Introduction
It is important to evaluate a company’s position in the market. There are four most common areas used to analyze a company: strengths, weakness, opportunity, and threats (SWOT). Carrying out a SWOT analysis on a company makes it possible to evaluate the progress that the company is making.
Evaluation should be done from a qualitative perspective such as evaluation of completeness, internal consistency, rationale and suitability. More so, the quantitative point of view should also be put into consideration, including the strategic and financial outcomes for the company (Sanchez & Heene, 2010).
Evaluation of an organization is important because it shows whether an organization’s competitive capabilities and core competencies are strategically relevant. These are most logical and appealing building blocks for companies. Most of the companies use resource-based strategies to exploit company resources in ways that offer value to their customers. The best and most potent strategies are those which are competitively rare, hard to imitate and hard to be trumped by substitute resources.
A good strategy to size up a company’s resource strength is through carrying out a SWOT analysis. It is powerful in determining the company’s strengths and competitive deficiencies, opportunities and other external threats thus making it possible to find ways of empowering its future (Thompson et al., 2010).
This paper will conduct a SWOT analysis for Apple Inc. It will also investigate the core and distinctive competencies of RIM which makes Blackberry mobile phones. It will discuss the resources and core competencies of Dell and lastly identify why competitors find it difficult to imitate Dell’s direct sales model given that its products are based on standard industry technology.
The SWOT Analysis of Apple Inc
There are various activities, which add value and competitive advantages to Apple Inc. However, the value, rarity, inimitability and organization (VRIO) of an activity or resource determines its sustainability. SWOT analysis refers to the strengths, weaknesses, opportunities and threats of a firm, in this context, Apple Inc.
According to the case study, some of the Apple Inc. strength includes the stability and user friendly product lines. Its technical savvy is one of its kinds. Arguably, Apple Inc. makes and sells iPod music players ranked among the best technological devices of the time. iPod is based on propriety standards and retailed through Apple’s retail stores (Huzefa et al., 2009).
Strength
Its strengths include its ability and willingness to have a diverse customer base together with its progressed technical expertise; an illustration of this is the recent integration of Microsoft’s products lines with those of Intel processors. Secondly, its financial strength which makes it remains robust and stable even when the global market is stagnating.
It does so by reducing costs and integrating product packages as well as participating in strategic alliances such as the iTunes. The firm has strength in its brand loyalty. Apple Inc. has brand loyalty, which is extremely costly and one which cannot be imitated (Huzefa et al., 2009).
Weakness
One major weakness of Apple Inc was the departure of Steve Jobs. He had been in the limelight as a single player in the minds and eyes of consumers and shareholders. The company had continuously exploited his rare and valuable resource to yield positive earnings to the shareholders. The market share of Apple Inc. can also be viewed as a weakness of the company. Apple Inc. geographical market is described to be concentrated in the U.S. and its products are mostly for the learned (Huzefa et al., 2009).
Opportunities
Opportunities for Apple Inc. include the market growth for PC hardware and software. The introduction of Intel based processers has grown into the businesses replacing PC with iMacs. This move was to tighten the loop holes concerning stability and reliability, which lacked in PC. iMacs have gained popularity, especially in the banking sector, foe example, Japan’s Aozora Bank Ltd replaced 2,300 PCs with iMacs.
Another opportunity is customer electronics. Apple Inc. expanded its market through the iTunes concepts of downloadable mobile phone features and movies. This has opened doors to build strategic alliances with manufacturers such as transmission giants like Disney amongst others (Huzefa et al., 2009).
Threats
Threats include the legal risks, especially when considering the fact that patent, infringement and copy rights can easily be violated by rival companies. This is so because it is easy to imitate support software. Other threats include competition, especially in two areas: the areas include the competition from the PC hardware/software and from consumer electronics. More so, with the relative increase of newcomers in the consumer arena, it might be hard for the firm to sustain its competitive advantage (Huzefa et al., 2009).
The Core Competence and Distinctive Competence of RIM
The Introduction of Blackberry by RIM was viewed as a simple idea. However, its popularity spread more than wild fire. The product was appealing with the innovation of such a small device compacted by vast wireless options and a cute Keyboard, which resulted to addiction by most of its users. Currently, the company estimates to have more than 400, 000 users.
The dynamic growth for 14 years of its product existence is attributed to its strategies, which hold the firm in a position. It has a large market share and has added value of branding associated to the capabilities of the Blackberry phones. The company also lays its focus on its rivals to protect their patents and has made strategic alliances, for instance, with Nokia.
According to the SWOT analysis, the internal strength includes the diverse distribution channels and the vast joint ventures with service providers. It also has strong R&D team that is well acquainted and generative of high valuable innovative ideas. The weaknesses of RIM include the reduced projects, which act as the backup of the star projects.
Some of its external threats include the competitiveness and the numerous law suits associated with it. However, the firm stands in a good position to get into the fast market, especially with their appealing products. This may result to global expansion and brand loyalty, which will be its core competencies (Hamad, Lawson & Radi, 2002).
The Resources and Core Competencies of Dell
Core competences refer to all capabilities which are critical to make a business attain a competitive advantage. The competencies are dynamic; changing in response to the changes in the costumers’ demands and in the company’s environment. The key core competencies of Dell include the clear and well defined brand position focused to defined customers.
Their competencies are of fundamental consumer benefits, making consumers to have brand loyalty such that they are willing to pay more for the product. They are also competitively unique, making them difficult for the competitors to imitate.
The core competencies of Dell include its reduction of capital cost during the manufacturing processes with highly quality products being manufactured. Its direct model chain, its unrivalled expertise in logistic and supply-chain management also form part of the core competencies (Internal Situation Analysis, 2010).
The Difficulty in imitating Dell’s direct sales model
A firm’s competitiveness requires tight fit with the internal competitiveness and exploitation of resources that are competitively valuable; this is rare and is hard to copy by competitors. According to Internal Situation Analysis, “companies pursue resource-based strategies that attempt to exploit company resources in a way that offers value to customers in ways rivals are unable to match” (Internal Situation Analysis, 2010, p. 1).
For example, over a decade, Dell invested its time and finance into cultivating a relationship with its main suppliers. This has rendered unmatched supply chain capabilities. It has also made Dell plants operate with only several hours of order’s placement for various parts and components because their suppliers can access Dell’s daily production schedule. Another reason is its direct sales model, which makes Dell products to be relatively cheaper than those of its rivals (Internal Situation Analysis, 2010).
Conclusion
SWOT analysis is widely used to gauge the stability of a company. By carrying out a SWOT analysis of a company it becomes possible to identify the areas where structuring needs to be carried out in order to improve the competitiveness of a company. The analysis also points out the areas where a company has opportunities, which can be capitalized on. Core competencies are competitive advantages that a company has. Core competencies should be capitalized on to give a company a competitive edge in marketing.
References
Hamad, C., Lawson, D., & Radi, T. (2002). Hi-tech strategy Formulation Research in Motion. CATA Alliance. Web.
Huzefa et al. (2009). A strategic analysis of Apple Corporation. Scribd. Internal Situation Analysis. (2010). Evaluating a Company’s Resources, Cost Position, and competitive strength. Highered McGraw. Web.
Sanchez, R., & Heeene, A. (2010). A focused issue on identifying, building and linking competences. Emerald Group Publishing. New York, NY: Emerald Group Publishing.
Thompson et al. (2010). Crafting and executing strategy: The quest for competitive advantage: Concepts and Cases. New York, NY: McGraw Hills companies, Inc.