Apple’s Competitive Advantage
Apple Inc. Silvia Jimenez Jacob Paiz Nadine Anson INF220 Professor Juliana Zimmerman August 5, 2019
The History of Apple Inc.
The founders of Apple were Steve Jobs and Steve Wozniak. They were introduced in 1971 by a mutual friend who later became one of Apple’s earliest employees Bill Fernandez (Macworld, 2017). Both men shared a passion for technology and worked together on several projects such as “blue boxes” which allowed you to make long distance calls free of charge and the Atari arcade game (Macworld, 2017). The two men quickly recognized what they were capable of if they worked together and decided to go into business and founded Apple Computers Inc., in April 1976.
Apple’s mission statement has changed over the years as they recognize the industry continues to change. Apple’s most recent mission statements is “Apple designs Macs, the best personal computers in the world, along with OS X, iLife, iWork and professional software. Apple leads the digital music revolution with its iPods and iTunes online store. Apple has reinvented the mobile phone with its revolutionary iPhone and App store, and is defining the future of mobile media and computing devices with iPad” (Panmore, 2019).
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Steve Wozniak created his first computer using a kind of typewriter keyboard and the ability to connect to a regular TV screen. The computer was the prototype for what was to come. Steve Wozniak named it the Apple I.
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Apple’s Competitive Advantage
To gain a competitive advantage a business’s product or service must stand out from the rest in that industry (Valacich & Schneider, 2016). Competitive advantage can be achieved by applying one of four generic strategies (cost leadership, differentiation, niche (focus), and stuck in the middle. As stated by Michael Porter (2004), a stuck in the middle strategy is unlikely to achieve a competitive advantage.
Apple incorporates innovation, differentiation, and a focus on customers to attain a competitive edge over its competitors. Apple is consistently upgrading its devices to outperform the competition. The company prides itself on five marketing points which are better hardware, better software, better operating system, better support, and its devices are compatible to similar devices manufactured by other makers (Sahoo, 2012).
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Apple’s Innovation and Differentiation Stands Out
Apple is known for producing long-lasting, well-built devices using beautiful materials such as aluminum and glass (Sahoo, 2012). The company includes the latest technology, powerful processors, advanced graphics, and fast memory in all its products (Sahoo, 2012). Apple products are relatively more expensive than other brand names but due to its customer loyalty the company continues to see profits. The organization has also created its devices to store its client’s data in a way they are locked into Apple (Reluctant reformation, 2014). Apple has over 800 million users actively using its media store which is approximately three times the users of Amazon (Reluctant reformation, 2014). The company’s revenues were estimated at 16 billion and rising in 2013 (Reluctant reformation, 2014).
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Apple’s technology and innovation continues to get better. The company has created the iPod, iPad, iPhone, and Apple Watch to name a few of its most popular devices.
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Apple’s Innovation and Differentiation Stands Out – Cont’d
Apple continues to create new products, but this is not the only way the company differentiates itself. The company is moving towards a better ecosystem combing software, services, data, and partners (Reluctant reformation, 2014).
Apple is partnering with other companies such as IBM and making it easier for developers outside the company to create apps for the iPhone (Reluctant reformation, 2014). The organization’s operating system will soon allow all Apple devices to work together seamlessly (Reluctant reformation, 2014). The company has also introduced software which allows its devices to monitor health and fitness applications. Apple has acquired Beats a large headphones and music-streaming company. The company also teamed up with other large retailers such as Whole Foods, Walgreens, and large credit-card firms to upgrade its payment system (Reluctant reformation, 2014).
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Apple’s Future
Apple announced record high third quarter earnings for June 2019 at $53.8 billion (Apple Inc., 2019). The company’s vision statement is “We believe that we are on the face of the earth to make great products and that’s not changing. We are constantly focusing on innovating. We believe in the simple not the complex. We believe that we need to own and control the primary technologies behind the products that we make, and participate only in markets where we can make a significant contribution. We believe in saying no to thousands of projects, so that we can really focus on the few that are truly important and meaningful to us. We believe in deep collaboration and cross-pollination of our groups, which allow us to innovate in a way that others cannot. And frankly, we don’t settle for anything less than excellence in every group in the company, and we have the self-honesty to admit when we’re wrong and the courage to change. And I think regardless of who is in what job those values are so embedded in this company that Apple will do extremely well” (Panmore, 2019). Through its vision statement the company inspires its employees to support and engage innovation for competitive advantage (Panmore, 2019).
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Apple’s Future – Cont’d
Even with Apple being one of the most successful tech company’s in the world they were not up to speed with its big data (LinkedIn, 2019). Its competitors gained a competitive advantage by developing apps such as navigation and voice recognition that could be used in Smartphones (LinkedIn, 2019). Apple quickly caught up its technology and began developing apps that could be monitored and shared with other users (LinkedIn, 2019). An example being the company has partnered with IBM to further the development of health related mobile apps (LinkedIn, 2019). Apple has targeted other industries such as banking, travel, and insurance providing them a wide range of applications (LinkedIn, 2019). The company recently acquired FoundationDB which is a well known database architecture used for big data applications (LinkedIn, 2019). The company now offers cloud based storage for personal and professional use (LinkedIn, 2019).
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Apple’s Future – Cont’d
To remain a leader in the music streaming industry Apple acquired Beats who developed software that is designed to match listeners with the music they most likely enjoy (LinkedIn, 2019). The company has also entered the world of fashion with its “wearables” such as the Apple watch which is designed to collect fitness and health information which can also be shared (LinkedIn, 2019).
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Conclusion
Apple Inc., is a leader in the technology market. The company continues to improve its devices and improve upon its innovation. The organization recognizes to remain competitive it must not focus on expensive products to produce profits but focus on services and software that are more in line with its competitors (LinkedIn, 2019).
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References
Apple Inc. (2019). Retrieved from https://www.apple.com/newsroom/2019/07/apple-reports-third-quarter-results/
LinkedIn. (2019). Retrieved from https://www.linkedin.com/pulse/how-apple-uses-big-data-drive-business-success-bernard-marr/
Macworld. (2019). Retrieved from https://www.macworld.co.uk/feature/apple/history-of-apple-steve-jobs-mac-3606104/#toc-3606104-1
Panmore Institute. (2019). Retrieved from http://panmore.com/apple-mission-statement-vision-statement
Porter, M. (2004). Competitive advantage: Creating and sustaining superior performance. Florence, MA: Free Press.
Reluctant reformation; Apple’s future. (2014, September 13). The Economist, 412(8904), 73(US). Retrieved from http://bi.galegroup.com.proxy-library.ashford.edu/global/article/GALE%7CA382144067?u=ashford#page=1&q=advDocumentTitle^Reluctant%20reformation%3B%20Apple%27s%20future.&q=advPublicationTitle^The%20Economist^and&limiters=pubDate^20140913
Sahoo, D. (2012). Strategic Change of Campaign at Apple Inc. Vidwat: The Indian Journal of Management, 5(2), 38–48. Retrieved from http://search.ebscohost.com.proxy-library.ashford.edu/login.aspx?direct=true&db=bsh&AN=78382380&site=eds-live&scope=site
Valacich, J. A., & Schneider, C. (2016). Information systems today: Managing in the digital world (7th ed.). Upper Saddle River, NJ: Pearson Prentice Hall
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