Evaluating Apple's Performance: Products, Challenges, and Strategy

This report provides a strategic analysis of Apple, focusing on its market-activated corporate strategy (MACS) framework, strengths, and weaknesses. It examines the performance of key products like iPhone, Mac, and iPad using three-year revenue data to determine their contribution to net profit. The analysis identifies management challenges related to technology, leadership, data security, and revenue disparities among products. The report concludes by highlighting the need for Apple to address these challenges to maintain its competitive edge and brand reputation in the dynamic technology market. Desklib offers similar solved assignments and resources for students.

Strategic Context

Contents
INTRODUCTION...........................................................................................................................3
MAIN BODY...................................................................................................................................3
Market Activated Corporate Strategy (MACS) Framework..................................................3
Strengths and Weakness.........................................................................................................4
Analyse the performance of the products of Apple and determine the management challenges
that are being faced by the business.......................................................................................5
CONCLUSION..............................................................................................................................10
REFERENCES:.............................................................................................................................11
Books and Journals...............................................................................................................11
Online...................................................................................................................................11

INTRODUCTION
The business environment is dynamic and it keeps on changing. A business organisation
must conduct proper research so that they are able to form effective strategies. It is important to
understand the strategic context of a business organisation. It helps to understand the reason of
existence of a company, their functions and powers that help them work, etc. A company must
work according to the strategies that they have formulated and try to achieve goals and
objectives successfully (Kawai and Chung, 2019). This report is based of studying strategic
context of Apple. It is an American Multinational technology company that specialises in
computer software, consumer electronics, and online services. It is largest information and
technology company if measured in revenue. It is world's most valuable company as of 2021.
The company was founded 45 years ago in 1976. It has its operations around the globe. In this
report, there is evaluation related to market-activated corporate strategy (MACS). The strengths
and weakness of the business organisation are examined so that desirable actions can be taken.
Afterwards, in the report there is evaluation of 3 year data of the business organisation in order to
review its performance. By analysing data, the challenges faced by management are being
evaluated. In the end of this report, recommendations are mentioned.
Argument 1: The strategy used by Apple is to launch and innovate the products on regular basis.
It is a right strategy that is being followed by company and it helps them to earn more revenue.
The same was followed by the company at the time of Covid and made them successful.
Argument 2: This strategy used by Apple is not right and reduces the profitability of company at
the time of Covid.
MAIN BODY
Market Activated Corporate Strategy (MACS) Framework
According to Zavidna and et.al., 2019, this model offers a systematic approach to the
multi-business corporation to prioritize their investments among its business units. It is necessary
for a business organisation to know about the products that are bring profitability for the
company. At the same time, it helps them to take strategic decisions. There are changing
conditions of market and it is necessary to invest in right product so that the business unit is able
to earn good revenues. There is key role of identifying if any product of the company is making
loss. This will cause problem for the company as the product reduces their brand image and

value. The company must divest in that particular product, if it is not possible to earn revenue
from the same. It is necessary for the business owners to check if the business unit is adding
value to their portfolio or not. The ability of products offered by the company are being checked
under Market Activated Corporate Strategy (MACS) Framework. The company identifies the
capability of the business unit to stand alone in the market and achieve success. This also helps
to know the position of company against competitors and extract value from the company. It is
necessary for the owners of the company to work in such a manner that they are able to attain
success (Thams, Chacar and Wiersema, 2020).
In relation to Apple the company has good image in market and deals in products such as
iPhone, iMac, iPad. These products have ability to stand effectively and attain success in the
market. The company is dealing in the products and earning good revenue so that they are able to
achieve effective image. In relationship with Apple, the parent company has ability to extract
value from business. The company is able to gain success over all the other competitors that are
present in market. They are able to create the value from most assets and are able to deal with the
competition that is present in the market. It becomes necessary to keep the products in portfolio
as they are enhancing the sales of the enterprise. It will help them to perform effectively in long
run and achieve goals and objectives successfully.
Strengths and Weakness
It is important for a business organisation to know about their own strengths and
weakness. The company must work on their strengths so that they are able to make them

