Introduction
Apple Inc. is one of the most prosperous electronic firms in the world. Steve Jobs and Steve Wozniak started this firm on April 1, 1976. The two were electronic enthusiasts who were interested in developing their ideas into business ventures.
They were keen on turning their skills in electronics into a large business unit. Steve Wozniak, popularly known as Woz, was an astute electrician with a keen interest in computers. It was during this time that computers were started.
Steve Jobs on the other hand was a shrewd businessperson. Although Woz was more knowledgeable than Jobs in the art of designing computer hardware, Jobs was smatter in entrepreneurship.
While Woz considered his skills in making computers as a hobby, while Jobs saw a huge potential of stating a computer firm that would rival the then leading computer firm, the IBM.
Jobs managed to convince Woz of the importance of commercializing their skills, and together, they started this company.
They later incorporated Ronald Wayne, a rich businessperson who came in to help the two financially. The trio formed a formidable force, which culminated into a company that is prosperous and very profitable.
Although this company had various challenges that saw it eliminate its Chief Executive Officer, who was one of the founder members, in 1985, the firm was able to overcome these challenges using a number of strategies.
Steve Jobs, having been forced out of the firm in 1985 as the chief executive, returned in 1997 with strategies that transformed this firm to what it is currently.
Evans (2012, p. 67) says that Apple is one of the firms that were able to overcome the wave of.com crisis of the early twentieth century that brought down many firm, especially those that were computer based.
When Steve Jobs returned as the Chief Executive of this firm, it experienced massive development, especially from 2006 to 2010. Gountas and Mavudo (2008, p. 58) notes that Apple brand was considered as the most expensive brand in the market for the first time in its history.
It is also reported that in the year 2010, the total revenue of Apple edged that of its main market competitor, Microsoft, for the first time in since their inception.
The future of this firm is however, not as bright as it has been in the past. In the last one year, the firm has been struggling to manage the stiff market competition.
It has also been locked in prolonged legal battles with Samsung, one of its main competitors in the market. This research seeks to analyze the firm’s past performance and determine some of the future scenarios in which this firm will have to operate in the next seven years.
Review of Apple Inc. Management Style from 2006-2012
Apple is one of the current success stories in a group of companies that have managed to be successful in the face of increasingly competitive environment. This is attributed to management its strategies that have helped it cope with the competition in the electronic market.
According to Handlechner (2008, p. 90), in order for a firm to be successful in the current competitive market, it is important to understand some of the current market forces that directly affect its strategies.
Apple has been keen to understand the market forces in an attempt to find the best approach of meeting customers’ expectations. The period from 2006 to 2012 has been considered as the firm’s most successful period.
During this period, the firm has experienced massive growth in its market coverage. The firm managed to expand to the African market that it had avoided for so many years. Its presence in Asia during this period was massive. It had complete dominance of the American and European markets.
It would be important to analyze some of the forces that could have enabled this firm succeed in this period. It would be important to analyze the performance of the firm over the past decade in order to understand the driving factors of success.
Past performance of the company through the last decade
In the past one decade, Apple has been one of the most successful American firms that have managed to create very brands, and increased their market share by a huge percentage.
When Steve Jobs took over the leadership of the firm in 1997, the firm was performing so poorly that other many thought that it would collapse. However, Jobs managed to turn around its fortunes, to make it one of the most successful firms in this country.
The success of this firm could be attributed to superior strategies that the management employed in the market in order to achieve competitive advantage. This research will focus on three areas where this firm has always focused on to achieve this success.
The areas of sustainability, corporate social responsibility, and technology have been the core factors that have helped this firm reach its current position.
Sustainability
Sustainability has been defined differently in different contexts. Hult (2011, p. 67) defines sustainability as “The careful and efficient stewardship of resources by businesses, communities, and citizens.
It is the practice of meeting our needs in ways that are respectful of future generation and restorative of natural, cultural, and financial asset.”
This is a broad definition, but it brings out the meaning of sustainability as the process of using resources responsibility, conscious of the need to use them again in future.
In the context of Apple Inc., sustainability would ability of the firm to use its resources, including human resource, efficiently in order to generate profits, but in a way that is conscious of the need to protect the environment.
Sustainability is a relatively new concept, but it has gained massive relevance in the recent past because of its focus on stability. Apple has been concerned of finding the best approach of making its operations sustainable in the market.
