Business Strategy Report: Analyzing Apple Inc.'s Strategic Directions

This report provides a comprehensive analysis of Apple Inc.'s business strategy, examining the impact of the macro environment, internal capabilities, and competitive forces. It utilizes frameworks like PESTLE and SWOT to assess the external and internal factors influencing Apple's strategic decisions. The report delves into stakeholder mapping, evaluating the influence and interest of various parties, and applies Porter's Five Forces model to assess the competitive landscape. Furthermore, it evaluates Apple's strengths, weaknesses, opportunities, and threats, culminating in the development of a strategic management plan with tangible objectives and tactical actions. The analysis includes a critical evaluation of the strategic decision-making process, highlighting the strengths and weaknesses of different analytical models and their impact on strategic directions. The report also provides an overview of the company's financial performance and its approach to maintain competitive advantage.

Business strategy

Table of Contents
Introduction......................................................................................................................................3
LO1: Analysis of the impact and influence which the macro environment has on an organization
and its business strategies................................................................................................................4
P1: Applying appropriate frameworks, analyzing the impact and influence of the macro
environment on a given organization and its strategies...............................................................4
M1: Critically analyzing the macro environment to determine and inform strategic
management decisions.................................................................................................................7
LO2: Assessing an organization’s internal environment and capabilities.......................................9
P2: Analysis of the internal environment and capabilities of a given organization using
appropriate frameworks...............................................................................................................9
M2: Critically evaluating the internal environment to assess strengths and weaknesses of an
organization’s internal capabilities, structure and skill set........................................................11
LO3: Evaluating and applying the outcomes of an analysis using Porter’s Five Forces model to a
given market sector........................................................................................................................12
P3: Applying Porter’s Five Forces model evaluate the competitive forces of a given market
sector for an organization..........................................................................................................12
M3: Devising appropriate strategies to improve competitive edge and market position based
on the outcomes.........................................................................................................................14
LO4: Applying models, theories and concepts to assist with the understanding and interpretation
of strategic directions available to an organization.......................................................................16
P4: Applying a range of theories, concepts and models, interpret and devise strategic planning
for a given organization.............................................................................................................16
M4: Producing a strategic management plan that has tangible and tactical strategic priorities
and objectives............................................................................................................................18
D1: Critique and interpreting information and data applying environmental and competitive
analysis to produce a set of valid strategic directions, objectives and tactical actions..............18
Conclusion.....................................................................................................................................20

References......................................................................................................................................22

Introduction
Various aspects of the strategic management are used for the production of the plans. These
aspects can be able to make various strategic priorities and objectives that can assure the
betterment of the organizations like Apple Inc. Here, Apple Inc will need to consider the
differentiation strategy to stay in the market. In the world of modern business, the role of
business strategy can not be ignored. As the roles of business are very much important to find
out, the whole report have been made on the basis of Apple Inc., which is one of the leading
business production company available in the system. They will not be influenced and they don’t
have interest as well like the young people who doesn’t use the product of Apple Inc. In the last
side, meeting the needs will be high as their influence will be higher than the interests. They are
customers or consumers who can easily switch to the other parties very easily. There are several
theories for internal and external analysis which have been applied. On the other side, strategic
analysis of the product have also be done in this whole report.

LO1: Analysis of the impact and influence which the macro
environment has on an organization and its business strategies
P1: Applying appropriate frameworks, analyzing the impact and influence of
the macro environment on a given organization and its strategies
In the context of Apple Inc, there have been several influences which are getting assured by the
macro environment. With the role of the macro environment, any business organization can
understand their needs and also can assure how these needs can be important. According to the
understanding of the macro environment, a business like Apple Inc can easily establish a very
strong system which can help their continuous development along with the betterment of
organizational efficiency. With the proper understanding of all these theories, Apple Inc can also
assure the goal meeting activities to surpass the market competitors. In this way, Apple Inc can
be able to work within the system even perfectly.
Stakeholders’ mapping
As it is known, stakeholders can be consisting of so many parties who can be related with the
business organizations’ activities (Bohoris et al., 2016). So, any party who is going to be
influenced by the activities of Apple Inc will be known as stakeholder. There have been a
diagram and with the help of it, analysis and understanding of the stakeholders can be done.

