What Next For Apple Inc. After Steve Jobs Death - Essay Example

? What Next For Apple Inc. After Steve Job’s Death? Number: Due: Introduction After Steve Job’s death in 2011, most of Apple’s competitors thought that they had a nice opportunity to overtake them in the software industry. Most of Apple’s competitors at the time of Steve Job’s death included Samsung Electronics, Amazon, Google, Nokia, and Sony. The Smartphones and tablets that were being produced by Apple mostly had competition from Amazon’s Kindle Fire and the Nook. However, Apple was the leading firm before 2011 because of Steve Job’s strategies that he had used in the market many analysts believed that it was the end of Apple industry (Deatherage 2011). With Steve’s death, the company had stiff competition from google’s Android system. Furthermore, the iTunes were facing competition from Netfix that wanted to take over the living rooms in the world stage (Tariq, Ishrat & Khan 2011). Facebook had also come into being and wanted to dominate the internet business by coming up with their own windows that would an access to the internet while Amazon was entering into the tablet market at Job’s time of death. Cooke had now to battle with google and to maintain the image of the company (Stan & Bill 1991). Analysis of the Competition Using Porter’s 5 Analysis and Strategies Supplier Power The Apple company faced competition mainly on her Tablet industry and the emergency of google Android and the Blackberry’s Smartphones. In the year of Job’s death, Blackberry industry announced the release of a new Smartphone that had quite touching features that changed the way business people operated. The move was intended to edge over Apple’s iPhone that had not been in the market for long at that time (Stephen, Jerry, & Richard 1993). The blackberry release had nice features such as touch screens, slide-out keyboards that was a clear indication of the of the step they had taken in the production of the phones. This enabled different business people to be in touch with the world. Thus blackberry had a higher power in the production of such phones that posed a greater competition to her competitors mainly Apple (Peter 2012). The use of corporate strategy and strategic outsourcing was vital. Rivalry In the traditional business, the issue of competing firms often drove profits to almost zero. In any competitive environment the competing firms come up with different strategies in order to edge out their competitors. Therefore a firm without any competitive advantage would find herself operating on losses or lost most of their customers to their competitors. Due to the competition from Amazon’s Kindle Fire and Nook tablets, the Amazon had decided to lower her prices in order to outweigh Apple’s tablets (Manjoo 2010). However he continues to assert that Apple decided to attract more customers by increasing the features of the Tablet and coming up with more applications that would be used by the business people (Apple's strategy 2009). Threat of Substitutes These refer to products from other industries apart from Apple that have the same or similar functions to customers. The move by google to produce Android prompted a move by Apple to produce iPhone 5 that would compete with the product that serve the same purpose. The industry faced the challenge of implementing the iPad That had been launched just before Job’s death , in Steve job’s management the Apple company had managed to create Apple 2, Macintosh, the iTunes, the iPod and the iPad in order to deal with other substitute products from other industries (Mary & Robert 1994). They used business level strategy to deal with the threat from other similar products. Buyer Power Most companies and other government agencies mostly issue blackberry to their employees for business transactions a show that the Apple company is really facing much competition to attract her customers in the industry. The blackberry company is though promising new an operating system that would be in much competition with her competitors mainly Apple and Google (Lanshinsky & Burke 2011). Threat of New Entrants The strategies that Apple employed were much to do with differentiation strategy of her products. With the new management, the problem still existed on how Tim Cooke would get the attention of the customers that the company believed ranged from the experienced ones to the less experienced users. Internal Audit and Strategies Just like any other business organization, there are problems within the company that at some point they need to be addressed in order to realize the company goals. Just at the time of Steve the culture that was in the company was not pleasing. If a client did not know Steve Jobs in person it would take a long time to have their projects approved and done just unlike another client who was well known to the CEO. Thus different aspects of the company had changed since the time it was founded under Steve Jobs leadership. It is true that for the success of any company, corporate strategies need to be taken into consideration and therefore this was the case at Apple company. Having a clear understanding of the different internal organization and how the internal structure of Apple is able to deliver their services is important to achieving the company goals (Gobble 2012). Financial and Resource Audit From the financial statements, it is true that Apple does not pay its stakeholders any dividends. This is because the stakeholder policy of Apple is inactive and the Dividend Reinvestment Policy is not available to investors. The company pays dividends four times a year in each quarter. Some of the main competitors of Apple in dividend policy were Dell Inc., Hewlett-Packard Co., Microsoft Corporation., And Cisco Systems. These have no dividend policy thus matching Apple’s dividend policy (Gobble 2012). In the year 2011, Apple recorded a quarterly revenue $ 28.57billion and a net profit of $ 7.79 for every diluted share. The company in this year sold iPhones worth 20.34million in the quarter, iPads