Business and Corporate Level Strategy
Business in today’s world has become competitive. Different companies produce similar goods and offer the same services to satisfy customer needs while maximizing profits. To survive in the competitive market, companies must create unique products, adopt new business models, and research new markets. For instance, Apple has faced stiff competition from companies like Samsung that produce superior products with similar features as Apple (Hacklin et al.,2018). Despite the stiff competition, Apple has developed corporate and business strategies with competitive advantages to survive in fast and slow markets.
Business Strategies of Apple Company
The company’s business-level strategy revolves around product differentiation. The company differentiates commodities with a simple but attractive design with developed functionality (Hitt, 2018). The areas of concern in Apple’s business-level strategy include focusing on the functionality and design of products, customer experience, strengthening the company’s ecosystem, and decreasing dependence on a single business.
Functionality and Design of the Product
The company has adopted up-to-date features and proficiency of commodities based on competitive advantage. With research and identification of market gaps, Apple innovated superior products like the iPad. The iPad became the first electronic and communication computer with a graphical user interface. This made Apple well-known worldwide, thus registering a high percentage of market dominance compared to other companies like Samsung (Hitt, 2018). Maintaining Apple’s competitive advantage can be a problem as the company’s management may fail to ensure additional values and services to products, hence failing to maintain the markets
Focusing on Customer Experience
Customers are among the main pillars of Apple’s business strategy. The company allows customers to unwrap new products to view features before purchasing. The customers can ask questions and get help from Apple staff members on how the product works. Most Apple products, like iPhones, have already installed applications; there is no need to download and install anything. This gives customers an easy time because they only need to open the box, power up the device, and start operating (Hitt, 2018). Videos on various social media platforms show customers taking videos and downloading using iPhones, resulting from the successful customer experience created by the company.
Strengthening the Company’s Ecosystem
The company’s business strategy is vertically integrated. Apple’s vertical integration is based on advanced expertise on three major lines: hardware, software, and after-sale services. The company’s devices and software can sync faster and work in multiples with fewer differences in user interfaces. Vertical integration sets the company apart from stiff competition. Apple operates in a closed ecosystem, as the company’s items do not pair with those of other companies (Hitt, 2018). Secure systems create switching costs for customers, thus reducing competition.
Decreased Dependence on a Single Business
Apple does not rely on the sale of one product. The company enjoys economies of scale due to diversification. The company’s business structure is changing from just depending on selling the iPhone to other products like computers. With diversification, the company has raised more funds for investment in different business divisions such as Mac, iPad, and Apple Pay.
The Business Strategy for the Long-Term Success of Apple
Decreased dependence on a single business is an essential long-run strategy. The company does not depend on a single industry. The company relies on selling the iPhone and has diversified its operations to produce and sell other products, such as Macs and iPads. Because of diversification, the company enjoys economies of scale (Hacklin et al.,2018). For instance, if there is a market fall in the sale of the iPhone, the company cannot close down because of enough funds generated from the Mac sales. Companies that produce more than one product have an added advantage because the failure to sell one commodity does not affect the company’s operations (Ocasio & Joseph, 2018). Companies with various effects are financially stable since they generate much revenue from multiple sources.
Corporate-level strategies of Apple Company
Corporate strategies enable companies to allocate resources efficiently, focus on the company’s expectations, improve the competitive advantage, and increase shareholders’ value. Apple’s corporate system includes internationalization, the formation of trade and marketing alliances, and closely related diversification.
Apple has internationalized the production of its products as one of the strategies to dominate the markets. For instance, the company has taken advantage of cheap labor, low cost of raw materials, high markets, and economic stability in China to establish production industries. The company has dominated the market because it produces high-quality products (Rasul, 2018). The company’s production processes, such as engineering designs and manufacturing, are centralized and easily controlled.
Formation of Trade and Marketing Alliances
The company works in partnership with significant trading alliances like Microsoft Windows to enjoy the benefits of scale due to expansion. The company can learn about the existence of new markets and information about market changes. With trade alliances, the company can borrow resources to finance production activities when financial constraints (Rasul, 2018). Companies with trade unions can exchange ideas, leading to creativity and innovation.
The company has closely related products such as computers, mobile phones, and software. With immediate diversification’ customers can get products and services with high quality and designs because these gadgets are closely integrated with the same operating systems.
The Corporate-Level Strategy for the Long-Term Success of Apple
Production of closely related diversified products is the most important corporate strategy. This strategy gives the company a competitive advantage because a single product can perform more than one function. For instance, the iPad can be a home computer and mobile phone (Rasul, 2018). With close-related diversification, a company incurs fewer production costs because a single product can be offered to meet multiple customer tests and preferences. Customers can also save on purchase and operational costs since a single product performs more than one function.
