Apple SWOT analysis - Essay Example

? The work at hand presents the SWOT analysis of Apple Incorporated, which can help justify the recommended strategy. SWOT Analysis Below is the SWOTanalysis of Apple Incorporated. STRENGTHS OPPORTUNITIES Well-known brand Differentiated offerings High quality products Product and strategic innovation (Wonglimpiyarat, 2012, p.90) Technology Potential market share Unsaturated market for Apple’s product segments Possibility of innovation in the future More segments to explore Holiday seasons WEAKNESSES THREATS Change of management Products may be similar to those that will only cost less Can be easily challenged by competitors Relatively expensive offerings Well-studied by the competitors More alternative product offerings Competitors Financial factors Probability of unwillingness of the customers to purchase expensive devices every year Technological innovation As shown in the above table, Apple Incorporated has some remarkable strengths, weaknesses, opportunities and threats. As part of it strengths, Apple Incorporated possesses some of the well-known brands of mobile communication technologies in the world. This is strength because with strong brand recognition or strategic brand management, customers or potential buyers are most likely to develop strong loyalty towards certain brands (Tsai, 2011, p.521). With this, Apple may be one of the companies in its industry to produce a considerable market share. Apple Incorporated is also known to produce highly differentiated product offerings. Aside from this company’s brands, the unique technology that Apple promotes to its target segments resulting to the production of differentiated offerings is a remarkable strength, because it stands out in the market. This is further supplemented by the ability of the company to establish patents for all of its product outputs, which means exclusive ownership and trademark for future advantage. Apple Incorporated is also known in the market as a firm with a high quality trademark. With its ability to promote not only innovation, but standardization of its technology, Apple is known as a company that will never settle for less. It has undergone a management standard which eventually helps boost its capacity strength to increase the quality of its offered products. As already stated, Apple is known to lead in the product innovation. This sets Apple to produce a remarkable trend in its industry, making it a market leader in this aspect. The kind of technology that Apple employs is a cutting-edge, to the extent that it has become a renowned benchmark in its industry. The development of smartphones and other potential progress in the future when it comes to the related technologies of these product offerings have become the turning point for Apple to be highly recognized not only by its competitors, but its potential target market segment. The above are just some of the potential strengths that one can possibly see in Apple, but these do not hinder the fact that the company also possesses some weaknesses. One weakness of Apple that others might consider as such is the change of management. Many speculations at this moment especially on the part of the investors that Apple will never be the same again and that Steve Jobs must have provided the best ingredient for the company to succeed. This means that the present management is in great danger to be compared with the previous management. This is a weakness because this is something that possesses negative advantage right directly at the internal level of the organization. This strongly connects to Apple’s changing business model that may also have potential implication on the shareholders (Lazonick, Mazzucato & Tulum, 2013, p.249). Another weakness of Apple is its creation of products that may be similar to those that will only cost less. This is evident from the products that companies from China and in other parts of the world have produced. One can avail of them at a lesser cost, but significantly provides the same level of functionality. Although Apple can brag of its quality, there are many products that are almost comparable to its offerings, which give customers the alternatives. Apple is vulnerable to be challenged by competitors, and many of them will eventually try to make an attempt to knock the company down. This is usually the case of a market leader. Apple has remarkable expensive offerings, which make it to be vulnerable to lose in the market with the introduction of other alternative offerings by the competitors. Concerning this, the company has the tendency to be easily challenged by its prevailing competitors. This is also supported by the fact, which could be another important weakness at some point that it promotes relatively expensive offerings. Finally, Apple is well-studied by its competitors and it is a weakness on its part because this happens due to the fact that it has become the market leader in its industry. As such, its potential moves are guarded from time to time. Even if Apple may be faced with weaknesses, there are also potential opportunities particularly for its product offerings. One important opportunity for Apple is its potential market share. Its market share is growing and this is due to the ability of the management to go for innovation and market exploration. However, it is its exploitation of resources and capabilities that create value and financial transformation that lead to its success (Haslam et al., 2013, p.268). For this reason, there are still potential market share to explore due to more segments that may ignite the possibility of product innovation in the future. As observed, the stated opportunities for Apple are linked to each other, which would mean that an opportunity will lead to other opportunities in the future. Another unique opportunity for Apple