Internal Environments Of Apple Computer

Published Date: 23 Mar 2015 Last Modified: 28 Apr 2017

This project assignment provides a comprehensive evaluation and analysis of the external and internal environment of Apple Computer, which is a good consumer company. The external environment includes the general environment, industry environment, and competitive environment. It is analyzed to determine the driving forces and key success factors. In addition, the external environmental analysis processes are scanning, monitoring, forecasting and assessing. On the other hand, the internal environment analysis evaluates the organization, resource, capabilities, core competencies, objectives, financial performance, and strategies. Furthermore, Apple Computer is identified on several analyses such as strengths, weaknesses, opportunities and threats. Moreover, stakeholders are the individuals and groups who can affect the vision and mission of company as well as enforceable claims performance of the company. There are three types of stakeholders which are capital market, product market and organizational. Lastly, the strategic options are based on recommendation for future plan of Apple Computer.

The objectives of this assignment are review and analyze the fundamental of external and internal environments of Apple Computer which identify the strengths, weaknesses, opportunities and threats of company. In addition, management of strategies used by the Apple Computer which to enhance the efficiency and effectively of their business and fit with the external and internal environment. Moreover, there are also can realize the operations, business knowledge, decision making, interpersonal leadership and entrepreneurial skills obtained from Apple Computer.

The scope of this case study involves the external and internal environment of organization Apple Computer. The external environment can be seen under marketing scope such as industries and competitive faced by Apple Computer. As well as the internal environment involves inside the organization's operations such as capabilities, core competencies, and competitive advantage. Furthermore, it also related to globally that Apple Computer Incorporation is a famous and successful multinational corporation which creates consumer electronics, computer software, and commercial servers.

The limitations for this case study which obtained information from journals, internet news, online books, and Apple's web site. This also can be extensive studies of accessible data from library or bookshop to search related books of Apple Computer Incorporation. There are no interviews and questionnaire surveys were made.

2.0 Background to the organization

Apple is a multinational corporation as a computer company which started in 1976. The company also known as hardware products includes Macintosh computers, the iPod, the iPhone and the iPad. However, Apple has expanded into a very complex company that produces product diversify which specializes in much more than just computers. In 2001, Apple becomes the dominant market leader in music players such as iPod. As well, in 2007, Apple joined the phone industry with the iPhone which has been widely successful.

Apple is a consumer goods company that evaluates its value requires to understanding its products and consumers. On April 1, 1976, Steve Jobs and Stephen Wozniak began the partnership that eventually becomes Apple Computer. In early 1976, Wozniak had been working on combining video monitors with computers. His idea was to invent o user-friendly computer that ordinary consumers could buy. Therefore, Steve Jobs told his friend Wozniak that they should go into business together and sell computers themselves. Their first computer, the Apple I, was built in the garage of Job's parents known as a "kit computer", the original Apple consisted merely of a circuit board and did not even have an exterior casing.

Apple ignited the personal computer revolution in the 1970s with the Apple II and reinvented the personal computer in the 1980s with the Macintosh. 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.

The Apple Computer Incorporation brings the greatest personal computing realization to the all kind of people around the world with their own life style. Apple came out with the variety kind of product through its innovation. The market strategies evolved should be economical, efficient, durable, and flexible and allow the Apple to respond rapidly to both market and customer needs. Apple Computer Incorporation keep on top of technology to ensure the customers have the best tools available to them.

3.0 situation analysis

Situation analysis is used to analyze both the internal and external environments of organization which understanding the capabilities, customers and business environment of Apple Computer Incorporation. The situation analysis consists of several methods such as general environment analysis, Porter's five force analysis, and SWOT analysis. The situation analysis also looks at both the macro- and micro-environment that affect many firms within the environment and specifically affect the firm.

3.1 general environment analysis

Understanding the external environment of the technology industry is necessary in order to better understand the internal environment of Apple Computer Incorporation. There are consists of seven segments: demographic, socio-cultural, political/legal, economic, global, technology, and physical environment.

3.1.1 Demographic

Demographic is defined as statistical data relating to the population and particular group within it. It also a particular sector of population.

Apple Computer Incorporation Known as one of the world most valuable technology companies. Studies consistently show that Apple Macintosh computer is a higher-priced brand compare to other standard- priced computer and tending to target people who are higher standard of living. Some studies showed that Apple's users turn up to be younger and younger nowadays. Besides that, Apple's users consider themselves early adopters of new technology. Usually, the products in Apple's Macintosh computers are consider higher price and high quality compared to Microsoft Windows- based competitors.

During economy declined, Apple CEO - Steve Jobs said that the company would not lower the prices of its Apple Macintosh computers even though consumers might choose not to buy Macintosh computer but choose to purchase lower - priced computers. Based on Erik Arvidson, Steve Jobs said that 'there are customers we choose not to serve". Jobs indicate that Apple continues targeting customers who were high standard of living and less sensitive to price, even there is economic recession- from CNET. According to the survey, the ages of Mac users are between 18 and 34, more toward youngest trend. In addition, most of the users are more likely live in city, and they want to be perceived as unique and make different from others.

Over the past several years, the American middle class has experienced increasing of cost of many products or service such as healthcare and the CPI, but the salary is flattening and remains stagnant. The high cost to purchase Apple Mac computers may send potential users or customers into the hands of competitors when the consumers can't afford to buy the Mac computers. Due to the intuitive of Apple Mac, Apple's perceived value has directly brought benefits to them during the economic declined; they have continued to experience growth and benefit while other competitors suffered.

3.1.2 Socio-cultural

The current environmental trend and quest to go green has led a shift in consumer attitude towards more sustainable products. Apple Computer Incorporation has an Apple Recycling Program that reduces impact on the environment to improve products' environmental performance. Therefore, Apple designs to use less material, ship with smaller packaging, be free of toxic substances, and be as energy efficient and recyclable as possible. Apple measures the performance environment one product at a time by using the Product Environmental Reports which a way to design the process of products manufactured, used, and recycled represents the largest percentage of Apple's total greenhouse gas emissions in better environmental performance. Inside the Product Environmental Reports consists of several categories: climate change, energy efficiency, material efficiency, restricted substances and recycling.

