VALUE CHAIN AND
COMPETITIVE ADVANTAGE
APPLE Inc.
(Based On Theory M.Porter)
ADI NUR ACHMAD
S1 MLM C/22.44.12.154
Management Logistic
HISTORY OF APPLE Inc.
A brief
history of Apple Inc.
Apple Logo
Apple Inc. is an American corporation that designs and manufactures computer
hardware, software and other consumer electronics. The company is best known
for their Macintosh personal computer line, Mac OS X, extremely loyal
user-base, iTunes media application and the iPod personal music player. The
company headquarters is in Cupertino, California, CEO and co-founder is Steve
Jobs and the company boasts 284 retail locations spanning 10 different
countries.
Apple I Apple was established on April 1st, 1976 by Steve
Jobs, Steve Wozniak and Ronald Wayne to sell the Apple I personal computer kit.
Steve Jobs was said to own 45% of the company, Steve Wozniak with 45% and Wayne
with the remaining 10%. While Jobs and Wozniak were young with little to no
assets, Ronald Wayne was older with personal assets and was scared to put these
at risk. This resulted in Wayne selling his share of the company back to Jobs
and Wozniak for a reported 800$. Today Wayne’s share of the company would be
worth over 3 billion dollars.
Apple has developed a unique reputation in the consumer
electronics field. Those who use Apple electronics tend to be enthusiastic about
and loyal to the products while those who have no experience with Apple’s
products often criticize them as being overpriced.
Perhaps the single most important PR decision made by Apple
to date was the production and release of their “1984" commercial. This
commercial was directed by Ridley Scott and aired during the third quarter of
Super Bowl XVIII. The commercial was modeled after George Orwell’s novel 1984
which depicted a dystopian future where “Big Brother” told people what to think
and as a result people, in general, had very little freedom of choice. Some say
“Big Brother”, at the time, was meant to represent IBM while the female heroine
was Apple. Today many would say that “Big Brother” was Microsoft with the
heroine still being Apple, giving freedom of choice back to the people.
Regardless of your interpretation of the commercial or your views on Apple as a
company there is no denying that the commercial was a major event in the
history of Apple and brought some much needed notoriety to the Macintosh line
of computers.
The Apple iPad With the release of the iMac on August 15,
1998 Apple was able to put to rest some its past failures. These failures
included the first Apple Portable, which was bulky and awkward and the Newton,
Apple’s first attempt to enter the PDA market. In 2001, after several years of
development, Apple released Mac OS X, an operating system that targeted both
consumers and professionals. Mac OS X was a complete redesign from Mac OS 9 and
was able to harness the power of UNIX while offering a streamlined user
experience with a simplified GUI (Graphical User Interface). The iMac line of
personal computers paired with Mac OS X returned Apple to profitability and the
release of the iPod portable digital audio player later that year was the icing
on the cake. The phenomenal success of the iPod set the stage for future
products, including the best selling mobile device in history, the Apple
iPhone, the MacBook line of portable computers, and the Apple iPad announced on
January 27, 2010.
Value Chain Of Apple Inc (M.Porter)
· Most components are generally
available from multiple sources; a number of components are currently obtained
from single or limited sources. Hardwareproducts are manufactured by
outsourcing partner primary in Asia e.g. Foxconn.
· Delegate raw materials acquisition – Apple
works with its OEM partners todelegate the raw materials acquisition process
but provides some supervision forquality control purpose.
· Automated receiving systems – Apple
has implemented sophisticated automatedreceiving systems to speed up the
receiving process and reduce facility footprintand storage space requirement.
· Elimination of toxic substances in Apple
products. Every product is free of BFRsand other harmful toxins, Apple have
also qualified thousands of components tobe free of elemental bromine and
chlorine.
· Products are designed highly
recyclable aluminum enclosure.
· Utilize original equipment manufacturers
(OEM) s economies of scale – Appleoutsources production to third party OEM
partners to utilize their economies of scale while removing the burden of
production management from the firm.
· Apple used variety of direct and
indirect distribution channel, such as retail stores,online stores and direct
sales force, 3rd party cellular network carriers, wholesalers,retailers and
value added resellers.
· Apple continue to expand and improve
its distribution capacities by expanding thenumber of its own retail stores
worldwide in order to ensure a high quality buyingexperience for its product.
· Economical packing - Apple employed
teams of design and engineering experts who develop product packaging that’s
slim and light yet protective. Efficient packaging design not only reduces
materials and waste, it also helps reduce theemissions produced during
transportation.
