Running head: BUSINESS LEVEL STRATEGY 1

Capstone Assignment 3: Business-Level Strategy for Apple Inc

Business Level Strategies for Apple Inc

Strategies in business are instrumental for the success of an enterprise. A strategy refers

to a set of analytical techniques that influences the position of a firm in the market. At the same

time, it enables an organization to match its internal capabilities with external business

environment (Ireland, Hitt, & Hoskisson, 2009). Further, strategies allow companies to realize

their set target and mission. Business level strategy encompasses decisions made by corporations

regarding how to they can compete effectively for customers in their industry or market. It

involves choices about new technologies, products, services, or even location of a facility.

Conversely, corporate-level strategy influences an organization’s sustainability and competitive

edge (Ireland, Hitt, & Hoskisson, 2009). In particular, it focuses on how a corporation can create

values for its products or service in the market. Therefore, corporate-level strategies are long-

term approaches that guide allocation of resource. Apple Inc is a corporation that was selected

for analysis and development of both the business and corporate strategies. The business

strategies that are applied by Apple Company majorly rotate around a simple context of

innovation. While at Apple Inc, innovation is not only aimed at creating new products on the

markets but also improving the current products on the market. Currently, the company is relying

on the revenues from the consolidated and improved products such as the various iPad models

rather than the revenues that are driven by the new products.

Business-Level Strategies

The newly developed iPad models are designed with improved resolution capacity

alongside decreasing the size of the products. Similarly, innovation of the company is in the

software and different applications that the company provides on the market. The applications

that are used on apple gadget have several provisions for updates, and this gives the users more
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development and interface to the clients of the said business (Archibugi & Filippetti, 2015).

Consumers enjoy the various innovations the products that the company introduces on the

market, and this helps in maintaining a good relationship with the clients of the business.

The other business strategy that Apple Company focuses on is diversification. The major

diversifying factor that Apple focuses on is maintaining high-quality standards of the product at

affordable prices (Archibugi & Filippetti, 2015). The reality of diversification is on two

significant dimensions of price and quality of the products. The products of Apple Company that

are on the market are of high quality due to this fact their prices are higher than the other

products. Having highly-priced products, they quickly gain trust from the public since their

products are of high quality and their products last longer. Apple Company ensures that the

products it puts on markets are worth the price charged on these particular products.

Moreover, Apple Company carries out research on the customer's propensity to stay loyal

to the products they are producing. More so, Apple places a competitive advantage over the other

companies by providing various options for purchasing product such as user firmly online stores.

Such purchasing provisions are unique to customers, and this gives them a provision of easily

purchasing the products from their store at the time of their best convenience (Archibugi &

Filippetti, 2015). The stores provided online are well equipped with staff that is well known and

are very much helpful to the clients of the company.

Core Competencies

Following the Apple assessment, the company needs to maintain the uniqueness of the

products it provides to the consumers. The approach gives this corporation a competitive edge. In

particular, one of the strong features of Apple’s computer and phone products is that are operated

by IOS alone which saves the firm from competition from other similar companies in the
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technology industry even more importantly, it is fundamental for Apple Inc. to maintain

development of quality products to continue to realize high sales volume (Archibugi & Filippetti,

2015).

Maintaining the uniqueness of the products as compared to the other competitors is a

good option for the company. Additionally, maintaining uniqueness helps in efficiently

eliminating the element of competition from the other companies thus enjoying the benefits of

profit maximization (Archibugi & Filippetti, 2015). Most clients on the globe prefer being

unique with the product they use, thus prefer buying unique products despite the prices being

levied on them. The market is also infiltrated with luxurious clients who chose to buy expensive

products. This is another target market for the company that it will continue to exploit despite the

high costs it incurs in production.

Corporate-Level Strategies

The corporate business strategies of apple are divided into two different ages. The periods

include from 1976 to 1996 and from 1997 to today. While in the first age, Apple Inc applied the

low-level diversification corporate strategy. The company was dealing with products that were

computer-related. The first product that was apple 1 and this continued until the evolution of

Macintosh in 1996. Moreover, the development was limited to the production of software,

computers, and chips that is an indication of low diversification (Archibugi & Filippetti, 2015).

However, after this age, Apple shifted to the production of many more digital products. More so,

this is a period where Apple shifted from its corporate strategy to high-level business

diversification strategy.

Despite the introduction of several digital products, Apple continued to use the

constrained diversification corporate strategy. Apple is a company that deals in the production of
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both hardware and software components of a computer. Apple has various digital products such

as the iPhone, iPods and Apple TVs, and all these are products allow the sharing of resources

among the businesses (Archibugi & Filippetti, 2015). The above-mentioned products run on an

operating system program developed by Apple known as IOS. This provision helps in creating a

provision of economies of scale shared among the businesses owned by the same company. Each

business running under Apple is focused on platforms with extraneous products and different

product types. An example of such is the Macintosh product that has two provisions of both the

notebook and desktop (Archibugi & Filippetti, 2015).

Based on the above analysis, there are separate products that complement each other in

terms of sharing resources. The Mac book and IMC are all produced primarily from the same

products, and these resemble each other by creating uniqueness within the product lines. More

so, apple digital platforms also complement each other. Such as Macintosh, computers are able to

synchronize their media and personal data that are seemingly not possible with the other

computers (Maria, Kellen, and Smith, 2012). Apple’s primary goal and strategy are to make

significant forms of data within the media and immediately make them positioned as a reading

device and help in its perfection

This will help in the making of products that are more convincing to the clients as a

device. Following the above assertions, Apple Company should adopt and continue the highly

diversified corporate strategy. Apple Company has several products on the market, interlinked,

and produced using the same products. Having similar products produced by a similar company

helps in cutting the cost of products, thereby increasing the rates of return of the business (Maria,

Kellen, and Smith, 2012). The above decision is highly justifiable, as it does not violate any rules

as mandated by the company and the various associates that are related to it. The company deals
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with unique products, and this will help in keeping the customers' loyalty towards the company

products.

