Apple Incorporated: Management Systems Analysis

Introduction to Apple Incorporated

Apple Inc. based in the U.S. and operates in several countries. The company manufactures computer hardware and software products. In recent years, the company has started to manufacture electronics. Apple is a large company with a huge asset base and is one of the most innovative companies in the information technology industry. The company has been in operation for approximately thirty-five years[1]. The company began its operations by venturing into the production of personalized computers that were known as Apple computers. It shifted towards the production of other consumer electronics from the beginning of the 21st century. Steve Jobs has been the president of the company since 1997, but he passed away in 2011. The company has made a good name globally due to the quality of its products and good leadership strategies. Apple has a wide customer base for the products and services[2].

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Background of Apple

Apple has a wide range of products and services in the global market. The products include computers and computer accessories, information technology communication gadgets, and other consumer electronics. The products of Apple can be classified into two; the old and major products and the revolutionary products. The old products are the products the company has identified with for many years. The major products in this category are the Macintosh series of computers. The revolutionary products are those products that have left a big mark on the image of the company. Apple applies the most sophisticated technologies in the IT industry. These products include all the ‘I’ product series of products as well as sophisticated three-dimension software.

In ensuring that it gets the desired quality for its customers, Apple works closely with the manufacturers of the materials that are used in their products. The company takes a keen interest in the selection of materials used in the production of products. The company also focuses on the possible technologies and manufacturing possibilities. An example is the ‘double-short’ technology, which is used in the combination of different colors and colored materials for the products—the colored layers featured in the iPods and the iMacs. Apple helps the manufacturers in understanding or mastering the process and the products that they expect to come out of the process. The company dispatches its design teams to the factories. This is the secret behind the quality of their products[3]. Apple also uses assistive technology in products to cater to people with various needs like the blind. Products that have encompassed this technology include Mac, iPod, iPhone, iPad, and Apple television[4].

Information technology policy, innovative use, IT as an enabler

The presence of competition is one of the major forces that drive innovation in companies. Apple is one of the best examples of companies that utilize information technology in gaining a competitive advantage over other firms. Therefore, the management of Apple ensures that the company keeps and maintains a strong policy on IT. The company has a strong policy on the use of IT in its products. The policy on IT use by the company stipulates that the company will also be creative and apply research in the design and product development to come up with technologically advanced products. These products serve the ever-changing need of consumers. The company also spends a lot of resources on the design of the products[5].

Apple gives consideration to its customers by extending advisory services to customers. These services are meant to enhance the efficient use of these products for the realization of the full innovative potential of the products. Using highly innovative technologies, Apple has managed to develop high technology products and technologies like the C3 technologies, 3D technologies, among many others. By using IT services, Apple has become a leading innovator in the information technology field[6].

Information systems Architecture

Apple has a huge online presence, which helps in the management of sales. Online marketing forms part of the sales strategy. The product managers of Apple have a big online presence, which helps them in coordinating the different teams of the company. This ensures that teams bestowed with the responsibility of implementing projects discharge their activities according to company expectations.

Merchandising helps in the management of the online retail stores of the company. This enhances the customer experience. Merchandisers use their skills to enhance product placement, promotion, and pricing, and positioning in the retail market.

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Apple uses information systems and technology in the management of its business processes. It has a team that specifically deals with information systems and technology. This team manages the technical infrastructure of the company as well as the business structures of the company. Most business transactions are concluded online[7].

Marketing systems of Apple

Apple uses a vertical marketing system in enhancing its marketing activities. In this system, the marketing function is achieved through the interaction at different levels of production. Various people play different roles in the distribution system to enhance efficiency and economies of scale in the production, distribution, and delivery of products to the customers[8].

Apple owns all the levels of production and distribution. The company has retail stores in different parts of the world. It also engages in the designing and production of the products that are distributed and sold in the stores. This is a tight marketing system, and the major advantage of this marketing system is that the quality of the products that reach the customer is assured. It is also easy to detect anomalies in the products[9].

