Apple Incorporation and Samsung Group are profitable companies in their respective industries. These two firms also compete in various industries, such as Mobile Business and Consumer Electronics. The companies utilize different business practices and strategies to succeed in their respective markets. The discussion presented below examines the business strategies and practices embraced by Samsung Group and Apple Corporation.
Analyze the existing business strategies, domestic and global environments, industry, and internal capabilities for both Apple and Samsung. Assess the significant manner in which each company’s mission and vision align with the long-term goals and strategic direction of the organization.
Apple’s strategy is critical towards producing a few high-end consumer products that can compete successfully in the market. Apple Inc. uses a unique business strategy to target its global and domestic customers. The company outsources most of its products and hardware from different companies across the globe. This approach reduces production costs, thus maximizing profits. Apple “is widely known for producing cutting-edge products that merge technology and art” (Yoffie & Kim, 2010, p. 4).
Apple’s vision “is to bring quality personal computing experience to professionals, educators, consumers, and students in the world using innovative internet offerings, software, and hardware” (Yoffie & Kim, 2010, p. 3). The company’s mission “is to protect the health, safety, and environment of its employees, stakeholders, and customers” (Yoffie & Kim, 2010, p. 4). Apple’s vision and mission are critical towards supporting its strategic direction. The production of superior products such as the iPhone has made the company sustainable and capable of realizing its long-term goals.
On the other hand, the Samsung Group dominates the global market with a wide array of useful products. Samsung also supplies different hardware to many global business partners. Samsung currently dominates the global market by producing many devices that can address people’s needs. The company has “the best workforce, R&D team, and technology, thus making it easier to achieve its goals” (Chan, 2010, p. 2).
Samsung’s vision is “to inspire the world and create the best future for all” (Chan, 2010, p. 2). The firm’s objective is to empower its stakeholders with new technologies, talents, and partnerships. The corporation’s mission supports its strategic direction and long-term goals. Samsung uses this strategy to identify new opportunities in the market. The approach has made Samsung sustainable and prosperous.
Analyze the business-level strategy of each company by conducting a SWOT (Strengths, Weaknesses, Opportunities, and Threats) analysis. Next, determine the fundamental way in which each sector influences its competitive position within the industry. Provide a rationale to support the response.
Business-level strategies are common because many firms compete in various industries. Every business unit should have its unique strategies and practices in order to emerge successfully. Such business sectors will determine the overall success of the company. Apple Inc. uses the best business-level strategies to support its managers and employees in different business segments (Yoffie & Kim, 2010).
Apple Incorporation SWOT Analysis
The firm applies the above strengths and opportunities uniformly in different sectors. The company uses the above opportunities to market its quality products. Such devices have commanded a lead in the market. The company has “also produced product-offerings such as iTunes and apps for its devices” (Yoffie & Kim, 2010, p. 6). Apple Inc. has also produced superior iMacs and computers that have remained successful in the global market. Each sector plays a critical role in influencing Apple’s competitive advantage. The sectors work together in order to produce devices and products that can add synergy to one another (Carroll & Buchholtz, 2014). Apple Incorporation also discontinues most of its devices in order to produce better and superior ones. This strategy has continued to support Apple’s competitiveness.
Samsung also operates numerous segments under its roof. These segments target different customers and companies in specific industries. The approach has created new competitive advantages, thus making the company profitable. Samsung’s business-level strategies are critical towards achieving every targeted objective. The SWOT Analysis below summarizes the company’s business environment.
Samsung SWOT Analysis
Samsung merges different sectors, depending on the targeted customers. Samsung also monitors and studies the market in order to produce new products in different industries (Chan, 2010). The approach has made Samsung one of the most diversified corporations in the world. Each segment targets specific customers and market segments, thus making Samsung profitable. The marketing and advertising approach also identifies potential markets in different global regions. This diversified approach has been critical of the company’s growth.
Analyze the central manner in which the strategies of each company’s business leaders have adapted to cultural differences in order to both facilitate effective operations within global markets and drive new strategic initiatives with improved innovation excellence. Provide one example of such strategies in use from each company to support the response.
Samsung and Apple have always promoted new strategic initiatives using improved, innovative practices. The companies have also “adapted differently to cultural differences in order to have smooth operations in every global market” (Twarowska & Kakol, 2013, p. 6). Samsung Group has been educating individuals in different countries in order to improve its operations. The company analyzes the cultural practices and socio-economic values associated with the targeted markets. For example, Samsung has designed low-cost smartphones for customers in African and Asian countries (Chan, 2010). The company uses strategic marketing activities to deliver such products to different customers. The company recruits marketers from these regions in order to achieve its goals.
