Analysis of the Strategic Decision of Apple Inc - Essay Example

? Analysis of the Strategic Decision of Apple Inc Background to the Study and Overall Research Aim The area of strategic management has been able to gain substantial importance in the recent past. Few decades back, organizations generally focused on long term planning supposing the internal and external business environment to remain stable and consistent over long period of time (Bankes, 2003). With the course of time, entrepreneurs and managers around the world have understood that the environment can change at any moment of time and as a result of that managers and entrepreneurs now formulate plans following a particular strategy and also include contingency plans. Contingency plans are framed for the sole purpose of securing the company’s operation and service delivery mechanism (White, 2004). Furthermore, it is also meant for quickly restoring the services. Despite of that Companies around the world, still face challenges while moving through the strategic planning process (Lynch, 2012). In such situations, the only way out for the companies to deal effectively with these issues is to focus more on the strategic management (Camerer, 2008). The strategic decision making process differs from one company to the other and in the similar way differences also become visible between the two managers of the same company (Horn and Weber, 2007). For example, there are several instances that articulate shifts in strategic decision making styles in a company with the change in company leadership. This study seeks to investigate the strategic management practices of a company. In addition, the study will also shed light on the changes in the strategic management style of a company with the change in leadership. The aim of this study is to analyze the strategic management style of a chosen company and what are the strategic decisions made by the company. The study is also aimed at comparing and contrasting the strategic decision making style of two leaders and how it impacts the whole company. Hence, the overall research aim is to find out the significance of strategic management in a firm and how its application can be beneficial for a company. There are hardly any studies that attempted to uncover the changes in the strategic management style of a company due to the change in leadership and its impact in the welfare of a company. Hence, this study has strong relevance as well as significance in the field of business research. For this study, Apple Inc. has been chosen as the organization. The reason behind choosing Apple is the recent shift in the leadership of Steve Jobs to Tim Cook. Analyzing the strategic decision making of Apple will also help in clearly understanding the differences in strategic management approach. However to get further deep into the study, a brief synopsis of the chosen company are presented below. Apple: A Brief Synopsis Apple Inc., commonly known as Apple Computers is a US based Multinational Corporation, headquartered at Cupertino, California. The company was incorporated in the year 1976 and was founded by Steve Jobs, Steve Wozniak and Ronald Wayne. The role of Steve Jobs has been instrumental in transforming the company into one of the world’s largest MNCs. Apple is best known for its continuous innovation and trendy products. The company now operates in almost every part of the world and is regarded as the “home of innovation”. The company is involved in designing, developing and selling consumer electronic goods, personal computers and computer software. The company presently operates with 406 company owned retail stores. Some of the bestsellers of the company include hardware products such as iPhone, iPad, iPod and software packages such as iOS, iTunes and Safari Web browser among others. In the year 2007, the company was renamed by removing the word ‘computer’ from its name thereby making it apparent that the company will focus more on the consumer electronics segment. The major competitors of the company are Samsung Electronics, Nokia, Motorola and LG among others. As of 2013, the company had 72,800 full time employees and 3,300 temporary employees. In the last financial year, the total revenue of the company US$ 156.508 billion and the net income was US$ 41.733 billion (Apple, 2013). These figures clearly illustrate the strong financial situation of the company. Till Tim Cook took over the charge of the company, it was in the hands of Steve Jobs, who was one of the co-founders of Apple. Despite the change in leadership, Apple continues to be one of the most innovative and “digital lifestyle” company. Research Objectives The research objectives of a study are often dubbed as the specification or the ultimate rationale for conducting a research. Furthermore, the research objectives of a study help researcher to identify the exact information needs. In this context, the following are the research objectives of the dissertation: - The first objective is to analyze the strategic management practices and strategic decision making of the Apple Company. The next objective is to identify the strategic