BUS21510 Autumn 2019: Strategic Issues and Recommendations for Apple

This report provides a comprehensive analysis of the strategic issues facing Apple Inc. The study begins with an executive summary and table of contents, followed by an introduction that highlights Apple's historical context and current market position. The report then delves into a situational analysi...Read More

BUSINESS STRATEGY
STRATEGIC ISSUES AND RECOMMENDATIONS ON APPLE
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Executive summary
In the research report, Apple Inc. has been taken as an organization to see the strategic issues on
what could come inaction of its future operations. The assignment will briefly discuss the
strategic issues as well as on recommendations that can help the company to improve its future
operations to attain sustainable growth.
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Table of contents
Table of contents..............................................................................................................................3
Introduction......................................................................................................................................4
Situational analysis of industry structure for its strategies..............................................................5
Apple’s strategic internal issue and problem...................................................................................6
1. Cloud service............................................................................................................................6
2. Internet services.......................................................................................................................7
3. Competition..............................................................................................................................7
4. Social.......................................................................................................................................8
SWOT analysis:...........................................................................................................................9
Apple external acquisitions:..........................................................................................................11
PESTEL analysis:......................................................................................................................11
Recommendations..........................................................................................................................12
Recommendations to compete in outside acquisitions..............................................................13
Recommendations to socialize...................................................................................................13
Recommendations to compete with competitors.......................................................................13
Recommendations to improve I cloud and internet services.....................................................14
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Recommendations to build an effective organizational structure..............................................14
Generic strategic recommendations to improve the performance of apple for their future course
of operations..................................................................................................................................15
Conclusion.....................................................................................................................................16
References......................................................................................................................................17
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Introduction
Apple Inc stated their company by introducing the personal computing area in the year 1977 but
through the various changes in the management and due to different opinions the company
misses the opportunity to gain a competitive advantage like Dell, Microsoft and Samsung. In the
time of today, apple I operating in various lines of operations by designing not only computers
but various electronic devices like Mobiles, Laptops, tablets, watches, gaming consoles and
software.
Apple is continuing to provide innovative products to satisfy the needs of customers in the
market but even though their restless efforts have caused some problems in small markets. The
strategic issues and problems have reduced their market share below of 5% that has to lead to
major issues to run the company in the long run. The costs of apple to maintain their operations
have increased their comparison to utilizing the competitive operation system. The software
designers of Apple's operating system have also limited their sales due to the strategic issues that
are prevailing in their operations.
Another major issue that could come up as an advantage for the company laps to be another treat
that competitors are able to lap above the company by making an edge over them with producing
and sharing better products. The one advantage that Apple could possess with their operating
system but has failed to convince its consumer is their superiority.
Apple has to capitalize on the problems to resolve it as early as possible to make their future
growth stable. However, Apple has gained few customers but the number is not enough for the
company to require an upward growth and to reclaim a considerable market position.
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This case study will begin with the situational analyses of the company's issue that will hinder
the growth of the company in the coming 4-5 years. The situational analysis will also encompass
competitive situational analyses, industrial structure. I another section, the problems and issues
related o the company will be analysed and the recommendation will be provided with present
strategic options that can be used by the company to anticipate its positive outcomes for the
future. The recommended strategies given in the report will also be encountered as an analysis to
control the operations in the best strategically way.
Situational analysis of industry structure for its strategies
Apple Inc has managed to create its name as a highly competitive industry in the market, by
forging and innovating a path that leads to considerable differences in form of its competitors,
The industry is aiming to focus more on its design, quality, superior customer service and
elegance to its products.
