STRATEGIC ANALYSIS PROJECT

Apple Computer Inc is among the companies with a large base of loyal customers who offer the main support for a continued growth in the company.   Apple has come to be known as a very innovative firm offering its customers user experience which can be considered the best. The company’s strategy has involved building a product ecosystem which integrates its products into almost every aspect of human life.  The company derives its strength in competitive advantage from its brand image, Apple which is among the best IT brands in terms of establishment and product health (Ker,2015).  The company’s main competitors include Samsung and Dell in terms of computers, tablets and mobile phones. Apple competes directly with Dell in the PC market and this competition is mostly based strictly on price. In the year 2015, company managed to beat Dell in terms of growth in the market and in fact saw a marginal increment of its market as compared to Dell whose market remained stagnant in the same period. This growth is being informed by the MAC and iPad products which are continuing to be common and popular in the world of business and forms the biggest portion of the Apple’s revenues. Apple’s competition with Samsung is mostly on the mobile phone frontier. The iPhone products continue to face stiff competition from the Samsung advanced mobile phones with similar functionality (Alam &Khan 2015).   

The electronics industry continues to attract a lot of investment in strategic research and development an area that present a common ground for Apple and the other firms.  The growth in the market for Smartphone continues to be a major determined in the revenue collection for the above firms. This is because of an ever-expanding and growing market which presents growth opportunities for the Apple and its competitors. These characteristics inform the kind of rivalry experienced with the electronics market which has seen rapid changes in marketing strategies ranging from features, prices and physical presentation of the products to the customers. The competition is very stiff as every firm is trying to outdo others as evidenced in a race to introduce high performing and quality phones and PCs. However, Apple Incl. can be considered to be winning the whole competition gig given its innovation production of high quality iPhones and PCs (Wunbin, 2014). The Apple brand has allowed the company to set premium prices for every product which has made I possible for the firm to achieve high profits and margins. The competition has resulted to a situation where none of the company’s can claim full market leadership in the recent times. The competition affects the whole industry where other players are forced to adjust on prices or up their game in research and development sector.  As per the attached table, Apple receives high ratings when it comes to innovation at 4, compared to 2 for the other firms. Even though the other firms have high market share than Apple, it has at better financial positions due to high rating for quality (Wunbin, 2014).

A VRIO analysis involves a thorough assessment of various capabilities and resources of a firm .Internal environment of an organization refers to its internal capabilities and resources activities which provide the core competences to the firm so that it achieves competitive advantage and therefore earn returns which are above average (Bencsik,2016).  A VRIO analysis of Apple indicates that the firm competitive advantage stems majorly from its innovation, brand and a constant customer loyalty.  A combination o the three elements enhances this competitiveness. The iTunes and Apple brands have acquired a lot of trust from its customers due to the aforementioned innovation.  iPod and ITunes innovation when combined with iPhone forms an important factor in the firms competitive advantage . These innovative products are commonly user friendly and involve services which cover a means to organizing and store music in a computer and an easier purchase of new music.  The efficient integration of hardware and software has enabled the firm to continue being competitive given that these features develop strong customer loyalty (Bencsik, 2016).  

Furthermore, the company has managed to achieve high efficiency in the supply chain function such that the company is able to carry out is operations as monopsony. This means that it is able to dictate its terms to suppliers. This gives it a big advantage over its rival companies. The innovative nature of its products can be attributed to a wide berth of experienced employees and management. Innovation can be attributed to the major turnaround experienced in the company at the close of 90’s (Alam &Khan 2015). It’s therefore the major  capability which assist the firm to continue gaining rounds on the competition frontier against its bitter rivals , Samsung and Dell .Through the innovation of its founder , the company was able impact on the whole industry in terms of hardware , software , music , communication and publication. Creation of value was the main goal of its founder, a strategy that relates well to innovation (Alam &Khan 2015). As discussed earlier, the core activities that inform this innovation include operations, sales and supply and human resources. The increased research and development has meant that the firm sets another era of technological innovation in the industry.

Reference

Bencsik, A. (2016). Knowledge Management Initiatives and Strategies in Small and Medium Enterprises. Hershey: IGI Global. 185

Alam,M.Khan, U. (2015).A critical analysis of internal and external environment of Apple Inc. International Journal of Economics, Commerce and Management. Retrieved from: http://ijecm.co.uk/wp-content/uploads/2015/06/3660.pdf

Wunbin, A. (2014).Apple Inc. & the Mobile Telecommunication Industry. A strategic analysis of Apple Inc. position within the mobile communication market and ways to create and sustain competitive advantage. Retrieved from: http://www.academia.edu/9254033/Apple_Inc._Executive_Summary_1_Contents

Ker,J.(2015). Apple Inc. (AAPL). Consumer Goods Electronic Equipment. Retrieved from: http://tippie.biz.uiowa.edu/henry/reports15/AAPL_fa15.pdf

 

 

Appendix

            CPM Matrix

Success factors	Weight	Rating	Weighted Score (apple)	Weighted (Samsung)	rating	Weighted market (Dell)	rating
Market share	0,10	1	0.10	4	0.12	4	0.40
Price	0.10	2	0.20	3	0.10	4	0.40
Financial position	0.15	3	0.45			3	0.45
Product quality	0.15	3	0.45	4	0.08	4	0.60
Consumer loyalty	0.15	4	0.60	4	0.10	3	0.45
Innovation	0.14	4	0.12	2	0.10	2	0.28