Describe the Strategic Challenges Facing Apple Computer

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Apple Computer, Inc.
Frances Woodyard
Jacinta Acquay
BUS 499 - Business Administration Capstone
1/29/2012

Describe the strategic challenges facing Apple Computer.
The fast pace of technological change and competition are the challenges that Apple Computer is facing. Its strategic moves into communication devices and portable devices for downloading music and movies the company is in stiff competition from all venues. With no entry barrier in this business Apple has competitors, with lower priced imitation products which will threaten to lessen the value of Apple products and its strategy success (Hitt, M., Ireland, R., Hoskisson, R., 2011).

Apple faces many challenges to maintain its core competencies: marketing, innovation, relationship building, and brand management. They are trying to manage a wider variety of products and traverses into additional markets. Their diverse customer base and fresh sets of competitors who have a wider variety of strengths and strategies. The industries of technology and entertainment are on a fast track for changes. Uncertainty is on management’s mind wondering if Apple will be able to maintain its reputation for their brand due to their innovative designs, frequently releasing breakthroughs in the technology world, and new products that will satisfy the customer’s thirst for the newest gadgets. Also taking into consideration is the collection of products which are no longer being developed internally It now has to depend on the negotiation skills with the movie studios and recording companies. Movie studios and recording companies each have their own competition, and copyright issues that present problems during these negotiations (Hitt et al., 2011). Trying to balance the demands of the stakeholders has become progressively more difficult with Apple's success and growth. Also when customers, investors, partners, and governmental/legal agencies, present conflicting expectations which puts a growing amount of stress on the management team. It also has a problem because the company depends on Jobs' magnetism, dream, communication skills and his skill in building a rapport with everyone that is important to Apple. A new problem that Apple has to face now came with the death of Steve Jobs. It puts Apple at a risk if they do not have a dependable succession plan to utilize a group of potential executives that have the talents to continue success the Apple brand. Apple will have to be careful and thoughtful in their strategic management of these complex issues and challenges so they can have continuous success (Hitt et al., 2011). Describe the dimensions along which company success can be measured.

Measuring the success of your business can be varied. First – Is the need to see if the strategic goals and objectives are being achieved. Second - Everyone must take responsibility if the company is to be successful. Third - Share with everyone the goals and objectives the company is trying to accomplish and how valuable their contribution is to this success (Richardson, M. nd). All three of these steps go hand-in-hand. Without one you cannot achieve the other.

Company success is based on the profitability of the business. Analyzing the financial statements i.e. income, cash-flow, and the balance sheet will be an excellent gauge to the company’s success. The flow of money from sales and revenue into the company is a key factor of success. Reviewing the revenue you will see how much money is spent on expenses and costs. A company that is profitable will always have money left over after expenses are paid out. The company can then decide if the remaining cash can be used for another purpose or saved (Richardson, M., nd).

The customer base of the company should be checked periodically. If the base is showing growth consistently that is a good sign of success. Many of these new customers are coming from your competitors; because of your business...
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