Apple Incorporated - Case Study Example

Apple Incorporated Introduction There is a strong strategic importance that links operations and operations management for an organisation. In orderto clearly see this, there is a need to understand what operations management is. It is argued that it deals with activities that try to use inputs such as ‘’materials, energy, customer’s requirements, information, skills, finance and more” in order to come up with something that will benefit customers (Brown, Lamming, Bessant, & Jones, 2005, p.10). Based on this definition, it is implied that operations management is about integrating useful activities in an organisation that will create substantial output for the end customers by using all essential inputs. This only implies that an organisation will need to understand further the needs of customers in order to substantially give enough time on which of the company’s essential inputs need to be combined to come up with an effective and efficient output. Furthermore, what Brown and his colleagues try to emphasise from their definition of operations management is that the activities involved in it are actually different forms of operations that take place in the whole operation of the organisation. For instance, marketing activities deal with understanding not just the company or industry but there is a need to substantially consider the entire market. Such leads further to consideration of the price, products, promotion and place. These are not the concerned of the production department but it is there concern to get information from the marketing department in order to come up with products that the market requires. In the same way, product innovations for instance is not the concern of the accounting department but they only coordinate with the marketing department and production department in order to essentially address the need of the operation to substantially flow effectively and efficiently. As it can be observed, the three departments involved different nature of operation from the other but when they are combined together as entire activity; there is a definite outcome or one whole flow of activities which defined the organisation’s whole operation. This has to be managed accordingly and such leads to operations management. However, in today’s time when competition is everywhere and becoming fiercely complex, an organisation needs to actually come up with strategy in order to be competitive enough. Thus, here comes the need for strategic operations management. There is a need to use strategy in order to achieve the ultimate goals an organisation has set to be achieved (Brown, Lamming, Bessant, & Jones, 2005). This paper tries to critically review Apple Incorporated on its operation management. Specifically, the proponent tries to include the following. Critical review of the organisation’s Strategic Operations Management activities from manufacturing, service & administrative perspectives. Critical assessment of the organisation’s global capability & evidence of competitive advantage in their products & services in terms of design, planning, implementation of operations, etc. Critical review of information & their relative value to enhancing competitive advantage. Strategic Operations Management of Apple Incorporated Let us try to take a look at the strategic operations management of Apple Incorporated from manufacturing perspective. Product quality is so far the most obvious reason why until at present, Apple is renowned for its top-priced products for ipods, laptop computers and other line of products. Apple has concisely presented its financial performance and this is properly justified by different factors which of course include manufacturing considerations (Apple Incorporated, 2011). It has substantially stated that there is a wide range of importance that it has to take into account on product innovation strategy while trying to remain its competitive advantage on product quality and uniqueness. Furthermore, it has also identified the need to come up with unique products that is different from any existing products in the market due to existing intellectual property rights. Competition has become so intense for Apple in the global market where there is different players willing to take the competitive challenge. Manufacturing consideration is very important because for Apple this substantially has created impact on its financial performance. This alone has motivated the company to create more products that are of high quality with a unique feature and output. Thus, this is the main reason why Apple Incorporated is so concerned about intellectual property rights (Apple Incorporated, 2011). According to Porter (1980), since competition is getting tough, an organisation needs to come up with successful strategies and these include overall cost leadership, focus and differentiation. Based on Porter’s three generic strategies, it seems Apple Incorporated was completely able to combine all of them in order to come up with operation that puts high standard on manufacturing activities. In fact, the main reason why Apple continues to exist and become the leading manufacturing organisation in its industry is due to substantial quality it integrates in its manufacturing operation. As a result, it combines effectively marketing activities together and other operation activities in order to remain the leader in the market on pricing products based on standard quality. Apple has defined the standard for certain products in its industry and that what makes it the leader when it comes to considering product cost based on quality and reliability. The manufacturing operation therefore tries to develop substantial level of trust that the customers will be able to give as a result of product reliability. In addition, due to this high level of product reliability that Apple Incorporated was able to develop in its manufacturing operation, there is an effective creation of customer-brand loyalty or highly differentiated line of products. This is evident on Apple’s total revenue and its future’s positive projection which means that it remains to be the leader in targeting specific segments in the market which is more willing to pay for its existing and future brands (Apple Incorporated, 2011). On the other hand, Apple was also able to apply focus strategy in its manufacturing approach considering its leading innovative products with high pressure on reliability even if there is reliance on third parties (Apple Incorporated, 2011). Such strategy ensures focus especially on quality management considering that the company will be able to demand high quality and world class standard of innovation. Total quality management and even combined with world-class strategy therefore are very evident strategies of Apple Incorporated in its manufacturing set up. This only proves that total quality management and other dynamic manufacturing strategies can be