Competitive Environment

Apple has received stiff competition from various competitors on the market globally.

Apple's competitors include Samsung, pay pal, Tesla Motors, Amazon, Dell, Sony Mobile, Fit

bit, Bose, Google, and Microsoft. Samsung has been the lead competing tech company to apple

Inc (Mathis, 2015). Apple, on several occasions, has accused Samsung of duplicating its product

because of competition. Samsung places a competing edge in the shipping industry and financial

services. Additionally, Samsung uses a stronger operating system on products such as tablets,

smartphones, personal computers, and televisions at a subsided price as compared to the iPhone

and iPad that Apple produces (Mathis, 2015). Through this, Samsung is able to capture a

considerable size of the markets that prefer cheaper and low-quality product as opposed to the

highly expensive products. The products by Samsung are run on Android software that is heavily

licensed by Google and thus posing a great threat to the company’s operations. Most of the

competitor companies to apple work together to weaken its products.

Pay pal is another company that has posed high competition to the Apples' online

payment business. PayPal is one of the biggest online money transfer companies and apple

having operated for just two years, its business is still unpopular since the big companies in

money transfer like PayPal have overshadowed it. PayPal used a strategy of being earlier on the

market and captured a significant population rather than Apple Inc that has just been recently

introduced (Maria, Kellen, and Smith, 2012). However, Apple Inc is improving its Apple

payment systems by incorporating the software on all the smartphones and iPad that the

company is currently producing. The other company that has posted great competition to the
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company is the Tesla motors. Tesla motors being the leading producer of electric cars has

hindered the process of Apple from producing electric cars. More so, Tesla has great market

coverage that hinders the progress of other companies willing to join the business.

The other competing company to apple is Dell. Dell has been in operation since 1990 and

deals in the production of laptops and desktops. Dell uses a strategy of providing products that

are affordable to the clients, and these products are much cheaper than the products on the

market by Apple (Maria, Kellen, and Smith, 2012). More so, Dell has not suffered from the

characteristics that most companies have experienced. This has given the chance of dell to pose a

threat to apple market share. Currently, Dell is planning to rebrand its computers in order to

increase its popularity among the millennials. Such a strategy will enable Dell to reclaim more of

the market share from Apple.

Sony mobile has also proved to be among the leading competitors of Apple Inc. The

company named in 2012 as the fourth top leading company in the production of cell phones.

Sony Company has produced related products to the iPhone such as the Sony Xperia Smartphone

that is waterproof and shockproof. This phone is cheaper than the iPhone and therefore clients

easily settle for such products at the expense of the latter (Khan, Alam & Alam, 2015).

The other competitors of the company are Google and Microsoft. Google places

considerable competition to Apple Inc in several ways. Google is the owner of the operating

system of android that runs the other smartphones apart from iPhone. More so, Google has its

own version of iTunes that poses so many threats to iTunes that are owned by Apple Inc (Mathis,

2015). Google has been registered as Apple's most significant competitor in relation to online

payments as it owns several payment options that users are in a position to choose what options

are best convenient for them (Mathis, 2015). Google uses the strategy of having a broader
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consumer base and dealing with various products that Apple may not be in a position to provide.

More so, Microsoft is another direct competitor to Apple. Microsoft provides cheaper computers

as compared to apple, and this factor leads to loss of clients on the market (Mathis, 2015).

Relating to the above, Microsoft also entered the Smartphone business, and this posed fierce

competition to Apple Company.

According to the above analysis, Google is the biggest competitor to Apple Inc. Google

deals in several products and services that Apple Inc is involved in. Google also has a broader

customer base as compared to apple due to its product-differentiated services as opposed to

Apple Inc., whose products are uniform all over the globe.

Market Cycles

My choice of Google in as the primary competitor to Apple would not change whether in

slow-cycle or fast-cycle markets. While in slow cycle markets where Apple Company is in

existence due to its unique products, consumers would opt for products related to Apple products

(Mathis, 2015). Similarly, in the fast cycle markets such as perfectly competitive markets,

Google company still remains the primary competitor of apple inc. Google provides widely

differentiated products such as applications which are suitable for all communities and therefore

Apple quickly loses competition in such markets.

References

Archibugi D & Filippetti A. (2015). Editors’ Introduction: Science, Technology, and Innovation

Go Global. The Handbook of Global Science, Technology, and Innovation, 1-11.

Ireland, R. D., Hitt, M. A., & Hoskisson, R. E. (2009). The Management of Strategy: Concepts &

Cases. Evans Publishing Group.

Khan U, Alam M & Alam, S. (2015). A critical analysis of the internal and external environment

of Apple Inc. International Journal of Economics, Commerce, and Management, 3(6),

955-961

Leswing, K. (2017) "Apple added a revealing word to its official business strategy" Business

Insider. Retrieved 26th November 2019 from http://www.businessinsider.com/apple-

services-business-strategy-2017-8

Maria C, Kellen A and Smith S (2012). “The perils of best practice: Should you emulate Apple?”

McKinsey Quarterly, no. 4: 10

Mathis J (2015). “Apple vs. Google: Replacing Apple’s stock iOS apps with Google apps,”

Macworld 32, no. 10: 88-94