apples business and corporate strategies

8/4/2019 Apples Business and Corporate Strategies

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Apples Business and Corporate

Strategies

Apple Business andCorporate Strategies

Done By- Kushboo Sharma , Puneet Verma & Nadika Dharmawardena


2/18

Defining Business Level Strategies

The business strategy proposes how a specific

business model can gain competitive advantage

over its competitors in the industry.


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Business level strategy for Apple:Who What & How


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The How : Finding a Position that

works for Apple

Broad Low costleadership

Broad Differentiation

Focused CostLeadership

FocusedDifferentiation

Broad(i.e., industry

wide)

Narrow

(I.e. specific

segment only)

Strat

egic

Target

Strategic Advantage

Low Cost Differentiation


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KEY DRIVERS OF DIFFERENTIATION

ADVANTAGES FOR APPLE

The iBRAND

Sleek Stylish Designs

Continuous radicalinnovations e.g.- ITunesonline store

More convenient access

Superior Quality

Excellent customer serviceand technical support

To drive up customerswillingness to pay andgenerate demandsufficient to

(1) Recoup added costsand

(2) Generate enoughprofits to makestrategy worthwhile

Key Drivers Purpose


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Threats of differentiation & Apple

coping mechanisms

Too much differentiation

Stephan Wilfred of Daimler Chrysler speaking of

Mercedes-Benz S-Class car: functions nobody

needed and nobody knew how to use .

Apple copy cost innovations from competitors

such as Dell by reducing inventory, partially

outsourcing manufacturing and boosting directsales channels


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Value chain analysis of Apple Inc.

S

1.Greener apple.

2.Selective Hiring Processes.

3.R&D , Patent Filing.

4.Positive Supplier Relations.

5.Automated Receiving Systems.

6.OEMs Economies of Scale Internal Design.7. Direct shipping /Apple Stores

8.Secretive unveiling.

9.Quick responses to bugs warranty free

consultation.

1-4 (Support Activities)5-9 (Primary Activities)

D


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Value Creation

FF

Focus On Education

eMac

iMac

Apple I,II,III

Mac

Power

mac

Servers I book

Adding Value

C

O

NV

E

R

G

E

N

G

E

NC

E

Lifestyle Strategy


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STRATEGY DIAMOND

STAGING AND

PACINGFocused Differentiation

STAGING &PACING

DIFFERENTIATORS

Economic logic VEHICLES

ARENAS

ECONOMIC LOGICHigh Margins on the

Products &Economies of

Scope

ARENAS

Worldwide presence with

U.S. being the No.1 Market.Hardware, Software,

Consumer Electronics and

Digital Distribution

VEHICLES

Highly Internalized R&D &

Major Acquisitions in

Software Industry.

DIFFERENTIATORS

High end Superior Quality and

Stylish Products, Worldwide Brand

Recognition and Leader in

Innovation.


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BUSINESS LIFE CYCLE

EMBRYONIC GROWTH MATURE DECLINE

iPOD

Market

iPhone

Market

iPADMarket

iTunes

Market

iMac

&

iBook

DEMAND

TIME


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Testing the Quality of Apples Strategy

Exploiting theResources ?

Fit with currentindustry

conditions ?

Sustainable ?Aligned to the

StrategicPosition ?

Can it beimplemented ?

DIFFERENTIATION

Yes, Outsourcing the basics production and

Leadership under Quality Management

YES, Mobile & Music

Market still growing

with Tablet PCs and

Apple TV in

anticipation.

YES, Nothing Till Date Has

Matched Its PRODUCTS and

Services Whether iPod,

iPhone, iTunes & now the

iPad?

YES, Significant Internal

Development with Cost

Containment Measures

Required for iMacs & iBooks.

YES, Highly Qualified

Staff and Huge Financial

Resources


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Corporate Level Strategy

deals with identifying businesses in which company should

invest its resources and opportunities for expanding or

contracting.

actions taken by the firm to gain a competitive advantage by

selecting and managing a group of different businessescompeting in several industries and product markets.

Three important aspects : value creation for shareholders ,

configuration and coordination .

Introduction of iPhone is a piece ofApples Corporate Level

Strategy to create value through diversification.


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Diversification

It is a process of adding new businesses to the

company that are distinct from its established

businesses and operations.

Music player business with iPod

Online music business with iTunes

Smart phones business with iPhone


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Types of Diversification

Business Diversification Horizontal

Expansion

Vertical Integration Forward or backwardexpansion

Geographic Scope Geographic / global

expansion .


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Synergy

It is a condition under which different entities cooperateadvantageously for a final outcome . It simply means that the

whole is greater than the sum of its parts .

Economies of Scope and Cross Selling

Savings from Synergy > Cost of a Corporation

Rate of Profit > Cost of Capital


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Apples Synergies

synergy

Apple TV

mac

iPhone

RetailSoftware

iTunesContent

Software

AppleCare

iPod


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INDUSTRY

ATTRACTVENESS

(GROWTH RATE)

Relative Market Share

LOW

HIGH

HIGH LOW

PROBLEM CHILD

CASH COW DOG

STAR

iPhone

iPods

iMAC

iTunes


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The End

Thank you for your time and patience !!

apples business and corporate strategies

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