sold were 9.25million during the quarter, in the same quarter they sold Macs that were avaragely 3.95million, and iPods were 7.54million. This has been the best service delivery ever and the companies CFO stated that they were looking forward to the fourth quarter of that year (Peter 2012). He continues to state that Apple have been involved in the manufacture of a number of softwares that have earned market throughout the world business. Such resources include: Ios that is an operating system for accessing a variety of resources used for developing, designing and distributing applications for iPad, iPhone and iPod. In addition they have developed OS X that has the resources and the content for distributing Mac applications. iCloud are for preparing the IOS and OS X Lion applications for the cloud service. Further, there are the iPod, iPhone and iPad cases are used in downloading drawings that assist in designing cases for carrying iPod, iPad and iPhones. Other resources include: Open source, hardware and drivers, Apple applications, and Safari. Value Chain Linkages Every organization has to perform certain processes and activities that enable them to produce, sell, distribute their services and products. According to Porter's description of the value chain, the operations of any organization have inbound logistics that include how raw materials are supplied, the manufacturing processes, the outbound logistics that include how services and products are transported and distributed, and finally service delivery. According to a journal Data Monitor (2011), most components that are essential to Apple business are mostly available from different sources and only a few important components are getting from single sources. This Apple would be unable to obtain microprocessors in future in quite large quantities that have competitive prices that would affect Apple’s operations. In addition, the company uses components that are not common in the personal computer industry and others need customization. Therefore Apple’s supply of given products to the market are affected if the supply of key components of personal computers is derailed for example from IBM machines. This is a great threat as the company depends on the supply of certain components of personal computers from key firms. In addition Apple’s differentiation strategy is affected once the company depends on the availability of certain customized components from other firms (Collingwood 2009). The operations of Apple industry are affected greatly as it does not assemble all her products in the same area. In precise, final assembly of her products is made in Taiwan, Korea, Netherlands and other few selected countries. Moreover, on Apple’s distribution model in the past was not appropriate. It relied on a network of distributors of her products that often led to higher prices of the products. The company however, decided to introduce retail stores that extended her chain supply in different countries (Peter 2012). Functional strategy played a great role in their market maintenance. Leadership To attract more customers in the ever changing economy world the company needs to make accurate decisions that are able to look into the market, address the market problem so that the company can realize their goals. Apple is facing a much better competition especially in her tablet and Smartphone industry. The need to change business models, their marketing strategies, analyze the way the company distributes her products and the maintenance of the company culture is of great importance. All these need a leader with a great vision (Gobble 2012). Apple has been one of the most successful technology leaders in the world because of the leadership it enjoys. Even though the departure of Steve Jobs would have a great impact on the company, the rise of Tim Cooke would see the company still able to be at par with her competitors because of Cooke’s vision. Power and Politics Apple is a US based company. US is a hegemony state that is more so involved with a lot of fights all over the world. These fights are affecting the market of Apple since the company cannot operate in countries such as Iraq, due to political effect. With the new economy social issues are arising, and the conflicts between countries does not go hands free as it affects the economy that the Apple company is depended on for their market. The new world political economy is characterized by power conflict, privacy. Apple that is dependent on other countries for the assembly of her tablet and Smartphone body parts is greatly affected hence the scarcity of their services at times. A new strategy that would remove the third party assembly of Apple’s products would be beneficial in the case of the world wars that might affect the manufacturing and assembly process. Decision Making Decision making in Apple is often well calculated to avoid losing of customers. For example when the company decides to take their products to a new country that they do not already have the market there, the process of doing so involves asking the responsible departments which markets they wish to enter, the time they have to enter and finding the market size. Finding the size of the market, possible consumers and their level of wealth that determines their purchasing power is important in their success. Therefore corporate strategy that often identifies the market that Apple company is to invest their resources in often play a greater part. External Influences No business operates without external influences. The environment where it is located can have an impact on the organization, the government agencies, the economy, customer trends that are the market of the Apple products all might affect the strategies that the organization takes to make a profit. Apple on the other hand is no different either. Once the economy is strong is a clear implication that the customers have more money to buy the Apple services. The success of the Apple company depends on the economic conditions of the world and how they affect