Apple is an American corporation that manufactures personal computers, audio players, phones, and software. The company is one of the leaders in unique and modern multitasking operating systems with a graphical interface. The company was formally founded on April 1, 1976, by Stephen Wozniak and Steve Jobs (Apple (AAPL), 2020. The company quickly gained consumer confidence with its reliability and speed of technology. In turn, the emergence of revolutionary touch-screen phones changed the market dramatically. The fact is that the capabilities, the design, and the spectacular and eye-catching advertising anticipated an overwhelming number of potential buyers. It is necessary to analyze what factors allowed the company to achieve phenomenal success and secure a strong market position.
Apple is now an international leader of innovation and design, but its path has not been easy. It was possible to attract the public’s attention to the company’s products through the right formulation of its mission and vision. The have changed a little over the years, but they continue to motivate employees and encourage them to be productive and innovative. Apple’s vision mentions a love of simplicity – and this is an integral part of Apple’s approach to product design and development. The company also mentions that it hopes to succeed by offering products based on constant innovation. In addition, Apple communicates to its loyal and potential customers how carefully they choose their markets and how they strive to improve service. Its mission also includes all these key components – attention to users, a focus on innovation, and quality of service. Apple’s most important goals remain to improve the organization’s organizational structure, expand the market segment for products and services, and ensure the profitability of the overall economic activity.
A strategy is a model that integrates an organization’s main goals, policies, and actions into a coherent whole. It addresses the more fundamental aspects of the nature of the organization as an instrument of collective perception and action. A properly formulated strategy allows the organization’s limited resources to be ordered and allocated in the most effective way possible in response to external and internal environment changes. Apple’s competitive strategy is to create innovative products with a simple but user-friendly design. Apple has truly become a pioneer in the development of information technology. Most people note the quality, reliability, and usability of Apple products, making them one of the most popular in the world.
With the release of the Apple II, Apple revolutionized the personal computer in the 1970s, and in the 1980s, it demonstrated a fundamentally new approach to the personal computer with the Macintosh. Apple remains at the forefront of innovation with its unique OS X operating system, iLife, and professional applications. Apple also led the digital media revolution with its iPod portable music and video players and iTunes online store and entered the cell phone market with its revolutionary iPhone. Besides, Apple also helps guard the environment and protect consumer safety by limiting the environmentally harmful materials used in its products and processes. The company’s constant desire to create innovative products and the gradual capture of larger and larger markets is what ensures Apple’s revenue growth.
Operations management is the activity associated with developing, using, and improving the production systems from which a company’s products or services are derived. Without the correct application of operational management principles, an organization can only be profitable through happy accidents. The modern stage of logistics development involves accelerating the world economy’s integration and the market’s globalization, which has helped to create international logistics systems permeated by specialized supply chain networks. The most important strategic decisions in manufacturing activities include those about how, when, and where to produce products and provide services. Operational management helps figure out how to carry out raw material extraction, production, folding, and distribution.
Apple uses large amounts of advance payments and a well-developed logistics system as a strategic weapon to secure an advantage over competitors. Apple’s well-established supply chain is a very powerful competitive weapon. Tim Cook is widely recognized as an operational management genius. He helped Apple tighten up its supply chain and make the company’s operations the efficient mechanism they are today. Due to him, Apple reacts instantly to any changes in supply and demand, adjusting its offer accordingly.
The company’s supply chain management is an element of Apple’s operational management in which the company has been very successful. What Apple does not do is work with just one manufacturer. On the contrary, the company is trying to run its business in such a way that at any moment, it would be possible to switch to an alternative option with a better quality-price ratio offer. Apple pays a tremendous amount of attention to the control process (Rowland, 2019). A staff of 600+ technicians in China and Taiwan controls the quality and raw materials used, the volume of goods produced, and the overall profitability of even the smallest of manufacturers. In some cases, Apple installs its own equipment, which the supplier agrees to use in the manufacturing process (Rowland, 2019). Overall, in terms of how the company’s supply chain management is structured, it is an example to many other companies, significantly outperforming its competitors.