In manufacturing sectors, there is the part extraction of raw materials and product assembly to accounts of Apple's total greenhouse gas emission. Therefore, four importance things need to be focused which are material use, toxic substance removal, environmentally conscious material and responsible manufacturing. The products of Apple are designed in pioneered the development of smaller, thinner, and lighter. As the products become more powerful, then they require less material and generate fewer carbon emissions. For example, the size of Apple computer becomes smaller rather than traditional at a same time there are more powerful. From the glass, plastic, and metal in products to the paper and ink in packaging is a goal of Apple to leading the industry in reducing or eliminating environmentally harmful substances. Although not every products of Apple are free of harmful toxics, but some products are qualified thousands of components to be free of element bromine and chlorine. In addition to eliminating toxins and designing products with highly recyclable aluminum enclosure, Apple works with environmentally conscious materials including recycled plastics, recycled paper, biopolymers, and vegetable-based inks. Another that, Apple is committed to ensuring that working conditions in supply chain are safe, workers are treated with respect and dignity, and manufacturing processes are environmentally responsible. A significant portion of greenhouse gas emission Apple is come from the products when plug in products and start using it. Hence, energy efficient of product will be designed in both hardware and operating system to make sure work together to conserve power.

3.1.3 Political/ Legal

The success of Apple Computer Incorporation depends on effective and consistent public policies and rules that encourage a healthy business environment. The regulation and legislation can significantly affects how the Corporation conducts its business affairs and creates value for shareholders. The corporation takes part in the political process in order to protect and enhance the corporation's interest. Apple Mac Computer Inc. strategy is to engage in the political process with a view to the long term interests of Apple and its shareholders.

Apple currently belongs to some major trade associations which are American Electronics Association (AcA), Business Software Alliance (BSA), the Consumer Electronics Association (CEA), and Information Technology Industry Council (ITI). The purposes to engage in those associations are to advance the common goals and interests of the member companies and their customers. Besides that, the purposes include addressing issues as reduce piracy, opening access to foreign markets, ensuring consistent product standards, and promoting strong intellectual property protection.

Apple faces political or legal issues both domestically and abroad. Government focused on the environmental issues that restrict manufacturing of the units. Environmental concerns are issues that directly affect computer manufacturer. EPA- the profile of the Electronics and Computer industry code updated by the Environmental Protection Agency in order to provides directives the must be follow by the companies that manufacturing components of computers. In effort to promote product stewardship from environmental perspective, Apple has intelligently promoted the buyback and proper disposal of computer parts.

There are many competitors appeared in the market of computers line. Apple faces the battle of overcoming the market dominance of the PC based computers but does have tremendous opportunity present in the iPod and music associated industry. Apple also faces and recognized the pirating and copying issues. The government imposed law to protect their benefits and interests.

In addition, Government provides the basic regulations and restrictions that influence the computer corporations in producing and selling personal computer. In computer's software area, bodies such as the Copyright Arbitration Royalty Panel (CARP) or the Recording Industry Association of America (RIAA) can provide an important impact through imposing new laws in order to limit the digital music industry in its efforts to grow and expand. For example, CARP indicated company that produce audio or radio for the World Wide Web (WWW) which know a s webcasters should pay per song, per stream royalty. The high rate of 0.07 cent would force many corporations out of market or business. The RIAA claiming that the high rate does not affect music's fair market value and those who can't able to pay the fees should be first out of business. Those fees imposed on downloadable music content could affect the business because the consorts could totally disappear and the profit margin of Apple will become narrow. The government regulating the industry through imposed the music online competition act in order to solve various aspects of the US Copyright Act with update.

3.1.4 Economics

The economic environment was under unpredictable scenarios and was challenging to the Apple Computer Incorporation but the company managed to cope up with the challenges. After receiving competition from other products in from other companies, one of its products Mac managed to survive in the market. It is because Apple Inc. can successfully access the economic environment as it understands the foreign economic environment. It can help to predict the trends and events in those environments that may affect the performance of their products in foreign countries. Sometimes, it may also influence the decisions made. For example, when Apple came up with iPad in year 2010, it performed differently on both the home and international markets. Because of its high price, it kept on rising and falling. Apple Computer Incorporation was aware of the up and down changes and it would have been likely to come from a particular country imported components.

After all, the U.S. economy has improved and there are signs of full recovery looming the outlook is not certain. This uncertainty leaves consumers weary of big-ticket purchases like computers. The premium pricing of Apple leaves the firm at a disadvantage to less expensive competing products. However, when the consumers feel that the economy is improving, they will increase their spending on Apple products. Consumers seek to "treat" their own economic upturn with Apple's luxury products. Thus, they may be attracted to Apple's premium portables as Apple is known for its high-quality, reliable machines, and excellent customer services. This may be seen as presenting the best value of products than its competitors with fewer prices.

3.1.5 Global

The definition of global is allowed all the market from the world being one of the markets for trading. For information, the global market is also increased the dependencies of and relations of business and economics from the world. The computer industry exception that the Apple brand is not affected by the global environment because Apple successful to innovative revolution of products. For example, Apple reported sold 17 million of I-pad in the world. According the information, the European country is facing the unemployment rate, inflation and problem. The most serious is the bankrupt problem. Even though Europe is facing the problem, but the number for I-pad selling is still kept increasing. Another example can be seen that Apple Computer Incorporation plans to increasingly the retail presence out in the other countries since that the market not enough stock for supply to the customer. Hence, the Apple would like to increases the retail presence for the market in the foreign country. It can be evidence that the number of retailer store of Apple has 208 stores if compared the recent year, just has 177 stores around the market that increased about 17.51 percent.

