Economics of Organization and Strategy

timer Asked: Dec 12th, 2018
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Apple and Samsung are often mentioned together, as they are both world leading producers of smartphones. However, they are much different companies in a variety of ways. Carefully review the background readings concerning diversification and vertical integration. Then do some extensive research on Samsung and Apple concerning their diversification and vertical integration strategies.

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School: Cornell University

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Running head: MODULE 4 – CASE


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Apple Inc. being an American multinational and technology company was founded in April
1976 by Steve Jobs, Steve Wozniak, and Ronald Wayne (Hussain, 2013). The company has its
headquarters based on Cupertino, California and it deals with online consumer services, software
products and consumer electronics. Besides, it majors on design, development and selling of the
consumer electronic products. The company software products include the iWork and iLife
creativity and productivity suites among other products. Moreover, the company also deals with
hardware products such as the Apple Watch smart watch, the iPod portable media player, iPhone
smartphones, the iPad tablet computer and the Mac personal computer. To add on, some of the
company’s online services include the iTunes Store, Apple Music, Mac App Store, the iCloud and
the iOS App Store.
According to Bowen, Baker & Powell (2015), diversification is the aspect of a company
expanding its line of products or market. In this regard, being that in related diversification a
business benefits from understanding how the other businesses operate and finding out the possible
opportunities and threats associated with the businesses, Apple Inc has engaged in related
diversification in the following ways. First, the company’s iPhone products which include iPhone
X, iPhone 8, iPhone 7, iPhone 6 among others, depicts a good example of its related diversification.
Moreover, being macOS and iOS operating system belong to the same product line, the company
also expanded its operating system product line to include both macOS and iOS. Most notably,
from the above examples it can be depicted that the company’s diversification strategy aims at
making the market more competitive by introducing new and innovative products that attract the
attention of more customers.
According to Voice Marketing (2018), unrelated diversification is a situation where a
business adds an unrelated or new line of product, service, or market to its existing line of business.



Notably, due to the advantage of costs efficiency many companies would like to engage in
unrelated diversification. In th...

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