Management Assignment: Corporate Business Issues for Apple in United States
Management Assignment Task: Choose an industry, or a company in a particular country.
Discuss important contemporary business issues for corporate leaders and managers and analyze how these issues may impact organizational strategies, structures and processes in the chosen industry or organization in the coming years.
The present management assignment is based on critical discussion of the important contemporary business faced by corporate leaders and managers in context with Apple Inc Company. Along with this, the study also considers the critical analysis and evaluation of how these issues can effect overall corporate strategies, procedures and structures in the coming years. Apple Inc is a multinational company based in America that is engaged in manufacturing premium customer electronics as well as software products. It has operations in several hundred retail stores in various countries, online stores as well as iTunes stores (Apple Inc, 2020). It isone of the most valuable companies in the world and has a strong corporate culture and they make considerable compromises to work on products that have the potential to change the world.
Outline of the Report
Significant contemporary issues faced by corporate leaders and managers in present era Business entities have evolved remarkably in the past few years; this has further formed several opportunities, standards and challenges for the business in global and domestic context. It is evident that the contemporary business environment is fiercely competitive and is creating a complicated landscape for the key stakeholders (Bower & Paine, 2017). Most of the businesses are required to depend on software as well as technological development and innovation for staying competitive. On the other hand, the technical topography changes at a very fast pace, and this can be extremely price, time-consuming and complex ordeal to address with. When it comes to effective management and leadership, traits such as communication, integrity and vision never go out of style. But, in present era, leaders and managers must also be capable to establish strong teams in response of recruiting and retention challenges, and keeping with advanced technology, along with demonstrating solid business acumen (Coulson-Thomas, 2016). Emerging trends from the increased pace of change as well as disruptive innovation to scattered workforce and demands of regulatory compliance have raises the pressures facing corporate leaders. The top issues and challenges faced by business leaders comprise of the need for broader ranging knowledge, skilled talent demand, information overall, change and more change, keeping up with technological advancement and so on (Mihai&Cre?u, 2019).
Contemporary business issues for Apple’s leadership and management
At present, Apple has been facing considerable leadership challenges, it has to be noted that, Cook has established a standard of high financial performance, that seems to not possible to meet in the future. Moreover, it has also been discovered that the profits of Apple also fell to $11.2 billion; a total 2% falls from previous year. It has been evidenced that the worldwide smart phone sales to end users reduced 20.2% in the 2020’s first quarter. The economic instability brought by coronavirus has led to collapse of Smartphone demand, as customers stopped to spend on the non-essential products (Fernandes, 2020).
It is also to be noted that the ongoing US-China trade war has also impacted the shares of Apple on a negative basis. The tariffs can impact the annual earnings of Apple considerably as tariffs are proposed by US as 10% on the Chinese imports. Since, given that, Apple is largely dependent on China for product assembly, at the same time the value added in the country might be restricted and it creates a critical element of the supply chain of Apple and can cause major disruption because of the trade war and can increase the costs for Apple in future. By considering the aspect that Apple is no longer relied on China as its major competitors are i.e. Vivo, Huawei etc, it is facing supply chain issues and closures of stores which is adversely impacting the sales of iPhone in the 2020’s first quarter (Luo, 2019). In addition to this, the increased competition from Huawei, Google, and Samsung has also eroded the leading position of Apple in the consumer electronics industry.
Competition has been considerably disrupting the emerging markets, and extra threats are also been placed by weaker macro-economic conditions and strong dollars. Since, there is too much hype regarding 5G to kick off and upgrade the product cycle of iPhone, in this aspect, this places a huge set of challenges as business is maturing and will need a fine-tune of strategies and this further involves major changes to the pricing, feature set, device lineup and schedule releasing (Loghin and et al. 2019). In addition to this, the major issues has been placed by the ever evolving technologies, Apple has not been capable to keep up with the technological advancement lately, as competitions such as Samsung has introduced folded screen technologies, and since customers are becoming more dependent on voice commanding smart technology, Siriis still not matching up to the Amazon as well as Google Assistants (Marrero, 2018). Even rivals of company are now ahead of company as company is trying to play with catch up strategy rather than providing innovation. For instance in year 2018 announced iPhone with three rear facing cameras and similar features was provided by Samsung through releasing four rear cameras. Thus, it requires focusing on its innovative strategy rather than providing similar features as its rival
Apple has always been a flat structure company, in comparison to other technological giants like Microsoft, it can be stated that Apple has fewer senior managers. On a theoretical basis, this means there is less bureaucracy level. However, it also comes up with considerable challenges, out of the US personnel of approximately 84000 individuals; merely 115 executives give report to the Cook or the direct subordinates. By considering this hierarchical organizational structure, wherein there is fewer management layers, it is a big and large scale company with numerous workforce that operate in tandem under one head it become problematic to approve fast decision or making rapid changes, it also offers lesser flexibility and prevents employees at lower management levels to take participation in decision making (Tasnim, 2018). In addition to this, it also becomes difficult to meet or adopt immediate changes at the drop of a hat as the authority of decision making is only with the very few senior leaders and CEO.