Despite, the major advantages the company has created for itself in this stiff competition within
the industry still the company has other eternal factors that are present as a formidable challenge
and strategic issue for the firm (Rabbani, Ahmadzadeh and Farrokhi-Asl 2019). The high
competition in the market is one of the major reasons that has to lead to strategic issues of the
company and has led to intense rivalry within the market that as driving prices down and has
eventually destructed the prices too. The key resources of the company that includes the software
team, hardware engineers, the design team are also responsible to bring in strategic issues by not
delivering optimum research performance in their devices (Maciejewski 2018)
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BUSINESS STRATEGY
Apple has to look at ways o innovative its way to make a comfortable position for themselves
with commanding prices as per their performance. Unfortunately, the apple is not giving enough
time and efforts to dwell on the strategic issues that have led them to future threats that may
come in 4-5 years ahead. However, as today the apple has emerged itself s one of the top global
brand among their competitors the position will not be the same so it is the time for Apple to find
new ways to create value among their customers and shareholders as well as to maintain profits.
The apple market due to the strategic issues is become saturated and leading a very few new
buyers in their store. To continue the growth in future terms, apple must look on to expanding as
well as reviewing the strategic issues to overcome the sources of revenue (Athey and Luca
2019).
Apple’s strategic internal issue and problem
1. Cloud service
The launch of I cloud service from Apple has been one of the major issues that are deemed to be
a global problem among the I phone users which can be a major issue for the company in coming
4-5 years. The question among the users are- does apple has enough talent inside the company
and in their employees to grow and develop a sustainable cloud? This is the major reason that
has made I could system a major problem to deal with and has made the people drop out to buy
their new I phones (Ashta and Biot 2018)
However, many few people know what, when iPhone was launched it majorly relied on the
Amazon (AMZN) web services t deliver their cloud functionality. However, the other companies
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like Google and Facebook are continuing to improve their cloud services and have a lot of
knowledgeable skills staff in their team. At, preset apple is failing to deliver this to their
customers and it can be a major strategic issue for their future course of time (Ansoff et al.
2019).
2. Internet services
The internet service of apple has been reviled as another major strategic issue which Apple
should identify to run their operations in the coming years by improving it's functionality their
IO’s platform. According to the research, many press releases, and blogs has gained the attention
of users facing the slow internet service in every variant and devices of I phones (Noe et al.
2017).
As IOS has continued to heat the technological market over the years, customers are relying on
to see the best performance in every aspect of their service. Apple is failing to take things slow
and to grind out a steady approach to identify the major issue of internet services (Johnson,
2018). The researches have also seen that the apple maps don’t work promptly is also one of the
major issues that are noted from past years. Sadly, the apple consumers are getting impatient and
waiting for Apple to turn around their strategies in to improve the internal structure of their
issues that can give them speedy response son IOS platform (Kodama 2018).
3. Competition
Apple has created its brand name in the world most selling phones globally. However, the
competitions of apple such as Google, Samsung and Nokia are setting ahead to give better
services to their consumers by improving their technology and adding up different variants of
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phones. The apple has failed to give consumer satisfaction if related to its competitors that is a
major cause of strategic issues in coming years that can decline the sale and profitability of the
brand. Apart from this, another major issue apple can cause from their competitions is that they
are successions to deliver the core properties in their devices that can fulfil customer satisfaction.
Apple still has the chance to gain their competition over their competitors in their market by
adding and improving their functionality in their I phones as well as improving the quality of
service and attention to their customers (Stanoso et al. 2019).
4. Social
Another major strategic issue and problem apple are acing are to be less social interaction with
their consumers on all platforms. According to the internal skills set perspective, Apple can take
advantage of social platforms by telling its consumers how their products are best and what new
features that have introduced in their new models. However, Apple has failed to give efforts
increase their presence over social media platform that has to lead to less engagement with
consumers as well as less engagement to introduce their products in a better way (Phillips and
Moutinho 2018).
The social issue can be a major problem in next coming years of Apple if not resolved in a
significant time, as it will lead to less engagement of consumers over their brand and
substantially they may fail their presence over the social platform as well as in the technological
market. Another major concern, which may lead to strategic issues of apple, is its cultural
differences and technological differences among its competitions that lead to next point of being
engaged in social platforms (Malenkov et al. 2019).
