Strategic Mgmt
Dr. Jun Xia
Chad Hyatt
Dohhoon Yoon
Joseph Ruzvidzo
Khizer Javaid
CONTENTS
Value Chain Analysis
Financial Analysis
Porters 5 Forces
Product Life Cycle
SWOT Analysis
VRIO Analysis
Company Strategies
BCG Portfolio Matrix & Recommendations
"Apple designs Macs, the best personal computers in the
world, along with OS X, iLife, iWork and professional
software. Apple leads the digital music revolution with its
iPods and iTunes online store. Apple has reinvented the
mobile phone with its revolutionary iPhone and App Store,
and has recently introduced iPad 2 which is defining the
future of mobile media and computing devices."
Profitability Ratios
2008
2012
Liquidity Ratios
2008
2012
ROA% (Net)
14.93
28.08
Quick Ratio
2.07
1.24
ROI%(Operating)
35.39
55.79
Current Ratio
2.46
1.5
Turnover Ratios
2008
2012
Leverage Ratios
2008
2012
Total Asset
Turnover
1
1.05
Long Term
Debt to Equity
0.17
0.52
Receivables
Turnover
7.46
10.13
Total
Debt to Equity
1.24
0.37
Compounded Annual Growth Rate 2008-2012
Sales
35.96%
Costs
22.44%
Profits
43.85%
The Apple product life cycles indicates just how big the iPhone and the iPad will be over the next few years.
It took the iPod five years to break the thirty million units per annum mark. The iPhone got there in four and
the iPad made it in year two of launch. Either way for Apple, four years of strong growth are evident from
products already in the lineup, both the iPhone and the iPad are set to hit the one hundred million units per
annum mark in 2014. Despite the march of the Androids, the Apple growth story continues.
Strength
Software is Apple’ core OS X allow them to
develop mobile device technology
Strong financial performance
Customers’ interest
Retail store
Weakness
High
Prices
Market share subsiding
Different CEO
Patent breaches
Flaws in new products
Inconsistency with variety of OS
Opportunities
High demand - IPad and IPhone 5
ITV launch
Emergence of the new provider of application
processors
Advancement of tablets and smartphones markets
Protection of patent against the other companies
Threats
Currents tax increase
Changes in technological rapidly
Key components - price pressure from Samsung
Foxconn Workers’ pay raise
Breaches IP rights
Android OS growth
Online music market
Resource/
Capability
Value
Rare
Inimitable
Organized to
exploit this
resource
/capacity
SCA,
TCA,
CP
The Brand
Yes
Yes
Yes
Yes
SCA
Supply
Yes
Chain
Management
Yes
Yes
Yes
SCA
Top
Executives
Yes
Yes
Yes
Yes
SCA
International Yes
Product
Distribution
No
No
Yes
TCA
1. Related Diversification Strategy
Software and computer technology
Digital music market with the launch of the iPod and
iTunes
Mobile devices iPhone, iPad
App Store the digital contents market
cf)
Samsung Electronics, Samsung Card, Hotel Silla,
Cheil Industries(fashion, apparel), Samsung Insurance
2. Product Extension (Line extension & Category extension)
Mac - MacBook Air, MacBook Pro
iPod – iPod Nano, Shuffle, Touch
iPhone – iPhone 3G, iPhone4, 4S, iPhone 5
iPad – iPad 1,2,3,4
Apple TV, iTunes, iCloud
3. Vertical Integration
chip manufacturers, manufacturing,
software standards, closed ecosystem, retail stores
product optimization
cheaper parts, higher efficiency
cost savings, high margin
Ex) To power the iPad, Apple has designed its own processor, called the A4.
(Past: Intel chips for iMac and Macbook, Samsung chips for iPhone)
4. Three Generic Strategies – Differentiation
·
Powerful Ecosystem
·
Design Quality - iMac line was the first home computer to omit a floppy drive
·
Economies of Scale
a. BCG Portfolio Matrix
Market Share
Large
$
Cash
Cow Star
Dog Question
mark
Small
Low
Market Growth
?
High
b. Strategic Alliances with Microsoft
Synergy



Maturity stage, Apple should lower costs as volumes have increased.
Apple Inc. should continue its Global expansion through partnerships ex. China
Mobile deal increased Apple’s 1st Q revenues by 29%.
Acquisitions and Mergers