Business-Level and Corporate-Level Strategies: Apple Inc.

Apple Inc. is a multinational company that works in the computer and mobile device manufacturing sector. The Cupertino, California-based company's headquarters were established in 1976. Apple Inc. creates, produces, and sells personal computers, portable digital music players, and mobile communication devices. The business also offers a variety of complementary software, services, accessories, and networking solutions. The company's well-known brands include, among others, the Macintosh computer lines, iPhone, iPod, and iPad. Over the years, there have been significant developments in the industries that produce computers and mobile phones. As a result, there is fierce competition from other businesses operating in the same sector. In many instances, Apple Inc. is affected by economic and technological factors in this industry. In essence, when technology advances, the economic factors come into play to influence the purchasing power of the customers. This essay will analyze Apple Inc.’s strategies, its business environment, and its competitors. Additionally, this paper will determine the best strategies for this company that will ensure achievements of its goals and overall success.

Business Level Strategies

Apple Inc. pursues a broad differentiation strategy, an aspect that makes it difficult to reduce the cost of their products. For this reason, the price of its products is higher than many of its competitors’. However, it is of the essence to recognize that Apple Inc. differentiated itself from its competitors by its unique design, innovation, superior customer service, and premium quality. Additionally, Apple concentrates more on product design; as a result, the ease-of-use feature and unique sample design attracts many loyal customers. Due to brand loyalty, Apple customers are less sensitive to prices of the different products. As such, the company is able to sell at premium prices that enable them to cover its high production cost and earn profits. Another critical strategy is the fact that Apply invests a lot in innovation, which not only boosts the company’s revenue but also but also enhances the sale of products (Butler, 2005). Having products in various markets have played a significant role in maintaining profits within the business even when one market fails.

Among the different business-level strategies, technology is the major segment that influences the operations at Apple Inc. and its competitive environment. Essentially, consumers are technology conscious today; as such, they tend to go for brands that are technologically integrated and advanced. The fact that Apple invest heavily in research and innovation ensures that the growth and expansion of the company is determined by the technological factor. For instance, by introducing iPods and iTunes, Apple Inc. was able to increase their revenue significantly and keep its market leader role in the market. As a result, they have remained on top of its competitors as far as advancement in technology is concerned. However, as many businesses in this industry integrate their transactional operations with computer and smartphone technology, Apple has been on pressure to keep ahead (Garsten, 2014). As a result, they incur high cost to make sure they keep on top of innovation so as to maintain relevance in the competitive market.

Corporate Level Strategies

Although Apple Inc. started in this industry by Macintosh computer, they have since moved to different products such as phones, tablets, and many others. In essence all these industries are related as they all use technology and innovation as their basis for development. Apple has also formed several cooperative linkages in history to achieve a common objective. The first alliance that was significant and prominent to the company is with Motorola and IBM, which occurred in 1992. This linkage was also known as the AIM alliance formed to give the response to Windows and Intel collaboration. Wintel were personal computers that were equipped with Intel processors and running with MS Windows. The second alliance was with Intel where Apple produced Macintosh computers that were operating with Intel microprocessors (Akhter,& Rahman, 2014). This strategy was beneficial as it enabled Apple to compete with rivals such as Dell, and Hewlett Packard.

Apple’s corporate level strategies were advantageous to the business since they were able to outsource some basic production procedures to third-party manufacturers. Moreover, the company was able to cut some costs such as overall in countries where the cost was much lower than the United States. Consequently, the company was able to control all the designing part of the products, thereby ensuring that they have the company’s core value. As a result, Apple was able to manufacture the same high-quality products, at a lower cost, hence saving money for the business. In essence, Apple Inc. produces high-quality computers and mobile phones, which allows the company to sell even at a premium price. Also, by selling products through both online and retail channels in their retail stores created a platform for interaction with their consumers. There are also many programs and software that enhance the experience of clients using their products (Butler, 2005). The consistency and convenience of Apple Inc.’s products and services make sure that customers are willing to pay extra money.

The Competitive Environment

Apple Inc. operates in a very competitive environment since there are new companies entering into the computer and mobile phones industry. Also, the old enterprises in the same industry are launching new products and services, an aspect that possesses a big threat for Apple. As such, it becomes critical for this company to develop effective strategies that will help them gain a competitive advantage. Over the years, Apple has had many competitors; for instance, there were Nokia, HTC, and Palm in the phone market. In the same way, there was Sony and Creative in the iPod era. Today, Samsung is considered the most significant competitor of Apple having dethroned this company in the phone market. In response to the competition, Apply focus and research and innovation attract deal with new entrants into the market (Garsten, 2014). In essence, the corporate structure of Apple Inc., and the culture of research and innovation are what serve as a driving force and competitive advantage.

