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Running head: ENVIRONMENTAL SCANNING – APPLE INC.
Environmental Scanning – Apple Inc.
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ENVIRONMENTAL SCANNING – APPLE INC.
Internal and external environments
Apple Inc. was started in 1976 by Steve Jobs. The company is famous for its
aggressive pioneer, its glamorous product design, and its up-to-date technology. Three
researchers: Usman Ali Khan, Mohammad Noor Alam, and Shabbir Alam, have come up with a
report entailing the internal and external environments of Apple. They achieved this by applying
techniques such as SWOT analysis, Porter’s five forces analysis, and PESTEL analysis.
Internal Environment
A SWOT analysis was used to summarize the major issues from Apple’s business
environment. In this case, strengths and weaknesses are considered to be part of the company’s
internal environment. Opportunities and threats form the company’s’ external environment.
Below are the strengths and weaknesses of Apple Inc. (Khan, Alam & Alam, 2015).
Apple has, since opening up its personal computer business, enjoyed rapid growth
from its large sales volume. The company has managed to maintain its top position, according to
Forbes, with a capital of up to $416.62 billion. Apple’s worldwide recognition is attributed to the
aggressiveness of its founder, Steve Jobs. The company had earlier positioned its major branches
in locations of high traffic, a factor that has contributed to its high revenues. Another strength of
Apple Inc. is its trustworthiness. Customers can wait behind long queues in the cold to get the
newest iPhone. Also, these gadgets are easy to use and understand.
Being the world’s largest IT company comes with greater responsibilities. In spite
of the company having a strong promotion strategy, its weakness is revealed by its dependency
on iPhones and iPods. Additionally, the brand’s hardware can only be used on iOS gadgets,
whereby android, its closest competitor, does not have such issues (Khan, Alam & Alam, 2015).
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ENVIRONMENTAL SCANNING – APPLE INC.
External Environment
In political terms, Apple faces several challenges since it has had numerous
contract suppliers around the world. Since a bulk of its sales contribution is outside the US,
political insurgencies would affect the company on a large scale. The company has recently been
under political pressures that arise from issues such as suicide cases of its major supplier,
Foxconn (Khan, Alam & Alam, 2015).
Factors that have affected the company economically include the high
unemployment rates in the United States, China, and Japan between 2012 and 2013. When
countries such as America, Europe, and Japan were recovering from the global recession, Apple
was affected.
Social analysis has shown that Apple has always been making changes to its
products to satisfy customer needs. It has, therefore, made several acquisitions including, Topsy,
Prime Sense, and Embark. It has also made alliances with Sony, Phillips, AT&T, and Motorola.
By 2013, the company’s sales had increased by huge proportions in India.
From a technological point of view, Apple has proven to be a trendsetter when it
comes to the business of consumer electronics and innovation. It was able to maintain 49% of its
entire population of consumers, according to Forbes. Its deal with China Mobile has acquired the
company 760 subscribers of China Mobile, giving it a great competitive advantage (Khan, Alam
& Alam, 2015).
Apple’s competitive advantage
Apple Inc. manufactures and sells electronic products such as computers,
smartphones, tablets, and music gadgets (Gupta & Prinzinger, 2013). The key components of the
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ENVIRONMENTAL SCANNING – APPLE INC.
company’s competitive advantage are its brand strength, premium pricing, innovation, and
management of the supply chain.
The company’s brand strength gives it great visibility on a global scale. Apple
has established an interrelationship among its products to encourage consumers who purchase
one product to try another. Since products such as the iPhone, iPad, and Mac all run on the same
software, iOS. This means that they are easy to use and so become the natural choice of
consumers who want to get new gadgets.
It is difficult to mention Apple Inc. without thinking of innovation. The company
has, over the years, established a reputation and has shown commitment to the development of
new products. A major factor of its competitive advantage is its ability to create new products on
the same operating system platform. As a result, the company can minimize risks...