The firm has been conscious of the models of sustainability that has worked for other firms in the past. As seen in this firm’s operations, it has been keen to ensure that it observes the three pillars of sustainability.
As McDaniel (2002, p. 116) observes, “Economic pillar for example, looks to sustain natural and financial capital whereas an ecological model looks to biological diversity and ecological integrity.”
According to Laszlo (2003, p. 70), sustainability has majorly been looked at from the perspective of environmental protection. One of the earliest pillars of sustainability to be developed was the planet.
This pillar seeks focuses on the need to ensure that environment is protected from any form of degradation to ensure that it is able to support the future generation. As Husted (2011, p. 39) says, development projects that are not focused on protecting the future generation are not sustainable.
This scholar says that the current development should be beneficial to the current and future generation. Apple Inc. has been seen as one of the firms that have developed programs to help fight environmental degradation.
Although their effort has not been able to meet the level of e-wastes directly related to their products, it has earned praises from some of the industry players as one of the firms that have managed to reduce the level of their pollution greatly.
This has helped it earn trust with the market, especially in the United States, which makes the major market for its products.
As Hill and Jones (2010, p. 40) note, it is through corporate sustainability policies that firms can manage to achieve success in the current competitive market.
Corporate sustainability can be defined as a business strategy that seeks to create long-term value to all the stakeholders within an organization while protecting is socio-economic and cultural environment.
It involves development that is conscious of risks that may be countered during normal operations. Corporate sustainability is a term that has been commonly used in reference to large corporate organizations with global market coverage.
Apple is one of the firms that have been considered to have the best-thought corporate strategy sustainability policies. This has enabled the firm understand market forces.
It is able to determine the possible impact of its production activities, and ways through which some of the negative consequences can be mitigated. It has come to appreciate that its operations can only successful it they are supported by the natural environment.
For this reason, it has been keen to protect the natural environment from any possible destruction due to issues such as pollution.
Apple has always focused on achieving sustainable development in its operations over the past decade. This is what has contributed to its current success. According to Maser (2012, p. 26), sustainable development may mean different things to different people in different contexts.
It has commonly been defined as the kind of development that helps in meeting the current needs in a way that do not compromise future generation’s ability to achieve their needs.
Steve Jobs, the former chief executive officer of this firm, once defined sustainable development as the ability of a firm to achieve the current developmental needs in a way that would assure it of future developments (McKenzie-Mohr 2011, p. 37).
This definition of sustainability by the chief executive of this firm demonstrates how Apple has been approaching the issue of sustainability.
It is a clear indication that this firm has considered sustainability as a way through which it can achieve its current developmental needs without compromising the firm’s ability of future developments.
The firm has avoided temptation of going for projects that would help the firm experience quick profitability, while ignoring the need for future development. This explains why this firm has been consistent with its development over the past years, especially from 2006 to 2012.
As Steve Jobs would insist while still the chief executive of this firm, sustainable development is focused on all factors of that may have an impact on the firm in one way or the other.
As McDaniel (2002, p. 51) notes, sustainable development seeks to ensure that any gains made in the development process do not create a room for future failures within a firm.
This means that when a firm is seeking to achieve sustainable development, the main question should always be on the impact it may have on future prosperity.
The aim of this firm, as the former chief executive would note, is not to achieve massive short-term success followed by a series of failures, but to have a consistent growth, however minimal it is to the firm.
This way, Apple managed to become the most profitable firm in the year 2010. In the same year, its brand was ranked the most expensive of all other brands in the world. This was an indication that the firm’s past activities were sustainable.
Corporate social responsibility
Corporate social responsibility is another field that this firm has been focusing on in the recent past. According to Hooley (2008, p. 38), firms take a lot from the environment and the society through their normal operations.
Apple Inc. understands that there is need to pay back to the society what it takes from it in the form of corporate social responsibility. It is referred to as a responsibility because it is a duty that should be performed, and not a favor that firms should only engage in at will.
Apple has defined its corporate social responsibility into two broad areas. The two areas include concern to the environment, and concern to the society.
On its concern to the environment strategy, this firm focuses on the need to have to reduce amount of its industrial effluent, including the greenhouse gases. This firm has always developed policies that are meant to reduce its industrial emissions to the environment.