Apple Incorporation also focuses on the cultural differences in different regions in order to have effective operations (Apple Incorporation’s Ethical Success and Challenges, 2014). However, the company does not produce differentiated products to address the changing needs of the global consumer. Apple produces superior smartphones, handheld devices, and applications that can empower many individuals. The company also embraces a powerful outsourcing strategy for its products. A good example is the iPhone. The smartphone “is designed in California and assembled in different parts of the world, such as France, Korea, and China” (Twarowska & Kakol, 2013, p. 86). The approach makes it easier to produce superior brands that are available at considerable prices. Apple Inc. should reconsider its strategy in order to adapt to the changing cultural differences in the world.
Evaluate the superiority of each company’s organizational competencies in terms of entrepreneurial capabilities, organizational design capabilities, and strategic capabilities geared toward increased performance and profitability. Include one example of such superiority from each company to support the response.
Samsung Group uses its organizational competencies in order to realize its potentials. The company has superior entrepreneurial capabilities. Samsung begins by identifying its consumers’ needs in different parts of the globe. The next step is producing quality products and appliances that can address such needs. The company’s organizational design has played a key role in its success. The company has several regional managers to oversee different activities and marketing strategies. The strategic capabilities identify new markets that can promote the company’s performance (Carroll & Buchholtz, 2014). Samsung produces digital cameras, phones, tablets, water heaters, TV sets, refrigerators, and security systems. Such superiorities have made Samsung the most profitable and diversified firm (Chan, 2010).
Apple Incorporation has embraced a centralized organizational structure in order to become successful. The company’s organizational design makes it easier to design, produce, and analyze its quality products. For instance, the production of superior products such as iPods, iTVs, iPads, and iPhones have revolutionized the company’s entrepreneurial strategy. The company’s R&D utilizes modern technologies in order to produce superior devices. The company used experienced marketing teams to deliver its products to different consumers (Twarowska & Kakol, 2013). The company should improve its presence in different global regions in order to promote its performance.
Recommend one appropriate new business strategy for each company that may maximize profitability and improved competitiveness in the industry. Provide a detailed rationale for this strategy.
The above discussion explains why these two companies are major rivals. The firms have continued to dominate various industries because of their superior products and strategic capabilities. However, new strategies will ensure the companies are competitive and profitable. Samsung can design a new business strategy in order to maximize its profitability and competitiveness (Chan, 2010). The next approach is doing away with every nonproductive segment. The strategy will ensure the company dedicates its technologies and innovative ideas to products that can maximize profits. The current organizational design will support this recommended business strategy, thus making Samsung successful.
Apple Incorporation can also introduce a new business strategy in order to become competitive. The company can begin by embracing the power of diversification. Apple serves a small number of industries. These “include computer hardware, electronics, and digital distribution industries” (Yoffie & Kim, 2010, p. 3). The introduction of new products such as televisions will ensure the company remains competitive. The firm can also produce a wider range of smartphones and appliances in order to attract more customers. This approach will improve the company’s performance because many people admire its unique brand. The decision to promote new marketing strategies in different global regions will also support the above business strategy.
Evaluate the success of both companies’ corporate-level strategies in terms of horizontal integration, vertical integration, strategic outsourcing, or diversification. Next, determine the type of strategy that contributed most effectively to the creation of a successful and profitable multibusiness model. Provide a detailed rationale to support the response.
Several factors and practices contribute a lot to Apple’s success. The company’s corporate-level strategy has made it easier to achieve every objective. Apple uses “strategic outsourcing strategies whereby most of its value-creation practices are performed by independent companies” (Yoffie & Kim, 2010, p. 19). Such functions make it easier for Apple Inc. to reduce its costs and maximize profits. Strategic outsourcing reduces production costs, thus increasing profits.
The “approach makes it easier for Apple Incorporation to differentiate its products and increase its competencies” (Yoffie & Kim, 2010, p. 12). This strategy explains why Apple has a remained a successful and profitable firm. However, outsourcing has forced the company to depend on other companies thus affecting its objectives. Apple has also diversified its business by producing software, hardware, and devices that contribute a lot to its profitability.
Samsung uses a unique corporate-level strategy in order to emerge prosperous. Samsung Group embraces the power of diversification. Diversification “has made it possible for Samsung to produce appliances, television sets, smartphones, cell phones, and household equipment” (Chan, 2010, p. 2). The company has successfully dominated the global market. The company also uses strategic outsourcing for its software. The company purchases different software from different programmers. This approach has reduced the company’s production costs. In summary, the company’s diversification strategy has contributed a lot to its performance.