Apple was lately established their brand in China in year 2011. The Apple has six retail outlets in Beijing, Shanghai and Hong Kong. From the information that I found, the young generation of the China are favorite to sell Apple product, especially I-pad. Furthermore, Apple has make agreement with the Foxconn Technology Group, Taiwanese firm. The Taiwanese firm helps the Apple package the I-pad and other electronic. The factory located in the Shenzhen which hires about 25,000 employees for working. Besides that, the Apple organized the campaign namely "I-Mac". Meanwhile, the Apple spent about $100 million budget as their start point to enter the global. They start in the United State, European and Japan. Hence, the number of the I-Mac has been number one in the computer industry.

3.1.6 Technology

Apple Computer Incorporation provides more amazing successful technology products in the worldwide technology industry. Especially the revolution Apple I becomes to I-Mac. This is because Apple offers advanced technology that is flexible enough for individual researchers and scales to support larger collaborative efforts. There are many benefits from the consistency of one operating system, Mac OS X, from client to server. In the hardware part, for example, the Mac Pro, Apple technology provides the power and ease use in high-performance computing. With its state of the art graphics capabilities, Mac Pro makes the perfect visualization workstation as well as graphics technological provides the ability with brilliant clarity contrast, and detail. In addition, the Macintosh is the ideal system for publishing scientific work that Microsoft Office runs natively on Mac OS X as well as favorite writing, reference and publishing tools.

On the other hand, the platform of Apple can combine the power, security, and stability of UNIX with the ease of the Mac interface. For example, Mac OS X provides the ideal platform for scientific research. The Mac also allows people to publish, communication with other people, and browse the Internet. These are the benefits for advance the technology of Apple Computer Incorporation.

Apple's most recent iPod to date, the iPod Touch (September 2008), is the first iPod to have a touch-sensitive screen and include Wi-Fi wireless networking. The home screen features multiple 'touch-buttons' to play music, videos, see photos and maps, surf the Internet, check email, etc. Users can also access the iTunes Media Store and download content with the touch of a 'button.' With up to 32GB storage, the iPod Touch offers 36 hours of audio playback and 6 hours of video playback.

3.1.7 Physical Environment

The recycling approach of Apple begins in the design stage, where create compact, efficient products that require less material to produce, material used including arsenic-free glass, high-grade aluminum, and strong polycarbonate. Even packaging uses recyclable materials wherever possible.

All e-waste collected by Apple will be controlled voluntary and regulatory programs worldwide. The recyclers must comply with all applicable health and safety laws and Apple does not allow the use of prison labor at any stage of the recycling process. Nor they allow the disposal of hazardous electronic waste in solid-waste landfills or incinerators. Apple recycling programs are once an Apple product reaches the end of its useful life. The weight of the materials recycle each year is compared to the total weight of the products Apple sold. Apple global recycling once again exceeded 70 percent goal.

For more than 20 years, Apple has been working on ways to minimize the impact company and products have on the environment, which developed and formulated the first environmental policy in 1990. Since, Apple will be continued to make the products more energy efficient, eliminated many toxic substances, and embraced renewable energy in facilities. In addition, Apple has dramatically changed the traditional consumption model of CDs, DVDs, and DVD-ROMs associated with music, movies, and data storage into the modern model of iTunes, App Store, and iCloud. Apple has also revolutionized how people purchase and consume books, magazines, and newspapers with the introduction of the iBookstore and Newsstand.

3.2 industry conditions - porter's five force analysis

The Porter models involves scanning the environment for threats from competitors and identifying problems early on in order to minimize threats imposed by competitors. Porter's five forces model can be applied to a country to help gain insight into creating a competitive advantage in the global market as well as help businesses compare and analyze the profitability and position with the industry against indirect and direct competition.

Threat of New Entrants

The threat of the new competitor is very high. This is because the Apple Computer Incorporation is large economies of scale makes its return of profit effectively. For example, the apple earned the higher profit about $88.7 million per year for iPad as the best seller one of the computer beside the IMac. Hence, the apple competitor, such as Samsung also manufacturing the Samsung tab, contain almost function with the iPad. For the information given that the number of Samsung tab is kept increasing and the revenue of Samsung also increasing.

The technology of the computer being maturity such as the Apple and competitor has the maturity technology to manufacturing the computer to meet their customer needs. A new company would have to create competitive software that a rapidly changing technological advancements within the computer software market. For example, the personal computer market provides Microsoft's Windows compared with Apple Computer Inc. provides Apple's Mac OS X.

Another threat is the cost of manufacturing between Apple Computer Inc. and its competitors. As an example, the competitor Samsung offers the cheaper price of the products than Apple Computer Inc. whereas the products of Apple have a higher quality. In addition, the barrier of new entrants would be face legal barriers which mainly in the form of patents such as copyright the computer design patent as well as technology.

3.2.2 Bargaining Power of Suppliers

The bargaining power of suppliers for hardware products is low as the industry is highly saturated, causing suppliers to be competitive in their pricing. Apple adopts a differentiation strategy which requires the firm to ensure that suppliers provide high-quality components, driving up its supplier costs. However, Apple is partially insulated from the impact of higher supplier costs due to the premium that the firm charges for its products. Furthermore, Apple purchases a large amount of raw materials, increasing its bargaining power as a significant customer. Hence, Apple is able to secure components at a lower price.

The microprocessors of Intel have been dominating the PC Computer Processing Unit market with 80% of the market share. To provide higher performance desktops and laptops, the entire Macintosh line is now running on Intel chips, increasing Apple's dependence on Intel. Therefore, Intel has a high bargaining power as a supplier for its PCs. However, for non-PC devices that make up 60% of its revenue, Apple develops its own A4and A5 chips which mitigates it over-dependence on Intel.

In addition, the Operating Systems (OS) of Apple develops its own Mac OS X for its PCs and OS for its non-PC devices. Due to incompatibility of the Mac OS with many software programs, Mac users may prefer to run the Windows OS. This creates a dependency on Microsoft to provide the Mac-compatible Windows OS. However, since Apple is the third largest PC seller in the U.S. market,

Microsoft would also be dependent on Apple to make the sales for the Windows OS. Hence, this interdependency would result in a low bargaining power of Microsoft.

