Executive Summary
Apple Inc., more popularly recognized as Apple, has successfully managed to be a profitable firm in the extremely competitive consumer electronics industry. This admirable achievement has been made possible by being inventive and distinguishing the specific product from competitors in the market by delivering exceptional commodities and recommendable client service. Furthermore, the overall production of the products is delegated to committed third-party providers. Hence, it has allowed Apple to be a prosperous organization. In a broader sense, the corporation has established such high standards that the company itself has to perform at the highest possible level to sustain the expectations that it has established. Due to its innovativeness, the consumer electronics sector has been standardized over the last several years. As a direct consequence, there has been an increase in rivalry between enterprises operating within the industry, with price emerging as the primary differentiating factor.
Additionally, Apple has been able to portray its goods as the best in the market regarding creativity and ingenuity, efficiency, and dependability because of the brilliant research and development staff that the company employs. Comparatively, other products are deficient in all three of these categories. However, to ensure that the firm maintains its dominant position in the sector for a considerable amount of time in the future, Apple has to evaluate its business plans continually. This strategic plan provides an in-depth review of Apple’s performance and operating environment. Apple’s current market position has been determined by a variety of variables, including but not limited to its company value, SWOT strategies, management, and financial outlook.
Apple Overview
Apple Inc. is a worldwide corporation with its headquarters in Cupertino, United States. Steve Jobs and Steve Wozniak launched Apple Computer in April 1976, and the company was officially registered one year later in January 1977. The firm develops technology products, computers, and software applications, all of which are eventually placed on the market for purchase. Apple’s most well-known and successful devices are the Macintosh line of personal computers, the iPod, the iPhone, and the iPad. The firm’s offerings in the realm of computer software include, but are not limited to: Final Cut Studio, which is a music and video production suite; Aperture, which is professional photography software; iTunes, which is a media browser; the Mac OS X operating system; Logic studio, which is a music production suite; and Mac OS X. According to Apple (2022), the firm now operates more than 300 outlets around the country as of May 2022. Reports are that as of January 2022, the corporation has over 300 locations in over ten countries in addition to its online store. In terms of market value, Apple is one of the world’s greatest technical corporations.
Several experts have speculated that Apple has more cash than the United States government. Reports are that the company has more than 154,000 full-time workers globally (Apple, 2022). At the same time, Apple sells its items via an online shop and its retail chain locations. Other items are offered by selling directly to consumers, resellers, value-added resellers, and wholesalers. Apple has mastered market segmentation, niche creation, and penetration. Despite high pricing, the organization has managed to maintain clients that include small and medium-sized companies, individuals, academic facilities, federal agencies, innovative clients, and corporations. Apple Inc. has more than 500 retail outlets in more than 20 countries serving international clients (Deen, 2017). The outlets have robust supply chain that ensures goods reach to customers seamlessly.
Company History
Apple, Inc. was once known as Apple Computers, Inc. and was established on April 1, 1976, by Steve Jobs. Based on Delamater (2018) research, the firm was founded in Steve Jobs’ workplace, where he and Steve Wozniak constructed the Apple I and later the Apple II computer. Still, it was not until 1980 that the company went public due to the high sales and revenue level. The Lisa computer was introduced during the following years, only to be discarded, and the Macintosh computer was built. Steve Jobs momentarily left the firm before rejoining as CEO in 1997. In 1998, the wildly successful iMac personal computer was created and released to consumers.
In the following years, the business introduced the iTunes music store, several iPod models, an updated iMac, other PCs, and the iPhone 2007. What is intriguing about the firm is that it has also begun marketing its own Apple TV, iPad, and iCloud, which provides internet storage for various uses such as commercial or personal storage (Delamater, 2018). As the firm grew its product line, its sales skyrocketed, making it one of the most competitive businesses. Apple Watch was introduced in 2014, and Apple Music became a prominent live radio service for users in 2015. Each item has been excellent, generating considerable cash for the firm, even though not every product is distinct and gives clients various characteristics. Today, Apple is innovating new electronic device brands to meet the insatiable consumer nature.
