apple business strategy case study

If suppliers increase their prices, a company with a differentiated product can pass that cost to its customers, thus reducing the threat of suppliers. The products made by the company offer something different. However, to those consumers who are concerned about technology and high performance, Apple is still the preferable choice. The company is successful because it efficiently … On June 25, 1985, Bill Gates sent a memo to John Sculley (then-CEO of Apple) and Jean-Louis Gassee (then-Products President). 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In 1997, when Apple was seeking a CEO acceptable to Steve Jobs, Jean-Louis Gassee (then-CEO of Be, ex-Products President at Apple) commented, “Right now the job is so difficult, it would require a bisexual, blond Japanese who is 25 years old and has 15 years’ experience!”  Charles Haggerty, then-CEO of Western Digital, said, “Apple is a company that still has opportunity written all over it. Apple continued their innovative streak with advancements in flat-panel LCDs for desktops in 2002 and improved notebooks in 2003. The institutional leader creates the organizational infrastructure necessary for innovation. In 1985 … Now, let us discuss about the current expansion strategy that used by Apple that make the company has greater success in marketplace. Case Study: The Business Strategy of Apple Apple Inc is a multinational American company that design and sells computer software, consumer gadgets and personal computers. This move allowed Apple to have a desktop and a portable computer in both the professional and the consumer segments. The company’s strategy was. The following are some comments about Apple’s no-licensing policy. In most courses studied at Harvard Business schools, students are provided with a case study. Apple was founded by Steve Jobs and Stephen Wozniak in 1976;  Apple Computers  revolutionized the personal computer industry. The company offers various products for the different market it targets. It was co-founded by Steve Jobs , Steve Wozniak and Ronald Wayne. A U-Form organization resolves the inter-functional collaboration dilemma if there are product development and product management teams. In 2012 Cook reduced component suppliers from 100 -24, forcing Suppliers to compete. In reference to Apple’s recent advancements, Jobs said, “We are going to do for digital creation what Microsoft did for the office suite productivity.” That is indeed a bold statement. There is economic value in product differentiation, especially in the case of monopolistic competition. The only person who’s qualified to run this company was crucified 2,000 years ago.”. A business strategy is a deliberate plan that helps a business to achieve a long-term vision and mission by drafting a business model to execute that business strategy. Therefore, Apple is … Apple – A Digital Business Strategy Case Study This is a case study of how in 1997, Apple was able to change their fortunes and transform their business all by having the right strategy. How Innovation Contributes to Competitive Advantage? Ionology’s 7 Principles of Digital Business Strategy is applied to the case. When reviewing the history of Apple, it is evident that this attitude permeated the company during its peaks of success. On the other hand, Windows does not have such technology. Apple’s profitable but risky strategy When Apple’s Chief Executive – Steven Jobs – launched the Apple iPod in 2001 and the iPhone in 2007, he made a significant shift in the company’s strategy from the relatively safe market of innovative, premium-priced computers into the highly competitive markets of consumer electronics. Specifically, an important source of Apple … Learn how your comment data is processed. Apple subsequently acquired Power Computing’s customer database, Mac OS license, and key employees for $100 million of Apple stock and $10 million to cover debt and closing costs. In 2013, the company annual revenue was … To those consumers who prefer lighter and thinner laptops will definitely be attracted to the Macbook Air. Apple turned the corner in 1993. Apple Inc is well-known for being innovative as they kept on producing new innovations from the first Apple computer Macintosh to the more recent iPhone and iPad series. Even the MacBook and iPhones … That never came to fruition, because Apple (with Spindler as the CEO) seemed contradictory and was extraordinarily difficult in business dealings. A business strategy, in most cases, doesn't follow a linear path, and execution will help shape it along the way. Learn how your comment data is processed. Outsourcing is another remarkable business strategy of Apple. The primary economic value of product differentiation comes from reducing environmental threats. In the case of Apple, there was the opportunity to manage risk and share costs  facilitate tacit collusion , and manage uncertainty. In addition, it resolves the other external factors that present difficulty challenges to Apple Inc. Suppliers at Apple register on SID (Supplier Information Database). As from 2013 to 2015, the company has recorded a steady rise in annual revenue. Activity 3 - Outsourcing (20 minutes) Apple outsource the component creations of its product to many overseas businesses. Apple had one of its critical points in history in 1999 when it introduced the iBook. It covers all the strategic issues facing the industry and Apple inc. as well as the recommended solutions for these issues on business and corporate levels. Case Study on Apple’s Business Strategies. In this Apple case study, the aim is to identify the internal as well as the external factors that have an impact on obtaining achieving high performances by Apple. Therefore, Apple products design is always attractive and elegant compared to those existing competitors. Moreover, Apple Inc’s dominant position in the global market has changed the trend of consumer usage of electronic appliances such as in virtual communication. Although Apple eventually realized the economic value of strategic alliances, it should have occurred earlier. The company most revered brands are Mac, iPad, and iPhone. Apple had issues within its organization. It was co-founded by Steve Jobs, Steve Wozniak and Ronald Wayne. However, there are still a lot of loyal customers who prefer to spend more money on