Bargaining Power of Buyers

The bargaining power of buyers is low to consider the customers would have to buy the products in very large volume. Apple has 98 national and 4 international retail stores as well as online store carrying the full line of Apple products. Therefore, the Internet is a huge selling point for Apple computer with the popularity and benefits of at-home shopping. There are the high bargaining powers of businesses to purchasing Apple computers in bulk for office use compared with home users that they have literally no control over Apple when it comes to their pricing.

Apple focuses on product differentiations that have a signature style and innovation features to set apart from their competitors. This makes buyers less price sensitive and avoids the same features or stylish look with other products of competitors. According the information mentioned that once Apple sells to the end user it has essentially secured future sales of its hardware and software due to a lack of third party options. This gives buyers even less relative bargaining power to shop for better prices or alternatives for their hardware or software needs.

3.2.4 Threat of Substitute Products

Threat of substitute of product toward Apple Mac computer is very high. Apple work to pursue their customers that their product is superior compare to its competitors. The more differentiation of product compare to substitute, the less likely the switch to a substitute will occur. Apple has to provide justification for increase if the prices are higher than other PC company. Apple's operating systems with higher differentiation can expertise higher pricing when Apple presented it product to the creative designer community, but not to the individual computer buyers unless those buyers are purposely looking for such enhanced graphic capabilities.

In average, all of the PC industry is a very competition intense sector with the technology undergoing paradigm shift. PC industry has to come out solution to cope with these changes. Coping with these changes can make life difficult for the player in the PC sector. Apple has been able to manage and retains its technological expert and designer approach to come out of this difficulty. Besides this, Apple could convert some of these problems or difficulties into opportunities by looking at its SWOT analysis.

A readily amount of substitute products threatens Apple's market due to buyers easily can switch from one device to another. Apple persists to make different with their Mac computer series from the common PC market. Therefore, Apple isn't as directly affected as Dell, HP Compaq, Asus or IBM. As Apple is operating in a fast cycle market in which the firm capabilities that contribute to competitive advantage and have protection from imitation by other PC industry where imitation is often rapid and inexpensive. Apple has always differentiated on the innovation and design. Apple has to adapt and offer new services to keep itself from the competition. Steve Jobs is very good in coming up an innovative product to keep this as advantages from falling over. It is very difficult for firm competing in fast cycle market and innovation play an important role to avoid them from being out of market.

The pressure from substitute products is considered to be high if products of different business or industries can basically satisfy the same customer needs. Consumer preferences can change any time especially in high technological market. Apple currently can avoid the threat of substitute products as technological innovation will not produce big changes in the near future. In despite of this, Apple has to be aware that the external environment can change rapidly to the disfavor of Apple.

3.2.5 Intensity of Rivalry among Competitors

Apple Computer Incorporation faces strong rivalry from its existing competitors due to the huge number of competitors in the similar industry in which it operates. In the Personal Computer (PC) industry, its main competitors include Hewlett-Packard (HP), Dell, Lenovo, Compaq, Acer, Gateway and IBM.

In the personal computer market, Apple was the leader who came out first with Apple I and soon able to make the Apple II became a family commodity. After IBM transformed the PC from proprietary systems into open structure, PC has been dominated by Wintel (Windows + Intel) structure. Compaq, HP and many other producers started to show in the market to produce IBM compatible PC. It was an intense competition for Apple. Apple lost the PC market because of ignoring industrial changes as it insisted in selling their products as a high price proprietary system. The hardware and software were so different and not compatible with IBM machine. Besides, Intel created competitive disadvantage for Apple by releasing faster processor every quarter. This made Apple failed to respond in time. After all, Apple tried to develop new iMac to win the market back but unfortunately it was a failure as it focused on the wrong market.

Although the companies are aware those PCs are weakly differentiated but they are still active in innovation. For example, Windows operating system make Windows Intel platform more valuable and thus create additional pressure for Apple especially high switching cost for consumer to switch to Apple. However, Apple success with unique selling points in "ease of use", "industrial design", "tech elegance", and "powerful graphic application". Apple's products are highly differentiated in terms of design and functionalities as compared to its competitors' products. As a result, Apple is insulated from intense rivalry due to strong brand loyalty arising from its positive reputation for high-quality and unique products. It is proven that in 1990, the majority of IBM and compatible users 'put up' with their machines, but Apple customers love their Macs. They will continue to be loyal to Apple until their needs and desires are let down. Apple would be able to sustain this competitive advantage as long as it continues to innovate and meet the customers' expectation.

description of key stakeholders

3.3.1 Capital Market Stakeholders

The shareholders are concerned with the stock price of the company. They want to make sure their investment is profitable and has a future. Steve Jobs as the co-founder, chairman, and chief executive officer of Apple Inc. He was widely recognized as a charismatic pioneer of the personal computer revolution and for his influential career in the computer and consumer electronics fields. In the late 1970s, Apple co-founder Steve Wozniak engineered one of the first commercially successful lines of personal computers, the Apple II series.

After losing a power struggle with the board of directors in 1985, Jobs left Apple and founded NeXT, a computer platform development company specializing in the higher-education and business markets. In 1986, he acquired the computer graphics division of Lucasfilm, which was spun off as Pixar. He was credited in Toy Story (1995) as an executive producer. He served as CEO and 50.1% majority shareholder until Disney bought Pixar in 2006. Jobs received 7% of Disney shares, and joined the Board of Directors as the largest individual shareholder.

In addition, the organizations who offer the Apple MacBook Finance will surely look into the consumers' pocket prior to their financing the deal. Depending upon the sort of revenue structure, consumers will get the financial from the banks or economic lenders. The very first step in the procedure is to get in touch with a financing business with financial particulars.

If consumers are functioning in an organization or government business, they can apply for the mortgage with the organizational itself. The multinational organizations and most of the reputed organizations offer Personal Payday loan to their employees at extremely relaxed interest rates. These firms have tie up with the manufacturer I.