Apples Product and Services
Apple Inc. is a global firm that creates electronic devices, produces, and distributes consumer electronics such as smartphones, personal computers, tablets, wearables, and accessories. The company also provides many services relating to these products. Products made by the corporation encompass the iPhone, Mac, and iPad. iPhone is the brand name for Apple’s family of mobile devices that run on the iOS operating system (Apple, 2022). Apple’s series of personal computers built on the macOS operating system are referred to collectively as Mac. iPad is the brand name for the company’s lineup of versatile tablets powered by the iPadOS operating system. Apple TV, Apple Watch, AirPods, devices made by Beats, iPod touch, HomePod, and various other Apple-branded and third-party accessories are included in the Home, Wearables, and Accessories category. According to Apple (2022), Apple’s wireless headphones that connect with the virtual assistant Siri are called AirPods. The Apple Company has its brand of high-tech wristwatches called the Apple Watch. At the same time, AppleCare, Cloud Services, Marketing, Virtual Content, and Payment Services are some of the other services it offers (Apple, 2022). Consumers, small and medium-sized businesses, educational institutions, large businesses, and government agencies make up most of the company’s clientele.
Apple Operations
Apple operations management includes implementing OM’s decisions to guarantee the seamless functioning of all elements of the company. Some of the choices made in operations management include product design and quality management.
Quality Management
This operations management decision area highlights high standards and procedures. The Senior VP for Operations at Apple Inc. collaborates with eight additional Senior VPs to guarantee that the organization’s operational requirements are met. The firm is well-known for its excellent quality, penetrating several business sectors, such as product design and development, retail, marketing, internet sales, industrial design, and human resource management. Apple employs a comprehensive framework for quality assurance to solve this operations business decision area.
Goods and Services Design
Many organizational components and authorities coordinate Apple’s product design procedures. Macs, for example, have a Senior VP for Mac Hardware Engineering and a VP for Mac Software Engineering. This coordination illustrates Apple Inc.’s organizational model. These VPs work closely with the company’s Senior VP of Logistics. The network of connections guarantees that the results in this operational sector help Apple improve its technical product design.
Mission Statement
Apple’s current mission statement includes “bringing the best user experience to its customers through its innovative hardware, software, and services.” Apple’s mission statement emphasizes that the company exists to provide superior customer service. The declaration defines the company’s strategy for achieving this objective. In its current mission statement, the corporation emphasizes the breadth of its activities and how they are used to meet the demands of its clientele. While emphasizing the dynamic technological developments throughout time, Apple clarifies that its primary purpose is to effect good change via innovation. Several components that drive the organization towards success, for instance, derive from this goal statement.
Best User Experience
The criteria of “excellent user experience” reflects Apple’s dedication to enabling the use of its products by its customer base by making the product experience more user-friendly. Instead of focusing on creating enjoyable goods, Apple creates items that are easy to use. In addition to this, the addition of security precautions to each product makes the whole experience for the client better. As a result, it should come as no surprise that products sold by Apple are precisely crafted and customized down to the minutest of details.
Improving the Lives of Individuals
In the first section of its mission statement, Apple reaffirms its obligation to facilitate the convenience of its consumers’ lives via streamlined and user-friendly technologies. The company’s decision to integrate this component with the desire for security measures that enhance the user experience was largely prompted by the identification of online security flaws. The corporation has expanded the range of services available to its consumers, as seen by its presence in education, business, and healthcare.
Vision Statement
Apple’s vision statement is, “We believe that our purpose on earth is to produce excellent products, and this will not change.” Through this statement, the firm emphasizes that it is constantly committed to delivering high-quality items to its customers. The statement also indicates that they want to do so for an extended period. It describes how Apple. Inc. tackles its operations to establish itself as the market player in the industry in which it operates. Among the elements linked with this assertion are innovation, partner integration, excellence, and market specialization.
Corporate Values & Culture
The beliefs and guiding principles by which a company runs its operations are referred to as the firm’s core values. Steve Jobs transformed Apple Inc. into a firm that primarily emphasizes assisting individuals driven by a strong desire to impact the world via the pursuit of their interests positively. Another one of the company’s fundamental principles is that it should produce and market the highest-quality goods feasible and continuously seek opportunities to expand its product line and deepen its commitment to innovation. Since it was founded, the corporation has been responsible for developing a wide variety of high-quality goods. Among them are the iPad, the iPod, and the iPhone, which have proven to be quite profitable for the business.
One way to explain Apple, Inc.’s corporate culture is an organizational culture that has been shown to contribute to the firm’s success significantly. The culture of Apple places a strong emphasis on the value of creativity and innovation inside the company. When it comes to the company’s culture, Apple emphasizes five primary traits, including moderate combativeness, originality, secrecy, innovation, and excellent performance at the highest level. Apple has continued its expansion path, both its product line and its service offerings. Because of the company’s capacity to maintain such a high level of consistency in the development of new goods, the company’s corporate culture may be characterized as being exceptionally well-organized and robust.
