Major Macro-Environmental Trends Facing Apple - Assignment Example

Exam Рареr: Strategic Маnаgement and Sustainability Name: Course: Tutor: Date: QUESTION 1: Major Macro-Environmental Trends Facing Apple In order to evaluate the operations and functioning of an organization, it is imperative to evaluate the external influencing factors in the market. Yuksel (2012, p.53) argued that such an analysis can be evaluated based on the concept of Political, economic, social, technological, environmental and legal (PESTEL) analysis. Therefore, in order to evaluate the strategic performance of Apple Inc., this review offers a strategic analysis on its industry PESTEL factors. A political analysis on the industry establishes that the UK market, of which the organization is headquartered, has a good political goodwill for local organizations. In the recent past, the economy has embarked on a bid to support the local industries especially the technology industry. As a developed nation, the economy has increased the overall automation and technology use in the market. Therefore, the existing political climate supports the overall functioning of the industry and offers Apple a strategic expansion advantage. In addition, an economic analysis establishes that the market faces a stabilizing financial situation after the European credit crunch and the global financial crisis. As such, the consumer base purchasing power is steadily improving with reduced inflation rates as well as increased employment levels as well as improved incomes. Therefore, this presents a stable consumer base with improved income levels. As such, this offers the Apple Company an increased opportunity to adopt increased pricing strategies in the market. Therefore, this offers the organization an opportunity to increase its profitability levels through an increased and improved customer base. Moreover, a social cultural analysis on the organization establishes that the market faces an increased favourable shopping culture in the UK technology market. An evaluation by Winkelmann-Gleed (2012, p.83) stated that the UK consumer base is intrinsically motivated. This means that the consumer decision making process is based on individual internal motivating factors and needs rather than the external factors. Consequently, the consumers tend to buy organizational products that are unique and highly customized to suit their needs. As such, the Apple Company is mandated with the responsibility of developing appropriate organizational systems supporting the concept of increased products customization. In this regard, in order for the organization to boost its overall market competitiveness it ought to engage in increased market research and surveys to establish consumer preferences and product tastes prior to products designs development. A technological review on the UK market establishes that the economy has increasingly embraced technology in the respective industries operations. As such, this offers the Apple Company an increased consumer base in the local technology market as well as on the global platform. However, an environmental analysis on the global technology industry environment reveals that the organization faces increased operational challenges. In this case, issues such as raw materials depletion, environmental pollution and degradation implicate on its functioning as well as on the eventual production costs. In order to overcome these challenge, the Apple Company management adopted the sustainability production process, a corporate social responsibility program entailing supply chain management for environmental regulations conformance. Finally, a legal analysis establishes that the market faces increased market regulations that implicate negatively on the Apple Company development agenda. For instance, the government passed the tax regulation which increased the overall economy taxes by 20%. Consequently, this reduced the overall industry consumer purchasing potential. Thus, this forces the organization to adopt low cost market operational approaches. Based on the above PESTEL analysis on the Apple Company, it is apparent that the local UK and global technology markets presents a combination of success and failure factors. On one hand, the analysis establishes that the organization has developed appropriate structures to embrace the presented opportunities while adopting appropriate proactive mitigation approaches for the challenges. References Winkelmann-Gleed, A. 2012, "Retirement or committed to work?", Employee Relations, vol. 34, no. 1, pp. 80-90. Yüksel, I. 2012, "Developing a Multi-Criteria Decision Making Model for PESTEL Analysis", International Journal of Business and Management, vol. 7, no. 24, pp. 52-66. QUESTION 2: Apple Ansolf Analysis Over the recent years, the global market has grown increasingly competitive. As such, multinational organizations in the industry have been forced to develop and retain competitive edges in order to capture the highly competitive market bases. In this regard, there has emerged the need for the development of sustainable competitive edges. In this case, Frensch (2007, p.43) argued that one among the common strategies adopted in the development of such strategic alternatives include the Ansolf model. As such, this review evaluates the Apple’s Company strategic development and expansion strategy based on the model analysis structures. In this case, the evaluation reviews the four strategic expansion alternatives presented by the model for both the existing and new products namely the market penetration, market development, product development and diversification approaches respectively. With respect to new product development, the Apple organization has a strategic alternative of venturing into new markets through the adoption and development of new product quality levels in the market. As a result, the organization has the opportunity to expand onto new markets through the adoption of diverse qualities in the market on its product lines. For example, the organization can develop new I phone products with varying features that would allow for the selling of such products based on the distinguished features. Such an approach would allow for increased market success through increased market base expansion. In addition, the organization has the opportunity to develop and expand the process of market penetration. The market penetration approach incorporates the development of increased market influence in an existing market through selling of the existing organizational products. This can be achieved through increased market promotional and advertising strategies in the market. Through this approach the Apple Company can strategically expand its operations at reduced costs. Developing new products is an expensive process that incorporates a lengthy new product development process as well as the associated high costs in the markets (Schmidt and Druehl, 