Apple products. In order to make the company more innovative, Steve Jobs focused innovation on competitive pressure and value proposition by stressing his management style on customer center innovation and customer experience. The sponsor procures, advocates, and champions. The company is often criticized because a 30% cut is a significant commission for small businesses or app developers. Business Strategy. Beside this, Apple also emphasizes customizability on the part of entertainment that offer computer-build for high performance such as gaming. iTunes allow consumers to categorize and download songs easily. In terms of applications and software, Appstore provides a platform for customers to download software and applications according to categories. I just did not see how it would make sense. Instead, hardware parts such as display panels are either bought from third-party manufacturers, and propriety hardware such as the processors found in the iPhones and the iPads are manufactured by outsourced companies. This mini case study sheds light on the role that design thinking and innovation played in helping Steve Jobs rescue Apple with his consumer-driven strategy and vision for the company. From the study, the conclusion is if the company wants to continue to succeed the same way then it must consider macro and micro environmental factors. Apple’s business strategy controls its unique ability to design and develop its own operating systems, hardware, application software, and services. INTRODUCTION APPLE’S HISTORY & PRODUCTS STEVE JOBS ROLE SWOT ANALYSIS PORTERS FIVE FORCES - IPHONE PESTEL ANALYSIS BOSTON I PORTFOLIO SOURCES Spindler begrudgingly licensed the Mac to Power Computing in 1993 and to Radius (who made Mac monitors) in 1995. Case Study: The Business Strategy of Apple, Business Level Strategies - Cases of Wal-Mart, Apple, Zara and Ikea. Apple's Profitable but Risky Strategy 2540 Words | 11 Pages. Other than that, Apple is using specialization strategy where they customized customer’s laptop according to their requirements. This case study is about innovation at Apple Inc. (Apple), one of the most valuable companies in the world in terms of market capitalization. Since a company with a differentiated product competes as a quasi-monopoly in its market segment, there is a reduced threat of buyers. Managing uncertainty, managing risk, and sharing costs are sources of economic value in any industry. SWOT Analysis of Apple. He felt that up-and-coming rival Sun Microsystems would overtake Apollo Computer, which did happen. The first strategy that use by Apple Inc for their current expansion strategy is creating innovative idea that slightly different from the competitors that already exists in market and industry. Not only does a company have to bear the cost of standard business, it also must bear the costs associated with overcoming the differentiation inherent in the incumbent. Apple has followed a vertical integration strategy to build a formidable competitive advantage. Apple business strategy can be characterised as vertical integration in a way that the company has advanced expertise in software, hardware, and services at the same time. There are some substitutes for an equity alliance, such as internal development and acquisitions. But my approach was stupid. To realize our ambitious plans we must focus all of our efforts in one direction.” This statement was in the wake of Apple divesting significant software holdings (Claris/FileMaker and Newton). All the high tech products provide consumers with a better living standard in many different ways. This completed their “product matrix”, a simplified product mix strategy formulated by Jobs. Five leadership roles will facilitate the innovation process:   Institutional Leader, Critic, Entrepreneur, Sponsor, and Mentor. Gil Amelio, an avid supporter of licensing, took over as CEO in 1996. Apple lends us an interesting example of how good leadership is vital for the success of a corporation. But you’d need to recruit God to get it done.”   Michael Murphy, then-editor of California Technology Stock Letter, stated, “Apple desperately needs a great day-to-day manager, visionary, leader and politician. It is easy to search for any application or software by using Appstore. We were also naïve to think that the best technology would prevail. “If we had licensed earlier, we would be the Microsoft of today.” – Ian W. Diery, Apple Executive VP, I am aware that I am known as the Great Satan on licensing…I was never for or against licensing. The case study cites the underlying competitive rivalry within the market as the primary challenge that Apple faces currently as Cook and the other vital managers devise new strategies to counter such competition. April 28, 2014 April 28, 2014 / obsurvival. A company attempts to make its strategy a sustained competitive advantage. The company does not own and operate manufacturing or production facilities. Apple charges a 30% cut for in-app purchases through its app-store. In 2005 Apple won a legal case about a blog that pre-introduced new Apple products. Through thebroad differentiation genericstrategy, Applestands out in the market. However, the difficulties with these drive the formation of strategic alliances. The mentor coaches, counsels, and advises. Sculley and Spindler were hoping IBM would buy Apple and put them in charge of the PC business. Therefore, now Apple Inc is known as a strong company and the market leader in industry. Please give me a call.”   In 1987, Sculley refused to sign licensing contracts with Apollo Computer. This site uses Akismet to reduce spam. Apple led the global technology market by developing innovative products such as the Mac, the iPod, the iPhone, and the iPad which redefined their respective markets. Furthermore, Apple also created a substantial value in highly competitive market and industry which help them to achieve competitive advantages in an industry with stiff competition. Gaming plays important roles to help Apple to customize in features and specification to make the products more attractiveness and creativity. Gates recommended that Apple license Macintosh technology to 3-5 significant manufacturers, listing companies and contacts such as AT&T, DEC, Texas Instruments, Hewlett-Packard, Xerox, and Motorola. 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