Final Strategic Plan

Apple Inc Environmental Analysis

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Apple Inc Environmental Analysis

Introduction

Apple Inc is an American multinational firm that was established by Steve Jobs Steve Wozniak, and Ronald Wayne in April 1976. The organization deals with information technology market specifically electronic gadgets like Macs, iPods, iPads, iPhones, Watches and software application like iTune, iWork and IOS (Apple Inc, 2014). The organization provides high quality and unique innovative gadgets that meet and supersede the customer expectations in the market leading to the good competitive advantages in the market. The organization develops strategic plans or measures in their operation after conducting an environmental analysis that will provide the opportunities and threats.

How Apple Inc. Creates Value and Sustain Competitive Advantage

Environmental scanning strategy in the organization enable the administration to evaluate and establish the internal and external opportunities and threats that faces their operation and facilitates the development of plans to maximize the opportunities and minimize the threats effects. Through the environmental analysis Apple Inc was able to brand their products in the market which enabled them to achieve good competitive advantages in the market. The organization is able to produce high quality and unique gadgets that meet the customer expectation hence being able to differentiate them and develop a brand that ha facilitated value addition in the organization. The organization through external environmental scanning was able to establish that production of their products in china will come at an affordable or cheaper cost hence reduction of the production expenses that facilitates the ability to achieve competitiveness. Furthermore, the external environmental strategy has enabled the organization to participates in effective and successful corporate social responsibility activities that has facilitated the development of good public image hence attracting investor and large customer base in the market (Duhigg, &Barboza, 2012). Also, the environmental scanning has enabled the organization to counterattack some of the security threats that are present in the market which increases the customer trust on the organization in the long run.

Evaluate Apple Inc. Company External Environment

The external environment of Apple Inc comprises of various factors including the government/ regulations, consumers, technology, suppliers, economy, political, competitors and investors among others. The external factor like government regulations may affects the organizational operational activities as they depend on these regulations to develop their strategies. In the event the government imposes high regulation or taxes in the organization this may affects the profitability levels of the organization hence affect their competitive advantages. In addition, the consumers are the major player in the external environment. The organization needs to develop high quality products and unique to meet the needs of the customers in the market to maintain loyalty. Technological changes is another external factor that influences Apple’s operations as they have to make sure they incorporate the latest technology in their products in order to achieve and sustain the competitiveness. Suppliers on the other hand are external factors of the organization as they influence the cost of production in the organization. The supplier can supply high quality raw material at an affordable price to the organization leading to reduced cost of production that facilitate the profitability levels. Political factor can poses a threat to the organizational operation and affect the operations or profitability. For instance, Apple production line in china can be influenced by political instability between the two countries leading to huge negative financial implications that will affect the profitability levels. Public opinion has a lot of implication on the environment of an organization in which in 2016 when a mass murderer had an iPhone and the FBI wanted Apple Inc. to unlock the phone to retrieve information. Controversy all over the United State spread as the consumers fought for privacy when it comes to the unlocking of cell phones.

Assess Apple Inc. General Environment

Apple Inc general external factor comprises of a lot of factor including the PESTEL (political, economical, social, technology, environmental and legal). Political factors as stated above affects the organizational operations and can poses threats of benefits in the long run. For example chin production line in China can be affected by the current political trade warfare between United States and china (Khan et al, 2015). Economical factor includes the performances of the economy which influences the purchasing power of the customer in the market. Social on other hand, entails the patterns and influences of the demography in the given economy this can be of benefits or threat to the organization. Technology is a vital aspect in Apple Inc as the products are centered to high technology in the market hence this can poses opportunity for new and innovative products or threats for other organization to develop more advanced product than Apple products. Environmental includes the natural calamities that might affect production or sales of the organization like hurricanes or floods. This can affects the organization ability or influence the purchasing power of the clients in the market. Legal factor are the regulations that monitors the operations of the organizations in the given market sector. This can impose more regulation that hinders the production ability of the organization hence poor ability to achieve competitiveness.

