovative services, technologies and products.
Senior directors ensure conducting of an audit in compliance with public company accounting
oversight board that needs to be performed and planned an audit for obtaining assurance
regarding risk assessment and financial reporting. According to section 135 of companies Act
2013, the rules that are promulgated under the BOD's of Apple in adopting the adequate CSR
policy.
The company adopted various practices with respect to corporate social responsibility
that are contributing to the technology incubators that are approved by the government, Ensuring
sustainability of the environment, promoting equality of gender, promoting education involving a
special education and the vocational projects. Apple indulges its suppliers in sustainability
program where around 44 of them have been pledged for using the 100% of the renewable
energy in respect of their production (Agrawal, Schaefer and Funke, 2018). The company had
taken significant steps in area of the water stewardship involving controlling over the use of
freshwater, improving quality and demonstrating leadership by providing for the protection over
the shared resources of water. The emphasize of an entity is in improving the use of water
through developing clean water and safety programs which in turn prevents the water pollution.
Apple opts for designing centres of new data for using very little water for the cooling purpose.
This helped an entity in conserving more and more water and protecting an existing resources for
ensuring continuous water supply.
Question 4
I believe that multinational corporations are the large organizations that is been
incorporated in one of the country that produces and sells the services and goods in several
countries. The two major features of MNC's is large size and global presence, controlled mainly
by parent company. I observed that there are various benefits attached to external innovation that
includes reduced cost relating to research and development, helps in improving the productivity,
results in inclusion of the new customers in an existing development process, more accuracy for
the customers targeting and the market research, viral marketing etc (Rhéaume and Gardoni,
2016). However, some of the limitations are also attached with external innovation that is there
are chances of revealing an information that is not been intended for the purpose of sharing.

Increased complexity is the another major limitation that arises through external innovation and
regulates the ways in which a contributor affects the project.
Internationalisation also provides for large number of benefits that involves access to the
export financing, better management of risk, easy cash-flow, benefits through currency exchange
and increased revenue with decreased competition. On the other hand, it results in brain drain of
the students of the developing countries, weakening regional and the national engagement,
adverse effect on the employment sector, acculturation and the loss of an indigenous values and
the culture (Sapinski, 2015). I analysed that the roles and responsibility of the top executives of
Apple company is to maintain an effective control over the financial reporting and to express
opinion on the internal records of the company based on the audit.
CONCLUSION
On the basis of above discussion it is concluded that Apple is innovating its business
operations consistently and following closed innovation model in its business. Firm must operate
its business in both domestic and international market because its products are preferred by
people in both sort of market. By reducing price of the products firm can further improve its grip
in the market. It is also concluded that firm understand its social responsibility and due to this
reason time to time it perform varied corporate social responsibility activities across the globe.
By summing up the above report it has been assessed that competing across the world allows
Apple Inc. to gain worldwide customers and in creating an effective global marketing standards
or strategies that in turn allows an entity for adapting new opportunities on the basis of the
customer trends and the demands in the entire marketplace around the globe. With technological
advancements and expansion of international trade, Apple could be able to incentivize in selling
its services and the products in the foreign market. Operating the business on the global level
enables an enterprise in expanding market share, reducing the cost and in becoming more and
more competitive.

REFERENCES
Books and Journals
Agrawal, A., Schaefer, S. and Funke, T., 2018. Incorporating Industry 4.0 in Corporate Strategy.
In Analyzing the Impacts of Industry 4.0 in Modern Business Environments (pp. 161-176).
IGI global.
Den Hartigh, E. and et.al., 2016. Platform control during battles for market dominance: The case
of Apple versus IBM in the early personal computer industry. Technovation. 48. 4-12.
Gehani, R. R. 2016. Corporate brand value shifting from identity to innovation capability: From
Coca-Cola to Apple. Journal of technology management and innovation. 11(3),=. 11-20.
Hacklin, F., Björkdahl, J., and Wallin, M. W. 2018. Strategies for business model innovation:
How firms reel in migrating value. Long range planning. 51(1). 82-110.
Heracleous, L., and Papachroni, A. 2016. Strategic Leadership and Innovation at Apple Inc.
SAGE Publications Ltd.
Kim, B., Kim, E., and Foss, N. J. 2016. Balancing absorptive capacity and inbound open
innovation for sustained innovative performance: An attention-based view. European
Management Journal. 34(1). 80-90.
Kim, J. M., and Jun, S. 2015. Graphical causal inference and copula regression model for apple
keywords by text mining. Advanced Engineering Informatics. 29(4). 918-929.
Lusch, R. F., and Nambisan, S. 2015. Service innovation: A service-dominant logic
perspective. MIS quarterly. 39(1).
Pisano, G. P. 2015. You need an innovation strategy. Harvard Business Review. 93(6). 44-54.
Rhéaume, L. and Gardoni, M., 2016. Strategy-making for innovation management and the
development of corporate universities. International Journal on Interactive Design and
Manufacturing (IJIDeM). 10(1). pp.73-84.
Sapinski, J.P., 2015. Climate capitalism and the global corporate elite network. Environmental
Sociology. 1(4). pp.268-279.
Yamazaki, K., 2019. Golden Rules in Global Corporate Strategy. In Japanese Global
Strategy (pp. 157-169). Palgrave Macmillan, London.

Yun, J., Won, D., and Park, K. 2016. Dynamics from open innovation to evolutionary
change. Journal of open innovation: Technology, market, and complexity. 2(2).. 7.
Online
iPhone, iPad and iPod sales from 1st quarter 2006 to 4th quarter 2018., 2018. [Online].
Available through:< https://www.statista.com/statistics/253725/iphone-ipad-and-ipod-sales-
comparison/..