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Business Strategy: Apple Inc. Business Case


In the initial section of this paper, identification of a company which uses strategic management is conducted. This is expounded through provision of a discussion concerned with the Company’s corporate strategy as well as explanation of the engagement of the business in respect to its operational activities. The paper goes ahead to expound on the growth objectives and different growth strategies which exist in the business environment.

In the subsequent section, the paper provides discussions of the strategic management processes therein the global environment, the role of corporate governance in strategic decision-making process, environmental analyses in respect to Apple Company, various challenges faced by this company while carrying out the strategy implementation as well as during creation of strategies offering potential strategic alternatives pertaining to different scenarios. It should be noted that while conducting this research paper, the author expects that the research analysis adopts effective communication techniques as well as embraces materials from other courses attributed with business administration.

Section 1

Strategic management is a technique used by managers in order to evaluate and analyze the key goals achieved by top-managers on the behalf of the real-business owners. It should be noted that the approach assumes the adoption of different forms of resources in order to execute functionalities fairly, especially in respect to the external business environment. An example of a Company which uses this form of management is Apple Inc.

It is noted that different forms of organizations adopt different methodologies of diversification strategiesin their aspirations for growth activities. Notably, the entity which is perceived as having assumed a diverse form of portfolio in respect to business units is termed to be a corporation. This is due to the fundamental fact that the entity initially assumed additional level of strategies which did not correlate with the serving of end-users in distinctive single markets.For instance, in Apple’s case, the company started off as a mere business entity which was concerned with the generation of only computer-related products (Investor relations, 2010).

However, this aspect changed significantly to allow for the Company toassumenewer activities into areas concerned with electronics, music and games. In the course of conducting its operational activities, the Company developed distinctive models which are used to figure out different marketsfor businesses toenter and to exit. These models also help to do different managerial correlations for these businesses . The Company, through the adoption of this technique, has learnt to identify businesses in their own unique capacities hence allowing them to pursue effective business strategies (Anand, Ashforth,& Joshi, 2005).

In this portfolio-based strategy, resources are allowed for sharing across different forms of business units existing within the same plan, so that distinct and common elements may affect the decree of common ownership.

Apple Inc. is a business company which is engaged in production of electronic gadgets as well as iTunes products. It has established its market position by generating innovative products which it has managed to put forth in the global environment. This Company is known for i-based products like iMac, iPads and iPods. The Company’s key objective is its concern with adopting effective and efficient methodologies needed for expanding its sales volumes to consumers who do not own any of their products. This fundamental growth objective, as mere as it may seem, is an all-inclusive goal which aims at achieving results through processesthat deal with advertising as well as expansion of distribution networks.

The move by the company to open-up flagship stores such as the new store opened-up for business in central Hong Kong is an effective methodology to reach-out to the largest part of its customer-base (Quinn & Jones, 1995).In addition to this, it is noted that Apple Inc has diversified its business portfolio by offering hardware products, software products as well as services to immediate customers. Thus, it has ensured that a larger customer-base has been attained altogether.

Basically, there are five different forms of growth strategies. They are product differentiation, diversification growth strategy, acquisition growth strategy, market penetration strategy, as well as market-expansion growthstrategy.

The product differentiation growth strategy is assumed whenever a company opts to expand its production line or in other cases add newer features into the already existing products in order to catapult the level of sales volume and respectively profits. It should be noted that whenever a company uses this form of growth strategy it continues with the process of distributing its respective products within an established market. This form of strategy is fairly assumed whenever it is established that the immediate technological advancements continue to change significantly with time.

With respect to the diversification growth strategy, a company will embark on approaches needed in selling their products into newer markets. In comparison to other growth strategies, this one is riskier given the fact that the company should conduct extensive research in order to ascertain whether or not the potential target-consumers will purchase the products.

In the acquisition growth strategy, an established company adopts the methodology of purchasing both operational activities and management functions of the company in order to expand its market base. This type of strategy is used whenever a company desires to expand its original product line as well as penetrate into newer and established markets. However, it is noted that this type of strategy is considered to be risky, especially because the company involved puts in a lot of investment resources in order to implement the strategy effectively and efficiently.

In respect to the market penetration strategy, a business entity is perceived as having adopted the approach whenever it embarks on promoting its products within the already existing market to which it has been availed since the start of its operations. It should be noted that the fairer way which can be adopted in order to catapult growth using the company’s existing product line is to catapult the size of the existing market share upon which it operates.

According to Suttle (2010),the market share is defined as the percentage unit of sales in respect to the dollar sales volume which a given company possesses within certain markets in respect to other forms of competition. Consequently, this strategy is fairly affected whenever the company lowers the prices of its products. For instance, in case of little application of product differentiation, a much lower price is likely to help the company catapult the level of its existing market share.

