Strategic Management Competitiveness and Globalization - Case Study Example

Report for Sustainable Global Enterprise Abstract Apple Inc. was incorporated in 1976 together with its subsidiaries. The company is mainly involved in the designing, manufacturing and marketing of mobile communication and media gadgets, personal computers, and portable digital music players. The company is also engaged in developing and selling a broad range of related software applications, networking solutions, peripherals, plus third-party digital content. In the year 2011, Apple Inc. acquired Nortel Networks Corporation’s Patent portfolio. In 2012, Apple Inc. acquired app-search engine Chomp. Apple has incorporated sustainability goals in its operations, allowing the company to substitute energy and carbon-intensive processes. Apple pursues to build a sustainable business and create value for both the company and its stakeholders. Apple has had a remarkable success in discursive innovation through the employment of more resources, models, and tools to aid the company innovate continuously. The paper analyzes Apple Inc. profile and explores its pursuit of sustainability in its operations. 2. Introduction Apple is a reputable company that sells its products to consumers, small and middle sized businesses, education, enterprise, creative markets, and government, besides providing hardware and software products and solutions for clients within the information technology and scientific markets. The company has demonstrated willingness to bring best user experience to its clients via its innovative hardware, peripherals, software, services, and internet offerings that guarantee advanced, well –integrated digital lifestyle and productivity solutions (Afuah 2009, p.86). Apple operates in five core segments, which include America, Japan, Europe, Asia-Pacific, and Retail. The America’s segment incorporates both North and South America. The European segment, on the other hand, encompasses Europe countries, plus Africa and the Middle East. The Asia-Pacific segment encompasses Australia and Asia countries (other than Japan). The retail segment, on the other hand, operates Apple-owned retail stores distributed globally. Apple recognises that the industry in which the company competes embodies speedy technological advances; hence, its ability to compete hinges on guaranteeing a timely flow of competitive products, services, and technologies, within the marketplace. The company has persistently pursued the designing of innovative products and technologies and has enhanced its existing products to broaden its product offerings and intellectual property via licensing and acquisition of third-party business and technology (Nolan and Croson 1995, p.25). Labour disputes, war, geopolitical uncertainties, public health issues, terrorism, and other business interruptions have caused and could inflict damage or disruption to the company’s international commerce and global economy. These aspects may present negative influences on the company, its suppliers, logistics providers, manufacturing vendors, and customers. Apple continues to grow in terms of unit sales and broadening of its products’ spacing across consumers’ price range, growing geographical availability of its products (O’Grady 2009, p.42). This has been facilitated by the company’s continuous evaluation and undertaking of sustainability programs. This is directed at reducing energy, cutting emissions, and waste, besides empowering employees to find even more innovations. 3. Company Profile Apple’s present market capitalization stands at over $500 billion and is among highly profitable companies in the world. Apple Inc. is well established and not merely a start-up company. In fact, most of its products manifest a significant market share. For instance, iPod boasts of the largest market share (close to 70%) of the digital music market compared to its closest competitor, which has only 8%. Apple’s business strategy leverages its distinct capability to design and develop its own application software and services, operating systems, and hardware (Manu 2010, p.65). Apple mainly distributes and sells its products through its online stores, direct sales force, and retail stores, as well as through third-party cellular network carriers, resellers, wholesalers, and retailers. The final assembly of Apple’s products is presently performed in the Company’s manufacturing facility in Ireland, as well as by external vendors in California, China, and Korea. Presently, the supply and manufacture of most of the critical components of the company’s products is performed by sole-sourced third-party vendors. Apple targets both traditional and new markets in its bid to broaden and anchor its market share. The core target consumers manifest characteristics such as middle/upper income earners, individuals who would like to have fun with technology, music enthusiasts, and professionals mainly in media and design (Manu 2010, p.67). Apple has incorporated a wide range of enterprises that react to the needs of education clients (mainly hardware and software products to enterprise and government clients). The company also supports various initiatives such as mobile learning and real-time distribution and accessibility of education related materials via iTunes U, a stage that permits students and teachers to share and dispensed educational media online. Apple’s 2005 Mission statement states that the company commits to safeguarding the environment, health, and wellbeing of its employees, clients, and the overall global community. This flows from an integrated, sound health, environmental, and safety management practices into every facet of the business (Nolan and Croson 1995, p.26). Apple commits itself to availing technologically innovative products and services while simultaneously preserving and enhancing resources for future generations. Apple pursues continuous enhancements in its environmental, health, and safety management systems in the environmental quality of its services, products, and processes. Apple engages in the process of creative destruction in which innovative entrepreneurs persistently pursue the introduction of new products, processes, and markets. In this model, the entrepreneur acts as the change agent or the catalyst of the fresh order. Apple has demonstrated