3.3.2 Product Market Stakeholders

The customer is concerned about the quality and usefulness of the product. Management of Apple wants to make sure they can satisfy the customers which want to offer the best product on the market and to make sure they live up to their reputation of quality electronics. Apple continues to listen to their customers to make their products easy to use. They have also made their products accessible to people with disabilities.

External to the company, Apple's most pressing challenges emanate from the industry and competitor environments. A multitude of existing and new competitors is poised to battle for market share and requires continuous attention from the company's leaders.

Apple currently dominates this market, retaining a competitive advantage based on superior innovation and solution integration of hardware (personal computer and iPod), software (iTunes), and content distribution (iTunes Store and iTunes Wi-Fi Music Store). However, the competitive rivalry in this arena is expected to intensify as competitors imitate Apple's approach and tightly integrate their own offerings to appeal to consumers. Probably most threatening to the company's position is potential collaborations between competitors and content providers to offer integrated solutions that produce more value or exclude Apple from access to content.

Apple requires each of its suppliers to meet the highest standards for all goods and services. The requirements include a commitment to rigorous quality assurance. In addition, suppliers must be committed to ensuring the highest standards of social responsibility. The ideal suppliers are those who understand the culture and expectations. The value and importance for suppliers are to making and meeting commitments and delivering the highest quality goods and services.

Organizational Stakeholders

Since formation of the Apple Computer Company in 1977, it has employed over 75,000 peoples worldwide. The majority of Apple's employees have been located in the United States but Apple has substantial manufacturing, sales, marketing, and support organizations worldwide, and some engineering operation in Paris and Tokyo.

The managers are the CEO of Apple Computer Inc. is Tim Cook, senior vice president which Internet Software and Services manager is Eddy Cue, senior vice president IOS software is Scott Forstall, senior vice president for industrial design is Jonathan Ive, senior vice president for hardware engineering is Bob Mansfield, senior vice president for Chief Financial Officer is Peter Oppenheimer, senior vice president for worldwide marketing is Philip W. Schiller, senior vice president for general counsel is Bruce Sewell ,and senior vice president for operations is Jeff Williams.

At Apple, employees are specialists who are not exposed to functions outside their area of expertise. Jobs saw this as a mean of having best-in-class employees in every role. Under the leadership of Tim Cook who joined the company in 1998 and ascended to his present position as CEO, Apple has developed an extremely efficient and effective supply chain which has been ranked as the world's best for the four years 2007 - 2010. The company's manufacturing, procurement and logistics enables it to execute massive product launches without having to maintain large, profit-sapping inventories.According to a report by the New York Times, Apple insiders "believe the vast scale of overseas factories as well as the flexibility, diligence and industrial skills of foreign workers have so outpaced their American counterparts that "Made in the U.S.A." is no longer a viable option for most Apple products".

SWOT analysis based on stakeholders groups

A situational analysis, also known as SWOT analysis for Strengths, Weaknesses, Opportunities, and Threats, is useful to understand the current situation of Apple Computer and to determine the strategic solutions. The Strengths and Weaknesses of a company examine the internal environment whereas the Opportunities and Threats examine the external environment.

3.4.1 Strengths

Capital Market Stakeholders

Strong financial performance - strong sales, low debt

It is common for competitors selling personal computers based on other operating systems to aggressively cut prices and accept lower product margins to gain or maintain market share. This puts continuous downward pressure on Apple's margins. Other than price, key competitive factors in the computing market include product features, relative price/performance, product quality and reliability, design innovation, availability of software and peripherals, marketing and distribution capability, service and support, and corporate reputation. As the industry and its customers become more reliant on Internet connectivity, alternative (even substitute) devices are becoming increasingly smaller, simpler, and less expensive than traditional PCs. These devices compete for market share with Apple's desktop and laptop computing products.

Apple has 364 retail stores in thirteen countries, and an online store. It is the largest publicly traded company in the world by market capitalization. The company is the largest technology company in the world by revenue and profit, more than Google and Microsoft combined. On August 20, 2012, Apple surpassed Microsoft to become the largest company in human history by market capitalization, in nominal terms.

Visionary and charismatic CEO, Steve Jobs

Apple is famous for its entertaining, world-class product presentation, that attract press coverage from the entire world and there is no debate as to who built this reputation. Steve Job's celebrity and charisma made him "the closest thing to a rock star in the world of business". During his second tenure at Apple, between 1997 and 2011, he appeared 4 to 7 times a year when he was healthy, of course to unveil new products during one of his trademark 'keynotes'. While he was notoriously a capricious speaker who refused to rehearse in his late twenties, he perfected his art at NeXT, and came back to Apple as the best showman of the industry.

The most common team to describe Steve Job's charisma is "Reality Distortion Field". He has a reality distortion field. In his presence, reality is malleable. He can convince anyone of practically anything. The reality distortion field was a confounding mélange of a charismatic rhetorical style, an indomitable will, and an eagerness to bend any fact to fit the purpose at hand.

The launch of a new product at Apple is often called "the death march" because of the very intense work that is demanded of everybody involved, not only engineers, but also marketing and logistics people, to meet deadlines.

Product Market Stakeholders

Strong Marketing Efforts

One of the greatest strength of Apple is its impact of marketing efforts which produced a potent concoction of a strong global brand and celebrated products. Apple is one of the most established and reputable IT brands globally. The computers that are promoted by the Apple are new functions, modern and energy efficient. Apple's notebook - Mac is the most environmentally friendly portable computers.

Apple is high repute worldwide. Due to the massive marketing efforts, Apple has built the high loyal customer base to advocates the brand not only to recruit customers, but also retain them. Most Mac users are loyal to the Apple product. Apple customers always think that Apple can provide them the high level of product. Because of this, the selling percentage of Mac book is increasing.