· Apple advertises online, on TV and
Throught print ads
· Apple store have various programmes
to promote their products.
· Apple is juga endorsed by their
fiercely loyal customers.
· Product are sold by apple reseller,
throught the apple website and at 194 retail store around world.
· Apple care provides extensive
customer support around the world.
· Updaten of software are regularly
released.
2.Support Activities
About 75
percent of Apple facilities energy consumption comes from renewable resources,
according to a company-issued sustainability report. In the last two years
Apple has increased its use of renewable energy by 50 percent, though the
firm's long-term goal is to run its facilities using 100 percent renewable
resources.
Environmental
advocates have praised the iPhone maker for its advancements towards green
energies.
"Apple's
announcement shows that it has made real progress in its commitment to lead the
way to a clean energy future," said Greenpeace international senior IT
analyst Gary Cook.
"Apple's
increased level of disclosure about its energy sources helps customers know
that their iCloud will be powered by clean energy sources, not coal."
Apple has
reported that it has implemented a 100 percent renewable energy policy at its
datacentres. The company currently has datacentres stationed in North Carolina,
Oregon, Nevada, and California. In April 2012, Greenpeace lambasted Apple for
running its cloud storage datacentres in areas which rely heavily on coal
power.
Greenpeace
says that in order for Apple to reach its goal of 100 percent renewable energy
use it will need to work with power providers such as North Carolina's Duke
Energy to change the current dirty energy paradigm.
"As it
keeps growing the cloud, Apple still has major roadblocks to meeting its 100
percent clean energy commitment in North Carolina, where renewable energy
policies are under siege and electric utility Duke Energy is intent on blocking
wind and solar energy from entering the grid," continued Cook.
"To
show how it can help remove those roadblocks, Apple should disclose more
details about how it will push utilities and state governments to help it
achieve its ambitious goal in all of its datacentre locations."
Apple's use
of renewable energy comes following a pledge the firm made last year to
increase its use of eco-friendly power. Last May, the firm started pushing to
use more on-site power options at its corporate facilities.
- Human Resource Management
I started
working at Apple during the dot-com boom in 1998, and I left the company in
2007. As much as I loved working at Apple, by 2007 I determined that I now had
the financial freedom and opportunity to leave the company and begin working on
my own projects.
That was
because Apple had been very good to me via the stock market. In the time I
worked there, the stock price had gone from less than $10 per share (adjusted
for splits) in 1998, to $100-plus per share when I left in 2007 -- and it now
hovers around $300 per share. And since I still own shares that I bought for
less than $10 per share, my investments in Apple have paid off handsomely.
A Culture of
fandom
At Apple, it's
never, "How long did you work for the company?" but rather, "How
many times did you work at Apple?" The Apple attitude seems to infect
everyone who works closely with the technology -- and, even after leaving the
company, we all say that we still "bleed six colors," in reference to
the original six-color Apple logo.
While at
Apple, I, like many other employees, moved between several different divisions
and jobs. I started at the company as a software engineer in the WebObjects
(Web application) consulting division. I then became an inbound marketer for
their K-12 school division, where we sold a suite of hardware, called the Apple
Learning Hub, to school districts as part of the company's one-to-one
initiative to provide one laptop to each student in a district.
I last
worked as an engineer at the Apple Online Store -- which was, by far, the most
important experience of my time at Apple, since the online store was earning
millions of dollars in revenue every day. We would take the store offline
before Steve Jobs took the stage to give a keynote speech and update the
database with the new products he was introducing. It was always a great
learning experience to bring the store back online under the onslaught of Apple
fans checking out the new products.
A great
working environment
Apple's HR
department takes good care of its employees. In my eight years at the company I
never once had, or heard of anyone having, pay issues or other administration
problems. Working at Apple was mostly a positive experience, with just a few
less-than-ideal elements to the job. Here are some highlights:
Can We Talk:
At Apple, you could raise issues that weren't appropriate to bring up with your
manager to a higher level by posting it to the Can We Talk section of the
internal HR website. For example, in spring 2001, the Apple federal office in
Reston, Va., was remodeled to look more like the main campus in Cupertino,
Calif. The architect in charge of the remodel removed the large American flag
hanging on the lobby wall, since it didn't fit into Apple's design. Immediately
after the 9/11 attacks, Apple promoted a video on their HR website as they
unrolled a huge American flag at 1 Infinite Loop. A quick post to the Can We
Talk section pointing out the irony immediately fixed the problem, and the
American flag was replaced in the Reston office lobby.
