Assignment 1:
Select a business organization from the Fortune 500 which is of interest to you and ensure that you
will be able to obtain the necessary information about its strategy, business model, and performance
(much of this information can be obtained from the organization’s Web site, annual report, financial
news, etc.). Write an overview of the organization you selected, including the following:
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Name of the organization, locations, web address
Overall organizational strategy and business model
Products or services, industry, and market position
Sources of information about the organization (at least three)
Your reasons for selecting the organization
Write your response in 2–3 pages in Word format. Cite your sources. Apply APA standards for
writing style to your work.
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Apple has an "i" for revolutionary technology. Since release, the company's
iPhone -- which accounts for the largest portion of its sales -- has spurred a revolution in cell phones
and mobile computing. Apple also continues to innovate its core Mac desktop and laptop
computers, all of which feature its OS X operating system, including the iMac all-in-one desktop for
the consumer and education markets, the MacBook Air ultra-portable laptop, and the high-end Mac
Pro and MacBook Pro for consumers and professionals. The company's popular iPad tablet computer
has become another game-changer in the consumer market. It generates nearly two-thirds of sales
outside the US. The company’s products and services include iPhone, iPad, Mac, iPod, Apple TV, a
portfolio of consumer and professional software applications, the iOS and OS X operating systems,
iCloud, Apple Watch, Apple Pay, and various accessory, service and support offerings.
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Company Type-Public
Headquarters:
1 Infinite Loop
Cupertino, California 95014
United States
Main Phone: 408-996-1010
Total Employees-97,000
1-Year Employee Growth-14.93%
Year of Founding or Change in Control-1977
Plant/Facility Size (sq. ft.)-16,231.00
Accountant-Ernst & Young LLP
Primary Industry:Wireless Telecommunications Equipment
Primary SIC Code 36639906:Mobile communication equipment
Primary NAICS Code 334220:Radio and Television Broadcasting and
Ticker- AAPL
Website: www.apple.com
Key Financials (Fiscal Year-End September 2014)
 Sales ($ M)-$182,795.00M
 1-Year Sales Growth-6.95%
 Net Income-$39,510.00M
 1-Year Net Income Growth-6.68%
 Total Assets-$231,839.00M
 Market Value-$741,444.56M
Company Rankings
 5 in FORTUNE 500 (June 2014)
 S&P 500
 Dow Jones Industrials
 88 in FORTUNE's Fastest-Growing Companies (August 2014)
 Dow Jones Global Titans
 1 in FT Global 500 (June 2014)
 5 in FORTUNE 1000 (June 2014)
Key People
 Dr. Arthur D. (Art) Levinson-Chairman
 Mr. Timothy D. (Tim) Cook-CEO
 Mr. Jeffrey E. (Jeff) Williams-SVP Operations
 Mr. Luca Maestri-SVP and CFO
 Ms. Angela Ahrendts-SVP Retail and Online Stores
 Mr. Eduardo H. (Eddy) Cue-SVP Internet Software and Services
 Mr. Craig Federighi-SVP Software Engineering
 Mr. Jonathan Ive-SVP Design
 Mr. Daniel (Dan) Riccio-SVP Hardware Engineering
 Mr. Philip W. Schiller-SVP Worldwide Marketing
Most of Apple’s revenue is phoned in from its line of iPhones. They accounted for about $102 billion
in sales for 2014 (ended September), 56% of the total revenue. Sales of the company’s iPad and iPad
Mini, which fill a market niche between notebook computers, e-book readers, and smartphones,
were just more than $30 billion in 2014, a 5% decline from 2013. The company’s laptop and desktop
computers posted a 12% sales increase to about $24 billion in 2014, 13% of revenue. Revenue from
iTunes, the App Store, and software grew 13% year to-year, coming in at $18 billion. Sales of the
iPod tailed off in 2014, down 48%, to just $2.3 billion. One of the factors that makes Apple products
so popular with some and less so with others is that its hardware and software products are tightly
woven together for a seamless experience. In 2014, the company added greater cohesion, enabling
users to go from device to device with little interruption. Users, however, are restricted in the
number of non-Apple devices they can use with iPads or iPhones.