In its production plants, the firm has developed systems that help it ensure that only treated effluent leave the firm through clearly defined and accepted channels. The firm has also ensured that its greenhouse gases are reduced as much as possible.
It has done this by developing more efficient production strategies that is conscious of the issues relating to the environment.
According to the report by McLaughlin and Aaker (2010, p. 84), Steve Jobs, the former chief executive of this firm, had proposed for a strategy of collecting their e-wastes from the environment.
Although this project has not been put to practice, it has been lauded as one of the most desirable strategies that would help protect the environment from e-wastes.
In this strategy, customers are encouraged to present their old phones to any of the firm’s outlet, and the customer would be given a brand new phone at a subsidized cost. This would help fight the habit of irresponsible disposal of the firm’s e-wastes.
The firm would then find a way of recycling some parts of these e-wastes. Those that cannot be recycled would be disposed in a more responsible manner. In implemented, this policy will help reduce the level of e-wastes in countries where this firm operates.
The second concern has always been on the need to help enhance the well-being of the society in which it operates. In its normal operations, this firm needs the society in one way or the other.
It needs the society to be part of its employees, its market, its suppliers, or any other relevant fields that enable this firm operate. It has a responsibility to it. In the developed countries such as the United States, this firm has been sponsoring popular games such as the Super Bowl Games.
In developing countries such as Afghanistan, the firm has been keen on supporting the needy within the society. The firm has sponsored various educational programs as a way of empowering the society.
Technology
Technology is the third field in which this firm has been focusing on within the last six years. Since 2006, Apple has been coming up with strategies that are meant to upgrade its production system as a way of enhancing quality of its products.
According to Montiel (2011, p. 49), emerging technologies are changing the face of the world in various fronts. This scholar says that emerging technologies have had massive impact in the field of electronics.
Apple has been one of the firms that have been keen to use the emerging technologies for its own benefit. The firm has been able to apply some of the new technologies to enhance its production processes. Through this technology, the firm has been able to improve its production process.
The rate of producing a single product per unit time has significantly dropped. This does not only help in reducing the cost of production, but also helps this firm in reducing the amount of emissions into the environment. The firm would take shorter time in the production process than before.
Technology has also helped this firm market its products in the global market. According to Viardot (2004, p. 68), Apple is one of the firms that have heavily used the social media as a means of reaching out to its clients.
The firm has successfully attracted a large pool of customers to its products through Facebook, Tweeter, and YouTube marketing. The firm has also been using other means of internet marketing to help expand its market share.
Technology has also helped this firm improve its communication strategies. Apple has developed internal communication systems that allows for inter-departmental communication as a way of sharing vital information on the normal operations of the firm.
The management has also used technology to develop system that would enable the top management at the firm’s headquarters monitor operations of this firm in the overseas market.
A critique of the management’s performance in the identified areas
The management of Apple has scored favorable in the field of sustainability. As shown in the above discussion, the management has laid down a number of strategies that would help it remain competitive in the market.
The firm has been keen to take into consideration the three pillars of sustainability. It did not ignore any other pillars, a sign that its sustainability has a strong foundation. However, it should implement the policy on collection of e-wastes. Good plans should not just remain on paper.
They should be implemented so that their benefits can be enjoyed. In the area of corporate social responsibility, the performance of this firm can be give a score of above average. It has been focused on environmental protection and enhancement of the society’s welfare.
The score is not excellent because most of its corporate social responsibility has not spread to the third-world countries where its products have become very popular.
In the area of technology, the score of this firm can be considered as good. This firm has been one of the industry leaders when it comes to the use of emerging technologies to produce new better products in the market. It has been a pacesetter.
Analyzing the company’s management approach using theoretical model
In the past six years, Apple Inc. has focused on introducing products that meet expectations of the market. To achieve this, the management has embraced change in its management strategies. It has been keen to ensure that it changes its market approaches with the changing market needs.
It is important to understand some of the theoretical models that this firm has been using to protect its future interests. The Future Wheels Diagram below shows some of the drivers of change in the external environment that could have motivated this firm to be dynamic.
Future Wheels Diagram for External Factors that Motivate Change
Changed marketin’ strategy
The above future wheels diagram shows some of the possible external factors that could have motivated the management to initiate change. As demonstrated in the above Future Wheels diagram, one of the external factors that may motivate organizational change is government laws.
