Apple Computer Analysis the Business Environment That Essay
- Length: 8 pages
- Sources: 5
- Subject: Business
- Type: Essay
- Paper: #60934437
Excerpt from Essay :
Apple Computer Analysis
The business environment that is affected by the process of globalization determines companies to develop complex strategies. These strategies are intended to help companies improve their position on the market and increase their number of customers. Apple is one of the most successful companies on international level. However, this does not make it easier for the company to address the environmental factors in this business industry. Apple must make investments in reaching the high quality standards that the company established in this industry.
Therefore, it is important that Apple identifies the success factors that can help the company reach its objectives. In addition to this, the strategy must be flexible in order to be able to adapt to different environmental factors that influence its activity. This strategy must be developed in accordance with the company's objectives, but also with different market requirements.
Impact of the Company's Mission, Vision, and Stakeholders
The company's mission statement is that Apples designs Macs, the best personal computers in the world, along with OS X, and other professional software. The company leads the digital music industry with its iPods and iTunes online store (Apple, 2012). The company has also developed important innovations in the mobile phones industry represented by iPhones and the App Store, and its iPads are intended to significantly influence the mobile media industry. The company has developed a complex activity that helps improve its position.
The vision of Apple is represented by building a strong company that is able to develop innovative products that customers can use in order to make each activity easier. In addition to this, the company is interested in ensuring better communication between people through the products it develops. This vision provides the general line that Apple must follow.
The most important stakeholders of Apple are represented by its customers, employees, managers, the community, the government, and others. Each of these categories of stakeholders has their different interests regarding Apple. In order to be successful, Apple must address the interests of all these categories. Customers want high quality products at lower prices. Employees want bigger salaries and better working conditions. The company's managers want higher levels of incomes. The community wants such companies improve their corporate social responsibility activities. The government wants to benefit from higher levels of taxes from such companies. Therefore, it is obvious that it is not easy for Apple to satisfy these different needs of stakeholders.
The company's mission, vision, and stakeholders have a significant impact on Apple's strategy and success on the market. The company's mission and vision provide the guidelines that Apple must refer to when developing its strategies. The interests of different categories of stakeholders have the most important impact on how these strategies are developed. This is because the company's strategies are developed in accordance with want customers need, but also in order to satisfy the requirements of other categories of stakeholders. This means that the company cannot develop strategies based on what the company wants, but based on the requirements of these stakeholders. In other words, the company's strategy is limited by these requirements.
Analysis of Competition Forces
Power of Buyers
The power of buyers is represented by the impact that customers have on certain industries (Hill & Jones, 2009). In the electronics industry producers are able to develop forward integration. This means they can ensure their distribution and retailing activities. The buyer switching costs are not significant in this business. If customers are not satisfied with the products of certain companies, they can easily purchase the products of other companies. In addition to this, buyers in this industry are fragmented. This means that there are numerous buyers, but with reduced power. In other words, they have little influence of the products and their prices.
Power of Suppliers
The suppliers in the electronics industry provide the raw materials that are represented by the workforce, components, and other supplies. Therefore, it is important that producing companies develop successful relationships with their suppliers. There is a high number of suppliers in this industry. This makes it easier for companies to address them if they are not satisfied by the quality of the supplies they provide. In addition to this, suppliers are not concentrated. The power that customers like Apple have on their suppliers determines them to have a better position in comparison with these suppliers.
Market Entry Barriers
It is not easy to address the electronics industry. The most important market entry barriers are developed by the government, patent owners, asset specificity, organizational economies of scale, and others. The high costs of entering the electronics industry also make it difficult for smaller companies to address this market.
The intensity of rivalry on the electronics market is determined by the number of companies in this industry, the level of market growth, fixed costs, storage costs, product differentiation, diversity, and others. There are numerous companies in the electronics industry. They are characterized by product and by price differentiation. Large companies like Apple prefer to focus on product differentiation by developing innovative products that customers are interested in. Smaller companies prefer to focus on price differentiation. This is because this allows them to address the competition in this industry.
Threat of Substitutes
The threat of substitute products in the electronics industry is reduced. Although there are several different types of products with similar functions, customers rarely prefer to use substitutes. Therefore, this is not an issue of great importance for Apple.
There are numerous strong points that Apple benefits from. The most important advantages of the company are represented by the company's tradition on the market, its established customer base, favorable brand perception, high quality of products, innovative processes, and others. The tradition that the company has developed on the computers industry allows Apple to be one of the most successful companies on international level. This is because customers trust such companies and prefer to purchase from them instead of purchasing from companies with smaller prices that determine reduced levels of trust.
The established customer base is another strong point that Apple must focus on. This allows the company to benefit from the loyalty of its established customers. In addition to this, it allows the company not to increase its investments in addressing new customer segments. The favorable brand perception achieved by Apple through the success of its Macs determines the same favorable perception of new products that the company develops. Therefore, this leads to reduced resistance from customers towards such products.
The high quality of products and the innovative processes that Apple invests in allow the company to benefit from a strong position on the computers industry (Apple, 2011). This is important in addressing environmental factors that have significant effects on the company's activity. In addition to this, it ensures that the company benefits from a satisfactory incomes level.
The most important weaknesses that the company must address refer to the features of some of its products. This mostly refers to the screen of the iPod Nano. It seems that the screen of this iPod is faulty, and that it breaks under impact. As a result, the company has decided to replace some of these iPods. This is not a good image move in the case of Apple. Another weakness is represented by the fact that Apple must increase the prices of its music download activity. This seems like a necessary move, but it is likely that customers will not appreciate it.
The most important opportunity that Apple should focus on is represented by developing its iTunes and music player technology into mobile phone formats. This allows the company to expand its customers base. In addition to this, the company should focus on developing the technology referring to podcasts. This is because there is great interest from customers in this field.
The competition in the electronics industry is an important threat that Apple must address. However, this is something that Apple knows how to manage. Therefore, it is important that the company develops flexible strategies that allow it to improve its position on the market.
In order to develop a successful strategy, Apple must focus on its established customers base and identify their needs and requirements. Based on these needs, the company should invest in its research and development process in the attempt to improve the products and services it provides to these customers. In addition to this, the company should expand its business on international level in countries where there is reduced consumption of such products. This is because customers in these countries might not need iPods, but they must need something that other companies do not provide. Therefore, such countries represent important markets that Apple should address.
The company should also focus on improving the quality of some of its products. The fact that Apple had to replace the components of some of its products does not look like the company is…