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Strategic Management Case Analysis: Apple Inc.: Taking A Bite Out of The Competition

Apple Inc. is an American technology company established in 1976 that designs consumer electronics such as the Mac, iPod, iPhone, and iPad. While Apple has strengths in branding, innovation, and customer loyalty, it also faces threats from extensive competition and potential economy downturns. The document proposes that Apple address its low market share by making products more affordable while maintaining its differentiation strategy through superior design and customer experience. It also recommends Apple focus on its niche market and set up a replacement plan for Steve Jobs' eventual succession.

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356 views24 pages

Strategic Management Case Analysis: Apple Inc.: Taking A Bite Out of The Competition

Apple Inc. is an American technology company established in 1976 that designs consumer electronics such as the Mac, iPod, iPhone, and iPad. While Apple has strengths in branding, innovation, and customer loyalty, it also faces threats from extensive competition and potential economy downturns. The document proposes that Apple address its low market share by making products more affordable while maintaining its differentiation strategy through superior design and customer experience. It also recommends Apple focus on its niche market and set up a replacement plan for Steve Jobs' eventual succession.

Uploaded by

fahadoh
Copyright
© Attribution Non-Commercial (BY-NC)
We take content rights seriously. If you suspect this is your content, claim it here.
Available Formats
Download as PPTX, PDF, TXT or read online on Scribd
  • Strategic Management Case Analysis: An introduction to the strategic management case analysis focusing on Apple Inc. and its competitive strategies.
  • About Apple: Provides a brief history of Apple Inc. and lists its hardware and software products.
  • Current Scenario: Presents graphical data on Apple's net sales growth over multiple years.
  • Low Market Share: Highlights Apple's low market share in comparison to competitors using a pie chart.
  • External Environment: Opportunities: Explores potential growth areas for Apple including technological innovations and strategic alliances.
  • External Environment: Threats: Identifies challenges facing Apple such as competition, substitute products, and economic conditions.
  • Competitor Environment: Examines Apple's competitive landscape naming key competitors and their influence.
  • Internal Environment: Strengths: Lists Apple's internal strengths like branding, innovation, and product quality.
  • Internal Environment: Weaknesses: Discusses Apple's internal weaknesses including high pricing and limited market penetration.
  • Five Forces Model: Illustrates Apple's industry dynamics using the Five Forces model, highlighting challenges and competitive intensity.
  • Core Competencies: Outlines Apple's core competencies such as differentiation and value creation strategies.
  • Apple's Strategy: Explores Apple's strategic approach, emphasizing product differentiation and market positioning.
  • Apple's Problems: Identifies key problems facing Apple, such as low market share and pricing challenges.
  • Previous CEOs: Reflects on the roles of Apple's previous CEOs and their impact on the company's success.
  • Strategic Alternatives: Proposes strategic alternatives for Apple to address current market challenges and opportunities.
  • The Strategy: Outlines a two-fold strategy focusing on niche market growth and leadership transition planning.
  • Focus: Details targeted strategies to improve customer concentration and expand niche markets.
  • Replacement Plan: Describes Apple's leadership replacement plan focusing on transition and mentorship phases.
  • Proposed Course of Action: Recommends actions for Apple to maintain market leadership and innovate in a post-PC world.
  • Conclusion: Concludes the analysis with a summary of findings and gratitude expressions.

STRATEGIC MANAGEMENT

Case Analysis

APPLE INC.: TAKING A BITE OUT OF THE COMPETITION


About Apple

 Established on April 1, 1976 in Cupertino, California, Apple is an


American multinational corporation that designs and manufactures
consumer electronics and computer software products
 Known for hardware and software products such as:
 Hardware: Mac, iPod, iPhone, iPad
Software: OS X, iLife, iWork, iTunes
 Fortune Magazine has named Apple Inc as the “most admired
company in the world for 2010”
Current Scenario
Current Issues
1Q Market Share08

22%
31%
Dell

HP
6%

Low Market 7%
Acer

Share Apple

9% Toshiba
25%
6.6% Others
External Environment: Opportunities

Fast growing Industry (Customer Electronics Industry)


Technological Innovations
Extend new products to loyal customers
High Potential music phone market
Strategic Alliances
 
External Environment: Threats

Extensive Competition
Substitute Products
Low prices of Competitors
Technical Advancements
Economy downfall
Competitor Environment

High Competition
Share of Dell and HP
Microsoft and Intel-Leaders of Software
CE Industry- Sony, Nokia, Samsung, Cisco, Motorola
Competitor Environment
Internal Environment: Strengths

Branding
Innovation
Differentiated Product
Ease of Use
Superior Quality
Retail Strategy
Internal Environment: Strengths

Efficient Marketing and Sales


High Customer Loyalty
Online Sales Channel
Internal Environment: Weaknesses

High Price Proprietary System

Niche Market, Less Penetration

Cannibalization
Five Forces Model
Core Competencies

Differentiation Strategy

Value Creation
Differentiation Strategy

 Unique Features and characteristics


 Commands Premium Price Sustainable Competitive
Advantage
 High Customer Service
 Superior Quality
 Prestige
 Rapid Innovation
Value Creation Process
Apple I,II,III Mac

FF

Focus On Education

C
o eMac
n
v Music Strategy (iTunes)
e
r Lifestyle Strategy
Video Strategy (iMovie) Adding Value
g
e
n Internet Strategy (iTools) Digital Hub
c iMac
e
Apple’s Strategy

Apple employs a Product Differentiation


Drawbacks as a result of their strategy include:
 Not appealing to Price Conscious Consumers
 Risk of Imitation by Competitors
 Risk of Change in Customer Taste
Apple’s Problems

Low Market
Share

Low
Customization

Prices Too
High
Previous CEOs

Ups and Downs of their own


Established Identity of Apple
 Jobs’ success rate
Strategic Alternatives

Problem Strategy Alternative


Low Market-Share Price Differentiation Extend their current
product line to include
some products with a
lower price point.
Ex. Re-launch “Mac
Mini”
The Strategy

Two Fold Agenda

 Continue to focus on niche market


 Set up and prepare for Job’s replacement
Focus

Concentrate on current customers


Expand niche market
Use iPhone and iPad as gateway
Replacement Plan

One year planning phase


Jobs appoints successor
Two year mentoring phase
Chief advisor position
Proposed course of Action

• Make Apple products more affordable

• Innovate

• Maintain leadership style and vision of Steve Jobs

• Have the first leader advantage

• Envision a post-PC world


Thank You

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