In the market-expansion growth strategy, a company focuses on distributing its immediate products in a relatively newer market environment. The rationale behind the adoption of this growth strategy is triggered by intense-levels of competition so that the existing market provides no room for expansion for the company’s operational activities.

It is evidently sound to assume that whenever a business entity fails to figure out newer markets for its existing products, it loses the capacity to catapult its product sales volume and hence profits. Another viable reason for a company to adopt the market-expansion growth strategy is its goal to use the products in other, newer dimensions.

Apple Inc. can effectively control an extensive market base whenever it chooses to adopt an acquisition growth strategy. Currently, the firm is using the product-differentiation growth strategy in which the operational activities of the firm have been established upon a distinctive product-portfolio. This portfolio consists of provision for hardware products, software products as well as other services.

The product-line for this company involves iPhones as well as iPods series. Despite the fact that the Company has penetrated new and established markets, it is logical for it to assume the acquisition growth strategy for the following reasons: first, it has an established financial support-base, which means that the investment-based strategy will have less risk potential. Second, the Company has established an effective technical support and effective top-most management team which can assist in the implementation of company strategies. It should be noted that the growth strategy is distinct and can attract a vast portion of the existing market shares so that the Company’s profits as well as sales volume increase significantly. The need to adopt the acquisition growth-strategy is based on the necessity to eliminate intense competitions by swallowing-up of their activities.

Section 2

Strategic Management Process within the Global Environment

Companies may opt to expand their production activities into the vast global environment through distinctive forms of cross-boundary investment procedures. This can be done through extensive trade agreements, investment strategies and strategic-based contracts as well as through licensure of operational activities. It should be noted that companies are expected to formulate relevant formidable procedures which will be crucial in affecting positive strategic management processes. Thus, it is fairly safe for these companies to adopt strategic management processes which are internationally viable in order to commence its production activities effectively and efficiently (Hart, 1992).

Thus, there are four distinctive processes which have been devised in order to assist business entities in their respective needs, in particular the adoption of the strategic management at a global perspective. First, there is identification of the overall scope of the operations of the business at hand. This component of the strategic management also includes different geographical locations, namely countries and regions. Consequently, these regions should possess capacities to attract vast market niches in order to be classified in that matter. With respect to this component, the top-most managers should adopt a strategic decision management approach which will be concerned with identification of unique regions and matching them with selected market niches in order to attain full optimal activities. This is based on the fundamental fact that different market regions possess distinctive as well as unique advantages to the survival of differentbusiness operations (Hart, 1992).

Second, the strategic global management process involves resource allocation. In the course of using the company’s resources, it is required that immediate effective measures should be taken in order to ascertain the efficiency of the firm’s operations in the selected market niche. It should be noted at this stage that the company should focus on the use of resources while ascertaining its immediate functionalities as well as allocate each resource in respect to the significance of each function. For instance, the company’s top-management team may embark on adopting resource allocation approaches which are either focused on product-line developments or geographical locations (Hart, 1992).

Third, the company’s top management team should embark on adopting distinct methodologies for the company. This will provide competitive advantage over the immediate competitors within the same industry. While identifying the competitive advantage, one may ascertain that the company engages in its operational activities – the ones that it can perform better than its immediate competitors. It is noted that for any company to effectively realize its competitive advantage aspirations, it has to adopt such new and distinctive techniques as advanced technology, adopt effective and efficient organizational practices as well as allow for the allocation of channel systems. It is at this stage that the company, operating at the global platform, should engage in identifying both existing and potential areas of competitive advantage as well as provide immediate platforms for planning in order to sustain the practices as a whole.

Fourth, the company’s top-most managementteam should adopt a synergy-based criterion which needs to be based upon the establishment of a cohesive form of plan. The incorporation of this plan should be conducted in a manner which allows for the numerous functions as well as operational activities to benefit from one another. For instance, the top-most management team may assume a strategy which allows one product-line to provide a platform upon which the other line of products can gain access to market niche. This will ensure that different products aregenerated within a single entity benefit from one another (Margolis & Walsh, 2003).

The Role of Corporate Governance in Strategic Decision-Making

Business organizations are meant for regulation whenever their respective objectives of operations are made a priority. The top-most management team should be subjected to legal requirements on the level of activities they are expected to conduct. Thus, organizations should fulfill certain stipulations in order to present information to the interested public fraternity.In its structural components, corporate governance is a mechanism which allows business managers to be monitored in order to ascertain the fact that they fulfill their respective legal responsibilities. Hence, different objectives of the company are attained (Kayes, Stirling & Nielsen, 2007).