Comparison of Strategies

There are several differences between the business level strategy used by Apple Inc. and that utilized by the Samsung Company. For Samsung, their primary focus is creating a product with programs that will connect that will give impact and connect with consumer’s life. Furthermore, this company’s priority is producing profitable products and services, which will be affordable to a wide range of clients. To achieve this, Samsung makes deals with manufacturing factories to produce quality products at low prices. On the other hand, Apple concentrates more on high-quality products irrespective of the cost. Additionally, this company has products in different industries to serve more consumers in addition to other programs and software. As a result, Apple can continue earning revenue even when one market falls (Hitt, 2017). In the same way, they can provide an all-round experience to their clients since they have complementing products and services.

On the corporate level strategies, the two companies also differ; a few years ago, Samsung was struggling in the smartphone industry. Currently, it is the world’s largest technology company by revenue by defeating the Apple organization. Samsung is a conglomerate as it makes many components that go into its smartphones, an aspect that gives it a cost advantage and flexibility regarding production and time. For Apple, even though it has a well-managed and diverse supply chain, it mostly relies on external partners. In some occasions, this leads to difficulties and delays, negatively affecting the delivery efficiency of the company to its customers. However, Apple Inc. has made alliances that ensured that they could still reach their level of high quality in products and services at lower cost. As a result, the company could expand its production, open more retail stores and reach out to more clients in different parts of the world (Akhter, & Rahman, 2014). Higher revenues and more profits are advantages accrued from such a strategy.

The Best Choice

After comparing the two companies, it is evident that Apple Inc. is most likely to be successful in the long term. First, Apple deals with a variety of products ranging from phones, computers, software, and other applications. As such, this company will survive even when one or two products perform poorly in the market. Samsung is focused on smartphones and its accessories making it vulnerable to market forces. Second, Apple seeks to create brand loyalty where their clients will buy a product due to its quality and the available compliments. However, Samsung is more interested in providing quick and affordable products in efforts to attract more customers. As a result, Apple Inc. will retain their customers, while Samsung is likely to lose clients if they are not satisfied. Another reason for Apple’s success is the fact that they are on top of research and innovation, an aspect that keeps their customers coming back for newer products (Hitt, 2017). However, this is a strategy that has also been recently incorporated by Samsung.

Slow-Cycle and Fast-Cycle Markets

In a slow-cycle market, my choice would still be Apple Inc. because this company has loyal customers. Even if the Samsung Company imitates their production method, their clients would still buy from them; they would not be attracted by imitated products. Furthermore, it would be difficult to mimic the choice of various industries that Apple has ventured. As such, Samsung cannot out-compete Apple even with protection from imitation. However, in a fast-cycle market, my choice would be Samsung since they respond fast to consumers’ orders and are quick to adjust to changes in the market. In essence, Samsung produces smartphones and all its components, making them flexible to effect change quickly. Apple still depends on external partners, which makes it difficult to implement change within a short time as required by their clients (Butler, 2005). These reasons would make Samsung more successful than Apple in a fast-cycle market.

Conclusion

Apple is a company in the computers and mobile phones industry. In any industry, there are different companies selling the same product at different prices and with different features and qualities. Therefore, it is fundamental for every company to formulate plans and strategies that will enable them gain competitive advantage. Such plans include the business level and corporate level to ensure that all operational units are following the company’s vision and mission. In the normal operations of a company, there are external and internal factors affecting production both positively and negatively. Additionally, every company has its objectives and goals and should, therefore, establish effective strategies that will help them achieve success. The success of any business depends on many factors that should be under addressed.



References

Akhter, S., & Rahman, M. N. (January 01, 2014). Competitive Strategies in the Smartphones and

Computer Industry. International Journal of Technology Diffusion (ijtd), 5, 1, 73-88.

Butler, T. (July 01, 2005). Power Conflict, Commitment & the Development of Sales

& Marketing IS/IT Infrastructures at Digital Devices, Inc. Journal of Cases on

Information Technology, 7, 3, 18-36.

Garsten, C. (2014). Apple World: Core and Periphery in a Transnational Organizational

Culture: A Study of Apple Inc. Coronet Books.

Hitt, M. A. (2017). Strategic management: Competitiveness & globalization: concepts and cases.

New York: Cengage learning.