management practices and decision making differences of Steve Jobs and Tim Cooks. Another objective is to identify the challenges that the company may face in the near future. To collect the relevant information about the subject of concern from the secondary sources and primary sources. The aim is to collect secondary data from journal articles, books and authentic electronic sources. In addition, the aim is also to carry out a focus group interview of the managers of Apple. The last objective is make recommendations to the company about how they can deal with the challenges of the future. Furthermore, recommendations will also be provided to the company in the field of human resource management, accounting, financial services & banking and hospitality. Initial Review of Relevant Literature Over the last few decades, there has been a significant amount of empirical and theoretical work on strategic management completed from both management and psychological disciplines (Drejer, 2004). This section of the study will carry out a comprehensive review of the literature on the subject of concern. This section begins with the importance of strategic decision making in an organization. The review discusses the factors that foster the strategic decision making process of an organization. The idea of strategic decision making is frequently described in terms of strategic management research and its roots extend back to Ansoff’s (1965) Corporate Strategy and Chandler’s (1962) structure and strategy (Hoskisson, Hitt and Yiu, 1999). Mador (2000) defines strategic decision making as the decision responsible for determining the direction of the firm. The author also summarizes that strategic decision is complex in nature and involved a high degree of uncertainty, but effective implementation presents excellent results. Dean and Sharfman (1996) stated that strategic decision making helps a company minimize the impact of external perils, as it always maintain a contingency plan (Russell, 2001). According to Davis, Shaver and Beck (2008), strategic decision making are completely different from the tactical or operational decision making in a number of ways. One of the most evident differences is that a strategic decision is responsible for a long term impact on a business and simultaneously involves high risk. In today’s tumultuous and competitive business environment, strategic management is one of the most important concepts that has emerged in the field of management (Ulijn, et al., 2000). According to Lempert, Nakicenovic, Sarewitz and Schlesinger (2004) strategic management is a continual process of framing strategies for the organization for creating a harmony between the organization and the environment in which it operates. Echoing the same, authors such as Khatri and Ng (2000) emphasized that strategic management is the systematic analysis of the factors that are associated with the competitors, customers and the organization itself. Thus, the objective of strategic management is to achieve better alignment of strategic priorities and corporate policies. In the context of Apple, the company has taken several strategic decisions since the era of Steve Jobs and some of those decisions are even dubbed as the “game changer” for Apple. The launch of iTunes in the year 2003 for windows based platforms was a breakthrough. This decision allowed the company to get out of its own Apple world and target a broader customer base. The launch of the iPhone was another strategic decision that has provided the company with unimaginable success. Hence, from this fact it is evident that strategic decision is important to a firm’s success. However, comparing the two leaders of Apple, it has been found that the decision making style of them is different. Steve Jobs was a visionary person, while Tim Cook is yet to prove his creativity with something extraordinary or a product which is yet to be seen. The final paper of this dissertation will critically analyze the decision making styles of the two leaders. Research Methods: Justification and Description The aim of this study is to analyze the strategic management practices and strategic decision making of the Apple Company and along with that identify the differences in the strategic management practices and decision making differences of Steve Jobs and Tim Cooks. In order to address these objectives, the study will collect the most pertinent information. The subsequent section of the study will give a brief overview of the sample size, sampling technique and the analysis method that is to be put into practice. Information to be collected The information to be collected for a study is considered as one of the most important factors for satisfying the objectives of the study. Information related to the strategy of the company during the era of Steve Jobs and the current strategy of the company will be collected. This will help in contrasting the strategic management styles of the two leaders. In addition, raw data in the form of responses from the managers of Apple will be also collected so as to get a better understanding of the situation. Furthermore, information