SWOT Analysis
A company may better understand its strengths, weaknesses, opportunities, and threats by doing a SWOT analysis, an approach to strategic planning. Following the completion of a SWOT analysis, an organization will be able to develop four distinct types of strategies. Because SWOT strategies are typically a mixture of an IFE (internal factor evaluation) and an EFE (external factor evaluation), they are the most widely enacted methods in most organizations. Similarly, these strategies enable a business to maximize its potential benefits from opportunities while simultaneously minimizing its exposure to potential risks.
Strengths
Apple’s strengths include a skilled and creative investigation and advancement group behind Apple’s innovative products. Further, it entails a strong label picture that helps gain a competitive edge in the market and robust monetary productivity that gives investors confidence to invest in the company. Thus the implication is that the organization cannot lack investment for any new project that the company desires.
Weakness
Recently, the corporation has been embroiled in many court cases regarding intellectual property, which may impact the functioning of the company. In addition, Apple has had to recall several goods because of the potential dangers they provide to users; this action has contributed to a poor perception of the corporation.
Opportunities
There is a significant amount of untapped potential in the market for smartphones and tablets, which has the ability to grow the company’s revenues over time. In addition to this, there is a very promising market for mobile advertising that has the potential to be tapped.
Threats
Apple’s annual sales would undoubtedly be impacted in terms of the numbers of smartphones and tablets sold. This can be explained the growing popularity of the Android platform developed by Google. Additionally, the rising competition from other rivals may impact the sales volume, while the firm’s dependency on just a few suppliers might provide a problem for the company in the future.
Competition
Apple’s business strategy has led to intense competition between the corporation and other industry participants. A notable aspect of the product is that it employs the same design principles for several products without altering their distinguishing characteristics, such as software design and user experience. Van De Vliert. (2021) accentuates that; it is especially true when Apple’s iPhone and iPad are powered by its famous IOS software. Consequently, these gadgets are immediately distinguished from comparable market offerings. This distinction has helped Apple leapfrog its competitors in the industry. It is not unusual, for instance, to hear computer enthusiasts praise Apple’s IOS software for its smoothness and engaging user interface.
Apple works in an extremely dynamic and competitive environment as a technological corporation. According to Tian et al. (2022), rivalry results from the continual entry of new firms into the market and the introduction of more innovative products by established companies. The latter is seen to be the organization’s primary difficulty. In addition, technological advancements have made the competition more challenging due to the innovative capabilities of these new businesses (Tian et al., 2022). As a consequence, Apple’s key competitors continue to expand, with new entrants appearing almost every year. Examples are Samsung, Oneplus, and Xiaomi in the mobile phone market, and Dell and HP PCs in the software industry (Agnihotri & Bhattacharya, 2021). In spite of this, Samsung will be regarded as Apple’s principal competitor, and still, due to the production of quality products, Apple has managed to outwit other market players thanks to their loyal customers.
Apple’s Management Team
Tim Cook, the chief executive officer of Apple Inc., is placing a stronger emphasis on grooming a new generation of leaders to ultimately head some of the iPhone manufacturer’s most important businesses, including hardware development, services, and marketing. In addition, CEO Cook practices and encourages democratic leadership. Cook’s top management needs to arrive at a consensus over the company’s strategic choices. In addition, after taking the post of CEO, Cook has afforded the new product development team additional autonomy, reducing his direct involvement in the new product development process, some other leading various departments include.
Katherine Adams, Senior Vice President, and General Counsel: Eddy Cue, Senior Vice President Services: Craig Federighi, Senior Vice President Software Engineering: John Giannandrea, Senior Vice President Machine Learning, and AI Strategy: Greg “Joz” Joswiak, Senior Vice President Worldwide Marketing: Sabih Khan, Senior Vice President Operations: Luca Maestri, Senior Vice President and Chief Financial Officer and many others posts. The leaders’ ultimate goal is to ensure that the organization’s mission and vision statement is adhered to and achieved.
Apple’s Financial Outlook
Apple Inc. posted record aggregate and iPhone Christmas sales and its biggest sales historically in a fiscal year and the company’s best sales ever in a calendar quarter. Consequently, the tech giant’s quarterly profits crossed $30 billion for the first time dollars (Apple, 2022). Apple AAPL, -2.69 percent reported revenues of $123.95 billion for its fiscal first quarter, which is an increase over the company’s previous quarterly revenue record of $111.44 billion, which was established one year earlier dollars (Apple, 2022). Earnings reached $34.63 billion, or $2.10 per share, increasing over the preceding year’s quarterly earnings of $28.76 billion, or $1.68 per share. Hence, the first time Apple has crossed $30 billion in three months.
