Get and Learn The Managing Innovations in Business
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Business innovation is defined as the process of bringing fresh idea, process, method, product or services to market for improving its current performance and to achieve competitive advantage (Tidd and Bessant, 2014). This report is about Apple Incorporation which was established in the year 1977 with the introduction of first personal computer Apple I in California. It belongs to the consumer electronic industry and offers a range of product or services in both hardware as well as software related to entertainment, communication and media. This report elaborates about the innovational history of Apple from its inception to till date using PESTLE analysis. It also involves a detail description related to the current capabilities of Apple Incorporation through SWOT analysis and then industrial analysis using porter's five force model.
The Organisation & Industry Overview
The Organisation and its Innovation History (500 words)
Apple Incorporation is a multinational company established on January 3, 1977 as a manufacturer and trader of consumer electronic. It deals in both software as well as hardware along with media and communication related devices. Apple has a great history of success or achievements in consumer electronics and is a most demanding brand worldwide (Cheng, Yang and Sheu, 2014). The innovational history of Apple can be better understood using PESTLE analysis. It depict about various factor which supported company to achieve success in marketplace.
- Political:-Apple Incorporation started its business from California which maintain a good political relation with other countries. This supported Apple to expand its business in other nations and it become able to expand its business worldwide by providing several gadgets like Ipad, IMac etc.
- Economical:-Globalisation helped in enhancing the economical condition of developed as well as developing country to a large extend by providing employment opportunity and increasing the disposable income of people. This social advancement has motivated company, as customer started demanding more technical advanced and personalised gadgets. This factor act as a innovation driver for Apple as it started enhancing it technical operations and company introduced Macintosh a computer based on graphical user interface.
- Social:-With the enhancement of living standard, people started updating their paper based operation into digitalisation which act as a driver of innovation for Apple (Du, Leten and Vanhaverbeke, 2014). Therefore it started seeking for improvement over its computer and introduce its first laptop in year 1997 named as “Macintosh power book”
- Technological:- Apple Incorporation first setup its business in California, a techno-driven country which is known for its innovational support toward military like aerospace. So this factor supported Apple to a large extend by providing them with various infrastructure and resource related facilities. This provided Steve Jobs and its friend with required technical support and they become able to introduce Apple I which was the first personal computer in 1976.
- Legal:-ntroduction of internet for connecting the whole world contribute toward improving and simplifying the business and communicational activities. But it also brings up a number of crime with it which leads to increase in demand of security. By assessing the security demand of people, Apple take an initiative to launch a advance laptop named as “iMac” in year 2017. This laptop consist of a Secure Enclave coprocessor with a T2 chip which provide a foundation for secure boot, encrypted storage capability and touch ID which uses fingerprint as a passcode. This support user to keep away unauthorised access and threats that may affects the system (Trevino and Nelson, 2016).
- Environmental:-The increasing concern of people toward environmental protection, customers started demanding the products which are produce less harmful radiance and are recyclable. In order to maintain its market share, Apple started replacing the use of plastic in gadgets to material which is easier to recycle.
The Organisations existing Innovation Performance and Capabilities (800 words)
Apple Incorporation is one of the best known brand around the world which belong to consumer electronics and provide several innovational products. Company invest more over research & development operations in order to identify the opportunities present in market. This help them in bringing gadgets with innovative and unique feature that further support Apple to remain always first choice of customers. It has a high skilled and talented technical staff who work harder to maintain the capability of company so that they keep on providing innovative gadgets to its customer for years.
The current innovational products of Apple Incorporation are MacBook Pro, iPad Pro, iPad mini, MacBook Air etc. From these gadgets MacBook Air is the latest innovation of Apple and gaining higher attention among people. It is powered by an 8th generation Intel Core dual-core i5 processor and also includes features like Intel Graphics processor, touch ID and two thunderbolt 3 port. This provide a more personalised, secure operations with around 8GB of 2133MHz memory with up to 256GB SDD storage which provide a greater customer experience (The next generation of security, 2018). The current capabilities form up a base for future innovations. Therefore, it is very essential for Apple Inc. to identify its capabilities on the basis of internal and external analysis for determining its ability to bring future innovation. This can be better analysed using SWOT analysis which provide informations regarding the current strength which support in exploiting future opportunities. It also present information regarding the weaknesses of Apple along with threats that are required to be consider while brining new innovation.
One of the biggest strength of Apple is its ability to develop and design hardware, application, software and services. This allows company to introduce unique, advanced and easy to use products which includes iPad, Macbook etc. Another strength of Apple is its strongest brand image, as it always focuses on bringing the best to market for fulfilling the expectation of customers (Dawson and Andriopoulos, 2014). Its innovational product from iPad to Macs are most successful innovations of Apple and main reason of its attractiveness among people is level of technological innovation. This support Apple to launch a laptop in MacBook range named as MacBook Air with advance features that provide higher security assurance using fingerprint as a passcode along with vast memory and storage option. It always try to provide a seamless experience to its customers by investing huge amount of fund in R&D to determine the capabilities required to develop for brining new innovation. This support Apple to manage its capability to being compatible with changing expectation and for offering innovative product to customer in future also.
Apple is a well known brand for its high-tech and innovational featured product which provide a seamless experience to customer and a new way to live their life with more technological advanced gadget (Kindström and Kowalkowski, 2014). But major drawback of Apple is that it offer products at a premium price which is not affordable to everyone. This factor has limited the target consumers of company who are able to afford such gadget at premium price.