Health
insurance: The health benefits are very good at Apple. A couple of people in my
office had to deal with life-threatening diseases, either directly or for their
dependents, and their total out-of-pocket expenses were less than $1,000 for
co-pays and prescriptions.
Career path:
My biggest complaint about working at Apple was that there was no career path.
While working at a field office, in Virginia, or from home in Southern California
(all of which I did), may not be the fast track up the corporate ladder, I
noticed no difference when I was working at the main headquarters in Cupertino,
Calif. This fact is by no means a "dirty little secret," however.
It's simply the way Apple works, as our HR rep correctly pointed out.
Secrecy:
Apple's secrecy is comparable to the U.S. government's in terms of "need
to know" and compartmentalization. That sometimes resulted in duplicated
efforts within the company. While this secrecy is a necessity to keep Apple
ultra-competitive, it would have been more effective if open projects could
have been presented to the secret teams to see if there was a fit worth
bringing the open projects into the mix.
Blogging: As
an Apple employee, you definitely get the feeling that blogging about the
company is frowned upon. It goes to the extent that if you have a personal blog
about an unrelated topic, you don't even want to mention that you work for
Apple.
Military
service: While Apple does not employ many military veterans, they've gone above
and beyond what is required. Reservists called up to active duty are put into a
military-leave status and they remain Apple employees while Apple makes up the
salary difference between their military pay and their Apple pay until they
return.
Toys: It
almost goes without saying that working at Apple allows you to use many of
their latest products on a daily basis. Apple employee discounts usually fall
in the 15 to 25 percent range, making it easy to buy the latest "gotta
have" Apple product for friends and family. Over the past five years,
Apple has frequently given every employee a gift ranging from the iPod shuffle
to the iPhone. Also, before Apple recycles a computer, they give employees the
opportunity to take it home. I've probably brought home more than a dozen
computers over the years.
Caffe Macs:
The corporate cafeteria, Caffe Macs, is the place to eat on campus. The food
quality and variety are excellent, whether you're looking for pizza and pasta
or sushi and salad. What can't be beat is the level of excitement and
electricity in the cafe. On a daily basis, you'll see at least one of Apple's
top executives in Caffe Macs, including Apple's CEO, Steve Jobs himself, who
seems to show up there once a week.
Overall,
there seem to be no end to the great things about working at Apple. Steve Jobs
takes tremendous pride that Apple is a California company that creates great
products. When working at Apple, you definitely feel like you're a part of a
group of people who will make a serious dent in the universe. It's a fantastic
place to work, and I hope to return one day.
Continuing
innovation in a small number of key products has been the key to the company’s
success over recent years. It has developed an extensive patent portfolio
around the touch-screen interface used in the iPhone and iPod Touch. In 2009,
it won several patents that allow for simultaneous tracking of “multiple finger
and palm contacts” which, according to the patent, should allow for “unprecedented
integration of typing, resting, pointing, scrolling, 3D manipulation, and
handwriting.” This intellectual property gives Apple a competitive advantage in
the development of devices such as the iPhone, iPod touch or even tablet PCs in
the future. The company has also successfully rejuvenated its desktop and
laptop lines, developing the OS X operating system and switching to more
power-efficient Intel processors in recent years.
Over the
years, Apple has developed an entire ecosystem of suppliers who support our
business operations. Our goal, in a nutshell, is to obtain stellar products and
services within tight timeframes, at a cost that represents the best possible
value to our customers and shareholders. If that sounds like a daunting task,
it’s the same one we assign ourselves.
We are proud
of the strong relationships we have built with our suppliers, many of whom have
been working with us for years. And we are always looking to expand our
supplier base to accommodate our rapidly growing customer base. To that end, we
periodically review our relationships and add new suppliers as needed.
Apple
requires each of its suppliers to meet the highest standards for all goods and
services. Our requirements include a commitment to rigorous quality assurance.
In addition, suppliers must be committed, as we are, to ensuring the highest
standards of social responsibility.
The ideal
suppliers are those who understand our culture and expectations. We value
suppliers who take the time to learn about and understand our business and who
look for ways to add value. These suppliers know the importance of making and
meeting commitments and delivering the highest quality goods and services.
Our business
environment is competitive and fast-paced. Our suppliers must understand this
dynamic and be agile and flexible in responding to changing business
conditions. Above all, Apple values innovation. We appreciate suppliers who
truly understand and share in our challenges, and who help us find the best
possible solutions.
