Aligning Operational Needs with Business Strategies- Apple Inc.

Aligning Operational Needs with Business Strategies- Apple Inc.

Apple Company has achieved massive success despite going through ups and downs since its launch in 1976. In 2018, the company became the first one to attain a market capitalization of $1 trillion (Stapleton, 2022). A key success factor for Apple is the massive product development campaign that leads to new product development. The innovativeness at Apple shows that the company understands the market needs, hence the ability to capitalize on those needs. Strong elements of Porter’s five forces at Apple that may impact its profitability include competition and buyers’ bargaining power. On the other hand, the threat of new entrants, buyers going for substitute products, and suppliers’ bargaining power are weak elements of Porter’s five forces.

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Analysis of the Porter’s Five Forces

Industry Competition

Apple faces intense competition from other industry players. Rivals like Google, HP Company, Amazon, and Samsung Inc. compete directly with Apple (Stapleton, 2022). These companies expend vast amounts of money on research and development, just like Apple. Another factor responsible for the competition is the low switching cost from one company to another. The result is intense industry competition.

Bargaining Power of Buyers

Buyers’ bargaining power is high due to the low switching cost. If customers fail to acquire a product at the expected prices, they may switch to a competitor. Buyers’ bargaining power is looked at two-fold. There is individual and collective bargaining power. Individual bargaining power is weak since a single customer leaving cannot affect the company’s bottom line. However, if many customers leave collectively, the company will likely face losses.

The Threat of New Entrants

The threat of new entrants in the industry is low. This is mainly attributable to two factors. Firstly, the cost of establishing a related technology company is high (Stapleton, 2022). Besides, the investment needed to create new brand recognition is so huge. Even if a new entrant can raise the required capital to create and market a brand, they will still face competition from already established players.

Suppliers’ Bargaining Power

Suppliers’ bargaining power is a relatively weak force in the industry. This is because there is a huge supply base for Apple’s component needs (Stapleton, 2022). In addition, the company has a huge pool to choose from. For instance, there is a wide array of computer processor parts. Besides, these suppliers engage in intense competition as they look for clients. Subsequently, this allows Apple and other industry players to negotiate better deals.

The Threat of Substitute Products

Substitutes are products that are not in direct competition with current product offers but serve a similar purpose. For instance, a landline phone can be a substitute for Apple’s iPhone to communicate. The market force is weak since potential substitute products have limited capabilities compared to Apple.

Effectiveness of Apple’s Leadership Model

The current leadership model at Apple represents a paradigm shift from the traditional leadership model under Steve Jobs. The current CEO, Tim Cook, implements a democratic leadership model, unlike his predecessor, who implemented an autocratic leadership style (Financhill, 2021). A democratic leadership model involves listening to everyone and giving them a chance to practice their capabilities. Tim’s leadership style lets everyone at Apple exercise their talents for the company’s success. However, that does not mean that the CEO delegates all powers to managers. On the contrary, the CEO maintains an open mind and lets everyone express their viewpoints. At the end of the day, he convinces everyone to follow his lead.

Democratic leadership is effective since it bolsters employee engagement. Employees at Apple are free to engage their individual innovative capabilities for the benefit of the company (Financhill, 2021). In addition, a democratic leadership style drives a sense of respect and recognition for employees. To that end, employees work as if the company is theirs since they know their input is valued. As a result of the current leadership at Apple, employees report positive workplace motivation (Financhill, 2021). For instance, the employees feel sufficiently involved in the decision-making process. Also, the environment has allowed employees to express themselves without any fear. Besides, the rewards directed at employees who offer breakthrough insights come in handy.

Determining the Effectiveness of a Leader

Fostering Growth and Strong Values

One way to measure a leader’s effectiveness is to look at their ability to encourage employees to adopt a growth mindset and strong values. Good leaders must create an environment in which every employee enjoys working (Forbes, 2021). If employees have a positive sentiment about their leader and are always looking forward to going to work, then their leader is effective.

Measuring Profitability

Profitability is one of the most crucial measurements to determine a leader’s effectiveness. A good leader should create an environment that positively impacts the company’s reputation (Forbes, 2021). A leader also plays a key role in winning a company’s new clients. If the leader is effective, a company will win new clients.

Attainment of Strategic Objectives

A leader’s effectiveness can also be measured by evaluating the company’s strategic objectives. An effective leader regularly monitors a company’s goals to ensure they are on the right path (Madanchian et al., 2017). In case of a diversion, a good leader redirects the company on the right path.

Measuring Employee Confidence

A leader is as good as the people who work under them. A good leader should put employees in roles they are good at. As a result, this will enable employees to be productive, whereas the leader remains hands-off. Also, the leader should be available to deal with emerging issues. These attributes instill confidence in employees about their leader.

Recommendation

The current democratic leadership at Apple gives employees too much of a free hand. Whereas the democratic leadership introduced by Cook is good, a few changes are needed. I believe the CEO should implement a hybrid of autocracy and democracy to keep employees motivated. On the operational side, the company should adopt new security features for its devices. The devices have been a target of data thieves due to their vulnerability. Therefore, implementing new IOS features will come in handy. Besides, Apple should direct more investments into AI and machine learning. Subsequently, this will save employees time as they will not have to undertake some activities manually. For instance, some employees are caught up in sending personalized messages, which can be done through machine learning.

References

Financhill. (2021). Tim Cook Leadership Style. Financhill. https://financhill.com/blog/investing/tim-cook-leadership-style

Forbes. (2021). Council Post: How To Measure Leadership Effectiveness: 14 Essential Tips. Forbes. https://www.forbes.com/sites/forbesbusinesscouncil/2021/05/28/how-to-measure-leadership-effectiveness-14-essential-tips/?sh=4aa12acc2823

Madanchian, M., Hussein, N., Noordin, F., & Taherdoost, H. (2017). Leadership Effectiveness Measurement and Its Effect on Organization Outcomes. Procedia Engineering, 181(181), 1043–1048. Science Direct. https://doi.org/10.1016/j.proeng.2017.02.505

Stapleton, C. (2022). Analyzing Porter’s 5 Forces on Apple (AAPL). Investopedia. https://www.investopedia.com/articles/investing/111015/analyzing-porters-five-forces-apple.asp#:~:text=Apple%20in%20the%20Marketplace%20From

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A primary technique of deeper analysis of an organization is Porter’s Five Forces Model. This technique is often used when looking at your competitive advantage. Looking at your competitive advantage is important to aligning your operational needs with your business strategies.

Aligning Operational Needs with Business Strategies- Apple Inc.

Review sources on your company.

Write a 700- to 1050-word proposal to the company of your plan to align the operational needs with business strategies based on your analysis. Include the following in your proposal:

An analysis of the company based on Porter’s Five Forces
An analysis of the effectiveness of the leadership model the company is currently using
Consider the current leadership style or styles in place at the company.
Determine the effectiveness of the leadership style/s and whether an alternative style/s would be more impactful.
Assess how to determine effective leadership. What makes a leader effective or ineffective?
Consider sources of managerial power when leaders are effective.
Recommendation for the following actions:
Leadership model changes
2- to 3- actions needed to align operational needs with business strategies identified in Week 1

Include and cite 1 other resource besides the text.

The company I chose for this assignment is Apple.