Developing a Strategic Plan for Apple (Essay Sample)

Developing a Strategic Plan for Apple Student’s Name Institution of Affiliation Course Date Table of Contents TOC \o "1-3" \h \z \u Executive Summary PAGEREF _Toc170547538 \h 3Situational Analysis PAGEREF _Toc170547539 \h 4Current Situation PAGEREF _Toc170547540 \h 4SWOT Analysis PAGEREF _Toc170547541 \h 5Strengths PAGEREF _Toc170547542 \h 5Weaknesses PAGEREF _Toc170547543 \h 5Opportunities PAGEREF _Toc170547544 \h 5Threats PAGEREF _Toc170547545 \h 6Critical Areas for Strategic Plan PAGEREF _Toc170547546 \h 7Environmental Scan and Porter’s 5 Forces PAGEREF _Toc170547547 \h 7Environmental Scan PAGEREF _Toc170547548 \h 7Porter’s Five Forces PAGEREF _Toc170547549 \h 8International Performance PAGEREF _Toc170547550 \h 8Operational Planning PAGEREF _Toc170547551 \h 9Financial Performance PAGEREF _Toc170547552 \h 9Strategic Goals PAGEREF _Toc170547553 \h 11Strategic Goals PAGEREF _Toc170547554 \h 11Prioritized Core Strategies PAGEREF _Toc170547555 \h 12Recommended Organizational Structure PAGEREF _Toc170547556 \h 13Recommended Marketing Positions PAGEREF _Toc170547557 \h 13Corporate Social Responsibility PAGEREF _Toc170547558 \h 13Measuring Success PAGEREF _Toc170547559 \h 14Conclusion PAGEREF _Toc170547560 \h 14References PAGEREF _Toc170547561 \h 15 Executive Summary Apple Inc. was founded in 1976 by Steve Jobs, Steve Wozniak, and Ronald Wayne, with headquarters in California as a technology company dealing in electronics, software, and online services. The company has irreversibly changed the sphere of technologies and people's lives with its devices like iPhones, iPads, Macs, and Apple Watch, as well as services such as Apple Music and iCloud. Apple has always positioned its products at the higher-end market because of the quality of its products and the innovation they bring to the market. Apple sells its products through various outlets, including stores, online stores, and authorized dealers worldwide. Promotions involve continuing to present the company's brand as the innovator and the premium brand in the eyes of the consumer. Apple's motto is to be the best at creating unique customer experiences by offering innovative physical tools, digital applications, and solutions. Apple works in a highly competitive environment where technological advancement and competition are intense and fast-growing. The company's primary strength lies in its robust brand image in the eyes of customers with good brand loyalty, and it has registered substantial operating profits of forty-seven billion from its sales. At the same time, weaknesses include that it wholly relies on the iPhone, and its products are costly to reach a broader market. Further development is present in emerging markets, services, and AI; the threats include competition, regulations, and consumer change. In conclusion, Apple has a competitive advantage but must constantly create new ideas to sustain. The company's international operations are satisfactory, but specific issues like culture, currency differences, and political risk are also issues. Apple's business strategy, specifically for the next three years, emphasizes innovation, diversification, and internationalization to gear up for the next three years. Keywords: Apple, Software, Mac, Online services, innovation, brand. Situational Analysis Current Situation Apple Inc. faces many opportunities and threats in the business environment it occupies in the technology industry. The industry is very dynamic, with high levels of technology, changing markets, and high levels of rivalry, both within and outside the industry. Strategically, Apple's current situation can be assessed by investigating the industry, market conditions, and general business environment. Such industries as the technology industry are always characterized by innovation and high investment in R&D. Businesses must continuously bring novelties to their portfolio to secure market niches. In this regard, Apple has been leading the way and is consistently coming out with new products that create a new benchmark in the market (Dwivedi et al., 2021). However, due to the rapidly changing technological environment, Applemusto continues investing in research and development to counter rival firms, including Samsung, Google, and Microsoft. iApple's brand image and dedicated clients are also a critical competitive advantage that allows the firm to charge relatively high prices for its gadgets. On the other hand, the market is also sensitive to price fluctuations and has high and fluctuating consumer switching costs. Economic aspects of the general business environment refer to an environment characterized by stable economic growth, acceptable inflation rates, and relatively low interest rates, which is the best environment for any business to thrive (Weinstein, 2020). Political factors of the general business environment include an environment that respects