Apple: Strategic Management and New Entrants

The model of “Five Forces” was developed and made by Michael Porter in 1980s which was impacted on global business strategy formulation. Its use for analysis of competitive strategy and it can analyze customer’s competitive environment effectively. The five forces are the bargaining power of suppliers and buyers, threat of new entrants, substitutes and rivalry. These five differentiations are affecting the profit from the industry and also the potential change of a company. Such as to ensure a company have a good relationship with their suppliers or avoid new entrants to decrease their profits and all. Everything has its good and bad, it depends on how the company manipulates the 5 forces for the best benefit. I have some comment for “Five Force”. First, It can’t tell you or teach you how to reach the right position. As an example, Apple is extremely competitive in field of computer and mobile phone and enjoyed approximately 6 years of excess profits. They have many buyers and competitors and suppliers weak, but they are not to achieve this position for combat competitors or more, they achieve this position is because they want to create a product that people need and make the products that people want. If Apple do not know this advantage and they only know how to combat their competitors only, it’s meaningless. Also, the “Five Force” show to us that to protect our product, when you reached that level, you need to protect it. That’s why Apple wants to combat with their competitors such as Samsung, Android and etc. They need to “keep” their users through iCloud, this is the way to sustain their position. But all these aren’t involved in all because Apple has to develop and made a new iPhone or iPad in twice a year. If they did this their position will be raise up continuously and then protect their position. Thus, it have to developed or created then protect. In this technological era, the network is updating constantly. It shows that the analysis of “Five