SMGT3356 - Strategic Management: Apple Inc. Case Analysis Report

This case study provides a detailed analysis of Apple Inc., examining its mission, core values, and internal strengths and weaknesses through a SWOT analysis. It delves into Apple's core capabilities, evaluating its value chain, including supply chain, key activities, distribution channels, and target markets. The study assesses Apple's financial position, considering its resources, critical ratios, and liquidity. Furthermore, it addresses the company's strategic situation relative to the COVID-19 pandemic, outlining the expected impacts, such as production halts and sales declines, and proposing potential mitigation strategies, including donations and awareness campaigns. The analysis also identifies risks associated with the current global crisis, such as potential unit sales shortfalls and supply chain disruptions. The study concludes with a brief analysis of the risks associated with the student's own BSG company structure.

Running head: STRATEGIC MANAGEMENT 1
Business Strategic Management
Name
Institution
Author’s Note

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Apple Inc. Case Analysis
Organization’s Mission and Core Values
Apple Inc. is an international company that is known for its ability to offer different types
of products and services to all its esteemed customers who are spread across different parts of the
work. It is a modern form of a multi-technology organization that is entirely American based
(Abdelkafi & Täuscher, 2016). Apple Inc. is known to be attached to a special kind of mission
together with core values that have been able to portray a true picture of what the organization is
all about. As a result, its purpose is majorly concerned with bringing out the best user
experiences across a variety of its consumers through the help of its modern innovative
hardware, software, and several other services related operations (Prajogo, 2016). Its core values
include;
 It believes it is the face of the whole earth when it comes to making great products that
are capable of bringing high levels of customer experience (Chatterji et al., 2016).
 the organization believes in simplicity which makes it avoid different complex situations
as much as possible
Internal Analyses for Apple Inc.
SWOT Analysis
Strengths
 Ability to manufacture a variety of various products- Apple is connected to a range of
products, which happens to be one of the best strategies for earning profit.

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 Careful and appropriate employee selection-When it comes to matters about recruitment,
Apple Inc. is always keen on selecting sincere employees who are confident and can
work hard just to meet quality.
Weaknesses
 High product price compared to smartphones- Apple has always been able to
implement a premium mode of pricing strategy, which makes most of its product cost
beyond the reach of a general individual.
 They have a very less variety of their phone product design- The first version of
iPhone one together with IPhone seven appears not to have a big difference since it is
all about their respective looks
 Limited condition of network distribution- Since Apple carries out delivery of its
products by itself, this tactic narrows down the entire distribution channel thus
making the network to be limited as much as possible (Teske & Schneider, 2016).
Opportunities
 There is a high demand for computer-related products- There has always been a more
significant shift in terms of the laptops across different regions
 Globalization- The kind of globalization that is being encountered across different
markets is providing people with one of the best opportunities for quickly acquiring
technology products (Kohler, 2016).
 Expansion of different types of distribution networks- Since under various
circumstances, Apple normally distributes products on its own, there is an
opportunity of coming up with a third-party distribution platform that will further
guarantee more sales.

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Threats
 The emergence of new competitors-Apple has been able to come across various
emerging, and strong competitors who have been able to offer almost the same
products will lower prices
 Imitation-This has always been one of the most serious threats for a variety of
recognized brands. When Apple comes up with a new product in the market, a
substitute is usually introduced through the help of several other organizations.
Core capabilities of Apple Inc.
Apple Inc. is known to have a variety of core capabilities that have given it the
opportunity of emerging as a competitive organization across the different market platform. One
of the significant core capabilities is to be able to encompass innovation. As a result, the
organization has been able to come up with a variety of innovative products (Kolk, 2016). On the
other hand, quality is also another core capability that is attached to Apple Inc. is quality where
all its products have been of high quality to meet the expectations of different customers.
Evaluation of Apple’s Value Chain
Supply chain
Apple is known to be having an extensive supply chain when it comes to gaining a
variety of raw materials since it has several options. Again, some of its significant suppliers
entail different competent providers, together with others that are known to represent an
approximated percentage of 97% of its procurement expenditure. Again, a good portion of
Apple's major suppliers is situated in various parts of Asia, China, together with Japan.