the sovereignty of nations, the rule of law, political stability, and the ordering of a favorable society for business operations. Physically, the firm is vulnerable to global policies on trade, fluctuations in government policies, and conflict. For example, the case of tariffs and trade battles involving the US and China has consequences for Apple's operations regarding supplies and expenses. SWOT Analysis Strengths The primary strategic resources of the firm entail a favorable brand image, customer loyalty, and sound financial performance. The Apple brand signifies innovation, quality, and style, resulting in clients' loyalty and willingness to pay for Apple products. This brand strength also allows Apple to charge more for its products than its competitors, earning it a higher profit margin. Apple has consistently high revenues and profit margins. The firm's current assets and cash flows can afford significant investments in research and development to produce the highest innovations and new products in its complex of devices, software, and services. Weaknesses Although Apple's strategic position seems robust, it has specific weaknesses that could influence its operations. One major disadvantage is that it gets much revenue from the iPhone. Hence, Apple is greatly dependent on the Smartphone Market, for instance, due to consumer trends/shifts from Smartphones or economic conditions that affect disposable income (Fan & Yang, 2020). Furthermore, the adopted pricing policy of Apple, as of other branded companies, tends to maintain high product prices to secure brand exclusivity and enterprise profitability; however, it shuts the door to the cheap, sensitive price segment. Opportunities Apple has many opportunities in the emerging technology scenario. On possible opportunities, there is the chance of venturing into new markets, specifically emerging ones. Populous countries with a rising middle class and improving internet connection represent significant opportunities for expanding Apple's offerings. Specifically, it means that by adapting products to the needs and market price-sensitive demands of different geographically located groups, Apple can expand the company's target audience and the range of its revenues (Fan & Yang, 2020). The second significant opportunity is the increase in the services segment within Apple's products portfolio. Applications like music, storage, cloud computing, payment systems, and application stores offer repeat sales revenue and increase customer loyalty to Apple products. Apple can expand its services and invest more in this field, mainly as people consume more digital content and subscribe to various services. Another great opportunity is the emergence of artificial intelligence (AI) and Augmented realities (AR). Threats There are several threats that Apple has to counter in this highly competitive technological world. One of the threats is the high possibility of competition from global technology companies like Samsung, Google, and Microsoft, among others. These competitors do not cease to devise and launch new products that rival Apple's and put pressure to drain the company's profits. Legal factors are significant threats that significantly affect Apple's operations and strategies, particularly those with regulations. Political factors such as data privacy policies can affect Apple's business processes, purchasing of materials, and expansion strategies. Lack of response to emergent technologies and market traits can also contribute to the decrease of competitive advantage and the role of Apple in the industry. Figure 1: Apple’s SWOT Analysis Strengths Weaknesses Opportunities Threats Innovative ventures Dependence on smartphone sales Healthcare technology Competition Brand Loyalty Supply chain vulnerabilities Augmented Reality Economic downturns Ecosystem Integration Limited Product Range Electric vehicles Politics High-quality design High Prices Market Expansion Legal issues Critical Areas for Strategic Plan Based on the SWOT analysis, several critical areas emerge that are essential for Apple's strategic plan over the next three years: Apple should aim at diversifying its product portfolio; in this regard, there is too much overdependence on the iPhone (Fan & Yang, 2020). Expanding the active portfolio or improving some existing ones, such as wearables, accessories, and professional services, can help diversify Apple's revenue model and increase market coverage. The central part of Apple's strategic growth can and should be expanded in the services segment. Apple Music, iTunes, Apple Arcade, and more; Apple Pay significantly contributes to the company's revenue model and retains users in the Apple environment. Improving the functionalities of existing service portfolios and launching new services can increase incremental revenue and improve overall client satisfaction and loyalty. Using novel technologies such as AI and AR a...