is the existence of holiday seasons. In the industry where Apple belongs, there are peak seasons in which the flow of production and distribution will run smoothly at the advantage of the production company. Apple is getting the advantage of this, which has a great contribution to the existing demand level for its product offerings. In other words, holiday seasons are remarkable opportunity for Apple not only to increase sale, but grow its market share in its industry. Generally, the stated opportunities for Apple are found in the market, its external environment, as it has still many segments to explore as potential candidates for its product and technological innovation. However, there are some threats that try to stand as barriers to Apple’s opportunities. One of the potential threats is the prevailing alternative offerings that surface from time to time in the industry, which might post a potential challenge to its operating system (Potter, 2006, p.4). This does not only eliminate the chance of Apple to gain potential revenue and market share, but even elimination of loyal customers. These alternative offerings are eventually the reason behind the existence of many competitors that would like to pull Apple down from the top. Other relevant threats are the factors in line with finances. This can bring the important message that it is good to determine until when the market will accept high-cost for communication gadgets in exchange to other sophisticated alternatives, especially in times of tough economic times. These financial factors will therefore result to another vital threat, as customers’ unwillingness to purchase expensive devices every year may essentially surface as another problem. Another important threat is the prevailing technological innovation in the industry. If Apple will be left behind the race with its competitors that are in unity to pull it down, such would be the time when the organization will have to achieve a decline in its market share and it must be so tough to go get back what has been lost. Strategy Option Windows, Macintosh OSX and Android are among of today’s leading operating systems. This tough competition leads computer systems industry to initiate standards (Pinto et al., 2013, p.2472). Operating systems even become partners of innovative product offerings. Macintosh OSX has long been established partner of Apple in its introduction of its latest innovations. Windows on the other hand has become so popular in the world, due to its ability to innovate and create improvement based on customers’ feedbacks and experiences. Android is a newbie in the industry, but various smartphone companies are integrating the potential of this operating system. Therefore, in order to stand with competitive edge against Apple, the best way to do is to choose Windows operating system. Even if it is expensive, there are many users who are highly acquainted with this operating system, and so it is not that hard to market new smartphone products with a possible integration with it. The best strategy therefore is to create a smartphone product that is not just good for mobile communication, but including the convenience to use the features of laptop computers and other gadgets in line with listening to music, watching movies, capturing images and other possible options. This is not just to integrate the said other supplementary programs, but the point is to also make them efficient and more useful when it comes to producing output and quality. This is something new that Apple has not yet established in the market. Although this might be quite expensive because of the features and the linked requirements for the value chain in its production, partnership and outsourcing are good for implementation to save on cost. Saving cost will then lead to a more flexible pricing option as competition will surge high in the future (Dreyer, Schneider & Smith, 2013, p.3704). Hitting this one will eventually hit the potential weakness of Apple Incorporated even if it has substantial strengths and opportunities as stated above. The ultimate measure of the success of this strategy is the potential achievement of the target market share. Next to this will then be the ability to achieve the target profitability. Corrective actions are therefore necessary in order to fulfill the target goal. Corrective actions or control will be in a form of performance evaluation program and this includes observing if the standards are met and if not, a more realistic goal might have to be adjusted in the first place. If goal has become realistic based on the market evaluation program, more strategic options will then be employed. References Dreyer, J. K., Schneider, J., & Smith, W. T. (2013). Saving-based asset-pricing. Journal of Banking & Finance, 37(9), 3704-3715. Haslam, C., Tsitsianis, N., Andersson, T., & Yin, Y. P. (2013). Apple’s financial success: The precariousness of power exercised in global value chains. Accounting Forum, 37(4), 268-279. Lazonick, W., Mazzucato, M., & Tulum, O. (2013). Apple’s changing business model: What should the world’s richest company do with all those profits? Accounting Forum, 37(4), 249-267. Pinto, R. S., Nobile, P., Mamani, E., Junior, L. P., Luz, H. J. F., Monaco, F. J. (2013). Operating System from the Scratch: A Problem-based Learning Approach for the Emerging Demands on OS Development. Procedia Computer Science, 18, 2472-2481. Potter, B. (2006). New threat of Apple Mac OS X. Network Security, 2006(2), 4-5. Tsai, S. (2011). Fostering international brand loyalty through committed and attached relationships. International Business Review, 20(5), 521-534. Wonglimpiyarat, J. (2012). Technology strategies and standard competition – Comparative innovation cases of Apple and Microsoft. The Journal of High Technology Management Research, 23(2), 90-102. Read More