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BUS 599: Strategic Management
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Analyze the existing business strategies, domestic and global environments, industry, and internal capabilities for both Apple and Samsung. Assess the significant manner in which company’s mission and vision align with the long-term goals and strategic direction of the organization.
The strategy used for the young Apple Inc. was considered as non-cooperative strategy; Steve Jobs one of the original founders and innovator of Apple Inc. did not want to share the company’s software with any other companies. Jobs wanted total exclusion of Apple’s software and hardware products. The differentiation business model gives companies a competitive advantage because the focus is to satisfy the customer need that no other competition can satisfy which allows the company to have higher prices for their products. Apple Inc. came out of the gate with the differentiation model but it did not work for the new company. According to Richard Lynch Apple’s strategy of non-cooperation was not a successful strategy in Apple’s initial launch; Apple’s first handheld device, “Newton” failed (global-strategy.net). Another reason for Apple’s ineffectiveness was the disagreement between Steve Jobs and directors at Apple. Apple director’s wanted Apple, Inc. to use the cost leadership strategy that Michael Dell, founder of Dell PC used and compete more with Dell but Jobs did not want to develop low-cost personal computers which later got Jobs forced out of the Apple, Inc. company (Hill & Jones, p. 177). “Promoting innovation is a big advantage for businesses although the failure rate of the innovation of new products is high” (Hill & Jones, p.495). Reasons for new innovation failure are uncertainty of the product by consumers; the new innovation is not meeting for the customer because of possible bugs in the technology, poor design or overall quality. Upon Jobs’ return the strategy of Apple was focused differentiation, only to contend with a premium PC market.
Apple Inc. is now considered as a first mover in the industry; Apple currently has global brand loyalty, increased sales volume and the company stock has become the most valuable.
Initially Samsung started in a different industry in China in the late 1930’s. Samsung Group did not come into the electronic industry until the 1980’s and later moving into the 1990’s the Samsung Group entered into the semiconductor industry developing low-cost memory chips and LCD displays for colored screen devices. Samsung Group adopted the cost-leadership business model in the 1930’s because the company wanted to always been seen as a low-cost manufacturer in the industry. According to Charles W. L. Hill and Garth R. Jones, the cost-leadership business model takes every avenue to lower costs for products and services to surpass the competition in sales (Hill & Jones, p. 168).
Samsung has been in existence for over 75 years in China. Samsung has different divisions one being the Samsung Group that evolved in the 1990’s later becoming the a leader in the digital world and globally. Samsung Group was dedicated then and still dedicated today in creating innovative products and services that make lives better for people and continuing to be a global digital leader. “Samsung Group makes a conscience effort to stay aware of the global economy and believe it’s important to develop new technologies as the world changes”(Samsung.com, March 13, 2014). Samsung has a vision to become number one in the industry surpassing its competitors in the next six years.
Analyze the business-level strategy of each company by conducting a SWOT (Strengths, Weaknesses, Opportunities, and Threats) analysis. Next, determine the fundamental way in which each sector influences its competitive position within the industry. Provide rationale to support the response.
Apple’s business-level strategy is