Apple Incs Strategic Evaluations

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As a multinational company that pioneers in hardware products such as the iPhones, iPads, and Macintosh computer, Apple Inc is highly known for its innovative products and cutting edge technology (Fadaei, 2014). Therefore, to maintain its steady growth in the competitive market, there is the need for a strategic method and direction for Apple Inc that will steer the company to more growth. From this perspective, this report has taken an environmental business aspect and evaluates strategies that can be recommended to an implementation plan.

Assessing the performance of an organization allows the stakeholders to evaluate different strategic options that can be integrated into a firm. The criteria for evaluating strategic recommendations for an organization can be summarized by the abbreviation SAF meaning Suitability, Acceptability, and Feasibility. The evaluation option suitability assesses the strategies that address the opportunities and threats an organization faces. Therefore, in this part, this report will assess Apple Inc's opportunities and the threats it faces as well as capitalize on its strengths to avoid the weaknesses it faces. A SWOT or a PESTLE analysis is a suitable tool that can be used in this part. On the other hand, acceptability deals with whether the expected outcome of the proposed strategy will meet the stakeholder's expectations. Acceptability can be categorized into three types; risk, return, and stakeholder reactions. The third evaluation option feasibility evaluates whether the proposed strategy has been implemented successfully. In feasibility, two questions are likely to arise; are there resources to implement the proposed strategy effectively? And can they be obtained? Apple Incs feasibility evaluation will focus on two crucial areas which include the people and the significance of resource integration (Johnson et al., 2013). In this light, this report will provide a strategic assessment of Apple Inc based on the three options of suitability, acceptability, and feasibility.

Suitability

According to Johnson et al. (2013), suitability addresses the critical issues that are related to an organization strategic positioning. The issues include strengths, weaknesses, opportunities, and threats an organization faces. The SWOT analysis considers the internal factors of Apple hence this tool can be used to assess and test the suitability on the proposed strategy.

Apples SWOT Analysis

Strengths

-The company has a powerful brand image and design expectations associated with its products.

-Apple Inc has invested in billions for R&D (Research and Development) and expansion.

-Apple offers a refined supply chain that can supply high demands in case of an increase in orders.

-The company offers successful product lines such as the iPad and iPhone

-The availability of more than one product for consumers to choose from (Wang, 2014).

Weaknesses

-The pricing of Apple products are high as compared to its main competitors, and this depicts a challenge to consumers

-There is a high dependency on the other product lines such as the iPhone and iPad

-There is a declining market share for other products

Opportunities

-The Apple Watch introduction as a new product category offers an opportunity for Apple Inc to maximize profitability and customer needs.

-The Apple Watch will result in increase in demand and consequently expansion

-The high brand awareness

-The integration of iCloud will help boost the appeal of Apple Watch to the consumers

Threats

-The rapid technological change has resulted in a competitive industry environment

-The growth of Samsung and Android products such as gear watches is a competitive threat

-There might be a possibility for low customer adoption (Wang, 2014).

Apple SWOT Analysis (Wang, 2014)

From the above SWOT analysis of Apple, the suitability test allows us to choose a number of strategies that could be developed and integrated to give the company an edge over its competitors. Screening Apple in terms of its competitive advantage requires aligning the proposed strategies to satisfy the VRIO model. The proposed strategies include the Blue Ocean strategy and product development strategy. The Blue Ocean strategy allows companies to move from competitive markets to new market spaces hence creating a positive effect on jobs in the new environment. Both strategies allow Apple Inc to innovate and create new products such as the latest iPhones in newly created markets hence competition becomes irrelevant (Kim, 2008).

Acceptability

As mentioned earlier, evaluating Apple Inc in terms of acceptability means whether the proposed strategy will meet the expectations of the company's stakeholders. It can be tested in various ways such as analyzing the risks, return on investments, and stakeholder reactions (Johnson et al., 2013).

Risks

For an organization with long-term innovation programs such as Apple Inc, the risks can be high. To mitigate some the risks, Apple Inc can opt for strategic alliances in developed countries when penetrating new markets. Also, the product development strategy is one business strategy Apple can use to leverage and aggressively use with minimal risks.