Furthermore, the profit margin has enabled the organization to predict market trends. In this way, the consensus forecast among the analysts polled by FactSet was for profits of $1.90 per share on sales of 119 billion dollars (Apple, 2022). Following the publication of the findings, after-hours trading saw a 5 percent increase in the price of Apple shares. Furthermore, Ahelegbey et al. (2022) underscore that the Apple organization has sustained itself due to the continuous production limitation, chip constraints, and rise of the COVID-19 virus. In this sense, Apple stock is a buy, according to the consensus of 32 economists surveyed by MarketBeat as of May 5, who forecast that its price would increase by over 15 percent to $190.59 in the year leading up to May 2023, nevertheless, the maximum price objective was $225. According to the most negative estimates, the stock price might decrease by over 7 percent to $155 on May 9, 2022, from its current closing price of $152. Twenty-four experts rated the stock a ‘buy’ or strong buy’ recommendation, while eight gave it a ‘hold’ rating.
Analysts have cut their price estimates in recent weeks in reaction to the disclosure of the result. They were cut to $195; other algorithmic projections indicated that the stock was “a good long-term investment” that might increase 33 percent to $202 by May 2023 (Ahelegbey et al., 2022). The website predicted that AAPL shares would hit $249 in May 2024, $294 in May 2025, and $340 in May 2026. Conversely, the five-year price forecast for Apple shares until 2027 is $385. This would indicate a 153 percent rise compared to the closing price of $152 on May 9, 2022.
Apple’s Strategy
Product differentiation may be regarded as Apple’s business strategy. Specifically, the study of Björkdahl. (2020) indicates that the international technology corporation distinguishes its products and services based on its basic but aesthetically pleasing design and superior functionality. The Apple business plan includes the following four components.
Concentrate on Product Design and Usefulness
Apple’s competitive edge is based on the sophisticated features and capacities of its services and products, which it has incorporated into its business plan. The description of technological advances made by Apple includes the emergence of the iPad, the development of the Macintosh, and the launch of the iMac.
Improving the Client Experience
One of Apple’s business strategy foundations is a concentration on customer experience. Apple enthusiasts often submit YouTube videos of themselves unboxing new Apple devices. This is the result of the company’s success in establishing a customer experience beyond the product-purchasing procedure.
Increasing Apple ecosystem
Apple’s business model may be described as vertical integration since the corporation has considerable competence in software, hardware, and services. Vertical integration is one of Apple’s primary features from its competitors. The corporation has reaped enormous benefits from its vertical consolidation. Apple’s ecosystem, which is allowed by such integration, is a big component of its competitive edge.
Decreasing Dependency of the Firm on the Sales of iPhone
Apple’s business strategy is changing from depending on iPhone revenue to focusing on its operations business. Elevation to a machine learning and AI function and Siri. These high-profile adjustments that occurred within less than three months are obvious indicators of the corporation’s attention on activities and other business divisions to minimize the firm’s dependency on the revenues of iPhones.
Conclusion
Apple Inc. is one of the world’s major electronic companies. The American company has had tremendous success in recent years due to its senior management’s innovative methods. Moreover, Apple Inc. has been declared the world’s most valuable brand, with $97.3 billion dollars (Apple, 2022). Despite the current economic difficulties encountered in the United States, the company’s share price has remained reasonably constant. Its marketing techniques, particularly its concentration on social media marketing, have helped the company garner immense consumer loyalty globally. Despite this company’s outstanding achievements, its future remains unclear. The competitiveness of the electronic market is intensifying. Several Chinese companies that imitate the goods of the leading brands and sell them on the worldwide market have exacerbated this rivalry. Additionally, consumers have grown highly demanding. They have several options if they choose to acquire goods. Apple must devise a business strategy that will allow them to overcome these obstacles. It must maintain a creative approach to product creation and distribution.
References
Agnihotri, A., & Bhattacharya, S. (2021). Satya Nadella: Leading Microsoft’s Growth. SAGE Publications: SAGE Business Cases Originals.
Ahelegbey, D. F., Cerchiello, P., & Scaramozzino, R. (2022). Network based evidence of the financial impact of Covid-19 pandemic. International Review of Financial Analysis, 81.
Apple. (2022). Apple.
Björkdahl, J. (2020). Strategies for digitalization in manufacturing firms. California Management Review, 62(4), 17-36.
Delamater, N. (2018). A brief history of artificial intelligence and how it’s revolutionizing customer service today. SmartMax Software, Inc.
Tian, W., Wang, M., & Wang, Q. (2022). The core competentness of Apple Inc. Atlantis-Press.com, 718–725.
Van De Vliert, D. (2021). Apple iPhone: A market case study. MacEwan University Student eJournal, 5(1).