"Apple designs Macs, the best personal computers in the world, along with OS X, iLife, iWork and professional software. Apple leads the digital music revolution with its iPods and iTunes online store. Apple has reinvented the mobile phone with its revolutionary iPhone and App Store, and has recently introduced iPad 2 which is defining the future of mobile media and computing devices"
“Apple is committed to bringing the best personal computing experience to students, educators, creative professionals and consumers around the world through its innovative hardware, software and Internet offerings.” (Apple, 2013)
Apple's Strategy
Flavja Beqiri, 2013/2014 VG
Cook's four Pillars
1. Offer a small number of products.
2. Focus on the high end
3. Give priority to profits over market share
4. Create a halo effect that makes people starve for new Apple products
Recruiting and Retaining Staff
R&D
Internal Strategy Frameworks
Quality Control
Converting Raw Materials
Purchasing of Materials
Aftercare e.g:
Warranty
Distribution to Retailers
Value Chain
Apple's Mission Statement
Stake Holder Mapping
Are Apple On Message or Off Message?
On Message
All aspects are pulling together
Stakeholder Mapping
Mission Model
Purpose
Why does the company exist
Create Great Products
"Our goal, in a nutshell, is to obtain stellar products and services within tight timeframes, at a cost that represents the best possible value to our customers and shareholders. If that sounds like a daunting task, it’s the same one we assign ourselves."
(www.apple.com/procurement 2013)
Lenders
Third Party Retailers
Strategy
Values
The competitive position and distinctive competence
What the company believes in
- Innovation
- Great Products
- Simplicity
- Own and control primary technologies
- Loyalty
- Collaboration
- Honesty
- Create products that deliver and are easy to use
- Propriety formats - not compatible with other systems
- Consistency, easy to adapt to new hardware
- Educational sales - early exposure
- Varied products enjoy one and then purchase another.
- Focus on what's important
Behaviour Standards
The policies and behaviour patterns that underline the distinctive competence and the value system are :
Visibility
Managers
Employees
Employees
Suppliers
Competition
Shareholders
All aspects of the mission model are pulling together. They are foccused on achieving company goals in an ethical manner; with innovation being a key focus point.
Bowman's Strategic Clock
Bowman’s Strategic Clock
Apple sits between differentiation and focused differentiation on the strategic clock.
This is due to Apple having a high perceived value and the high price. Yet the price is still taken into consideration by the customer.
Vertical Integration
Resources
and Competencies
External Strategy Frameworks
Financial Resources: Capital
Human Resources:
Employees
Physical Resources:
Building & Stores
Intellectual Capital
How much of a threat to Apple?
- Bargaining Power of Suppliers – MODERATE
- Bargaining Power of Customers – LOW
- Threat of New Entrants – LOW
- Threat of Substitute Products – LOW
- Competitive Rivalry within the Industry – HIGH
Finance
PESTLE
Social
Economic
Political
Mobile phone subscriptions
Consumer lifestyle
Customer's change in attitude
Current economy :
Recession,
Consumer Spending,
Unemployment
Tax
Government involvement i.e. Code of Best Practice 2002
UK competition policy (EU competition law)
Environmental
Legal
Technological
Environmental Impact
Harm on global warming
Mobile Phone Wastage
Hand-free Legislation
Smart Phones
Growth of tablets
Advertising Laws
App Development
Competencies: Supply
Porter's Five Forces
SWOT
Opportunities
Strengths
- Customer loyalty combined with expanding closed ecosystem
- Apple is a leading innovator in mobile device technology
- Strong marketing and advertising teams
- High demand of iPad mini and iPhone 5
- Emergence of the new provider of application processors
- Growth of tablet and smartphone markets
- Obtaining patents through acquisitions
- Damages from patent infringements
- Strong growth of mobile advertising market
Threats
Weaknesses
- Rapid technological change
- Price pressure from Samsung over key components
- Competitors moves in online music market
- Incompatibility with different OS
- Decreasing market share due to upcoming competition
In 2014 the company sold 51 million iPhones with a 7% increase sold last year.