Government always comes with laws and regulations that are meant to streamline operations of various sectors of the economy. This firm is bound by law to change its operational strategies based on the changes that may be imposed by the government through regulatory measures.
One of the possible outcome of this factor may be changed production methods in line with the new measures put by the government to reduce pollution. Another outcome may be a changed transport system to reflect the changing regulation.
Another outcome from this factor may be reduced cost of the product in order to motivate other sectors. In all these cases, the management, and the entire fraternity of the firm, must change with these new developments in order to help the firm run as per the changed laws and regulations.
The second factor that may motivate change within an organization is economic changes. Economic changes always bring with it far reaching consequences to business units. A firm must be able to determine how to change in order to operate optimally within the current external forces.
In this regard, the management of Apple would determine if the economic forces would be favorable or unfavorable to this firm. Depending on the economic changes experienced in the environment, the outcome of this may be a reduction or increase of prices of the products.
Competitors play an important role in defining activities of a firm within a given market. It is one of the strongest motivators of change within an organization.
According to Chaston (2009, p. 29), a firm cannot ignore activities of the competitors and dismiss them as inconsequential or irrelevant to its operational strategies.
This assumption can be suicidal because any change that gives competitors a competitive edge over this firm is a serious threat that may force it out of the market.
The outcome of competitor’s activities may be a series of changed marketing strategies that would help the firm acquire a similar or even better advantage in the market. This may explain changing strategies used by this firm in the market.
The fourth factor as identified in the diagram above is technology. As Ferrell (2011, p. 90) observes, technology plays an important role in influencing changes within an organization. Firms cannot ignore changes that are brought by the emerging technologies.
It is important for the firm to find the best ways that it can change with the changing technologies in order to achieve the best results in their operations. The management has been keep to adopt to the emerging technologies as soon as they are developed.
Scenario Development: Assessment of the Contextual Environment (2018-2020)
The world is changing, and Apple must find a way in which it can operate successfully in the market. Scenario development helps in creating a conceptual environment, which is a representation of the future environment.
This conceptualization is always important in enabling a firm identifies some of the future market forces that it must conform to in order to remain competitive.
This way, it may start preparing on how to manage these issues early enough to avoid difficulties that may be encountered during the implementation process. At this stage, the research will focus on the environment in 2018-2010, in which this firm will have to operate.
The world in which the company must operate in 2018-2020
As Gerber (2008, p. 46) observes, during the normal operations of a firm, it is always important to understand the future of the market. Understanding the future helps a firm prepare for possible opportunities and threats that may be presented in the market.
Apple must realize that by understanding the future, it can end up being successful or otherwise, depending on the approach taken. In order to analyze the future environment in which this firm will have to operate, it is important to understand the three concepts identified above.
It will have to analyze the future in terms of sustainability, corporate social responsibility, and technology.
Sustainability
As mentioned above, sustainability has three pillars, which must be sustainable. The three pillars are always categorized as the environmental pillar, the social pillar, and economic pillar of sustainability. The diagram below shows the three pillars.
Figure 1: Pillars of Sustainability
Source: (Cavagnaro 2012, p. 27)
In 2018-2020, Apple must understand that soceital factors shall change in terms of customer needs and employee demands. Given the increasing relevance of performance contract, it is possible that in this period, employees will be paid as per their contribution to the firm.
Apple must be ready for this. It is also likely that it will be difficult to retain employees at the firm because many would want to explore other industries. The management must find a way of dealing with this high employee turnover.
To the customers, this firm must realize that they will demand for very high value for their product.
The production manager must be ready to supply this quality. It is also likely that e-marketplace will be stronger than brick-and-motar markets. This firm must find ways of making this shift before the time comes.
Environmentally, some changes are expected during this period. The society will be demanding for a reduction of rate of environmental pollution as a way of enhancing sustainability. This firm will be forced to find ways in which its production processes will not pose a threat to the environment.
Economically, it is expected that the third world countries shall have made steps towads becoming major markets for electronic products.
Apple will need strategies that would enable it capitalize on this growth. This firm must be ready to deal with all the three issues identified as the economic pillars.