Figure 1: Stakeholders’ matrix (Li, 2015)
In the analysis, it has been seen that there will be several dimensions which are needed to be
arranged and managed perfectly. Here, the Apple Inc have the people from all the dimension.
According to the analysis of it, four different sides can be found. The most powerful and
possessing most interest are the key players. For Apple Inc, they are government, law enforcing
agency and so on. If the influence of the product is reduced with high interest, it will make the
potential buyers of the products of Apple Inc.
If both interest and impact is taken down, these will create the least important dimension where
actual understanding of the product will not be demonstrated in a clear manner. They will not be
influenced and they don’t have interest as well like the young people who doesn’t use the
product of Apple Inc. In the last side, meeting the needs will be high as their influence will be
higher than the interests. They are customers or consumers who can easily switch to the other
parties very easily.

PESTLE
PESTLE is a model which can give a very effective idea about the role of external environment
within the context of Apple Inc. There have been several factors which can give and provide the
different aspect of the market and company. This is why the implementation of PESTLE analysis
will be really very important.
Political
It has been seen that Apple Inc is sustaining so many political impacts and changes which are
happening in the system. So, governments are now really very connected with the activities that
are done by Apple Inc. Government have been patronizing the activities of Apple Inc very
effectively. They also have a very good relationship with the political parties as well. On the
other side, after Brexit, there have been several changes that have been occurred by the bad
political conditions. This is how the political activities of Apple Inc is getting matched.
Economic
Apple Inc have been connected with several activities that are related to the economic activities.
The role of economic impact is so much enormous that the roles are getting assured. In the last
year, Apple Inc have been able to make a turnover of 35$ Billion which is highest in the market,
On the other side, Apple Inc will need to deal with the other issues as well because they have
considered the employee occupation (Bates et al., 2017). The employees are making the role in
the goal meeting activities as well. In this way, the economic understanding is getting assured
and well managed. However, they have added so many huge amount in the GDP of UK as well.
Social
Apple Inc will need to deal with several social issues as well. They will need to deal with the
people of the society. They were able to maintain a very strong relationship with the social
parties within the system. This is how the role of social parties can be demonstrated perfectly.
However, the customer turnover rate of Apple Inc is really very low and the customer
satisfaction level is more than 80%. By taking part into many corporate social activities, Apple
Inc has become able to make the standard on a perfect line.
Technology

In this case, there will be several needs of the technological understanding as well. As a
technological device making company, Apple Inc will need to deal with the technological issues
very perfectly. Once they are able to manage the technological understanding, organizational
efficiency can be easily assured. With the strong technological understanding, Apple Inc is
becoming able to reduce their cost along with increasing the level of customer satisfaction.
Legal
In this case, Apple Inc will need to deal with the legal sides as well. There have been several
laws and techniques which are connected with the legal sides. According to the understanding of
all these legal factors, Apple Inc will need to deal with the system very carefully. On the other
side, Apple Inc have a wing within the organization which is dealing with the legal factors. So, it
has been well managed from the side of Apple Inc.
Ecological
In reality, the activities of Apple Inc are not harming any side of the environmental system. Back
in 2015, Apple Inc has been announced as the Green Company for working in the most effective
manner toward the environment. They are also following several important issues in this matter
which can be very important (Pinnington and Hammersley, 2017). But Apple Inc is also
following all of these things very effectively.
So, in this way, PESTLE analysis can be done.
M1: Critically analyzing the macro environment to determine and inform
strategic management decisions.
As the result of PESTLE analysis, strategic management decision will surely get accelerated at a
top level. Various strengths and weaknesses of the PESTLE analysis can be used for better
making of strategic management decisions. PESTLE is a model which can give a very effective
idea about the role of external environment within the context of Apple Inc. There have been
several factors which can give and provide the different aspect of the market and company.
PESTLE analysis provides with the information about several bigger aspects of the external
environment which can help to understand the business situation.