Users of Apple products always expect to get devices or apps that work well right out of the box. However, that quality is a big expense, and that means that quality assurance and quality control are at the core of Apple’s corporate culture and are at the heart of development processes. At a time when the whole business world is on a path to openness, at Apple, everything about workflow is a taboo topic. One of the ways to detect defects and therefore produce better products is to test on users, and Apple is also actively using this by releasing beta versions of its software (Fámúwàgún, 2021). It is hard to assess the benefits of these beta programs without any details from Apple, but there are certainly benefits. In addition to its own Quality Assurance, which is directly responsible for the quality, the company has been using its own products since 1980 (Zhang, 2018, p. 40). Collective discussion of the criticality of defects found and the active use of manual testing, despite automatic tests, are also two strategies that ensure high quality.
A company like Apple needs only the best employees in every department, from programming to marketing to management. Thus, it is no wonder why the company performs well in terms of the human resources element of operational management (Okusolubo, 2020). However, the company is not without some problems. In a recent letter, Tim Cook outlined a company goal to diversify the gender composition of the company while paying attention to race and ethnicity.
In the smartphone market and tablets, one of Apple’s main competitors is Samsung. The company is one of the main processors and flash memory suppliers for iGadgets. Both competitors are dependent on each other to a certain extent, but this does not hinder the business. Still, the main goal of any organization is to capture the market share of competitors at minimal cost, and Apple aims to do that as well. Over the past decade, Samsung and Apple have repeatedly topped the world rankings of mobile device manufacturers. However, the companies are very diverse, with varying perspectives on what products should be like and how business should be run. 4 Vs theory based on a comparison of four key business indicators would be appropriate for analyzing the performance of two firms.
To begin the analysis of the two firms’ activities, it is necessary to start with the aspect of the volume of goods produced. In October 2021, the production volume of iPhone 13 smartphones and iPad tablets decreased due to a shortage of components (Apple’s iPhone 13 production fell 20%, 2021). Apple had to stop production in southeast Asia for several years. The firm’s decision was affected by power outages and restrictions in China. However, the Korean company Samsung faced the same situation. Both actors managed to cope with the crisis by updating their sales policies. Apple and Samsung launched sales of updated premium models – iPhone 13 and Galaxy Fold/Flip 3 (Bo-eun, 2021, para. 1). They increased sales in terms of cash, despite their decline in terms of quantity. Samsung retained its rank as the world’s top supplier in terms of units for the quarter. However, in terms of money, Apple has a serious advantage. While Apple concentrates on making profits, Samsung maintains more democratic prices and overtakes in the number of unit sales.
The most innovative and expensive company in the world. Apple makes iPhones, iPads, iMacs, MacBooks, AirPods, Apple TV+, Apple Arcade, and many other products. However, the company’s main competitor, Samsung, is not far behind in terms of diversity. Gadgets produced by Samsung have always been popular, and the situation has not changed in 2022. Samsung produces not only smartphones but also home appliances, tablets, laptops, and components for gadgets. For example, as of 2017, Samsung was the global market leader in chip production.
Apple is one of the largest and richest companies in the world. Not only its cash reserves are growing every day, but also brand visibility in general. The design of Apple products does not change so often – due to this, every device produced by the company becomes recognizable. The basis of Samsung’s success is that the firm follows market trends and reacts timely to changes in demand. Samsung’s steady growth in brand value reflects the company’s marketing efforts and a deliberate brand promotion strategy to strengthen brand unity. For example, back in 2006, Samsung became the World Olympic Partner in the wireless telecommunications equipment category and the Official Supplier of Home Appliances (TORINO 2006, 2006). The company’s support of the XX Winter Olympic Games in Turin increased brand visibility significantly.
Companies must be able to adapt to changing market conditions, which is associated with such a criterion as a variation. However, instead of adapting, some firms prefer to impose artificial restrictions. An example of limitations artificially created for the user is Apple. For example, it is impossible to transfer photos or videos from the iPhone to other devices over the air, and Apple has limited this basic function to its own products. Something similar has started to happen in the Android device market, and here the tone is set by Samsung, which has decided not to make many of its devices and accessories universal, fully working with all available platforms. In this regard, both companies are not too adapted to customers’ needs and, therefore, to the market’s needs as a whole.