the level of consumer spending (Manjoo 2010). The definition of how Apple markets her products and how it attracts the market remains a big challenge to Apple company. In the past, no company has been able to produce the quality products that Apple has been able to produce in the market. The range of all the hardware and software parts of the personal computer, the business applications, server producer, peripheral fabricator, and other online content provider services all have transformed the Apple company. But marketing is vital to any organization. The Smartphones and tablet industry have in later years been the main cash to the Apple company just like the PC market being Apple’s main source of cash. Other Apple products like the operating systems, servers and drivers all are important to the firm but would find no meaning without the Mac that is linked to the PC business. Thus Apple has received much competition in the market for the design, manufacture and the sale of personal computers and other software products. The market has greatly changed because of technological improvement that have increased the applications in the different market products (Peter 2012). The need for high performance software applications, an increase of the tablet features and the Smartphones have brought about the price competition in the market. In addition main competitors in the operating system software such as Microsoft have been involved in the price cut to attract more customers and maintain the market share. This move by Microsoft has affected Apple’s performance ratio and has put them under pressure for the increase of their gross margins. These developments and great changes in the software industry are expected to continue even in the future and therefore Apple must be on the look especially after the passing on of their visionary CEO Steve Jobs. In addition, most of the customers are in need of the internet, and this has led to the emergence of smaller, simpler and less devices such as Yahoo Messenger, ICQ are seen to be giving Apple’s existing products such as iChat. Thus in order to serve customers better, there is a need to know about the changes in their needs that bring about the change in demand. The highest rate of increase in technology has led to business having no boundaries and its more flexible and its often transformed each time due to the consumers’ changes in preference (Tariq, Ishrat & Khan 2011). Strategic Issues Apple is mainly facing the problem of the ever changing technology ant the satisfaction of customers who are ever being attracted to the competing firms mainly Blackberry and the rise of google’s Android phones. Amazon too has been decreasing her prices to get a cutting edge over the increasing competition from other companies. Most customers in the market are concerned with the quality, and efficiency of the service they receive from the manufacturers. Thus the need to have customer attention is important that would need the change of Apple strategies . Having strategies such as Just In Time inventory systems (JIT), Total Quality Management (TQM) would serve in an appropriate manner that include rendering of quality services. Although Apple has been able to reduce their inventories in the past, the increasing demand for their products and future strategies would need them to be monitoring their inventory systems. The company would cease from buying more input that would be based on forecasts of the future. The use of the Net Profit Value ( NPV) as a portfolio management technique does not sometime take the assumptions of uncertainty in the future. Thus the demand for Apple products would sometimes fail due to other unavoidable circumstances such as poor economy. Thus implementing JIT strategy would be of great benefit to the company. This would sometime solve the threat of increase in demand at certain seasons that might lead to lack of certain key component in the market. Moreover, the use of JIT would enable Apple to select products from a wider range of suppliers and increase their links to the suppliers of major components in the market. However, in terms of strategies aimed at the manufacturing processes Apple usually outsources her products to the third party that usually assemble them and therefore there would be nothing great to be done to the issue as it is important to have other parts of the Smartphones and the tablet assembled in other parts of the world (Gobble 2012). In concern to the building blocks of a competitive advantage, manufacturing can improve the efficiency of a product, their quality and customer responsiveness unlike having to assemble the parts of phones from different manufacturers. Thus this would ensure that the efficiency in production in the end lowers the cost structure. Production furthermore ensures that several tasks are performed on a product that go hand in hand with the high quality of the same product that lead to differentiation of the product that makes it unique from the competitor’s product. Conclusion With the advancement in technology, Apple is facing stiff competition with other firms entering the industry. It is still far from establishing themselves after the passing on of their CEO Steve Jobs that many believe revolutionized the Apple industry. Google’s Android is the latest threat the the company has to deal with as the platform has attracted a number of clients all over the globe. References Collingwood, H. (2009), 'Do CEOs Matter?', Atlantic Monthly (10727825), 303, 5, pp. 54- 60, Literary Reference Center Plus, EBSCOhost, viewed 16 March 2012. Data Monitor (2011), Apple Computer, Inc. Porter’s 5 Analysis, pp. 1-9, Business Source Complete, EBSCOhost, viewed 16 March 2012. Deatherage, M. (2011), 'What Steve Jobs Did', Macworld, 28, 12, pp. 52-54, Academic Search Premier, EBSCOhost, viewed 16 March 2012. Gobble, M. M (2012), 'Innovate Different', Research Technology Management, 55, 1, pp. 63- 65, Business Source Complete, EBSCOhost, viewed 16 March 2012. 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