iPhones during the 2015 quarter
Other product releases in 2014 included the iPad Air, the fifth generation iPad and iPad mini with
Retina display; iOS 8, the operating system for its mobile devices; an updated Mac mini; and OS X
Yosemite, an updated operating system for its computers. In 2015 it released the Apple Watch, a
smart device to bring Apple’s design and technology prowess to the wrist. To shore up its presence
in corporations, Apple formed a partnership with IBM in early 2014 to develop industry specific
applications for Apple’s mobile devices. The first apps, released in the fall of 2104, were for airlines,
financial services, and sales assistance. Always a secretive company about its product designs, Apple
has brought some chip design expertise in-house to reduce its dependence on outside
semiconductor suppliers. The company still relies on silicon foundries (contract semiconductor
manufacturers) for the physical fabrication of its chips, but the moves mean fewer outsiders will be
involved in future designs of the iPad, the iPhone, and other mobile devices. Apple outsources
production of hardware products to a few partners, primarily Hon Hai Precision Industry and Quanta
Computer. In September 2014, Apple and Samsung Electronics agreed to scale down their patent
infringement litigation by dropping claims outside the US. In the ongoing suit, Apple accused
Samsung of using iPhone patents in the design of Samsung’s cell phones. After Apple initial won a $1
billion verdict, the suit has lingered with appeals.
Geographic Reach
Apple gets about 36% of sales from domestic customers. Its international markets are Europe (22%
of sales), China (16%) Japan (8%), and the Asia/Pacific region (6%).
Sales and Marketing
Apple sells its products worldwide through its retail stores, online stores, and direct sales force, as
well as through third-party cellular network carriers, wholesalers, retailers, and value-added
resellers. In addition, it sells a variety of third-party iPhone, iPad, Mac, and iPod compatible
products, including application software, and various accessories, through its online and retail
stores. Customers downloaded more than 85 billion items from Apple’s app store in 2014. The
company operated about 260 retail stores in the US and 254 international retail stores. About 22%
of sales come through the doors of its stores. Additionally, Apple enhances reseller sales by
positioning Apple fixtures, merchandising materials, and other resources within selected third-party
reseller locations. Through its Apple Premium Reseller Program, certain third-party resellers focus on
the Apple platform by providing integration and support services, and product expertise.
Strategy
Apple spiced up its product mix at the end of its year with the release of iPhones with larger screens
than previous versions. The iPhone 6 screen is 4.7 inches and iPhone 6 Plus screen is 5.5 inches. The
larger screen versions stack up more closely with bigger-screen phones offered by competitors such
as Samsung Electronics. With the new phones came Apple Pay, this enables users to zap payment
information wirelessly at cash registers. The new iPhones also have most powerful processors,
sharper cameras, and longer-lasting batteries. The new phones turbocharged the company's
earnings in its 2015 first quarter. Revenue leaped to $74.6 billion from $57.6 billion in the same
quarter of 2014. Profit soared to $18 billion in the 2015 quarter from $13.1 billion. Apple sold 74.5
million
Mergers and Acquisitions
Apple is "on the prowl" for acquisitions in the words of CEO Tim Cook, having made some two dozen
mostly small purchases since late 2012 as it develops new products and improves existing ones. In
2014 it paid $3 billion for the Beats companies, which includes streaming music service Beats Music
and the headphones and speakers company, Beats Electronics. With the acquisition of Beats Music,
Apple will have its own streaming music service to position itself against other players such as
Amazon, Pandora, and Spotify. Also that year it bought start-up LuxVue Technology, which makes
power-efficient displays for small consumer devices.
Sources
o www.apple.com
o http://www.slideshare.net/raboz/strategic-management-at-apple-inc
o http://www.forbes.com/sites/ewanspence/2013/09/14/nine-business-and-strategy-lessons-fromapple-and-the-iphone-5c-and-5s/
o http://www.termpaperwarehouse.com/essay-on/Apple-Inc-Harvard-Business-School-Case/297698
o http://nerdpax.com/azure/apple_inc_naics_code