Strategic Management of Technological Innovation Course Project TM583 “Apple’s Strategic Plan”
Linda D. Smith
Lindasmith645@gmail.com Instructor: Professor Gorelick April 15, 2012
The company that will be the topic of discussion in my final project paper is Apple Inc. The company was established on April 1, 1976 by Steve Jobs, Steve Wozniak, and Ronald Wayne. Apple Inc. was formerly known as Apple Computer, Inc. until January 9, 2007 when the word “Computer” was removed (Wikepedia The Free Encyclopedia, 2012). Apple is a Fortune 500 company whose headquarters is located in Cupertino, California with over “60,000” employees and generated over 65 billion in revenue (15 Amazing Facts About Apple, 2010). Apple “designs and sells consumer electronics, computer software, and personal computers” (Products: Leading innovation, 2012). The company is best-known for its hardware products which include the Macintosh lines of personal computers, the iPhone, iPad, and the iPod" (15 Amazing Facts About Apple, 2010). Apple Inc. is an American multinational company is traded on the New York Stock Exchange and is one of 100 stocks that make up the NASDAQ and S&P 500. Apple is outperforming all of the other tech stocks and is considered the “sector leader” over companies such as Microsoft, Oracle, Samsung, and Google because of its strategic plan of innovation, excellence and consumer delight (S&P 500, Nasdaq Celebrate a Record-Breaking Quarter, but It’s All About Apple , 2012). The market value for Apple has topped $600 billion because of their outstanding performance in the industry! Section 1 – Strategy
Apple’s deployment strategy for 2013 is to pursue excellence by providing innovative technology products that will delight consumers now and in the future. This deployment strategy supports Apple’s shared strategic values: Innovation, Excellence, and Consumer Delight. The key aspect of implementing this technological innovative strategy will include: organizing for Innovation, managing the new product development process, managing new product development teams, and crafting a deployment strategy. In order to craft the deployment strategy, Apple will be to focus on five key elements: launch timing, licensing and compatibility, pricing, distribution, and marketing. Furthermore, a “key element of Apple’s strategic playbook is its relentless pursuit of consumer-delighting innovation” (Apple Strategy & Corporate Culture — Proven Success Formula, 2011). Deployment Process
First, the timing of a products launch is a significant part of Apple’s deployment strategy. The goal is to enter the market at time that will provide an advantage over the competition such as reducing business cycle time or seasonal effects to position the product in the market. Timing is an essential component of the deployment strategy!
Next, Apple will need to look for ways to leverage the “technological innovation of its existing products … often a firm must decide how compatible or incompatible to make its technology” with that provided by others or with previous generations of its own technology. However, if there is an existing technology with a large installed base or availability of complementary goods, the firm can sometimes leverage the value of that installed base and complementary goods by making its technology compatible with current products to increase profits (Schilling, 2009, p. 290).
A key element in Apple’s deployment strategy is pricing. How a product is priced will influence its rate of adoption, the product's positioning in the marketplace, and the firm's cash flow. The company must set the business objectives for its pricing model before they can determine its pricing strategy. A common pricing...