Analysis of Competitive Environment to Determine the Corporation’s Most Significant Competitor for Long-Run Success
With advanced technology, the production industry has become very competitive. Many players are operating the same business as Apple. For instance, Apple faces stiff competition from Samsung. Both Samsung and Apple companies are producing computing appliances and mobile phones. Regarding music devices, Apple’s leading competitor is Microsoft (Hacklin et al.,2018). With market expansion due to globalization, Apple’s iPad and iPhone have been compared with Samsung S trend smartphones.
Despite the stiff competition, Apple’s corporate business-level strategies have continuously enabled the company to dominate the market (Rasul, 2018). Samsung has heavily invested in coping with how Apple has produced closely differentiated products doing multiple tasks. Still, Apple has encountered these imitations by creating products with similar designs but performing different functions. Customers like Apple products because of integrations; thus, the company will remain successful in the long run.
Apple has heavily invested in internationalization, forming alliances, corporate diversification, and vertical integrations, thus overwhelming its competitors. Internationalization has enabled Apple to dominate markets across the world compared to Samsung. Apple products are of high quality and are found all over the world. The formation of trade alliances has helped the company acquire resources to finance production activities and thus does not encounter the problems associated with funds compared to the competitors (Rasul, 2018). Generally, with the production of closely diversified products, internationalization, formation of trading alliances, and vertical integrations, Apple is likely to succeed in the long run compared to its rivals, such as Samsung.
Competition Differences in the Fast and Slow Cycle Market
Changes in technology have substantial impacts on market demands—technological changes and advancements in the production industry focus on market cycles. The technology industry mainly lies in fast-cycle markets. However, some products enter slow-market cycles. In the case of Samsung and Apple, smartphones fall under fast market cycles whereby they are replaced with new advanced ones before customers fully utilize their utilities. The two rivals, Apple and Samsung, are pushing hard to outshine each other in the production of smartphones. For instance, Samsung introduced the S Galaxy trend that hit the market; before the consumers utilized the brand, Apple responded with the iPhone 5S (Rasul, 2018). There has been a big battle in the market because both companies are making profits, and we cannot determine which company will dominate the fast-cycle market. In the slow market cycle, Apple appears to be the best compared to Samsung because it has managed to produce closely- diversified products that Samsung has tried to imitate but failed.
With changes in technology, the production industry has become more competitive. Companies must adapt to technological changes and develop viable business and corporate strategies to gain a competitive advantage and operate profitably. Apple has developed sound corporate and business systems like differentiation and leadership costs, allowing it to dominate the market and become more appealing to customers (Hacklin et al.,2018). With stiff competition, companies should produce quality products that meet customer needs.
Companies should produce highly differentiated commodities with unique and appealing features so competitors do not easily imitate them. Companies should also diversify their operations to enjoy the benefits associated with economies of scale. Diversified companies make a lot of profits that can be used for innovation. Companies should join trading alliances to get financial support when expanding their business operations.
Hacklin, F., Björkdahl, J., & Wallin, M. W. (2018). Strategies for business model innovation. Long-range planning, 51(1), 82-110. https://www.sciencedirect.com
Hitt, M. A. (2018). Strategic management: Cases and Concepts: competitiveness and globalization advantages
Ocasio, W., & Joseph, J. (2018). The attention-based view of great strategies. Strategy Science, 3(1), 289-294. https://pubsonline.informs.org/doi/full/10.1287/stsc.2017.0042
Rasul, T. (2018). Market Relations and their Importance in Present Culture. The Journal of Emerging Companies, 52(1), 262-267. https://www.proquest.com
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THE CHOSEN COMPANY IS APPLE
Week 8 Assignment – Business-Level and Corporate-Level Strategies
In this assignment, you are to use the same corporation you selected and focus on Strategic Management, Strategic Competitiveness, and External and Internal Environments.
Research the company on its website, public filings on the Securities and Exchange Commission’s Filing & Forms page, Strayer University’s online databases, the Lexis Advance database, and any other sources you can find. The annual report will often provide insights that can help address some of these questions.
Use the Business-Level and Corporate-Level Strategies Template [DOCX] to ensure your assignment meets the requirements.
Write a 6-8 page paper in which you do the following:
Analyze the business-level strategies for the corporation you chose to determine which business-level plan is most important to the firm’s long-term success and whether you judge this as a good choice. Justify your opinion.
Analyze the corporate-level strategies for your chosen corporation to determine which one you think is most important to the firm’s long-term success and whether you judge this as a good choice. Justify your opinion.
Analyze the competitive environment to determine the corporation’s most significant competitor. Compare their strategies at each level and evaluate which company will most likely succeed in the long term. Justify your choice.
Determine whether your choice from Question 3 would differ in slow-cycle and fast-cycle markets.
Use at least three quality references. Note: Wikipedia and other websites do not qualify as academic resources.
This course requires the use of Strayer Writing Standards. For assistance and information, please refer to the Strayer Writing Standards link in the left-hand menu of your system. Check with your professor for any additional instructions.
The specific course learning outcome associated with this assignment is as follows:
Determine business-level and corporate-level strategies for a corporation’s long-term success comparable to the competitive environment.