Phl 320 Critical Thinking And Decision Making Research Paper

SWOT and Strategy Evaluation Paper
Kristen Cohen
PHL/320 Critical Thinking and Decision Making in Business
Due February 16, 2015
Michael McQuinn

SWOT and Strategy Evaluation Paper

The Apple Company is a giant in the electronic industry and have proven themselves most successful over the past 40 plus years, and continue to be innovative and grow with the ever changing industry. Apple is most well-known for the iPod, iPad, iPhone, iTouch and the mac computer. These devices are mostly sold in their retail stores and the company’s online site, and third party cellular network carriers worldwide. The company is also well known for their iTunes and App Stores. Apple’s strengths consist of a vision of the late Steve jobs, who
was a leader of the company with a mission and a vision to keep them on the top of the market with his innovative technology. We have seen this with the many products that have come out over the years such as iPhone, iPad, and iWatch, which is slated to be released sometime in 2015. New versions of these products are what keeps the company in high earnings and growth. They also have solid finances. They have about $38 billion in cash assets and $127 billion in long-term marketable securities on its balance sheet (as of June 28th). This is supporting strategic acquisitions, like the recent $3 billion deal for Beats Electronics, as well as an ambitious capital return program. Apple is also buying back their own stock and hopes to raise share net as they approach the end of the current decade. Apple’s weaknesses is that they price their items high on the market, although most people who are diehard apple users will most likely pay whatever the price is for the newest model on the market. The high price has caused them to fall short overseas where the average consumer cannot afford the product. The high price also hinders the company from price competition from competitors such as Samsung and companies OEM’s. The iPad has also become somewhat a disappointment with the new technology coming from Android and tablets that are essentially mobile tablets and computers all in one. Apple’s Opportunities have been Market-Share Growth, which in the last several years, Apple has a large space to extend it’s ever traditions computing space.
Apple currently has an almost-20% piece of the global PC/tablet pie (ahead of such rivals as Lenovo and Samsung), but we see this number increasing in the years ahead, especially as the company gains ground in China and the rest of the Asia/Pacific region. iPhones are also growing from being outsourced and offered to more influential local wireless carriers here and overseas. The acquisition of Beats Electronics is one of the largest deals in their history which took place in August 2014. The company looks to have paid a huge price, but it seems, given that a 2013 investment by the asset management firm Carlyle Group had valued Beats’ assets, including its high-end headphone line and streaming music services, at around $1 billion. The acquisition makes strategic sense. The up-and-coming music properties will likely prove to be a nice complement to Apple’s free iTunes radio service, which has generally garnered mixed user reviews and is going up against popular streaming offerings from free music web sites such as Pandora and Spotify. And Beats’ electronics unit should prove helpful when it comes to developing the iWatch and other smart, wearable devices. Notably, Beats, founded by respected music industry veterans Jimmy Iovine and Dr. Dre, has a highly creative management team, so the talent infusion will
probably go a long way toward allowing Apple to maintain its high status as the leading innovator in music accessories, because most everyone wants a good quality headphone. Apple’s Threats in the analysis is the Competition.
Main threats consist of the ever constant changing technology and their ability to keep up with the changing times and be able to produce a more techie product with more and more features with each new model of their products. Gross Margin Pressures are also a threat. This can happen when competition steps up their game and finds the next newest and greatest feature to make their product better than Apple. In conclusion, challenges lie ahead for the Apple Company. Apple’s positives easily outweigh its negatives at present. The stock remains something of a bargain in this frothy market, too, notwithstanding its recent rally. Indeed, trading at about 16 and 14 times the consensus share-net estimates for fiscal 2014 and fiscal 2015, respectively, the good-quality issue still looks to have room to run. Dividend growth will likely be healthy, as well, with the company now looking to return more of its cash hoard to shareholders. And Apple’s excellent finances make its shares suitable for most
accounts. Based on the SWOT Analysis and Strategy Evaluation, the most creative action I see Apple taking is something that will provide innovation for the company and was just announced today. The Apple Company plans to go totally Green. The CEO of the company Tim Cook is taking the headquarter building with energy that will come from a solar farm being built by First Solar and this will be huge as Apple is setting the precedence for other companies to follow. Apple is leading the way in addressing our ever changing climate by showing other companies how a large company such as Apple can operate with 100 percent clean, renewable energy. By doing this, Apple will greatly increase the supply of solar power in California. Also anticipated in 2015 will be the iPhone 7, the iPhone 6S is rumored to launch in September 2015. It will be running on iOS 9, a faster processor, some enhanced specs, but possibly minor design changes. Apple is said to have three variations of its next flagship namely the regular version, the Plus model and the Mini model. The highly anticipated iLens, or iGlasses will be coming out sometime 2015. It will be the slimmest camera available on the market and consumers are eagerly awaiting its arrival.

References:

http://www.valueline.com/Stocks/Highlights/Apple_Inc___A_Short_SWOT_Analysis.aspx#.VOLNsodTHIU http://www.strategicmanagementinsight.com/products/swot-analyses/apple-swot-analysis-2014.html http://loudfind.com/ilens-apple-iglasses-most-anticipated-gadget-of-2015/7638/