Corporate social responsibility
There will be a paradigm shift in the approach taken on issues related to corporate social responsibilities. Although the activities may remain the same as they are currently, the future market environment in which this firm will operate may impose some conditions.
For instance, a country such as Afghanistan may demand that all firms operating on its soil must commit a certain percentage of their profits towards various activities meant to elevate the condition of the society.
In this case, Apple may not have the freedom of choosing when to engage in corporate social responsibilities, and the amount of resources to commit. The approach taken in these activities in 2018-2020 may also change.
Governments in countries where the firm may change policies on how these activities should be carried. For instance, a government may decide to introduce policies that allow them to be involved in such activities.
In such cases, Apple must find a way through which it can align its strategies to the changing environmental laws.
Technology
It is definite that there shall be a massive change in the field of technology by 2018-2020. Technology has been changing rapidly in the recent past. It is therefore easy to predict a complete shift in the products that will be offered in the market as dictated by the shifting technologies.
Apple should be ready to use some of the production methods that will be introduced by technology during this period. It should be ready to find better ways of using technology to deliver superior value to the customer.
In 2020, it is very likely that marketing will go digital due to increased technological invention. This firm should prepare itself for this massive shift if it expects to remain competitive in the market.
It should be ready to spend more in research during this period, as there will be need to understand the dynamic environmental culture. The increased expenditure will also help cater for the costs of buying new machines, and training users on how these machines are operated.
Requirements of management in the scenario developed
In the part of this paper in section C, it is demonstrated that this firm needs to understand some of the changing environmental patterns and the way these changes may affect the normal operations of this firm.
In this section, Future Wheels Model was used to identify some of the possible drivers of change, and some of the impacts these drivers may have on the firm.
Apple must understand some of the requirements it needs to meet by 2018-2020 in order to be able to operate successfully in the market.
According to the model given above, this firm needs to understand the four drivers of change, which include government laws and regulation, technological changes, forces of the competitors, and economic fluctuations.
Each of these forces should be treated uniquely in order to understand their changing patterns. The firm should then find a way of adopting to the pattern in order to avoid any conflicts in its normal operations.
This means that it should follow changes that shall be made in laws and regulations governing its operations. It should be able to understand the economic forces and align its operations to it. It should also find a way of conforming to technological changes in this future environment.
Finally, this firm should ensure that it does not ignore activities of its competitors. The competitors may as well be the main downfall of this firm.
Analysis of requirement of future needs and current company competencies
The management needs of this firm by 2018-2020 have been identified, and the current company competencies stated. As Bissoondoyal (2006, p. 37) notes, ability of a firm to overcome future forces always depend on its current market strategies.
This means that ability of Apple Inc. to manage the changes in the environment by 2020, its current competencies must be showing signs of ability to do this. To understand this, the analysis will be done on the three factors of sustainability, technology, and corporate social responsibility.
According to the analysis above, Apple has been keen to observe the three pillars of sustainability. Its operations are increasingly becoming conscious of environmental needs, it appreciates the importance of its employees and the market, and cares for them, and its profits have been attractive.
This means that based on sustainability, the competency of the firm is aligned to its current and future requirements.
In terms of technology, Apple has been voted the most innovative firm in the world on several occasions. This means that it is competent enough to manage future technological changes that may be brought in the environment.
The current policies of Apple on corporate social responsibility may be considered as adequate based on the current requirements.
However, the changing environmental factors may demand some changes in these policies in future. The firm’s current performance points out to the fact that it is capable of managing its future environment.
Conclusion
Apple Inc. is one of the most successful firms in the electronics industry. This firm has been keen to align its operations with the prevailing market conditions. The firm has been keen to ensure that it provides the market with products of high value as a way of creating a pool of loyal customers.
Its global market coverage has enabled it to understand different market conditions that may affect its normal operations. The strategies of this firm have been very appropriate and have helped it attain its current prestigious position.
However, the future may present completely different factors that may demand for a new approach in the market.
The scenario development of the nature of environment in which this firm may have to operate indicate that some changes would be needed in order to make this firm sustainable in its operations.
The firm must find a way of changing its strategies according to the changes taking place in the environment.
In 2020, it is expected that several changes shall have taken place in the economic, social, political, and technological sectors.
This firm must be ready to work in these changing environmental factors on order to operate sustainable. The management should always be positive and flexible to these new developments.
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