Strategic Management

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Introduction

Incorporated on January 3, 1977, Apple Inc. is engaged in designing, manufacturing and

marketing of mobile communication, personal computers, media devices and portable digital

music players. It is also engaged in selling of wide range of software, networking solutions,

services and third-party digital content as well as applications. Since, its incorporation, the

company has been able to attain unprecedented growth and expansion. As a result of which

the company todays has presence in almost all major countries of the world (Reuters, 2017).

Notably, the company has divided its markets into five different segments that include

America, Europe, Greater China, Japan and Rest of Asia Pacific. The main products offered

by the company to its diverse markets include iPhone, iPad, iPod, Mac, iPhone OS, iCloud,

and Apple Pay along with wide range of other accessories and support services. Moreover, it

is also actively in engaged in selling and delivering digital content and music through various

platforms including iTune store, iBook Store and App Store. In addition, the company sells

its products through multiple channels including retail stores, online stores, as well as through

retailers, value-added resellers and wholesalers (Reuters, 2017).

The company has formulated and implemented an array of strategies over the years, which

have played a key role in its growth and expansion. Against this backdrop, this essay aims to

describe, evaluate, and recommend to Apple its strategic management plan.

Frameworks

PESTEL

Political

Political factor can be recognised to have significant impact on the performance of Apple Inc.

Apple is ascertained to be largely dependent on China for low cost manufacturing of its

products. Correspondingly, any sort of political or social unrest in China can be argued to

have significant implications of the performance of Apple (Chan & Nadvi, 2015). Moreover,

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in the recent years, European Union (EU) have come up with some rigid policies particular

related to taxation with the objective to tame tech giants like Apple, Google and Amazon

(Rankin, 2017). Hence, such policy measures can also be argued to hunt the potential interest

of Apple Inc.

Economic

Economic factors can be considered as another key aspect that has potential to negatively

influence Apple’s global performance. In this regard, it has been noted that in the recent years

the labour cost in China increasing which can be argued to result in losing cost advantages for

some of its products (Chan & Nadvi, 2015). Nevertheless, many countries, particularly India

is witnessing dramatic shift in terms of sale of the smartphones and has emerged as the third

largest consumer market for smart phones while smartphone market in in countries like USA

have become stagnant (Chandola & Fu, 2017). In such circumstances, Apple can shift its

focus to promising markets like India to continue experiencing growth and expansion.

Social

Consumer spending is witnessing considerable growth in some parts of the world such as in

Africa where Apple products are yet to penetrate. It offers a huge opportunity for Apple to

expand and exploit the untapped opportunity existing in African countries (Tschirley et al.,

2015). Moreover, the increasing use of social media globally and rapid urbanisation in some

of the most populated countries like India and China can be argued to have positive impact on

the brand image of Apple (Maiti, 2017).

Technological

The demand for new and advanced devices is constantly increasing across the world. In this

regard, it has been noted that cloud computing trend is growing rapidly which can be argued

to provide huge opportunities for Apple’s iCloud (Aljabre, 2012). However, competitors

such as Google and Samsung are quickly imitating the products and services designed and

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offered by Apple such as Google introduced Android pay which can be argued to have

similar capability as Apple Pay. Thus, it can be claimed that it has become challenging for

Apple to maintain uniqueness of its products and services. At the same time, the increasing

cyber security threat can be argued to make Apple system less secure and more vulnerable to

security threat (Pinchot et al., 2016).

Environment

One of the major environmental issues faced by Apple is related with the disposable of

electronic waste (Needhidasan et al., 2014). Accordingly, it can be argued that the expenses

associated with the disposable of electronic devices particularly the lithium batteries used in

many of the devices manufactured by Apple is usually high (Mancha, 2016). Currently, a

large base of customers is demonstrating their concern towards climate change and

greenhouse gasses impact. Thus Apple is under pressure to reduce the adverse impact on

environment arising from the manufacturing of its devices, failure of which can have negative

impact on its brand image. Moreover, government across the world particularly in Europe

have developed some stringent policies regarding the disposable of electronic waste so as to

reduce the adverse environment al impact which the companies like Apple are obliged to

abide by (Calster & Reins, 2017).

Legal

Laws and regulations are important element of contemporary organisations which is essential

for the organisation to comply. Apple recently has entered into highly regulated financial

market through its Apple Pay (Lowry, 2016). The entry of Apple into this segment would

increase the level of regulations and laws to be followed by Apple. In addition, there are

numerous international laws and national laws enacted by different countries to reduce the

adverse environmental impact which can be argued to have created additional burden on

Apple across its different locations of operations (Calster & Reins, 2017). In countries like

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China, laws related intellectual property is also a major challenge for Apple to comply with

(Zhan, 2014).

Porter´s Five Forces

Competitors

Recommendations

Limitations

Conclusion

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References

Aljabre, A. (2012) ‘Cloud Computing for Increased Business Value’. International Journal of
Business and Social Science. 3(1), pp. 234-239.

Calster, G. V. & Reins, L. (2017) EU Environmental Law. Cheltenham: Edward Elgar

Publishing.

Chan, C. K. & Nadvi, K. (2015) ‘Changing labour regulations and labour standards in China:
Retrospect and challenges’. International Labour Review. 153(4), pp. 514-534.

Chandola, V. K. & Fu, H. (2017) ‘Market Penetration Strategy of Smartphone Companies

from China for India Market: A Multiple-case study’. International Journal of Business
Marketing and Management. 2(4), pp. 10-16.

Lowry, C. (2016) ‘What’s in Your Mobile Wallet? An Analysis of Trends in Mobile

Payments and Regulation’. Federal Communications Law Journal. 68(2), pp. 355-384.

Malti, M. (2017) ‘Urbanisation and inequalities in China and India. Overview and
comparative study’. Theoretical and Applied Economics. 4(613), 121-136.

Mancha, A. (2016) ‘A Look at Some International Lithium Ion Battery Recycling Initiatives’.
Journal of Undergraduate Research. 9, pp. 1-5.

Needhidasan, S., Samuel, M. & Chidambaram, R. (2014) ‘Electronic waste – an emerging

threat to the environment of urban India’. Journal of Environmental Health Science &
Engineering. 12(36), pp. 1-9.

Pinchot, J. L., Mishra, S., Paullet, K. L. & Kohun, F. G. (2016) ‘Exploring Barriers To
Adoption Of Mobile Payments For University Students: Lack Of Awareness, Lack Of
Availability, And Perceived Security Risks’. Issues in Information Systems. 17(3), pp. 20-30.

Rankin, J. (2017) EU to find ways to make Google, Facebook and Amazon pay more tax.
Available at: https://www.theguardian.com/business/2017/sep/21/tech-firms-tax-eu-turnover-
google-amazon-apple [Accessed: 28 December, 2017].

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Reuters. (2017) Profile: Apple Inc. Available at:
https://www.reuters.com/finance/stocks/company-profile/AAPL.O [Accessed: 28 December,
2017].

Tschirley, D., Reardon, T., Dolislager, M. & Snyder, J. (2015) ‘The Rise Of A Middle Class
In East And Southern Africa: Implications For Food System Transformation’. Journal of
International Development. 27, pp. 628-646.

Zhan, Y. (2014) ‘Problems of Enforcement of Paten Law in China and its Ongoing Fourth
Amendment’. Journal of Intellectual Property Rights. 19, pp. 266-271.

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