Research and Development

Apple's R&D encompasses the product development process where it relies on its proprietary designs and keeps key design decisions in-housed. Apple is able to produce best-sellers, from the iPod scroll wheel design to the ultra-thin Mac Book Air. This sets Apple apart from its competitors. Apple is also recognized for designing products using its unique components. An example would be its own A4 chip, specifically designed for mobile devices that required efficiency and speed. It came up with proprietary developed applications to support its Macintosh line as well. The designs are uniquely created to capture the customers' eyes.

Products are designed ergonomically and stylishly, for example, the Ipod Nano, its slim design fit easily the consumer's pockets and it is also light weight enough to be carried around. This commitment to R&D allows Apple to produce sophisticated but easy-to-use products and deliver well-integrated user experiences.

Innovative and high-tech quality products

A close look at Apple's competition reveals that the company is confronted by aggressive opposition in all areas of its business. The markets for consumer electronics, personal computers, related software and peripheral products, digital music devices and related services, and mobile communication devices are intensely competitive. They are characterized by rapid technological advancements, which have substantially increased the capabilities and use of PC's, digital electronics, and mobile communication devices. As a result, a variety of new products with competitive price, feature, and performance characteristics are being introduced into the marketplace. And over the past several years, price competition in Apple's main product markets has been particularly zealous.

Large segment of loyal customers of 'Apple Culture'

With Apple's success and growth, balancing stakeholder demands has become increasingly difficult. Managing the sometimes conflicting expectations of customers, investors, suppliers, partners, legal/governmental entities, and other stakeholders puts an increasing amount of pressure on Apple's management team. And the company's dependence on Jobs' charisma, vision, and public communication and relationship building skills puts Apple at risk without a reliable succession plan and a pool of equally talented brand champions.

Organizational Stakeholders

Loyalty of employees

A study by Analysis Group found that Apple has created or supported more than 500,000 jobs for U.S. workers ranging from engineering to manufacturing and to transportation (Apple Inc, 2012). Apple employees show the loyalty towards the company as Apple Inc. does not need to recruit new employees, but to retain them.

Successful founder of Apple Computer

Steve Jobs is one of the strength as he has proved that he played an important part of the success of Apple. After returning from his absence during year 1985-1996, which was the most turbulent time that Apple experienced, Jobs replaced most of the Board of Directors and delivered seven consecutive quarters of positive returns to shareholders by focusing on the new product ideas. Therefore, Steve Jobs is undoubtedly a valuable, rare, difficult to imitate resources that Apple made full use of it.

3.4.2 Weaknesses

Capital Market Stakeholders

Lower market share and higher price compared to Microsoft and the competitors

Normally, most of the user will choose the Microsoft Window as their operating system in them desktop. The user will not choice the Apple operating system, because it is difficult to control. Another that, the operating of iMac is designed by the Steve Jobs, who is creative and innovation. The operating of the apple also too innovation to the user, they are not professional. Most of the professional are prefer using the Apple. For an example, the designer would like to uses iMac to design the clothes which Apple has provides the clear graph and crisp. Thus, the designer can correct their mistake immediately. Hence, the Apple computer in the computer industry just held a few percentages maybe less than 5 percent. The Apple competitors, such as Compaq, Dell, Acer, Assus are always lead the computer industry, because they are corporate with the Microsoft Window. This is because the operating of the Microsoft Window is very easy, the user easily learning. Apart from that, the weakness of the Apple is the price is too expensive for some consumer. The consumer needs to lend the money from the banks to purchase the Apple product. Apart the iMac, the most can present the Apple product is iPad. Most of the users are young generation and adult. The price of the Apple product could be one month of employee salary. Hence, the people need to save their money for a few months to buy the Apple I-pad.

Dependence on Steve Jobs for his personality, vision, negotiating prowess, and relationship skills

According the New York Times wrote: "by the early 80's, Mr. Jobs was widely hated at Apple. Senior management had to endure his temper tantrums. He created resentment among employees by tuning some into stars and insulting others, often reducing them to tears. Mr. Jobs himself would frequently cry after fights with fellow executives".

Some twenty years later, Michael Wolff's description of Jobs was little different:"There's the mercurialness, the tantrums, the hours-long, dictator-like speeches, the famous, desperate, and transparent hogging of credit, and always the charismatic-leader complex, through which he has been able to seduce and, subsequently, abandon so many of the people he's worked with. He may be as troubled and unsocialized".

Even though Steve Jobs had a very hands-on approach to product design, which was arguably the favorite part of his job. He famously often came down to the Industrial Design lab to spend time with the designer teams and give his opinion and guidance on their prototypes. As well as Jobs's reputation as a tech visionary originates not only from the reliable stream of breakthrough products that have come out of Apple in the last decade, but also from an observation from his closest colleagues. They recount countless times when he took a decision out of the blue, without any rationale, which turned out to be true.

Product Market Stakeholders

Failure of two notable products namely Mac Mini and Apple TV

Since the apple has successful manufacturing the iMac (apple computer name), but it still contains the weakness for the user. The foremost is that the users are not understand the feature of the Apple TV, is one service available in the iMac. This is because the Apple does not introduce complete the service of Apple TV to the user, hence, there are unpopular. In addition, the user need to sign up the term on agreement and need pay amount for one year. This caused the iMac is not interest for the user.

Historically incompatible software - computer and digital music format - users want compatibility

There is pressure on Apple to increase the price of its music download file, from the music industry itself. Many of these companies make more money from iTunes such as downloadable music files than from the original CD sales. Apple has sold about 22 million iPod digital music players and more than 500 million songs though its iTunes music store. It accounts for 82% of all legally downloaded music in the US. The company is resolute, but if it gives in to the music producers, it may be perceived as a commercial weakness.

Using false tactics and strategies

The iMac cannot sells well because there is a lack of good sales forecasting method. For example, the Apple just organized "iMac" campaign. Through this campaign, there is not attractive the slogan for the campaign. Another that, the Compaq is using the attractive slogan. They are using "Are you changed the life yet". Hence, they feel the slogan touch into their heart, because the user has a dream to changes their life. But they have not the passion. When the slogan advertise out, the sales of Compaq computer has been increased in the year 1994. This is reason why the Compaq always lead the market of computer. For Apple, they just put the original campaign into the some country, such as Japan and Euro country. These campaigns may suitable in the United State, not the Japan and European country local culture. Hence, the users feel nothing special and they just feel basic advertisement and slogan. Therefore, the sales of Apple computer in the computer industry are lower.