On the other side, it doesn’t consider the international market environment where all the factors
of PESTLE can change very quickly. The changes in the factors of PESTLE can not be
determined easily which is the biggest disadvantages of it. However, five forces model is used to
understand all the aspects of competitors view. There are various blind spots available in the five
forces model such as inconsideration of technological and other globalization trends. These are
the basic disadvantages of five forces model in this place. In this way, the strategic decision
making of an organization can be demonstrated.

LO2: Assessing an organization’s internal environment and
capabilities
P2: Analysis of the internal environment and capabilities of a given
organization using appropriate frameworks
In order to understanding the internal capabilities, the internal analysis will be important. An
internal analysis is an exploration of the organization's competency, cost position and
competitive viability in the marketplace. Conducting an internal analysis often incorporates
measures that provide useful information about the organization's strengths, weakness,
opportunities and threats. With the understanding of all these, it can be said that the role of
internal environment is really very important.
SWOT analysis
Strength
In this case, Apple Inc will have several strengths which are needed to be well taken care. This
will give a very strong and clear idea about the strong zone of Apple Inc. They have a very
strong operational structure. With the help of that operational structure, they can easily produce
quality and effective product (Oliver et al., 2018). They have been able to reduce the cost of
production as well. As the production cost will be lowered down, it will be able to increase the
profit at a very drastic level.
Weakness
Here, Apple Inc will also need to deal with the weakness issues as well. There can be so issues
which are related to the weakness. The employee turnover rate in Apple Inc is very much high.
The high employee turnover is happening because of the less satisfaction level. On the other
side, the skill of employees have not been oriented and the Apple Inc haven’t introduced any
new technology for more than 6 years.
Opportunity
Apple Inc will also possess so many opportunities within the system and the role of these will be
very much important. In this case, Apple Inc is required to hold several opportunities like the

working efficiency. They were able to maintain a very strong relationship with the social parties
within the system. This is how the role of social parties can be demonstrated perfectly. For the
Apple Inc, it is one of the most important opportunity.
Threats
In the analysis of Apple Inc¸ there have been several threats appearing in the system. In the
recent days, the cost of raw materials have been increased at a very high level. This is why it can
be a very strong point of threat. Brexit is another important threat that has been appearing in the
system. It is a very serious political risk which can hinder the way of development of Apple Inc.
after Brexit, there have been several changes that have been occurred by the bad political
conditions.
VRIO/VRIN framework
In case of the understanding of the internal resources, VRIO and VRIN framework can be one of
the most effective form of analysis tools. VRIO falls into the internal analysis step of these
procedures, but is used as a framework in evaluating just about all resources and capabilities of a
firm, regardless of what phase of the strategic model it falls under (Bailey and MacNeill, 2018).
The question of value can be like “Is this resource or capability valuable to the firm?”
The question of rarity can be like “Is the resource of company rare?”
The question of imitability can be like “Do firms without a resource or capability face a cost
disadvantage in obtaining or developing it compared to firms that already possess it?”
The question of organization can be like “Is the company capable of arranging competitive
advantage?”
So, this is the most important framework available in case of the VRIO/VRIN and so on. With
the help of this analysis, it can be found that Apple Inc’s resources are valuable and rare which is
creating issues of competitive advantage. But Apple Inc will face the disadvantage whenever
they will not possess a single resource. If all of these are well understood, Apple Inc can be able
to hold the competitive advantage for so long.

M2: Critically evaluating the internal environment to assess strengths and
weaknesses of an organization’s internal capabilities, structure and skill set.
McKinsey 7S Framework
It is a very strong framework which can be used within the system of organization to find out the
level, forces and sources of internal powers. These can be used with the help of many other
impact as well. This was a strategic vision for groups, to include businesses, business units, and
teams. The 7 Ss are structure, strategy, systems, skills, style, staff and shared values. But now, it
is getting used to find out the level of internal analysis (Clegg et al., 2013).
Figure 3: McKinsey 7S Framework (Caldwell and Smallman, 2016)
Structure of Apple Inc have been very much important to follow as they are working with three
layer system. On the other side, they have the strategy to work with the ultimate efficiency and
so on. They have a share vision which have been carried on to the other parties within the
systems. Their working system is very much efficient where the working style is really very
flexible. They have very skilled employees with great understanding on several technical sides.
This is how they are becoming able to arrange of these issues within the system of Apple Inc.