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SWOT analysis:
With the help of SWOT analysis, we can briefly understand the internal scenarios of this
organization. This analysis also helps us to overcome the threats and weaknesses accordingly
(Heracleous and Papachroni 2016). This will also help to understand which marketing strategy
can be helpful for Apple Inc.
Strength:
Apple is the richest and widely known company around the world. They have become the best
technology-based company within the last 10 years. Strengths include:
 They have a very strong position and image as well in the market.
 Their revenue and profits always belong to a higher margin.
 They always introduce something new and innovative which have a very effective impact
on their business and marketing.
Weakness:
Though Apple has become the richest and widely known and famous company throughout the
world still it has some internal issues which create a barrier for their business and growth also.
Some weaknesses are as follows:
 Apple products have a limited amount of distributors. The availability of these products is
very lower.
 The price of the products which are introduced by Apple is very high, thus every person
cannot afford these products.
 Price is high, sales are dependent on rich people.
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Opportunities:
Opportunities are mainly external factors which influence Apple’s business strategic direction.
 Enhancing supply change management by expanding the distribution network.
 Considering increasing demand sales volumes can be higher.
 Innovative and new product development which is cost effective and user friendly.
Threats:
Threats are mainly external and driven by competitors leading to affecting financial
performance.
 Competitors challenging aggressively or intensely.
 Increasing manpower cost in different countries
Figure 1: SWOT analysis of Apple
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Source: https://www.marketing91.com/swot-analysis-apple/
Apple external acquisitions:
Apple is well known for its global expansion and number of consumers it has lead with a
successful path. However according to the strategic issues and problem global expansion cannot
be always seen as a successful path for the long term. According to the research, Apple has not
contributed any big multi-dollar acquisitions outside its company which has to lead to a strategic
issue of the company and can hinder their further growth in the long course of time. However, in
the year 2018 apple made its best efforts to sell out their new I phones but still, the company has
not grasped enough acquisitions power (Chernev 2018).
PESTEL analysis:
Political factors:
 Free trade policies over time have been created mainly with developed countries, for
capturing market all over the world more policies to be increased.
 The political condition is stable in most of the developed countries less political
issues would be experienced (Johnson 2018).
Economic factors:
 Economic stability in developed countries leading to rapid growth.
 Rapid growth may increase revenue in developing countries through marketing
and sales.
Social factors:
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 Increasing use of mobile phones and social media leading to increasing demand for
digital devices.
Technological factors:
 Cloud computing increasingly being popular Apple may offer devices or apps which are
cloud friendly.
 Faster growing apps market and technological innovation is also an opportunity.
Ecological or Environmental factors:
 Apple is addressing the opportunity for sustainable business by recycling and related
materials.
Legal factors:
 As digital technology use leads to privacy issue Government impose more regulations
on Apple. This leads to the threat by creating new challenges as well as opportunity to
innovate privacy protected features.
Recommendations
Apple needs to get real technology transfer to solve out their core cloud, social skills and internet
services into the company that can solve their structural problem in for the long run. Below we
are listing some options that can be used as a generic strategy for apple better performance in the
above listed strategic issues (Chen and Bai 2016).
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Recommendations to compete in outside acquisitions
 Opt to more options on giving franchises of the store
 Developing a close relationship with suppliers is out most important factor that can lead
to compete in outside acquisitions and to maintain an exclusive business relationship in
the market to mitigate the power to lock in attractive prices (Heracleous and Papachroni
2016).
 Continue to build relationships by entering into the exclusive arrangements to gain a
favourable business deal can always bring a plus point for apple.
Recommendations to socialize
 Emphasis on the integrated system of advertisements: Apples can bring a significant
advantage in their operations for a future course of time by entering into seamless
interoperability to presenting their apple products on all the platforms of advertisement.