First of all, it should be noted that Apple is currently in the stage of maturity. Next, it is worth assuming the further development of the organization and identifying two scenarios for the future: optimistic and pessimistic. Based on this, it will be possible to isolate the necessary improvements in the management and structure of the organization. In addition, it will be possible not only to allocate ideas for development but also to consider steps already taken.
The optimistic scenario would be to maintain the pace of the introduction of new technologies and innovations since today, the competition in the IT industry is quite tough. Such incentives will ensure the introduction of product diversity, which will allow the company to introduce new products, and thus, Apple’s work efficiency will be ensured. It will be important to support various social projects. Thus, in 2017, Apple released a red iPhone in support of the fight against AIDS, tuberculosis, and malaria, after which it transferred the proceeds to the Global Fund (Kelly, 2017, para. 1). For a world-famous company, such participation in social programs is important because it helps to form sympathy and loyalty to its product on the part of the consumer, despite the high cost.
It should be noted that the company is reducing emissions associated with the production of technical devices. Due to the deteriorating environmental situation in the world, support for the policy of preserving the environment and protecting health will only positively affect the company’s reputation (Fámúwàgún, 2021). The pessimistic scenario for the organization may depend on the change of key people in the organization, as shown by the analysis of the life cycle of Apple. In addition, the company may begin to suffer losses if it ceases to improve technology and, accordingly, its products. Today, the technology market is rapidly developing and does not stand still, which means that if a company stops creating and announcing new products, any of its competitors can take a leading position in the market.
Based on the preceding, it is necessary to note several of the most effective ideas for improving Apple’s management. First of all, it is necessary to change the pricing in the corporation, which can be done with the help of several tools. First, it is necessary to conduct a comparative analysis with direct competitors to identify the most optimal pricing policy. In addition, the target and loyal customer, as a rule, already own the product and therefore does not seek to buy equipment again. Thus, Apple’s uncovered regions are Africa, some countries in Asia, and Latin America. The average income of citizens of these countries and their purchasing power is lower than that of the target consumer.
Through analysis and production adjustments, management will be able to reduce the cost of both development and the final product in such a way that the company does not suffer losses. The next area that needs to be improved is identifying consumer needs. It is important to note that along with time and technology, customers’ requirements for the final product are also growing. For example, one of the main advantages of other organizations is that they have dual SIM options in their flagship product lines. This helps frequent travelers or people in business who prefer just such smartphones. Apple still sticks to single SIM cards, which need to be modernized by operations management. In addition to this aspect, a battery can also be distinguished, which is significantly inferior in performance to competitors in cold regions. Thus, the task of operational management is to maximize the concentration of the intellectual and financial resources of the organization both to identify the actual needs of the consumer and improve technologies.
Apple is a task-oriented company, and its organization is more like a complex web of teams and projects than a clear vertical orientation. There are no internal organizational boundaries, but every employee tries to cope with difficulties jointly. The corporation successfully directs the activities of people working in different departments on different programs to overcome the challenges faced by the company as a whole. The firm’s main competitor, Samsung, is no less successful than Apple in coping with market challenges. In terms of improving the company’s operational management, there are some areas where improvement can be made. Namely, Apple can change the way pricing is arranged in the firm, be more attentive to consumers’ needs, and continue to invest in innovative projects.
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Kelly, G. (2017) ‘Apple suddenly confirms three new iPhones’, Forbes, Web.
Okusolubo, G. (2020) Organizational analysis (a case study of Apple Inc.). Lincoln: Lincoln University New Zealand.
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Rowland, C. (2019) ‘Apple Inc. operations management: 10 decisions, productivity’, Panmore Institute, Web.
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Zhang, Q. (2018) ‘Research on Apple Inc’s current developing conditions’, Open Journal of Business and Management, 6(1), pp. 39-36.