stronger. At the same time, business organisation must analyse the weakness so that they are able
to improvise the same and attain success. The strengths and weakness of Apple are discussed
below:
Strengths
Leading technology innovator: Apple is know as leading innovator in technology as the
company keeps on using latest technology and provide best to the customers. The company has
potential to produce its hardware, software, and other products that brings them at the top of the
line (Stretton, 2020). The company launches new product on regular interval of time that has
latest design. The company has market share.
Brand Reputation: There is good position of the business organisation. It is seen that by
providing latest product with new designs the company is able to establish high brand reputation
in the market. They provide effective customer services and that also helps the company to have
good brand position.
Marketing Strategy: It is important to note that Apple is known as master of
advertisement. The company creates hype in the market regarding the launch of new product and
it enhances the curiosity of the people regarding the launch of new product that enhances sales of
the company.
Weakness
High Price: One of the biggest weaknesses of the company is high price products
launched by the company (Mercuri Chapuis, 2018). It is seen, all the people are not able to buy
the products that are being launched by the company. Along with that there is high competition
in the market.
Incompatibility with Other Systems: It is seen that the customers face the issue of
Incompatibility with Other Systems. The company has their own operating system and the
customers are unable to switch to the phone.
Analyse the performance of the products of Apple and determine the management challenges
that are being faced by the business
Business Units: The business units at Apple are divided on the basis of the products it delivers in
its marketplace. These different products are iPhone, Mac and iPad. The management of the
Apple works in these three units as these are the main products of the business and formulate

strategies to make these units of the business work efficiently with more profits. These products
are discussed below
 iPhone : This is one of the main product which is traded by the business. These are
designed by the company and are the smartphones based on the iOS operating system. It
is a single product which combines of a computer, iPod, Digital camera and cellular
phone. It has touchscreen interface. The iPhones now a days can work without a power
button and the performance of the product is customizable according to the user of the
product. Currently, iPhone 12 and iPhone 12 Pro are the newest upgraded iPhones in the
market which have 5G technology.
 Mac : This is another product of Apple and is a personal computer based on the macOS
operating system. The latest model introduced by Apple is 13-inch MacBook Pro.
 iPad : This is the multipurpose tablet sold by Apple which works on the iPadOS
operating system. The latest version introduced by the business is iPad Air in the year
2020.

Revenue of the Products of Apple 2020 2019 2018
iPhone 137781 142381 164888
Mac 28622 25740 25198
iPad 23724 21280 18380
The above table shows the financial revenue which is earned by the different products of the
business in the three consecutive years (Apple Inc., 2021). The table shows that the revenue of
the product iPhone of the company Apple is fluctuating in these three years. The revenue was
highest in the year 2018 at the sales of 164888 but now has reduced to just 137781 in the year
2020. The product Mac of the business has revenue of 28622 in the year 2020 which shows that
the sales of this product has increased significantly in these three years as it was 25198 in the
year 2018. The iPad product of the business is also seeing increased revenue in these three
consecutive years as it was 18380 in the year 2018 but now in the year 2020 it is recorded as
23724.
Measuring of the performance: The productivity of the business of Apple and its products can be
measured by using the analyses of the net profit margin of the business (Apple Inc., 2021). The
net profit margin and the different products of the Apple are contributing to the net profit of the
business are shown below:
Contribution in the net profit= net profit / sales per product.
Year iPhone Mac iPad
2020 57,411 / 137781 =
0.41
57,411 / 28622 =
2.00
57,411 / 23724 =
2.41
2019 55,256 / 142381 =
0.38
55,256 / 25740 =
2.14
55,256 / 21280 =
2.59
2018 59,531 / 164888 =
0.36
59,531 / 25198 =
2.36
59,531 / 18380 =
3.23
Analysis of contribution of different products on the net profit of business

From the above table and calculations, it can be analysed how the different products of Apple are
contributing to the net sales of the business in the three consecutive years. The product iPhone of
Apple has contributed the least in these three years survey and the most contribution has been
made by iPad with 3.23 in the year 2018. Mac product of Apple has contributed moderately to
the net profits with the sales revenue from it. The maximum profits earned by the business were
in the year 2018 in this three-year analysis. In the year 2020, the business net profit of $ 57,411
M.
Challenges dealt by the Apple in regards to its products and its management
The main challenges that are being faced by the company Apple are discussed below:
1. Technology Challenge: One of the main challenges faced by Apple in its products is the
challenge of changing technology. With strong rivals working in the industry, the technology of
the gadgets keeps on changing and apple has to change its own products in such a way that it
brings innovative and new technologies in the market and cater these new technologies taking
birth in the market.
2. Leadership Challenge: Apple is facing a leadership change in its major management. This
creates a potential threat for the managing of the business as the operations of business are not
limited to a domestic territory and managing these operations gets hard when the new leaders are
appointed into the business. The leaders of apple need to take in consideration the visions and
missions and work accordingly in the market.
3. Data security and control: Apple is known worldwide for its cutthroat security of the
information related to its customers and saving their data from theft. With increasing
technologies worldwide, the business needs to keep a track of the illegal ways that may end up
breaking their safety policy which will surely harm the brand image of the company.
4. Revenue from the products: From the above analysis it can be said that the business majorly
deals in three products namely, iPhone, Mac and iPad. The revenue which is generated from
these products is not up to the mark and there can be seen a major difference between these. The
revenue earned from iPhones is the least. The company needs to focus on these differences and
work on corrective measure to make its products more appealing to the worldwide customers of
the business.
Findings