Organizational Stakeholders

Low behalf of employees

According to the New York Times, the Apple retail employees are so loyal to the company but there is a weakness that their pays are too low. Although they helped the company earned a lot of revenues for example each of the retail staffs earn in the region of $25,000 per annum but still most of them enjoyed little of that wealth. Therefore, Apple has made a decision on raising a 25 percent of pay for its retail stores workers and also offering all employees an extra discount on Mac computers and iPad tablets.

Health issue of Steve Jobs

For the same reason Jobs is a strength, but he is simultaneously a weakness too. The Board of Directors was concerned about Steve Jobs's ill health as it was an important issue for the top management and even investors. They were worried that everything is going to be hard without Steve and it is affecting the company. Apple Company will not be able to sustain the desired growth for the entire years. After the announcement of his leave, Apples shares have felled over the periods. The apparent lack of a succession plan became the limelight position coupled with the eyes of Jobs as Apple's single consciousness of shareholders. Apple's condition became better off when came to an extended CEOs absence but still it shake the employee's and investors' confidence in new acting of CEO (Apple Inc, 2011).

Opportunities

Capital Market Stakeholders

Development of iTunes.

Apple's involve in the music industry through iTunes which provides a good opportunity to increase Apple's bottom line and also increase brand awareness. The launching of the iTunes Music Store resulted in over 2 million downloads in only 16 days. The opening of iTunes music store is all done on Macintosh computers. The iTunes business has been a spectacular success for Apple. Apple iTunes store is profitable as the return will be even higher for Apple as it is the devices which can't compete by others.

Advantages taking from Microsoft.

Apple has always created an innovative way to expose the shortages of the Microsoft. Apple should finally take the deep consideration and go all out with its brand image to attack Microsoft. Microsoft users found that it less feasible to continually upgrade software packages unless they receive benefits for the money being spent. The last few Microsoft upgrades have been persistently bother with problems that provide another opportunity to Apple. Apple can use this as reviews so that they don't make the same mistake like Microsoft with its issues of upgrades.

Product Market Stakeholders

Apple's Operating System

Apple has taking advantages of the differences of operating system by turning it into an opportunity to enhance improvements to the Macintosh platform in order to achieve greater design and functional advantages over competing platforms. The Mac OS is seen to be safe, reliable, easy to use and secure system. The latest launch of its Leopard OS receives good reviews and comments with sale over million copies and creating 20% of the Mac installed base. Apple is not easy to compete by other PC computers in short time periods due to the increasing in vulnerability.

More international expansion

Apple Inc. is an American multinational corporation that designs and sells consumer electronics, computer software, and personal computers. The company's best-known hardware products are the Macintosh line of computers, the iPod, the iPhone and the iPad. Its software includes the OS X and iOS operating system; the iTunes media browser, and the iLife and iWork creativity and production suites.

Fortune magazine named Apple the most admired company in the United States in 2008, and in the world from 2008 to 2012. However, the company has received widespread criticism for its contractors' labor, and for its environmental and business practices.

Growing market of "Green" and energy efficient products

Greenpeace has campaigned against Apple on various environmental issues, including a global end-of-life take-back plan, non-recyclable hardware components and toxins within. Since 2003 Greenpeace has campaigned against Apple's use of particular chemicals in its products, more specifically, the inclusion of PVC and BFRs in their products.

The Environment Protection Agency rates Apple highest amongst producers of notebook computers, and fairly well compared to producers of desktop computers and LCD displays.

Apple featured in Greenpeace's Guide to Greener Electronics that ranks electronic manufacturers on sustainability, climate and energy and how green their products are. Green peace praises Apple's sustainability, noting that the company exceeded its 70% global recycling goal in 2010. It continues to score well on the products rating with all Apple products now being free of PVC vinyl plastic and brominated flame retardants. However, the guide criticizes Apple on the Energy criteria for not seeking external verification of its greenhouse gas emissions data and for not setting out any targets to reduce emissions.

Organizational Stakeholders

Licensing brand name with accessory manufacturers

Apple has opportunities in licensing brand name with accessory manufacturers. Apple's valued supply chain relationships, reseller agreements, wireless carrier contracts, and innovative co-branding arrangements play a critical role in supporting the company's differentiation strategy, powerfully linking the success of strategic partners together. The company's strategic alliances have provided an effective avenue for gaining sizeable market share. Also, affiliations with other strong brand names serve to increase Apple's marketing exposure and build consumer confidence. By attempting to fulfill the needs and wants of many different people ranging from the local population and customers to their own employees and owners, companies can prevent damage to their image and brand, prevent losing large amounts of sales and disgruntled customers, and prevent costly legal expenses.

Consumer image consciousness

Apple focuses on consumer image consciousness, Consumers clearly know that all products which are made by Apple (the corporate brand) and this straightly tell consumers believing Apple's products are more hip and technologically superior than competitive products. It provides a fantastic platform for future new products.Consumers will constantly seek out their new products and view them as the next purchase with a cool image and technological superiority,this means that Apple will continue to lead and deliver above average sales and profit growth. As for consumers, Apple Mac viewed as a superior brand name.

Partner with other industry

Apple and HP partner to Deliver Digital Music Player and iTunes.As part of the alliance, HP consumer PCs and notebooks will come preinstalled with Apple's iTunes® jukebox software and an easy-reference desktop icon to point consumers directly to the iTunes Music Store, ensuring a simple, seamless music experience. This offering is yet another way that HP is helping consumers enjoy more from their personal digital entertainment content.