energy, will power, and the mindset to prevail over and persevere over the impediments in the path to bringing the innovation to the marketplace (Manu 2010, p.67). Apple’s Computer business strategy leverages Apple’s unique capability to design and shape operating systems, application, hardware, services that deliver refined, new products and solutions differentiated to match the ease of use, flawless integration, and innovative industrial design (O’Grady 2009, p.43). Apple’s Business Model in terms of Innovation and Positioning Apple’s marketing is credited for exciting and aesthetic product design known for generating viral consumer interest. In an industry categorized by low profit margins and persistent cost cutting, Apple pursues fundamental concepts and appealing designs that render its products to be unique. The company’s differentiation enhances brand loyalty and minimizes price sensitivity. Apple’s valued supply chain relationships, wireless carrier contracts, cobranding arrangements, and reseller agreements play an essential role in supporting the company’s differentiation strategy. Owing to a successful market positioning, Apple has been able to withstand aggressive competition evident in all areas of its business. The positioning of Apple products is guided by factors such as price, product features, design innovation, easy access to software and peripherals, service and support, marketing and distribution capability, product quality and reliability, as well as price/performance and company reputation (Afuah 2009, p.87). The capability to continue to develop and avail fresh, innovative products characterized by customized components and services have been the biggest strength in Apple’s positioning within the market place. Company’s Delivery of Sustainable Value The Apple brand, coupled with its innovative capabilities and the quality of its marketing strategy, has been central in the company’s continued success. Apple’s strategic partnerships have been at the heart of determining the result of Apple’s forays into the music, video-on-demand, and mobile phone business. The company’s commitments and operations should be integrated and synchronized to harness the company’s core competencies, reinforce its competitive advantage, and maximize value (Teece 2010, p.172). The sustainability strategies that Apple has adopted derive from three stages; management of regulatory compliance, attainment of competitive advantage, and completion of a social, economic, and environmental integration. Apple has embraced entrepreneurs and recognized their role as innovators continuously bringing new goods and technologies to markets. Apple has been making significant efforts in establishing trust with its stakeholders via open communication grounded in transparency, honesty, and timeliness. Cultural sensitivity plays a key role in facilitating these relationships. Overall, Apple has strengthened communication with stakeholders including shareholders/investors, suppliers, NGOs, customer companies, and government (Morris, Kuratko and Covin 2011, p.210). Conclusion For sustainability to be useful and enduring, the sustainability ought to be representative and integrated within the day-to-day corporate activities and performance of the company (Morris, Kuratko and Covin 2011, p.212). Apple has made significant steps in integrating sustainability into its business decisions (concerning products, services, processes, and activities). This has happened amidst challenges as the company has in some instances been accused of lacking accountability. The challenges witnessed by the company in its pursuit of sustainability include global climate change, political upheaval that disrupts supply channels, labour/supply chain issues, and pressure from increasing critical nongovernmental bodies. Apple’s remarkable success lies in its ability to construct truly innovative products that responds to a vast client appeal. The company has consistently pursued constant and discreet product innovation yielding in fanatic client fidelity and an enhanced level of profitability. Apple has demonstrated a strong willingness to unlock the sustainability risks and opportunities present within the value chain. Apple sustainability pursuit can be enhanced through the adoption of a reporting mechanism that accommodates the sharing of performance metrics with customers, investors, and regulators, as well as prioritization of investments in fresh value chain initiatives (Hitt, Ireland and Hoskisson 2008, p.16). Although the company has phased out polyvinyl chloride and brominated flame retardants form various internal components of its products, the company faces an uphill task in cutting emissions, materials, and electrical usage for all of its products so as enhance its environmental rating and become more environmentally friendly. Recommendations It is essential for the company to secure strategic success, which requires that the company fanatically protect its brand image and adequately invest in its competitive advantages such as innovation and marketing. Apple should also continue investing in research and development so as to maintain a lead in radical product and technology discoveries. The company’s future financial state and operating results are fundamentally dependent on its capability to continue delivering improvements in its hardware, software, and services linked to consumer electronic devices within each of its product market. References List Afuah, A. (2009). Strategic Innovation: New game strategies for competitive advantage, New York, Routledge. pp.86-87. Hitt, M., Ireland, D. & Hoskisson, R. (2008). Strategic management competitiveness and globalization: Concepts and cases, Mason, South-Western. pp.16-21. Manu, A. (2010). Disruptive business: Desire, innovation and the re-design of business, Surrey, Gower. pp.65-70. Morris, M., Kuratko, D. & Covin, J. (2011). Corporate entrepreneurship and innovation, Mason, South-Western. pp.210-233. creative tech Nolan, R. & Croson, D. (1995). Creative destruction: Six-stage process for transforming the organization, Boston, Harvard Busines Press. Pp. 25-27. O’Grady, J. (2009). Apple Inc. Westport, Greenwood Press. pp. strategies 42-50, competition 153) Teece, D. (2010). Business models, business strategy and innovation. Long Range Planning 43 (1). pp.172-194. Read More