2005, p.273). Therefore, through marketing the existing market products, the organization will resultantly increase its revenues through increased marginal revenues. For instance, the Apple Company can increase its promotional activities in the market through the use of celebrities such as sports professionals to market its products such as the iphone and the iPods products. The use of such an approach would enhance increased marketing and market penetration by the Apple product at reduced costs facilitating overall increased profitability margins. In addition, the organization applies the market development expansion strategy. Through this approach, the Apple Company adopts a range of distribution channels to target and reach out on new markets. In this case, it is imperative to note that the organization through strategic alliances with supply chain partners such as Foxconn Company in China that enhances the organizational strategic expansion in the Chinese market. Through this approach, the Apple Company attains an increased global market presence with the existing organizational products. In order to increase the development of these alliances in the market, the organization should develop structures to enhance and facilitate increased strategic alliances in the market. Finally, this review establishes that the Apple Company applies the related diversification strategy. In this case, an organizational example can be cited in its wide variety product lines in the market such as the I pads, I phones, Macintosh as well as other periphery products such as the network enhancement facilities. Through these products, the organization has established an increased presence in the global platform allowing for increased profitability margins. Based on this analysis, the review concludes that on analysis of the Ansolf model, the organization faces an increased opportunity for strategic market expansion in the market. As such, the study concludes that the industry faces an increased market growth potential with the implementation of the proposed strategies. References Frensch, F. 2007, The social side of mergers and acquisitions: Cooperation relationships after mergers and acquisitions, Dt. University.-Verl, Wiesbaden. Schmidt, G.M. & Druehl, C.T. 2005, "Changes in Product Attributes and Costs as Drivers of New Product Diffusion and Substitution", Production and Operations Management, vol. 14, no. 3, pp. 272-285. Question 4: CSR at Apple The Global technology market faces increased management challenges in terms of increased competition levels. As such, organizations in this industry have resulted to the adoption of strategic alternatives through which the market gains a competitive edge. One of the recent strategic approaches in the market is the application of the corporate social corporate responsibility (CSR) programs (Lantos, 2001, p.596). In this case, the Apple Company in a bid to expand its overall market competitiveness and strategic expansion has increasingly applied the CSR programs to increase stakeholders’ satisfaction. One of the areas in which the program has encountered increased CSR programs application is in supply chain management. The organization has over the years adopted and developed an efficient supply chain management structure. In this case, the organizational management has increasingly developed strategic alliances with the supply chain partners in the market. Through this approach the organization has established the sustainable production process whose use enhances increased organizational performance and reputation. On one hand, the adoption of sustainable production process increases the organizational processes efficiency thus reducing on the overall cost of production. As such, this increases the overall organizational profitability margins in the market which enhances shareholders value maximization. Shareholders form an imperative part of organizational stakeholders. Their satisfaction plays a significant role for facilitating increased investments in the market. In addition, the adoption of the sustainable production systems, the organization facilitates environmental conservation efforts. A major global technology market challenge today is the environmental challenge. As such, the industry faces increased environmental pollution in the industry resulting to business and society conflicts. Thus, as Abimbola and Vallaster (2007, p.342) argued, organizational reputations are negatively implicated on. Therefore, the Apple Company boosts its market reputation and society satisfaction through market goodwill enhancement. The organization conducts supplier evaluation tools through which the organizational suppliers are selected. Consequently, the organizational supplier selection criterion is based on the adoption of environmental friendly production processes. Consequently, this has increased the consumer base confidence on the organizational products facilitating their satisfaction as well as their retention. Therefore, the adoption of the sustainable production process by Apple increases the organizational consumer base satisfaction rates. Additionally, the organization has increased market success satisfaction of the industry stakeholders. In this case, the organization through continuous supplier evaluation processes, conducts supplier appraisal and improvement strategies through which the capacities of the respective suppliers are developed. As such, this boosts the concept o strategic alliances and mutual gains in the industry. Joia and Malheiros (2009, p.541) argued that strategic alliance development is an imperative concept facilitating eventual organizational success based on the existence of market goodwill as well as the presence of willing and able industry partners. As such, this has boosted satisfaction level for Apple Company suppliers as well as distribution partners. Consequently, this has enabled the organization attained increased market competition. In summary, an evaluation on Apple’s Company CSR adoption establishes that the organization has attained increased market competitiveness and sustainability. As such, the analysis establishes that the organisation adoption of the sustainable production approach has offered it increased market success and improved satisfaction levels. Therefore, the review concludes that through the adoption of the organisational CSR strategies, the market has attained increased market profitability levels. References Abimbola, T. & Vallaster, C. 2007, "Brand, organizational identity and reputation in SMEs: an overview", Qualitative Market Research, vol. 10, no. 4, pp. 341. Joia, L.A. & Malheiros, R. 2009, "Strategic alliances and the intellectual capital of firms", Journal of Intellectual Capital, vol. 10, no. 4, pp. 539-558. Lantos, G.P. 2001, "The boundaries of strategic corporate social responsibility", The Journal of Consumer Marketing, vol. 18, no. 7, pp. 595-630. Read More