It has also been observed that Apple is working towards self driving cars as well as artificial intelligence, together with the secretive development of several other products; however its failure to generate a new and innovative product is turning off developers. It can be stated that the engineers at Apple need to work on the bleeding technological edge. Engineers must consider for big problems that will propel them for a culture that places them at a centre (Arpteg and et al. 2018). The best engineers are willing to operate in flow state and retain creative hours which the company is not allowing presently. In the industry established on the idea of disruption, appealing unique talent and retaining them nimble is the key. In this way, it can be asserted that Apple is not only required to merely make a better iPhone but also needs to come up with something different (Mihai&Cre?u, 2019).
It has been assumed by Apple that the iPhone is an exceptional product in an ever-changing market, wherein customers are willing to pay premium prices for newer version. Although, this was true a decade ago, at the time when the company was considered as a smart phone pioneer, but now Apple products are no longer considered as unique, there is sever competition from other rivalries (Petro, 2019). Simultaneously, service provides do not subsidize Smartphone sales, as the market is maturing. In addition to this, the circumstances and the market situations has making is considerably complex for Apple to compete with its old strategy of introducing new product versions and make customer pay premium prices for the same. Therefore, this is showing a major slow-down in their growth of sales. Analysis of how these issues may impact Apple’s structure, strategies and process in the coming years
It has been evidenced that Apple is failing to come up with hardware innovation and this is a vital challenge for the company, the innovation speed for their product is relatively slower as compared to the innovation speed of the software as well as application developers that make use of their products as a medium to customers. Considering this route means a future where customer want is a reliable and effortless device that impeccably connects them with application based on clouds of increasing value and diversity. Presently, company is also dealing with engineering issues like critical security bug in macOS, a brand new product being launched without half of the features enables due to snuckediOS update. Even it has been assessed by software engineer who worked on iChat and Maps; the issues have been transformed deeper due to lack of focus. Presently company is applying waterfall style development for dealing with engineering issues but the culture of company does not exactly sound conducive for producing quality code due to which severe issues might face in future (Nargunde&Satish, 2020).
For dealing with existing issues regarding incorporation of innovation, company is focusing on quality to ensure that it is successful in completing promise made at an annual developer’s conference that new features would work in reliable manner as presented in advertisement (Luo, 2019). For sustaining its top position and dealing with issues relating to future position of company Apple Inc has made payment of $200 million to purchase Seattle based artificial intelligence company Xnor.ai which does have specialization in edge based AI (Seshadri et al, 2020). Through this acquisition a glimpse of future devices is being presented by company. Performance improvement has been proven by company through natural language processing (Siri) or facial recognition but the performance is not interactive as Amazon’s Alexa. Even various issueshave been assessed in iPhone 11 due to which display might stop to respond and for same replacement program has been confirmed. The success of Apple Inc is dependent on steady customer appetite for customer on its each latest product. But with decreasing sales of iPhones, management is initiating to resemble other in retail market as company is failing to bring any new feature in smart phones, smart devices, etc. Moreover it’s rival Samsung and Huawei launched first folding phones with Galaxy Fold but Apple Inc have not able to provide such feature it its product yet. In accordance with recent trends, customer is reliant on voice command and smart technology but Siri is not able to match up efficiency provided by assistants from Google and Amazon. The issue might turn or create different problems for its market position in future (Carrigan, Coffman& Foss, 2020). It would be appropriate to state from above analysis that Apple Increquires new strategies as well as potential change for catalyzing demands i.e. both inside and outside retail stores of company. At platform of digital wearable, company is still undisputed leader but tough competition is provided by Huwaei as in first quarter of year 2019 company shipped 5 million wearable which is less than half of watches delivered by Apple Inc but with time probability exist that company would give tough competition in future (Vartanian, 2020).
On the basis of above analysis, it can be concluded that Apple is the pioneer in smart phone industry and its premium products are famous all around the world that delivers innovation and quality to high end customers. However, it has been noticed that company is facing decreasing profits and sales due to its incapability to keep up with the technology and changing market needs, and it has also been facing disruption in supply chain due to US-China Trade War and Covid 19. It can be cited that the company has been currently lagging behind the technological aspects as well as design innovation and there is no remarkable change from one product generation to other. Lastly, in order to maintain leadership and image as technology innovator, management would require more that tweaks and upgrades as well as recategorize existing services.
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