There are a number of opportunities present in front of Apple which company can exploit for maintaining its position in marketplace and expanding its operations. Apple can broad up its market share by providing product or services at price which is affordable to customers. Another major innovational opportunity that Apple can bring in its personal computer is artificial intelligence where users are not required to provide command through keyboard rather they can use voice recognition method to make system function. This will be an in-built function which it can provide that will save user's time.
Apart from this Apple can also bring hologram technology in its current personal computer or laptops. This will be one of the most advanced and highly acceptable gadget in market which removes the option of USB or hardware by proving all in one operation. Here it will make up a virtual image in front of user from where they can operate there system effectively.
Major threats that are present in front of Apple Incorporation is increasing number of competitors or substitute product in market. As Apple always become first to bring new or innovative product which then make it as a trend and also increase the expectation of customers (Gawer and Cusumano, 2014). Therefore, it leads other competitors to imitate that feature and offer to its customer at relatively low price. Major competitors of Apple is Microsoft, Dell, HP etc. which provides a wide range of laptop with various feature at an affordable price.
But increasing competition act as a innovational driver for Apple Incorporation, as with the introduction of substitute or competitive product, company started seeking for new way to make its product more innovative and rare which is harder to imitate.
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Consumer electronic industry refers to the sector which includes group of companies that deals in manufacturing and offering of electronic product to customer for personal as well as business purpose. It includes various types of devices related to the communication, entertainment and official equipments (Frow and et. al., 2015). This is one of the fastest growing and evolving industry where trends changes on frequently and new innovations are introduced on daily bases. Industry involves huge competition as companies like Microsoft, Samsung, Apple, HP etc. are the biggest player under consumer electronic industry. These companies making competition tougher day by day by brining new or innovational product to the market for offering customers beyond their expectation to make their life much easier. It has been assumed that in past 10 years the innovation in computer and related devices are increasing continuously. This has enhanced the thinking capacity of players in industry and as a result of which the they keep on innovating products.
Therefore, consumer electronic industry is offering innovative product and also motivating companies under this sector to bring on more innovative and technologically advanced gadgets for fulfilling the expectations of customers. For instance, Apple is planing to introduce more advanced feature in its personal computer as well as laptop range i.e. hologram and artificial intelligence. These features will changes the whole way in which computers are being operated by providing more advanced feature in current system. In order to use current capabilities for future innovation it is very essential for a company to analyse the industry to determine the growth opportunities present in marketplace (Schaltegger and Wagner, 2017). This can be done using Porter's five force model which consists of five major factors that directly influence the operations performed by a company. These are as explained below:
- Threats of new entrants:- Consumer electronic is one of the most competitive industry which always focuses on bringing new technology and innovational product in marketplace. Therefore the threat of new entrant is very less because it requires lots of capital as well as technical assistance for setup business and offering product to market where large number of competitors are present.
- Buyer power:- The buyers power is relatively higher in consumer electronics as there are number of options available to customers to choose from where they get similar featured product at price of their choice.
- Supplier power:- Bargaining power of suppliers are relatively lower as there are large number of suppliers present in market who are ready to provide raw material at lower price. This provide companies to choose from range of suppliers for offering their services.
- Threats of substitute:- Threat regarding the availability of substitute product in market is relatively higher in consumer electronics as there are number of competitors present who always seeks an opportunity to bring innovative product for differentiating them over others (Rothaermel, 2015).
- Competitive rivalry:- Competition is relatively higher in this industry for personal computer and laptops as there are number of well established companies which offer similar products in term of technology.
From the above given image it can be concluded that innovation is one of the major factor that must be consider by each company to fulling the expectation of its customer and remain competitive in marketplace. For determining the innovation that can be offered to market, a company must perform SWOT analysis. This help in determining the strength that a company have which support them in forming a base for exploiting the opportunity present in market. But before introducing any innovation in marketplace, company must perform industrial analysis using porter's five force model.
Books & Journals
Cheng, C. C., Yang, C. L. and Sheu, C., 2014. The link between eco-innovation and business performance: a Taiwanese industry context. Journal of Cleaner Production. 64. pp.81-90.
Dawson, P. and Andriopoulos, C., 2014. Managing change, creativity and innovation. Sage.
Du, J., Leten, B. and Vanhaverbeke, W., 2014. Managing open innovation projects with science-based and market-based partners. Research Policy. 43(5). pp.828-840.
Frow, P. and et. al., 2015. Managing co‐creation design: A strategic approach to innovation. British Journal of Management. 26(3). pp.463-483.
Gawer, A. and Cusumano, M. A., 2014. Industry platforms and ecosystem innovation. Journal of Product Innovation Management. 31(3). pp.417-433.
Kindström, D. and Kowalkowski, C., 2014. Service innovation in product-centric firms: A multidimensional business model perspective. Journal of Business & Industrial Marketing. 29(2). pp.96-111.
Rothaermel, F. T., 2015. Strategic management. McGraw-Hill Education,.
Schaltegger, S. and Wagner, M., 2017. Managing the business case for sustainability: The integration of social, environmental and economic performance. Routledge.
Tidd, J. and Bessant, J., 2014. Strategic innovation management. John Wiley & Sons.
Trevino, L. K. and Nelson, K. A., 2016. Managing business ethics: Straight talk about how to do it right. John Wiley & Sons.
The next generation of security. 2018. [Online] Available through<https://www.apple.com/in/macos/security/>./