Apple can exhibit their products over the social media platforms such as in Facebook,
Google, YouTube or in their website to use it as a marketing angle that will further result
in selling more products to the existing as well as to the new customers.
 Apple should make an effort to make use of their creativity by telling people how their
brand is unique from other brands as well as should continue to focus on creating a
professional market.
Recommendations to compete with competitors
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BUSINESS STRATEGY
 Innovation: Apple must an integrated system of hardware, software as well as of
ecosystem that can help them to innovate in the industry of technology as well as to keep
up in front of their competitors.
 Customer preference: Apple should focus on their customer’s preference first to work on
and to move faster on the transition to make a legacy technology that they need in their
systems (Clarke and Boersma 2017).
Recommendations to improve I cloud and internet services
 Apple must hire software engineers as well as the development team who are highly
skilled and brilliant and know what they are doing to improve the functionality of Apple
devices (White 2019).
 Apple should make sure to introduce and take recommendations from their customers on
what they are lacking behind as well as they should further give improve their hardware
and operations to make sure they are rectifying the problem (Steffen 2019).
Recommendations to build an effective organizational structure
 It is recommended for the organization to implement a strategy that has a clear thought
on the leadership development as well as a selection of a right program that cab able to
give special leadership qualities for apple development (Green 2015).
 The future employees must be technically brilliant, as well as should be innovative
pioneers with strong working skills and high level of ethics that can push the organization
to grow in improving their internal operations (Chikhale and Mansouri 2015).
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 Apple should make a centric approach on its customers by evaluating their demand and
choices that they are looking from the team as a brand and further apple should build
their operation in accordance to their customer's choice.
Generic strategic recommendations to improve the performance of apple for their future
course of operations
 Innovation in design: Apple should give major emphasis on the internal resource
allocation as well as in design development to lead the industry innovation.
 Consumer electronic diversification: As the technological market has grown abundantly,
Apple should make a way to develop the areas of their products to grow more by
fulfilling consumer satisfaction. The apple should also implement a strategy to develop
complementary products in order to provide a broad source of revenue to the customers
with less competition (Phill and Biot 2018.)
 Technical improvements: Apple should also work in improving their related operations to
the cloud system, integrate sources and I chat sectors to give better performance to the
consumer and fast processing that will eventually rise to better consumer satisfaction rate
as well as will give a platform of making new customers with their improvements in
operations.
The recommended strategies and points can help Apple to resolve their strategic issues that can
be a major threat in the future course of years in its operations. The issues are well defined with
the recommendations that can be used by Apple to implement a plan that can bring major
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benefits further for their future course of actions to stay ahead in their competitions as well as to
develop a plan that can bring benefit for their operations (Johnson 2018).
Conclusion
In conclusion of the assignment, it is briefly discussed on the apple operations and issues and
problems that lead to its strategic threat in the coming years. In accordance with the prevailing
threats, the recommendation has also been given that can help the company to lead into the
advantage to create a sustainable environment for them for a future course of positive e
operations. However, Apple has emerged as one of the leading technological firms in today's
time even with its popularity they have significant issues that can be a major cause of their
failure that has been discussed above. The company can take the best use of the
recommendations to exploit various opportunities as well as resolve the strategic issues that may
arise in their operations.
Moreover, Apple can take the user of their rapid innovation process as well as their strong brand
image to develop and launch the new product lines with the help of adding new technological
changes before their competitors do. However, Apple can face a significant threat on its imitation
and competition too that is one of the major challenges that can be seen in 4-5 years that affect
its global market.
However, based on the above recommendations highlighted according to the issues the Apple Inc
can continue to grow its aggressive innovation by developing its company’s products as well as
by fulfilling the demand of its consumers.
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In conclusion of the assignment, it is concluded that the apple can adversely affect its revenues
by enhancing the automation of its products and by contracting with distributors to improve their
overall market as well as to reach in the growth of making high sales and profit.
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Clarke, T. and Boersma, M., 2017. The governance of global value chains: Unresolved human
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