reliable manufacturing strategies that an organisation just like Apple Incorporated should implement. It is however evident that the effectiveness of these manufacturing strategies depend on how they will be used based on the needs and corporate goals of an organisation. Manufacturing strategy therefore is proven to effective in achieving competitive edge especially in enhancing manufacturing strength of an organisation (Brown, Lamming, Bessant, & Jones, 2005). The strategic operations management of Apple from service perspective is very obvious that it tries to focus on customer centric approach considering its timely delivery of new innovative products with cutting-edge technology and in particular in addressing customer demand (Apple Incorporated, 2011). Based on these considerations, Apple is known for its high level of evaluation for itself in order to meet a customer demand which in particular is what it created in the first place. In fact, marketing activities today are created in order to stimulate demand just like in the case of Apple Incorporated (Kotler, Armstrong, Saunders, & Wong, 1999; Boone & Kurtz, 2006; Apple Incorporated, 2011). The issue here is about the service that apple has actually managed to control over time. This in particular is in line with its highly sophisticated marketing strategy that ensures effective distribution of its products on a timely basis in order to sufficiently meet customers’ needs. Apple is not only doing what is a must but everybody seems to be doing when it comes to focusing on the needs of the customers. However, what seems to be unique about Apple Incorporated is its ability to place higher emphasis on creating a strong link between itself, third parties and the customers (Apple Incorporated, 2011). Such approach is highly centralised which gives Apple so much control on how its service would turn out. This is directly related to how it actually tries to effectively manage its operation from administrative point of view. Global Capability and Competitive Advantage of Apple Incorporated According to Porter (1980) competitive advantage is something that a certain organisation possesses which created positive impacts that the others do not have. In today’s world where competition is getting intense, there is a need to stand out in order to survive and manage to lead in the global market. This is an issue about creating global capability and competitive advantage. In line with these evaluative measures, it is important to consider Apple’s level of performance in its strategic operations management. The very evidence of competitive advantage of Apple’s line of products is the company’s ability to demand high quality of products to be rendered by third parties (Apple Incorporated). In this case, the company will no longer give so much focus on other related manufacturing issues but too much concern will be emphasised on final product. This gives Apple so much ample time to evaluate product quality that even the product output would demand high price, it will substantially ensure reliability. In fact, this certain level of strategy is part of Porter’s three generic strategies for competitive advantage. Apple is therefore clearly emphasising focus and such leads to creating specific market segments for its line of products. The United States for instance is widely known for its culture when it comes to placing substantial emphasis on quality. Japan is known for its high quality and innovative products. Markets such as these are most likely the promising areas for Apple’s line of products. In fact, the very reason why until now why Apple has become the leading and famous for its cutting edge technology especially on its ipod is because it has substantially found a market segment through its focus competitive strategy. It is not only through its products Apple is creating competitive advantage but as mentioned earlier, the greater value placed on customer-centric approach on designing products is creating competitive edge. Furthermore, Apple is good at its planning strategy considering that it considers wide array of factors prior to implementing necessary moves (Apple Incorporated, 2011). Apple’s value to enhancing competitive advantage Apple Incorporated is viewed not an ordinary company in its industry. In fact, its leadership in the market is a substantial challenge among its competitors. This only means that it has remarkable capacity to increase further its level of achievement in the market. This further would result to inching forward its competitive advantage to another level. Since Apple is known for its cutting-edge technology, such will be its competitive advantage among its competition even though others are trying to promote the same strategy. What is the most important with Apple is its focus is very strong on certain segments that the other cannot completely do. In addition, the impeccable product reliability of Apple adds up to its ability to maintain certain edge in the market. Such would bring forward to positive outcome of its differentiation strategy. According to Porter (1980), it is risky to go forward to differentiation especially for new entrants in the market. However, the competitors of Apple are mostly no longer new entrants. This is a remarkable challenge. However, Porter (1980) added that there are different forms on how to differentiate and these include “design or brand image, technology, customer service, dealer network, and other dimensions” (p.37). So far, Apple is famous for its cutting-edge technology and brand image. These can be substantially used in order to strengthen its specific hold and competitive advantage in the ongoing intense competition in its industry. Conclusion Apple Incorporated is a company built by a well-managed operation under the basic principle of competitive strategies. Due to its success in the industry where it belongs, there is a need to formulate innovative strategies that still would acknowledge the basic. Innovative competitive strategies are necessary for Apple Incorporated considering that competition is getting strong and there are more players coming who are much willing to take the level in which Apple Incorporated is standing at present time. In this regard, it is necessary to come up with more substantial approaches that will help remain other players to view Apple Incorporated as a big challenge for them in the industry. References Apple Incorporated. (2011). Apple Reports Fourth Quarter Results. [Online] Available http://www.apple.com/pr/library/2010/10/18results.html Boone, L. E., & Kurtz, D. L. (2006). Contemporary Marketing. USA: South-Western. Brown, S., Lamming, R., Bessant, J., & Jones, P. (2005). Strategic Operations Management. (2nd ed.). Great Britain: Butterworth-Heinemann. Kotler, P., Armstrong, G., Saunders, J., & Wong, V. (1999). Principles of Marketing. Milan: Prentice Hall. Porter, M. E. (1980). Competitive Strategy. USA : Free Press. Read More