- Supplier
Diversity Program
We take our
social and environmental responsibilities seriously. A good example is our
strong and longstanding commitment to a diverse supplier base.
Apple’s
Supplier Diversity Program was formally established in 1993; since that time
the company has continued growing and supporting the long list of suppliers who
participate. Apple actively participates in the program through the National
Minority Supplier Development Council (NMSDC), the Women’s Business Enterprise
National Council (WBENC), and Veteran–Owned Business Expositions, as well as
Supplier Diversity Business Opportunity Trade Fairs around the country.
The
businesses we categorize as diverse suppliers are Minority-Owned, Women-Owned,
Veteran-Owned, and Service-Disabled Veteran-Owned Small Businesses, as well as
businesses located in Historically Underutilized Business regions (HUBZone) and
Small Disadvantaged Businesses (SDB).
So how does
a business join Apple’s Supplier Diversity Program? That’s simple: You start by
completing the online Supplier Registration Form. Following a swift
verification and screening process to ensure a good fit between supplier
strengths and capabilities and Apple’s current and future requirements, Apple reviews
the supplier information. The business then becomes a potential supplier who
may be used in the procurement process as business needs dictate. In the
interest of encouraging the success of our diverse supplier base, we work with
the Supplier Diversity Program participants to help them develop their
businesses. This often involves working with a number of organizations that
offer training and feedback.
Suppliers
who wish to participate in Apple’s Supplier Diversity Program should complete
the online Supplier Registration Form so their information can be entered into
Apple’s Supplier Information Database (SID). We have included special areas
within the form that prompt the database to alert our supplier diversity team
and relevant procurement professionals about the availability of qualified
participants in Apple’s Supplier Diversity Program. This helps increase the
visibility of these suppliers and can improve their potential for engagement.
Apple’s
sourcing process is designed to ensure equal and fair treatment of suppliers so
that they can fully participate in a competitive procurement process.
We ask
suppliers wishing to participate in the process to register with our Supplier
Information Database (SID), a secure online database that Apple maintains with
regularly updated information on current and potential suppliers. SID enables
Apple procurement professionals to access key information about potential and
current suppliers, including capabilities, Supplier Diversity certifications, product/service
descriptions, Universal Standard Products and Services Classification (UNSPSC)
codes, contact information, and so on.
The First
Step
The first
step any supplier should take in seeking opportunities to do business with
Apple is to register with our Supplier Information Database. If your company
registers with SID and there’s a need for the type of products or services you
provide, an Apple procurement professional can then contact you to explore
potential opportunities.
If there’s
no immediate opportunity for engagement (as sometimes happens), the information
will remain in Apple’s confidential Supplier Information Database for six
months or for as long as you continue visiting Apple’s procurement website to
keep your company’s information up to date.
Please note
that all purchases are made in the competitive marketplace. Submitting your
company to SID does not automatically place your company on a “bidder’s list,”
nor does it constitute approval of your firm as an Apple supplier or obligate
Apple to solicit requests for quotation.
COMPETITIVE ADVANTAGE OF APPLE INC
- Cost
Leadership, Differentiation, and Market Segmentation
In his 1980
classic, Competitive Strategy: Techniques for Analyzing Industries and
Competitors, Porter simplifies the scheme by reducing it down to the three best
strategies. They are cost leadership, differentiation, and market segmentation
(or focus). Market segmentation is narrow in scope while both cost leadership
and differentiation are relatively broad in market scope. Figure 0
Empirical
research on the profit impact of marketing strategy indicated that firms with a
high market share were often quite profitable, but so were many firms with low
market share. The least profitable firms were those with moderate market share.
This was sometimes referred to as the hole in the middle problem. Porter
explains that firms with high market share were successful because they pursued
a cost leadership strategy and firms with low market share were successful
because they used market segmentation to focus on a small but profitable market
niche. Firms in the middle were less profitable because they did not have a
viable generic strategy.
Cost
leadership strategy has been highly adopted by Apple Inc in its endeavors of
ensuring competitiveness and success in the technology industry. The company’s
management has been able to draw policies and strategies that are aimed at
ensuring that the company is the lowest cost producer and distributor (Roth
2001: 24). By strategizing on cost efficiency, the success and sustainability
of the company is enhanced. By lowering the cost of production and management,
Apple Inc has been given golden opportunities on determining prices of its
products, thus enhancing its competitive edge. Lower cost of production and
distribution has enabled the company to put competitive prices on its products
as well as enhancing its gross profit margins (Bowerman and Wart 2011: 63).