Threats

Capital Market Stakeholders

Poor health of Steve Jobs

On January 17, 2011, Jobs announced in an internal Apple memo that he would take another medical leave of absence, for an indefinite period, to allow him to focus on his health. Chief operating officer Tim Cook took up Jobs' day-to-day operations at Apple, although Jobs would still remain "involved in major strategic decisions for the company." Apple became the most valuable consumer-facing brand in the world. iCloud is an online storage and syncing service as the last product launch Jobs would attend before his death.

On August 24, 2011, Jobs resigned his position as CEO of Apple. He was replaced by Tim Cook and Jobs became Apple's chairman. Despite Jobs' absence, Apple recorded its best non-holiday quarter during the recession with revenue of $ 8.16 billion and a profit of $ 1.21 billion.

Product Market Stakeholders

Legal risks and risk of imitations

Apple believes in the importance of protecting its intellectual capital by filing patents in the United States and worldwide for its inventions and innovations. Apple currently holds a portfolio of several thousand patents. However, the high success of Apple's product launching increases the risks of patent and copyright infringement and being imitated. In the past, when Macintosh licensed their ROM and software, almost 99% of customers who bought such clones were existing Mac users. Although the Macintosh licensing program has been halted, iPhone imitations in countries such as China have been rampant while more established players of the industry also copy the look and ergonomic design of Apple's iPhone. As long as operating systems and support software packages continue to converge and remain relatively easy to imitate, present and future lawsuits are inevitable.

Competition

This threat is mainly occurs on PC hardware/software and consumer electronics. Apple huge success attracts strong competitive responses, emphasizing the need to innovate and differentiate to out man oeuvre its competitors. Today, the PC is becoming more and more a commodity product. This results Dell, HP, and Lenovo compete to pursue low-cost and best-cost provider strategies by offering a range of options for varying prices to the customers. The similarity of their products in the same industry setting leads to price competition that cutting down prices and lowering product margins. If Apple is unable to compete effectively, it faces the risk of losing its PC market share.

The rapid innovation by Microsoft which releases new version of Windows every 2 years creates pressure for Apple (i.e. Microsoft Windows running on a Dell computer). Apple has no choice to catch up new hardware technology. In this case, Apple develops and builds highly integrated software system with designed specifically for the hardware it runs on. Apple believed that there will be no other systems work for PC manufacturers can achieve the same results. Apple will risk losing its market share if it does not continue to innovate and develop future MacOS releases.

Incompatibility with the windows platform

By the early 1990s, Apple was developing alternative platforms to the Macintosh, such as the A/UX. Apple had also begun to experiment in providing a Mac-only online portal which they called eWorld, developed in collaboration with America Online and designed as a Mac-friendly alternative to other online services such as CompuServe. The Macintosh platform was itself becoming outdated because it was not built for multitasking, and several important software routines were programmed directly into the hardware. In addition, Apple was facing competition from OS/2 and UNIX vendors like Sun Microsystems. The Macintosh would need to be replaced by a new platform, or reworked to run on more powerful hardware.

High product substitution effect in the innovative and competitive technology market as well as expensive products

During the time Apple experimented with a number of other failed consumer targeted products including digital cameras, portable CD audio players, speakers, video consoles, and TV appliances. Enormous resources were also invested in the problem-plagued Newton division based on John Sculley's unrealistic market forecasts. Ultimately, all this proved too-little-too-late, as Apple's market share and stock prices continued to slide.

Apple saw the Apple II serried as too expensive to produce, while taking away sales from the low end Macintosh. In 1990, Apple released the Macintosh LC with a single expansion slot for the Apple lle Card to migrate Apple II users to the Macintosh platform. Apple stopped selling the Apple lle in 1993.

Microsoft continued to gain market share with Windows, focusing on delivering software to cheap commodity personal computers while Apple was delivering a richly engineered, but expensive, experience. Apple relied on high profit margins and never developed a clear response. Instead they sued Microsoft for using a graphical user interface similar to the Apple Lisa in Apple Computer, Inc. versus Microsoft Corporation. The lawsuit dragged on for years before it was finally dismissed. At the same time, a series of major product flops and missed deadlines sullied Apple's reputation, and Sculley was replaced by Michael Spindler.

Organizational Stakeholders

Threats of new entrants

The risk of new entrants is also high in both the player and music service businesses. There are particularly from large, established consumer electronics companies, such as Casio, Sony and Toshiba (for players) or from on-line companies like Yahoo and Microsoft or retailers like Virgin Music (for downloads). New competitors are likely to enter because of low barriers to entry by given the attractiveness of these markets. The speed with which information about new technology spreads enables start-ups to gain legitimacy in the industry very quickly.

Threat of competitors

The biggest threat to Apple is the very high level of competition in the technology markets. Apple works very hard on research and development and marketing in order to retain its position. The popularity of Apple Mac is subject to demand, and will be affected if economies begin to falter and demand falls for their products.

summary of situation analysis

In conclusion, it's clear that many people are switching to a Mac these days. Apple Mac computers are analyzed as a company which heavily depended on its product market stakeholders. Nevertheless, Macs are expensive and require user's patience and willingness to adapt his or her behavior to a completely different interface. Mac is certainly not an option for every user, but it is definitely an option worth considering - particularly for designers or developers. Although organizational and capital market also plays an important role in shaping Apple Mac computers achievements and strategies, their core competencies which also allows them to strive in the industry for many years.

4.0 strategic options for the organization

4.1 Acquisition

There's only one real way to achieve massive growth literally overnight, and that's by buying somebody else's company. Acquisition has become one of the most popular ways to grow today. Since 1990, the annual number of mergers and acquisitions has doubled, meaning that this is the most popular era ever for growth by acquisition.

Companies choose to grow by acquiring others to increase market share, to gain access to promising new technologies, to achieve synergies in their operations, to tap well-developed distribution channels, to obtain control of undervalued assets, and a myriad of other reasons. But acquisition can be risky because many things can go wrong with even a well-laid plan to grow by acquiring: Cultures may clash, key employees may leave, synergies may fail to emerge, assets may be less valuable than perceived, and costs may skyrocket rather than fall. Still, perhaps because of the appeal of instant growth, acquisition is an increasingly common way to expand.