Evaluate Apple Inc. Industry Operating Environment

According to porter there are five forces that shape the industry. The first one is the buyer power which is the ability of the customer to bargain for better quality and prices in the market. Apple has many competitors they sell their products less in price than apple, the buyer threat for Apple is high (Apple Inc, 2014). The other one is supplier power which entails the ability of the supplier to supply the products to the organization. Apple Inc has no much supply power as the major suppliers are Chip and Intel. Threat or new entrant is another factor in the can influence the organization profitability capacity. Apple Inc is faced with threats of new competitors or entrants with more unique and quality products in the market. Apple is electronic organization it previously has numerous competitors around so threat of new entrant is high for Apple. Threat of substitutes entails the ability of the organizational product having immediate alternative in the market. Apple Inc is faced with numerous organizations that produce the same products like music, phones computer with lower prices. Competitive rivalry involves the competition of companies within the same industry. Apple Inc is faced with diverse competitors like Microsoft, Sony and techno among others. Apple's products are higher in price than its competitors so threat level is high for Apple.

The four parts of the external environmental analysis process

Scanning is the initial process of evaluating and gathering information that will provide the early signal of the trends and changes in the environmental activities. Monitoring is the subsequent process that entails the evaluation of meaning of environmental factor through observations. Forecasting involves the process of the organization anticipating or predetermines the outcomes based on the trends or market changes. Assessing is the procedure of evaluating the timing and significance of environmental changes and trends that affects a firms strategies and their administration.

General environment's seven segments

This entails demographic, economic, political/legal, sociocultural, technological, global, and physical. Demographic entails the study of a people based on things like age, race and sex, among others. This plays a very crucial role in apple strategic development in determining the target market or niche. Economic involves the general performances of the market including inflation, interest rates, exchange rates, and GDP and fiscal policies among others. This enables the organization like Apple to be strategic and predict future operations of the market. Social-cultural entails things like ethnicity, language and other cultural or traditional factors in the market. Technological is a major factor at Apple Inc as this entails the technological advancement and operations in the market. Global entails the political and competitive positioning of the organization which can facilitate the strategic movement of products across the globe (Brouthers, Gelderman &Arens, 2007). Physical entails the geographical positioning of the organization and topographical challenges and advantages. For instance china production which comes with advantages of low production cost.

Define strategic groups and describe their influence on firms

Strategic groups are the bodies that monitors the trends and changes in the market then developed effective strategies that will ensure the organization achievements and maintain competitiveness in the market. They are responsible for strategic planning of the organization and evaluation of the general environments of the organization. They influence the organization ability to achieve good competitive advantages in the market as they developed the strategies to facilitate the moves. They determine the approaches that can be utilized by the organization in order to ensure effectiveness and productivity. In Apple Inc Corporation this are the individuals that are responsible to incorporate the market trends and establish customer needs the match the needs with product development to ensure proper customer satisfactions.

What is competitor analysis and how is it used

This is the analytical practice that organization uses to evaluate the competitor in the market. These are approaches that the management of a given organization uses to evaluate the advantages and disadvantages of the competitors firm in the given market. This is very vital to ensure the organization uses the information to develop strategies that will ensure they achieve competitiveness over the rivals and sustain it in the long run (Khan et al, 2015). Apple Inc can use this kind of information to develop products that will be unique and different from the other competitors and above all ensure that they meet and supersede the customer expectations hence high ability to achieve and maintain the competitive advantages in the market.

References

Apple Inc. (2014). Apple Inc.annual report. Retrieved from http://www.sec.gov/Archives/edgar/data/320193/000119312514383437/d783162d10k.htm

Brouthers, K. D., Gelderman, M., &Arens, P. (2007). The influence of ownership on performance: Stakeholder and strategic contingency perspectives. Schmalenbach Business Review, 59.

Duhigg, C., &Barboza, D. (2012 Jan 25th). In China, human costs are built into an iPad. New York Times

Khan, U.A., Alam, M.N &Alam S. (2015). Critical analysis of internal and external Environment of Apple Inc. International Journal of Economics, Commerce, and Management,3(6)