2. Apple Inc. Current Profile
Name Apple Incorporation
Former CEO Steve Job
New CEO Tim Cook
Revenue $ 233.715 billion
Area served Worldwide
Headquarter California, United States.
Total number of employees 115,000
Source: www.Apple.com , 2015
3. Mission: "Apple is committed to bringing the
best personal computing experience to
students, educators, creative professionals and
consumers around the world through its
innovative hardware, software and Internet
offerings."
Vision: We are “committed” in producing high
quality products and providing high quality
service thus setting high industry standards for
other competitors.
Profile - Apple Corporation
4. 1974
The idea for Apple
Computers was
BORN
1976
First Computer was
SOLD
12. Q2. What are the key elements
of Apple’s strategy in computers,
personal media players, tablet
computers, and smartphones?
Have its strategies in its core
businesses yielded success?
13. Advantages
-Style
-Proprietary Capabilities ( Unique apps )
-Limited product line
Disadvantages
-Lack of price competitiveness
-Limited number of business application adapted for MAC ISO
Apple computers
14. Advantages
-Late mover advantage
-Fashionable Perception
-Music Store Support
Disadvantages
-Unmatched brand recognition and consumer loyalty
-systematic dedication & support of continuous developing market
-ipad & itunes Relationship
-Strategic Partnerships
Personal Media Player
15. -First to market innovation
-Fashionable Perception
-App store support
Smartphone & Tablets
16. Q3. What does a competitive strength
assessment reveal about Apple’s
computer business, as compared to the
leaders in the computer industry? Use
the methodology in Table 4.4 to support
your answer. Does it appear that the
company’s competitive positions in
personal media players, tablet
computers, and smartphones are
stronger or weaker than its position in
computers?
18. - Much stronger than its position in the computer
industry
- Held 78 % share in the digital music player in the
industry in 2011
- No other player held more than 5% in the industry
- Stronger than its position on the computer industry.
- Apple held 68% share of market for tablet computers
by mid 2012.
- Tablet computer were in the market from 1990s, but
Apple version gained significant interest from users.
Apple’s competitive position in the
personal media player and tablet
computer industry
19. -Stronger than its position in computers.
- Second best selling smartphones in the second
quarter of 2012
- iphone has contributed to the success of the entire
smart phone industry, which grew from unit sales of
1.7bn in 2009 to 4.9bn in 2011
- Apple lost its no.1 rank in the handset segment of
the industry to Samsung in late 2011.
- Threat to Apple posed by Google’s $12.5bn
acquisition of Motorola mobility.
Apple’s competitive position in the
smartphone industry
20. Q4. Does it make good strategic sense for
Apple to be a competitor in the computer,
personal media player, smartphone, and
tablet computer industries? Are the value
chain activities that Apple performs in
computers, personal media players, tablet
computers and smartphones very similar
and “compatible” or are there very important
differences from product to product? Which
of the four products lines – computers,
tablet computers, personal media players, or
smartphones – do you think is most
important to Apple’s future growth and
profitability? Why?
21. • It has made strategic sense for Apple to be a competitor.
• There are similarities in Apple’s value chain activities for all the 4 Apple’s
products:
• Primary Activities (supply chain management, operation, distribution,
sales & marketing, service)
• Supporting Activities (R&D in products, HRM, general administration)
• Technology Innovation (Apps, Common Operating Systems-iOS/Mac
OS)
• Customer Service and Purchasing
22. Products & Criteria Primary Activates Supporting Activities Technology &
Innovation
Customer Service &
Purchasing
Personal Computer Pricing Reduction
(Sales & Marketing)
PC Innovation
(R&D)
Mac OS X series -Purchase online
-Apple Outlet
Tablet Computer Better Hardware
(Manufacturing)
Similarities as Iphone &
non-pc products (R&D)
iOS series -Purchase online
-Apple Outlet
Smartphone -Expand Carrier Networks
(Service & Operation)
-Better Hardware
(Manufacturing)
Smartphone Innovation
(R&D)
-Great talents &
developers (HRM)
-iOS series
-Compatible with
Microsoft Product
(Microsoft Exchange)
-App Store (Valuable
apps & tools)
-Purchase online
-Apple Outlet
-Telephone Service
Provider
-Network Service
Provider
Personal Media Player Hardware Improvement
(Manufacturing)
Personal Media Player
Innovation (R&D)
-iOS series
-iTune’s (Digital media)
-Apple’s TV
(Entertainment &
synchronization)
-Purchase online
-Apple Outlet
-Wholesale supermarket
Comparison Outcomes Similar Similar Compatible Similar
Justifications -Good sales and great
marketing strategies
-Good product life cycle
-Follow the trend and able
to fight with their rivals
-Apple Support
Communities
-Better financial
performance (Mid 2012)
-Good administration
-Synchronize
-Similar functionalities
-Apple ID
-Innovative apps,
software, tools
-Apple Outlet
-Apple Website (Cart
System)
-Good collaboration with
3rd parties
Source: Apple, 2015-http://www.apple.com/support/
Value Chain Activities Analysis
23. Standard Operation Life Cycle
Source: Supply Chain 247-
http://www.supplychain247.com/images/slides/apple_really_num
ber1_supply_chain_slide1.jpg
25. • Apple has 3 strong dominance products;
• Smartphones
• Tablet Computers
• Personal Media Player & Digital Content)
26. 5. What is your assessment of Apple Computer’s
financial performance the past three
years? (Use the financial ratios in the
Appendix of the text as a guide in doing
your financial analysis?
32. Sources: Apple Inc., 2013, 2014, and 2015 10-K Annual Reports
Share Price Performance (YA 2012-2015)
Activity Ratios (YA 2012-2015)
3.29 6.04 6.86 6.12
25.49 27.98
34.86
26.31
87.98
76.58
98.18
92.47
0.00
20.00
40.00
60.00
80.00
100.00
120.00
2012 2013 2014 2015
Days of Inventory Average collection period Average payment period
Source: Apple Inc. share price 2012-2015, Bloomberg Business
33. 6. What recommendations would you make to
allow Apple to strengthen its position in its most
important markets? What steps should it take to
ensure that the iPad becomes a major
contributor to the company’s overall
performance?
34. Recommendations for 4 Apple Products in each industry:
Personal Computer Industry -Product Customization
-Lower production costs & price reduction
-More advertisements
Personal Media Player Industry -Innovation on product features
-Attractive advertisements
-Avoid marketing approaches & developer
requirements that may violate anti-trust laws
Smartphone Industry -Continue to lead in product innovation
-Make the iPhone compatible with more carrier
networks
-Develop valuable new apps
Tablet Computer Industry -Implementing the cost reduction strategy
-Developing more portable and desktop
computer compatible applications to iPad
-Leading the innovative product
Recommendations
35. Steps for Apple iPad to become
successful in marketplace & major
contributor to Apple’s overall
performance
Caught rival off-guard and forcing them to
quickly design and launch new lines of tablet
computers to limit Apple’s dominance in the
rapidly growing segment of the computer
industry.
- Entered in Tablet Computer Market in
2010.
- 32.394 million unit sold by year-end 2011.
- Held 68% market share in mid 2012.