Analyze the strategies that the internal leadership of both Apple and Samsung has taken to discourage unethical behaviors. Provide at least three examples of such leadership in action from both companies to support the response.
Ethical business behaviors are critical towards the success of different corporations. The internal leadership at Samsung encourages ethical practices and ideas that can produce the best results. The company has designed the best codes of conduct to govern the practices and behaviors of every employee. The company hires over 220,000 workers in 75 nations (Chan, 2010). According to the leaders, such codes of conduct are critical towards supporting the needs of shareholders, local communities, and business partners. In 2005, the company’s top management introduced the “Five Samsung Business Principles”. These principles include:
- Complying with ethical/legal standards.
- Maintaining a clean business culture.
- Respecting employees, consumers, and stakeholders.
- Supporting the environment.
- Becoming a socially-responsible firm.
The company’s leaders also embrace the spirit of corporate social responsibility (CSR). The company supports every unfortunate member of the community. The company expects every employee and product to comply with different industrial standards.
Apple Incorporation is also one of the leading ethically responsible firms in the United States. In 2011, many agencies accused Apple Inc. of providing unethical working conditions to its workers. Apple decided to introduce new legislations to discourage such unethical practices. Under the leadership of Steve Jobs, Apple Inc. began to take care of its workers. The company also uses different outsourcing strategies in order to cut costs and reduce cases of unethical practices.
Apple expects its suppliers to sign a document called “Supplier Code of Conduct” in an attempt to reduce every unethical behavior. This practice has been critical towards dealing with such malpractices. The company has also drafted a new code of conduct that applies to every segment, manager, and employee (Apple Incorporation’s Ethical Success and Challenges, 2014). New policies have been defined “to promote corporate governance and reduce organizational conflicts” (Apple Incorporation’s Ethical Success and Challenges, 2014, para. 4). The managers have a duty to punish every unacceptable or questionable conduct.
Assume that both Apple and Samsung are in need of organizational change and must alter existing strategies. Recommend three (3) specific ways in which Apple and Samsung could change functional, business, and corporate strategies, as well as organizational structure and control in order to improve business performance and competitiveness in their industry. Provide a rationale to support the response.
Organizational changes are essential because they make businesses successful. Organizational changes can different shapes depending on the targeted objectives. The “most appropriate organizational changes include new functional strategies, business structures, and corporate approaches” (Carroll & Buchholtz, 2014, p. 103). Samsung can begin by identifying unique business functions that will improve performance. The “company can mainly focus on its profitable products” (Ireland & Hitt, 2005, p. 69).
The approach will ensure the company concentrates on a few segments. The second change is introducing a new organizational structure. This strategy will ensure the company embraces a horizontal hierarchy whereby different managers collaborate with one another. This approach will ensure managers and workers can share their ideas in an attempt to produce superior appliances (Twarowska & Kakol, 2013). A new business strategy will also make Samsung profitable. The company can introduce new marketing strategies such as social media networks.
Apple Incorporation can also benefit a lot from new organizational changes. The first change is redesigning Apple’s functional strategy. The company will design new business networks, production strategies, and decision-making strategies. The approach will ensure the company produces profitable devices (Ireland & Hitt, 2005). A new business strategy for Apple will make it prosperous. The company can also market its products in many countries in Africa, Latin America, and Asia in order to increase its profitability. The third change is embracing a new organizational structure. The company can recruit regional managers to promote its products in different parts of the globe. A better corporate strategy will definitely make each of these firms successful.
Reference List
Apple Incorporation’s Ethical Success and Challenges. (2014). Web.
Carroll, A., & Buchholtz, A. (2014). Business and Society: Ethics, Sustainability, and Stakeholder Management. New York, NY: Cengage Brain.
Chan, K. (2010). Samsung’s Plans for Diversification Are a Positive Development. Moody’s Investors Service, 1(1), 1-3.
Ireland, D., & Hitt, M. (2005). Achieving and Maintaining Strategic Competitiveness in the 21st Century: The Role of Strategic Leadership. Academy of Management Executive, 19(4), 63-77.
Twarowska, K., & Kakol, M. (2013). International Business Strategy: Reasons and Forms of Expansion into Foreign Markets. Web.
Yoffie, D., & Kim, R. (2010). Apple Inc. in 2010. Harvard Business School, 1(1), 1-25.