From the above analysis, it has been found out that Apple is performing really well when looking
at the revenue generated by the business. According to the MACS evaluation and the whoel
report, this is very much clear that the business is able to generate its maximum amount of profit
from the sales of iPhone. Though its sale has reduced in the year 2020 as compared to the year
2018 but still it is the most sold out product of the company. The sales of Mac and iPad has
increased in the last two years. The net profit margin of the firm is also following the same trend
as followed by the sales. The net profit of firm is less for iPhone. it is eve lower than the Mac
and iPad who are showing good results. But overall, the performance of the organisation has
reduced because of the outbreak of COVID-19. It reduced the disposable income of people and
thus resulted in the reduction in the number of sales. The iPhone has a separate market
comprising of the customers who seems to be addicted towards the product and prefers to
purchase out only those products. The down fall in sales could be the result of the pandemic
which was not in the hands of company. The other two segments have also created a good
market for their products which is very hard to be beaten easily by any business.
Recommendations
Apple is a fast growing business and a dream of every user of digital market. They hold a
strong grip over the customers who purchase their products or desire to do so. The first thing the
company needs to thing about manufacturing the goods with less expenses. So that the cost of
the products could be reduced. The quality of Mac could also be increased by doing more
research. The company recently worked on the policy of stopping the production of its goods
because of the pandemic. This decision will affect the profits generation capacity but provide it
more chance to continue its workings on the research and development of the products. With the
emergence of the high level of competition the market share of the company is reducing and thus
they need to improve their marketing strategies so that more people get attracted towards it.
Additionally, the sale price of its products is very high which are not in the range of each and
every person. Thus, the company should start dealing in products which are affordable to all the
public and could be purchased by them. Overall the company focuses on the long growth and
should maintain its position in the market by serving good quality product at acceptable price.

CONCLUSION
From the above essay it can be concluded that the strategy that the business uses is very
important in the innovation and creativity for the products and services. Because the environment
in which the organizations operate is very dynamic and constantly changing. Research suggests
that the company should be educated about the functions and operations of the company and be
clear about the strategic goals that need to be achieved. In this paper, Apple is an organization
which is active in the IT and telecommunication industry. Apple is a conglomerate of the
communication industry for a reason. They work in all major industries and have customers all
over the world. Customers prefer their innovative products in order to experience something
different from other mobile or laptop brands. It strives to gain market share in direct competition
with many other businesses, while at the same time maintaining financial stability. It seems set to
stay, and future initiatives are sure to demonstrate the company's ability to compete in the tough
competitive industry. In addition, the strategy of the market-activated company is elaborated in
this essay and discussed in the strategic context of the Apple company. The strengths and
weaknesses of the business areas and the segments of the organization are briefly defined so that
the company can work on them and develop strategies from them. Furthermore, the performance
is measured with the help of the operating result and the profitability is analyzed. In addition, the
challenges, insights, and recommendations in the essay are also brief.

REFERENCES:
Books and Journals
Kawai, N. and Chung, C., 2019. Expatriate utilization, subsidiary knowledge creation and
performance: The moderating role of subsidiary strategic context. Journal of World
Business, 54(1), pp.24-36.
Mercuri Chapuis, S., 2018. The Skills of Middle Managers in a Strategic Context of Corporate
Social Responsibility: the MEDIAPOST Case‐Study. Skills Management: New
Applications, New Questions, 1, pp.89-108.
Stretton, A., 2020. Extending specialist PM services to a more generalist role in an
organisational strategic context. PM World Journal, 9.
Thams, Y., Chacar, A. and Wiersema, M., 2020. Global strategic context and CEO
appointments: The importance of a global mind‐set. Global Strategy Journal, 10(4),
pp.676-699.
Zavidna, L and et.al., 2019. Strategy of innovative development as an element to activate
innovative activities of companies. Academy of Strategic Management Journal, 18(4),
pp.1-6.
Online
Apple Inc., 2021 [Online] Available through:
<https://www.annualreports.com/HostedData/AnnualReports/PDF/NASDAQ_AAPL_2020.
pdf>
Apple Inc., 2021 [Online] Available through:
<https://www.computerworld.com/article/3505838/9-challenges-apple-based-enterprises-face-in-
2020.html>