Changes in the Dynamics of Pc Industry

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APPLE COMPUTER
CASE ISSUES
Core Competency (CI#1) : Apple design, develop and market numerous product and service lines. They sell their products to education, consumer creative professional, business and government customers. While apple seems to display numerous products and conduct business on different segments, it is legitimate to wonder what the company is really good at? Too much diversity is exactly what crushed Apple during the John Scully days. Cannibalization (CI#2): Through January 2005, Apple has opened 102 retail stores. Although these launches are potentially beneficial, Apple stores are hurting the resellers’ business and not all of them will survive. Considering that the company’s resellers still account for more than 50% of its domestic sales, the company is facing the risk of cannibalization and might deeply suffer. High Cash (CI#3): Why is Apple holding so much cash? Having too much cash in reserve might either mean that the company does not know yet how to allocate it or that they may have some risk concerns about future potential investment. Succession (CI#4): Apple is clearly one of the handful of companies where the fortunes are seen to be intricately tied to the person in charge. The star quality and the visionary talents associated with Steve Jobs are certainly contributed to the success of the company. So the news of Jobs’ cancer surgery might lead to a succession problem and compromise the company’s future. I. CURRENT SITUATION

A.CURRENT PERFORMANCE
Apple achieved a solid performance for the first quarter of 2005 compared to the same quarter 2004 with strong net sales in the Americas segment (+77%) in Europe (+63%) and in Japan (+18%). The Americas segment represents approximately 47% of the company’s total net sales. The increase in net sales in the Americas, Europe and Japan was primarily driven by increased demand of the iPod and the consumer-oriented iMAC. Demand for the iBook products were especially high for the Americas, while peripherals and other hardware were more popular in Europe. The retail segment’s net sales grew to $561 million as compared to $273 million in the same period in 2004, this represents a remarkable 105% increase. B. SRATEGIC POSTURE

Mission
Apple strives for continuous improvement in our environmental, health and safety management systems and in the environmental quality of our products, processes and services. Apple’s Guiding Principles

Ø Meet or exceed all applicable environmental, health and safety requirements. Ø Where laws and regulations do not provide adequate controls, Apple will adopt their own standards to protect human health and the environment. Ø Support and promote sound scientific principles and fiscally responsible public policy that enhance environmental quality, health and safety. Ø Advocate the adoption of prudent environmental, health and safety principles and practices by their contractors, vendors and suppliers. Ø Communicate environmental, health and safety policies and programs to Apple employees and stakeholders. Ø Design, manage and operate our facilities to maximize safety, promote energy efficiency and protect the environment. Ø Strive to create products that are safe in their intended use, conserve energy and materials and prevent pollution throughout the product life cycle including design, manufacture, use and end-of-life management. Ø Ensure that all employees are aware of their role and responsibility to fulfill and sustain Apple’s environmental, health and safety management systems and policy. Goals

Ø Innovation above everything else.
Ø Increase sales in the education segment.
Ø Produce user friendly, good appearance products to get customers “think Different” and “think Digital”. Ø Developing new digital lifestyle consumer, and professional software application Ø Investing in new products area such as rack-mount servers, RAID storage system and wireless technologies. Ø Provide a high quality sales and after sales support...
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