Apple iPhone Business Unit Strategy: Internal and External Analysis

This report provides a comprehensive analysis of Apple iPhone's business unit strategy. It begins by outlining the company's mission, vision, and core values, followed by an internal analysis that identifies strengths such as innovation and a strong brand, and weaknesses like high product prices. The external analysis examines political, economic, social, technological, and legal factors that may influence the company. The report then explores Apple's core competencies, including research and development, and recommends a low-cost leadership strategy to increase market share and maintain profitability. Strategic goals are defined, focusing on cost reduction, price reduction, market share increase, and efficiency improvements. The report outlines a plan to achieve these goals, including process automation and advertising campaigns, and details control mechanisms such as stakeholder management and regular audits. The implementation strategy focuses on management department adjustments, such as reducing hierarchy and centralizing management. The conclusion emphasizes Apple's strong brand and the suitability of the cost leadership strategy to address external factors and ensure continued success.

Apple IPhone
Business Unit Strategy
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Mission
• We bring the entire world to your hands, for you to conquer it by
providing you with the strongest and the best hardware and software
ever.

Vision
• To be the global leader in producing the hardware and software that
will connect the entire world.

Values
According to Apple (2018) the following are the core values of the company.
• We believe not in the complex but the simple.
• Excellence is the least we settle for.
• We believe in having control over the technologies that our products are
founded in.
• We believe in making great products that will change the world.
• We participate only in markets in which we can make a significant
contribution.
• We believe in prioritizing and focusing on the most meaningful projects.
• We believe in teamwork and collaboration.

Internal analysis
According to Forbes (2018) the following is the internal analysis.
• Strengths: innovation, strong brand, control over technologies, good
quality products, App store, diversification.
• Weakness: limited reach, high product prices, high-end targeting.
• Opportunities: Development of efficient and effective distribution
channels, customization of products, customer integration, reduction
in operating cost.
• Threats: stiff competition, overpricing of products by distributors,
disclosure of business secrets.

External analysis
External environment factors which may affect it according to Forbes
(2018) include;
• Political: change in taxation policies, import and export quotas that
may affect distribution chain, among others.
• Economic: Inflation, a high cost of finance, low consumer spending.
• Social: change in peoples’ lifestyle, perceptions of the media, and
cultural differences among consumers.
• Technological: the high rate of technology change.
• Legal: strict regulations and trade policies.

Core competencies
According to Forbes (2018)
• Research and development.
• Software and hardware development.
• Continues innovation and creativity.
• Marketing competencies in relation to segmentation and development.
• Customer service competencies.
• Problem-solving proficiency.
• Risk analysis and control competencies.

Overall strategy
The overall strategy will be low-cost leadership.
According to David (2011)
• It involves reducing the cost of producing a product without
compromising its quality.
• It will enable Apple to sell its products at a lesser price and still maintain
its profit margins.
• Focuses on the adoption of cost-effective operations methods in the
entire lifecycle of a product.
• It is easy to implement since it only requires an analysis of the major
process in which the cost of running them can be reduced.

Strategic goals
According to David (2011)
• To reduce the overall cost of operation at a rate of 25% by the end of
the year.
• To reduce the price of products at a rate of 20% by the end of the year.
• To increase the market share at a rate of 10% by the end of the year.
• Explore new customer segments.
• Reduce financial wastage at a rate of 75% by the end of the year.
• To improve the efficiency of the supply chain in order to reduce
procurement and distribution cost.

Plan to achieve the goals
According to Hitt, Ireland, & Hoskisson (2012)
• Analysis of the operations to determine the most costly business
processes.
• Automation of the major business process in the following strategic
business units: procurement, production, marketing, and research and
development.
• Massive multimedia advertising camping to attract new customers.
• Proper budgeting of every activity to ensure that money is not wasted.
• Forward and backward integration of suppliers and distributors.

Control mechanisms
According to Hitt, Ireland, & Hoskisson (2012)
• Stakeholder management to ensure collaboration in the
implementation of the plan.
• Regular measuring of progress on monthly basis.
• Setting targets for the strategy implementation team.
• Regular auditing of processes and activities to ensure that no money
is wasted on them.
• Regular analysis of potential risks in each strategic plan and
controlling them proactively.

Strategy implementation at the
management department.
According to David (2011).
• Reducing the hierarchy of command in order to cut on management cost.
• Centralization of management in order to minimize the cost of having
regional managers.
• Adoption of decision support system and executive information system
to aid in decision making in order to save on consultancy cost.
• Using an enterprise collaboration system to give unity of direction and
purpose.
• Hiring experts in order to save managerial training.