related to the strategic decision of Apple will be also gathered. Another aim of the study is to recommend Apple about how they can deal with the challenges of the future. In doing so, it is important to at first identify the potential threats of the company. The potential threats of the company will be underpinned by carrying out an assessment of the internal and external environment of the company. The information required in this context is the previous performance of the company and the information about its internal environment. The data will be collected again from the managers of the organization. However, the assistance of the secondary sources will be also taken. How Information will be collected The information will be collected from different sources. First of all, secondary information about strategic decision making in Apple will be reviewed and along with that the annual reports of the company will be also consulted so as to achieve better understanding of the strategies pursued by the company. The information will be also collected directly from the respondents. The respondents of the study will be the managers of Apple. The data collection instrument will be the focus group interview. The sample size for this study will be 5 and they will choose through simple random sampling. The reason behind going with simple random sampling is that it will reduce any chances of biasness. The respondents will be asked 6-7 questions pertinent to the subject of study. Regarding the time and venue of the data collection process, it will be decided by considering the convenient times of the respondents. The interview session will take place for 30 minutes and at any convened place. However, anywhere in the office premises will be preferred, as availability of the respondents can be ensured. Analysis technique Another important part of a study is the analysis of the data. This stage appears after the collection of data. As mentioned earlier, data will be collected from both primary and secondary sources. The analysis will be done qualitatively. Since the aim is to identify the differences in the strategic decision making process of Steve Jobs and Tim Cook, it is evident that the study does not include any kind of numerical data. Thus, conducting a qualitative research is justified. Timeline of Dissertation Activity Date Nov Dec Jan Feb Mar Apr May Jun Jul Aug Sep Oct Designing the research                         Determining the research Methods                         Collecting the literature                         Completion of the first proposal                         Submission of the proposal                         Approval of the proposal                         Collecting Primary data                         Data Analysis                         Working with the 1st draft                         Submission the 1st draft                         Editing and Submission of the 2nd draft                         Final editing and Final submission                         Reference List Apple, 2013. Apple Legal. [online] Available at: [Accessed 16 October 2013]. Bankes, S. C., 2003. Tools and Techniques for Developing Policies for Complex and Uncertain Systems. Proceedings of the National Academy of Sciences, 99 (3), 7263-7266. Camerer, C. F., 2008. The Potential of Neuroeconomics. Economics and Philosophy, 24, 369-379. Davis, P. K, Shaver, R. D. and Beck, J., 2008. Portfolio Analysis Methods for Assessing Capability Options. Santa Monica, CA: RAND Corporation. Dean, J. and Sharfman, M., 1996. Does Decision Process Matter? A Study of Strategic Decision-Making Effectiveness. Academy of Management Journal, 39 (20), pp. 368-396. Drejer, A., 2004. Back to basics and beyond: strategic management – an area where practice and theory are poorly related. Management Decision, 42 (3/40, pp. 508-20. Horn, R. E. and Weber, R. P., 2007. New Tools for Resolving Wicked Problems: Mess Mapping and Resolution Mapping Processes. Watertown, MA: Strategy Kinetics. Hoskisson, R. E., Hitt, M. A., Wan, W. P. and Yiu, D., 1999. Theory and research in strategic management: Swings of a pendulum. Journal of Management, 25 (3), pp. 417- 456. Khatri, N. and. Ng, H. A., 2000. The Role of Intuition in Strategic Decision Making. Human Relations, 53, 57-86. Lempert, R. J., Nakicenovic, N., Sarewitz, D. and Schlesinger, M., 2004. Characterizing Climate-Change Uncertainties for Decision-Makers. Climatic Change, 65, 1-9. Lynch, R. L., 2012. Strategic Management. 6th ed. New Jersey: Pearson Education Inc. Mador, M., 2000. Strategic Decision Making: Opportunities for Research. Kingston Business School Working Paper Series No. 11. Russell, R., 2001. The roles of values in servant leadership. Leadership and Organization Development Journal, 22 (2), pp. 76-83. Ulijn, J. M., O’Hair, D., Weggeman, M., Ledlow, G. and Hall, H. T., 2000. Innovating the corporate strategy: what would be the mission for international business communication? Journal of Business Communication on Strategy, Innovation, Culture and Communication, 37 (3), pp. 293-317. White, C., 2004. Strategic Management. Basingstoke: Palgrave Macmillan. Read More