The feature concerned with corporate governance is perceived to be attributed with principals who are tasked with the responsibility of ensuring the agents are performing according to their requirements and that they are not, in any way, exploiting their given authorities. It should be noted that in most parts of the globe, business organizations are overseen by a selected board of directors, whose composition, duties as well as mandates differ by their respective regions. The distinction upon which a company’s board of directors is chosen ensures that an extensive dispensation of both power and authority is made viable. The independent board of directors for a given company is perceived as being on a high level of decision-making process if compared to the one whose appointments are made within. With the immediate developments being witnessed in respect to the global environment, it is evident that the fundamental functionality of corporate management is to execute decisions in a manner which brings about the aspect of stability in respect to the interests of the entity’s numerous stakeholders (Friedman, 1996).

It should be noted that corporate governance forms the fundamental basis upon which decisions pertaining to both finance and competitive advantage of the business environments are affected in a manner which allows efficiency as well as effectiveness in the course of business practices.

Environmental Analysis: Apple Inc. SWOT Analysis

According to Manness (2012), Apple Inc is a firm which has gained immense levels of recognition over a substantial period of time. Its market cap in the stock exchange program has increased immensely.

Apple’s Strengths: first, the company incorporates unique and distinctive user interfaces for their immediate products. The Company has adopted and integrated the iCloud services to its customers in a manner which allows for immense-levels of transparency. It is without doubt that the Company’s products like the iPod and iPad have been considered influential features to the ascertainment of smart-phones. Second, the Company generates products with unique hardware designs. This is evident in the uni-body design structures for their Apple-based laptops, the distinct magnetic charger which is connected to the Apple’s most phenomenal product: MacBooks as well as the recently introduced iPhone 5, which has received vast recognition in respect to its durability aspect. Fourth, the company boasts of its aesthetic designs which are perceived as having an attractive aspect to its underlying customers. Fifth, the Company adopts a holistic methodology so that it generates not just hardware but also software, which, in turn, saves clients’ time and money (Gustin, 2012).

Apples Weaknesses: first, limited editions so that the Company is considered to be the only one which can generate products which have in-built incompatible operating systems: OSX and iOS. In this manner, customers are limited in their desires to try out newer systems offered by other system-developers (Manness, 2012). For instance, their desktop PC versions are limited of choice just as their own laptops. Second, the Company is perceived as having possessed a “know it all form of attitude”. This attitude is demonstrated by the limited versions of their products especially the Operating Systems.

Apples Opportunities: first, in respect to the iPhone product, it is safe to assume that the Smartphone industry is expanding at a constant rate. This is attributed to the fact that the product is replaceable on almost a regular cycle thus ensuring that the product records immense levels of sales volume. In respect to the iPad product, the Company surely has a complete market grasp due to the controversial uniqueness of these products.

Apples Threats involves first of all the issue of competition, especially in the Smartphone and tablet sectors. There has been an increasing development in the tablet features across the industries with such companies as HTC and Motorola coming in hand to generate products of a similar functionality. Second, there is the threat of “pride” in the management of the Company so that it cannot listen to the pleas of its customers. This is a platform which can lead to immense failure in case it is not rectified (Brews & Hunt, 1999).

Challenges in Strategy Implementation

In the course of the strategy implementation process, it is assumed that challenges are inevitable. The following are the probable challenges which the firm and its managers might experience in the course of conducting the operation. There is the likelihood of the entity’s culture becoming obsolete and irrelevant. Thus, the organization culture is confirmed to be homogenous and can only be applied effectively to a limited number of functionalities. In this manner, it leads toloss of both time and money (Hales, 1999). Second, there is a possible challenge of ascertaining the needful amount of investment in respect to time and other resources required while implementing the strategies devised by the top-most managers.Third, in the course of the implementation process one may assume that the organization structures are only limited to certain levels of information as well as gathering information systems which are dependent on obsolete environmental features (Mintzberg, 1994).Fourth, it might happen that the numerous stakeholders as well as power-holders might refuse to assist the implementation process on the ground that they want to retain their respective status quo as held previously (Freeman, 1984).

Creation of Strategies and Potential Strategic Alternatives for Different Situations

On a global platform, business entities are perceived as having assumed the adoption of different strategies in order to meet the immediate basic need of an underlying customer. For instance, multi-domestic strategies are formulated in order to meet the needs of the consumers within a particular country or region while the global strategy allows for standardization of both products and their respective promotional activities. Thus, a formidable strategy which can be adopted by the company is deploying the global strategy in the selling of its electronic-based products while adopting a multi-domestic strategy in order to cater for its appliances products. In respect to the company’s promotional strategies it might choose to use a similar advert for its products selling across the globe. In this manner, the Company will save time and other resources.

It should also be noted that the company can sacrifice its culture for global markets. For instance, in casethe company is used to establishing its restaurant business in an independent environment, this might draw mixed reactions in the Japanese market, hence it is safe that the company establish its premises near other restaurants in order to attract more customers. This is attributed to the Japanese perception of being cohesive and closer to each other in the course of conducting most of their activities.

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