Some of the practices adopted by the company in executing the cost leadership
strategy is through minimization of operating costs, lowering distribution
costs, tight control on labor costs as well as reduction of input costs.
The concept
of differentiation has also been widely adopted by Apple Inc in enhancing its
competitiveness and profitability. This has been achieved through designing and
production of unique products (Furrer 2010: 231). The aspects of advertisement
have also been adopted in ensuring product differentiation from competitor
products. Despite that differentiation has been a cause of higher costs to the
company; it has enabled it to distinguish its products and services from those
of competitors. It is worth noting that differentiation has enabled the
products of Apple Inc to appear unique, thus fetching higher markets (Ireland
et al 2008: 124). Apple Inc has been much conscious about the increased costs
following the adoption of differentiation, thus enabling it to maintain its
competitiveness.
Steve Jobs
speaks out about apple inc focus "Apple is a $30 billion company, yet
we've got less than 30 major products. I don't know if that's ever been done
before. Certainly the great consumer electronics companies of the past had
thousands of products. We tend to focus much more. People think focus means
saying yes to the thing you've got to focus on. But that's not what it means at
all. It means saying no to the hundred other good ideas that there are. You
have to pick carefully.
"I'm
actually as proud of many of the things we haven't done as the things we have
done. The clearest example was when we were pressured for years to do a PDA,
and I realized one day that 90% of the people who use a PDA only take
information out of it on the road. They don't put information into it. Pretty
soon cellphones are going to do that, so the PDA market's going to get reduced
to a fraction of its current size, and it won't really be sustainable. So we
decided not to get into it. If we had gotten into it, we wouldn't have had the
resources to do the iPod. We probably wouldn't have seen it coming."
APPLE SEGMENTING AND TARGETING :
Apple is more than just a brand, its a
lifestyle, part of growing culture of consumers who are artist, musicians,
writers, photographers, and most of all innovators. The firm has positioned
itself as a high end brand that offers beautiful hardware designs and also an
amazing users experience. Apple targets a market that consist of people from
their teens to their 40's that are interested in doing more with their technology
than just the usual boring old stuff that other companies offer. Their product
lines offer similar products that offer different benefits in order to prevent
cannibalization. For example you can buy an 2GB iPod shuffle for $50 or an
160GB iPod Classic for $250; both mp3 players but they are design to satisfy
different target markets. Apple has a multi-segment targeting strategy, meaning
that they satisfy 2 or more different types of markets for example the young
teen who likes to take pictures for fun to the professional photographer who
takes pictures for a living. Both examples have one thing in common, the
passion for creativity and art that makes the perfect mix with software like
the Aperture 3 which offers the ultimate photographic experience.
I
think that Apple is be bringing back the mass marketing approach, they don't
really concentrate their advertisements on certain groups of people, they try
to include everybody. You can see all the iPod ads posted on the page that are
meant to resemble you, see if you can find a silhouette that fits you. Apple is
becoming a cult brand that has gained to respect of world wide users who share
one thing in common, their love for Apple's innovation. And I say that Apple is
going back to mass marketing because when you go in to an Apple retailer you
can see people of all ages, cultures, social classes, and colors; like a small
scale ethnic melting pot. The iPod has become a symbol of our modern digital
music culture, and the iTunes store is now the 2nd largest music retailer in
the U.S. Steve Jobs says that "if you make something great than anybody
will want to use it", and that model has worked for them because they've
never really invented anything but they made what some considered the best
technology available; thus eliminating the need for an specific target market,
because their products appeal to everyone.
Apple offers amazing products that include
hardware and software that just draw all different kinds of people into the
market.( Their major hardware products are displayed in the page.) Software
like the iLife '11 which allows you to manage your music, movies, and pictures,
the Final Cut in case you want to make a whole length film, or the iWork, make
you look at Apple products as essential to your life. Benefit segmentation
works in 2 ways, first, it helps you segment your market and second, it
advertises your product which makes people want to buy it; and s that's the
point right? Apple in one of the most successful firms in the technology
industry so however it is that they are segmenting the market , they are doing
it right.
- COMPETITIVE ADVANTAGE MY SELF :
- -
I have many talent in sport : Futsal, Running, Basket,
And Volleyball.
- -
Good communication for negotiation
- -
My mouth can make people happy
- -
Have skill for design and concept event
- -
My words can make some people inspiring
- -
Have soft skill for use computer software
- -
Love indonesian branded