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Key activities
Apple Inc. spends a lot of money on research, along with development. On the other
hand, its unique brand is also known for its high level of technological innovation and even for
excellent quality. To maintain its high level of competitive advantage, there is a need for the
brand to put much focus on R & D investment.
Distribution
Apple Inc. has been able to manage one of the largest distribution channels, which are
known to be consisting of a variety of direct together with indirect channels. Right from different
types of retail stores to online retails, Apple Inc. has been able to come up with one of the largest
chains of distributing different types of its products to the customers.
Markets
Apple has been able to target a variety of markets that are located across different
countries. To make sure that the markets are accessed within the shortest time possible, the
organization has been able to set up various stores within that country.
An Evaluation of Apple’s financial position
Apple's essential resources majorly include its valued chief executive, together with a
wide variety of designers, retail stores, and even several suppliers coming from an extreme level.
The revenue growth for this organization in terms of percentage is not that high, and also the
growth margins maintain an estimated rate of about 38%. Apples' revenue is known to have the
capability of scaling up with a total compound annual increase of about. 4.35%. On the other

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hand, the current ration that is attached to the organization is known to be more than 1 in terms
of the years that are under consideration. This clearly postulates that the current assets are more
than what is displayed by the current liabilities (Asrar-ul-Haq & Kuchinke, 2016). As a result of
this, there isn’t any major issue when it comes to meeting various liquidity issues. It should still
be noted that Apple's current ratio is slightly lower than what is captured in the sector's 2.39. As
far as the organization's profitability ratios are concerned, its gross profit margin, the margin of
its operating profit together with net profit margin, has always proved to be positive across all
the analysis years (Kane et al., 2015).
Apple's strategic situation relative to Coronavirus pandemic
The Coronavirus has proved to be a significant threat across many countries in the world,
and this has interfered with the way a vast range of organizations are currently doing business. In
states that have been greatly affected like China, Apple Inc. has been able to stop nearly all its
operations which have made the organization not to have any expectations of meeting the
financial guidance of the second quarter as a result of the stopped production process due to the
Coronavirus pandemic (Hasanat et al., 2020). To avoid taking risks, Apple Inc. has also been
able to shut down most of its stores across various countries most so the ones who economies
have been greatly shaken by the virus and are expecting to resume back its normal operations
ones the pandemic comes to an end (Hess et al., 2016). This was a strategy that was implemented
by the management, having released severe losses in those countries by the time the Coronavirus
was on the verge of shaking a good number of economic operations (Yeoh & Popovič, 2016).

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Impacts that are likely to be encountered by Apple Inc. concerning the global
pandemic
Corona Virus has been able to hit hard on various economies, thus posing a lot of
negative impacts across different business organizations (Wallen et al., 2016). One of the major
expected impacts of the pandemic to Apple Inc. is a decreased rate in terms of production, and
also a variety of operations are likely to be halted in nearly all Apple stores that are located all
over the world (Chung, 2015). On the other hand, the sales figures that are attached to Apple’s
products most so the iPhones are expected to scale down by an approximated percentage of 61%,
which is likely to take place year over the years. In February this year, Apple was able to sell a
total of 494,000 iPhone products within the boundaries of china (Almutairi et al., 2015). This
clearly indicated a drop of about 61% compared to the high sales that were made last year, which
happened to be around 1.3 million iPhones. One primary mitigation strategy that Apple should
implement is to carry out donations to help in the treatment of the infected patients, together with
scaling down a vast range of economic and community impacts. Another mitigation strategy is to
help create awareness about the actions that should be taken in order to avoid the spread of
Coronavirus (Shamim et al., 2016).
Risks that Apple would encounter when operating in the current Global Crisis
One of the major risks that would be encountered by Apple Inc. the risk of meeting the
predicted unit sales since there would be a high probability that the organization would be
subjected to serious losses as a result of economic interference which has been caused by the
Coronavirus pandemic (Gudi & Tiwari, 2020). Again, Apple would be encountering the risks of
gaining access to a variety of raw materials for manufacturing its products; the emergence of the

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pandemic has been able to cause serious movement restrictions across different places thus this is
likely to make it very hard to gain access to certain types of raw materials.

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