Findings, analysis, and discussion

Apple is one of the most innovative companies in the information technology sector. It pegs its activities on creativity and innovation in product development. The company has efficient and sound management on whom the success of the company is pegged. The management of the company invests a lot in innovation and full engagement in the production and marketing of these products. Several factors are considered when analyzing Apple in various stock markets, as in figure 1.0 in the appendix.

Strengths of Apple

Apple Inc. is one of the most successful companies in the world. The success of the company has been driven by several factors. The first strength of the company goes to product development, where the company has managed to set high standards by producing high-quality products. The strength of Apple lies in the design and utility of its products. Its products have simple designs and easy to use. Apple has sound marketing strategies. For example, the vertical marketing system helps Apple to take advantage of products from other firms. Apple has a good brand name, which is an accelerator of the marketing of its products. Lastly is the leadership of the company, which can be termed as charismatic and visionary[10].

Weakness

The company is very proprietary. It does not reveal product development activities to outsiders. This works to the disadvantage of the company in many aspects. It limits the market share of the company. The other weakness of the company lies in the centralization of management. The company has a blow after the death of Steve Jobs, one of its major icons. The company does not have good relations with its shareholders. There have been many cases where it has refused to issue out dividends to shareholders despite recording high profits[11].

Opportunities

There are many major opportunities, such as customer loyalty. The customer base assures the company of a market for its products. The company is also diversifying its functions by engaging in the production of other consumer electronics. Apple has, in recent times, produced the Apple TV – a new version. This helps the company to take advantage of the Web[12].

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Threats

There are three major threats to Apple. The first is the threat from competitors who copy the ideas and develop on them. This has been the major bone of contention with companies dealing with products of a similar nature, like Motorola and Samsung. Also, the products of the company have very high prices, which makes other products from other companies take over the market; for instance, the Samsung Galaxy tablets. Also, the company is facing stiff competition from other companies which gaining full access to the market. Samsung, for instance, has been reported to have made far mush more sales of the galaxy tabs overtaking the sales of Apple. This is because the price of Samsung tabs is affordable to consumers as compared to that of Apple products[13].

Conclusion, recommendations, future directions

It is worth noting that Apple is a company that has set the pace for other companies in the information and telecommunication industry. It is actually one of the best companies in terms of innovation and performance. However, competition is stiffening, and the company needs to become more diverse and creative for it to maintain its record. Collaboration with other companies in the future is likely to bear more fruits rather than isolation. The company can also acquire other companies to venture into different industries. This strategy will also help in accessing other markets globally.

Bibliography

Apple Website, Apple’s Commitment to Accessibility, 2012, Web.

Apple Website, Information Systems & Technology, 2012, Web.

Apple Website, Merchandising, 2012, Web.

Forbes, Apple, Inc. (NASDAQ: AAPL) | At A Glance, 2012, Web.

Mueller, J, Apple: Strengths, Weaknesses, Opportunities, Threats, 2011, Web.

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Research paper factory, Apple’s Advantage, 2012, Web.

Richards, L, Three Types of Vertical Marketing Systems, 2011, Web.

Turner, D, The Secret of Apple Design, 2007, Web.

Appendix

Figure 1.0 Arguments that inform the analysis of Apple in stock markets. Source: Forbes, 2012.

Key Positive Arguments Key Negative Arguments
Apple has a strong brand name, loyal customer base, and defensible installed base. PC, consumer electronics hardware, software and other aspects of Apple’s business are characterized by extreme competition.
iPod is still a major traffic and revenue driver for the company’s computer products. Launch of video Nano iPod has enhanced revenue and benefited the company as a whole. The stock option pricing issue is a source of uncertainty and will likely lead to share price volatility.
iPhone has enabled Apple to reposition portable players business for growth, and enter the high-end segment of the smart phone market at the same time. Investment in technology stocks, including Apple, involves a high degree of risk due to the rapid changes in technology and competitor actions.
Apple has an excellent cash position and balance sheet with no debt. The ultimate size of the music/MP3 player market is unknown, and there is an increasing competition from multiple vendors.
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