Returns

Return is the term used to measure the effectiveness of the proposed strategy in terms of finance . As in the case study of Apple Inc, shareholders expect some increase in revenue from their investments. Therefore, performing a sensitive analysis in addition to a financial risk assessment is crucial in determining the viability of the proposed strategy. For instance, the release of the Apple Watch product has enabled the company to set aside $50 million which will be used in bug fixes and most importantly advertisement and promotion. This will ensure the company maximizes in the sales of the new products such as the Apple Watch and hence attract more consumers through its advertising and promotional strategies.

Stakeholder Reactions

As a proposed strategy to Apple's current strategy, the Blue Ocean strategy and product development strategy can be used to restructure a business financially. In this light, there are many situations whereby the reactions of the stakeholder could be crucial. For instance, if Apples C.E.O financial expectations are to be considered, then this will affect the acceptability of both strategies. Another example is if a group of shareholders willingly control the issue of shares; this would be unacceptable. Other groups of stakeholder reactions that impact an organization strategy include regulators, customers, and employees of the company.

Feasibility

Feasibility identifies whether an organization could implement the proposed plan. Feasibility assessment involves asking two primary questions if the resources exist to effectively implement the strategies and if they do not how can they be obtained (Johnson et al., 2013, p.390). Apple Incs viable proposed strategies which include product development and the Blue Ocean strategy are tested and evaluated on areas such as; people and skills and integration of resources.

People and Skills

Evaluating the success of a strategy in an organization depends on the people (employees) and their skills. To achieve sustainable competitive advantage, Apple Inc needs to encompass the knowledge, skills, and experiences of the employees. Sanders (2012) indicates that decision-making strategies such as recruiting the most skilled staff and enforcing the spirit of innovation are vital in the successful turnaround of the company. When young Steve Jobs hired John Sculley to manage Apple, the brand suffered as he did not understand the culture; this demonstrates the results of poor leadership in organizations. Most importantly, employees are an organizations most imperative resource since they undermine or create the organizations status for quality in services and products. When an organization has its structural design in place, it needs skilled people with the right abilities and knowledge in it. Given these issues, it will be imperative for Apple Inc to take into account the need to ensure skilled people in the company to ensure the successful implementation and delivery of the proposed strategies.

Resource Integration

The success of the Blue Ocean and Product Development strategies for Apple Inc depends not only on people and skills, but also tangible resource such as technology, information, and also buildings. Therefore, the feasibility of these strategies needs to be evaluated in terms of the ability to acquire the resources. Apple Inc continues to expand its business in emerging markets such as China where it has opened up new stores; this means new products, buildings, suppliers, and partners in the new market. Furthermore, Apple Inc distributes its production through a large distribution mechanism. For instance, consumers can preorder the new Apple Watch through Apples website and other authorized retail stores. As a result, the presence of these additional resources can result in the effectiveness and success of the proposed strategies.

 

References

Fadaei, R. (2014). Apple Marketing Analysis Report: Apple iPhone Case Study. Academia.edu. Retrieved 22 April 2015, from http://www.academia.edu/4103079/Apple_Marketing_Analysis_Report_Apple_iPhone_Case_StudyJohnson, G., Scholes, K., Whittington, R., Johnson, G., Angwin, D., & Regner, P. (2013). Exploring strategy Text and Cases (10th ed., pp. 367-394). Harlow: Pearson.

Kim, W. (2004). Value Innovation: The Strategic Logic of High Growth. Harvard Business Review, 82, 172-180. Retrieved from https://hbr.org/2004/07/value-innovation-the-strategic-logic-of-high-growth

Sanders, B. (2012). 8 Steve Jobs Leadership Mistakes Ad Agency Leaders Should Avoid. Ad agency new business | Sanders Consulting Group. Retrieved 8 November 2015, from http://www.sandersconsulting.com/8-unforgivable-leadership-mistakes-steve-jobs-made/

Wang, C. (2014). Apple iWatch Marketing Plan. prezi.com. Retrieved 22 April 2015, from https://prezi.com/socvdh42tm32/apple-iwatch-marketing-plan/

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