A business-level strategy is an approach that that aims to identify how a company should compete in each of its divisions. Corporate-level strategy, on the other hand, is an organizational plan that aims to define what type of business a firm should or intends to be. As such, the present paper is concerned with Apple’s business-level and corporate-level strategies. Moreover, the report assesses the most important approaches of the firm and examines its competitive conditions, considering slow-cycle and fast-cycle markets.
Business-Level Strategies
Apple creates, produces, and distributes smartphones, computers, tablet devices, gadgets, and parts, as well as a wide range of connected peripherals. In addition, the company provides payment, virtual goods, cloud, and advertising networks. Hence, Apple operates in the consumer electronics, software services, and online services industry, although its main products pertain to consumer electronics. The sector has stagnated, particularly in established product types such as laptops and television sets, and as a result, the consumer electronics sector is in turmoil (Markovic et al., 2018). To reach customers, consumer electronics businesses must discover new methods to innovate. Some of the consumer electronics market’s leading firms are spending extensively on research and development operations (Markovic et al., 2018). They promote advancements in current electronic processes and technologies with the goal of increasing efficiency and lowering costs.
Apple outperforms its competitors in one area: product differentiation. Differentiation strategy entails creating distinct items that stand out from rivals’ offerings (Hitt et al., 2020). Apple’s plan is to contract with a single manufacturer to supply both the operating system and the hardware for its devices. Another differentiation approach Apple uses is product distribution, which has opened retail outlets worldwide (Yun et al., 2019). This strategy has enabled the corporation to optimize profits by providing notable items for their excellent design and quality, sophisticated innovation, and user-friendliness. Through a thriving R&D department, the corporation has spent considerably on product innovation (Yun et al., 2019). The cost leadership approach often entails providing valuable and suitable consumer items at a reasonably low and competitive price.
The most critical strategy to the firm’s long-term success is cost leadership. A cost leadership strategy is based on a company’s capacity to reduce manufacturing costs and deliver affordable, high-quality products. It is a good technique for giant corporations with a lot of purchasing power (Hitt et al., 2020). The strategy is particularly valuable for Apple because it continuously enters new developing markets where customers cannot afford expensive goods. Moreover, cost leadership is the most often adopted method for gaining a competitive edge while running profitably. Apple has embraced this method by manufacturing cost-effective, high-quality goods (Yun et al., 2019). The company uses inexpensive and financially feasible raw materials, aided by the existence of a robust and inventive management team (Yun et al., 2019). Thus, cost leadership is a good choice for Apple, which aims at being the leader in the consumer electronics market while sustaining quality and increasing sales.
Corporate-Level Strategies
The corporate-level strategy handles the firm’s broad strategic reach. It is a big-picture vision of the organization, which involves determining which service or product sectors to compete in, as well as which geographic locations to operate in (Hitt et al., 2019). Apple’s corporate-level strategies include the medium and elevated diversification of its goods, which include personal computers, desktops, smartphones, record shops, and software. Furthermore, the corporation has a high level of expertise in personal computers and entertainment, enabling it to be more productive in manufacturing and distributing items at relatively competitive costs while being prosperous (Yun et al., 2019). Customers may acquire their selected products of high design and quality standard since all of these goods are well networked and function on the same software, which is one benefit of this diversification approach.
Another business strategy is to build strategic partnerships in order to gain advantages of scale, access to rival expertise, and contractual arrangements and expenses. The globalization of manufacturing is another corporate strategy used by Apple. The company has founded its manufacturing base in China to benefit from low labor costs, the availability of raw materials, a large potential market, and a favorable business environment due to China’s economic stability (Yun et al., 2019). The globalization corporate-level strategy seems to be the most important for the further growth of the company in the future. Since the company’s competitive market and industry are turbulent, expansion through globalization is a critical survival strategy. The approach provides more financial rewards, which are necessary to sustain Apple’s costly production.
Competitive Environment
Due to the sheer number of companies in the technology market, it is extremely competitive. Apple confronts severe competition at all levels and across all business segments. Microsoft, IBM, HP, and Asus are significant competitors in the PC industry (Tien, 2021). In turn, Samsung is Apple’s direct rival in the smartphone market. As a result of the globalization of commerce, competition is expanding as the global market continues to develop. Apple’s iPhone and iPad, the most profitable goods, are mostly contrasted with Samsung’s devices (Tien, 2021). Hence, Samsung is the most significant competitor of the company.
On a corporate level, Apple’s primary competition is Samsung, which is well-known for its smartphone industry. Since Samsung has spent considerably on competitor information as well as intricate logistics and distribution systems, this competition is more intense. To address this issue, Apple has guaranteed that all its devices share a similar design methodology platform (Tien, 2021). Furthermore, Apple has built retail storefronts and online stores, making it easier for people to buy and allowing the corporation to run at a cheap cost. Apple’s corporate-level strategies include a focus on strategic partnerships, corporate diversity, globalization, and consolidations in overcoming competition (Tien, 2021). As for Samsung, its corporate-level strategic approach is concentrated on technology innovation, research and development, integration, and promotion (Tien, 2021). Regarding the business-level strategies, both companies employ diversification, but Samsung lacks a cost leadership approach, which Apple has. Apple has more resources, innovations, and brand image that are valued by the customers of the market. As a result, the firm can withstand crises better and offer cheaper goods, which makes it more successful in the long term.
Market Cycles
The difference between fast-cycle and slow-cycle lies in the capability to produce various products that competitors cannot copy. Fast-cycle markets are those in which a firm’s competencies are not protected against copying and where imitation is frequently quick and cheap, while slow-cycle needs are the opposite (Hitt et al., 2020). The technology sector is more of a fast-cycle market. However, certain items have transitioned to the slow-cycle market (such as laptops and computers), while others stay in the fast-cycle industry. Apple and Samsung appear to be competing fiercely in the smartphone business. However, if the industry has completely changed to the slow-cycle market, Apple still will have a more robust future than Samsung. Since the company has a well-developed globalization and diversification strategy, it has a competitive advantage in both scenarios.
Sources
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