Running Head: BUSINESS MODEL 1

Business Model

Name

Institutional Affiliation
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As discussed with Sir Atif Hanif Saqi

Business Model

For years mobile market is getting competitive day by day, there are number of player or

business rivals who are operating in mobile market and trying to achieve the first position.

Among all these rivals the major rivals or competitors of mobile phones are Apple and Samsung.

In year 2012 Samsung is placed as number one mobile selling brand in whole world, but Apple

Corporation is trying to compete. This paper is written on Apple Corporation. Apple Inc. is

remains a most innovative company around the world. Since last few years it has been seen that

Apple is struggling in making the processors and memory chips, for that they consult or ask

Samsung to provide processors as a suppliers, this feature has provided Samsung a leading edge

to control the price of iPhone, iPod and iPad. In these days as business environment is getting

competitive and all rivals need to differentiate the products and provide it to customers at low

price to remain successful in market. After the death of Steve Job, CEO of Apple Inc. is

considered that they lack management in organization. As Apple has positioned their products of

high quality and they have segmented high class (Barney, 1995). They are the local customers of

Apple but as the competition is getting worse day by day, it has led Apple Inc. to think about

differentiating their products from competitors. As different competitors are now providing the

same quality and features at low or reasonable price, so Apple Inc. require to reduce their

products price to remain competitive. As Apple do not have processor and memory chips so they

are dependent on Samsung, which could raise the price of processors and memory chips which in

result will increase the overall price of Apple products.

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Now Apple Inc. to cope up with this problem need to start production of their own

processors and memory chips to deliver the high speed of processing to their customers. This

will help them in retaining their loyal customers. In Apple customers are bring loyal because of

high performing products. So Apple Inc. need to develop processor which could provide their

customers a high speed products to compete with Samsung and to differentiate their products

from Samsung with the help of innovative and quick processing products. This will help Apple

to remain competitive and to be a market leader in mobile phone market.

Mission Statement

Becoming the leader in developing innovative technology, to provide the high processing

speed, with high quality, it will act as extension in customers and to help in becoming the market

leader with minimum usage of resources.

Vision

A division of business unit to give cost effective solutions to strategic designers by

maintaining high quality products.

Business Model

Apple Inc. has made a number of different innovative products, which has enabled the

Apple to become the world’s innovative company. This division will help Apple in establishing,

creating and provision of values to their customers. Systematic process of innovation has helped

the organization in becoming the leaders, this manufacturing division will help the organization

in providing the endless high quality products with high computing power of the products. Apple

has already established a business logistics systems so it will help this division in providing the
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continuous services to its customers. Apple products are already considered as high quality

products and this division will help the business in developing more confidence of organization

in customers. Value proposition of organization is based on the experience of products, as Apple

products considered as quality products so this invention will result in the increase in product

quality. As Apple Inc. is wholly based on equity and they have not borrowed firm capital since

long time (Amit & Zott, 2010).

Even they have purchased few portion of their stocks back and paid dividend to

remaining shareholders. As the firm has strong financial base so it will help the Apple Inc. in

setting up of business unit or make investment. This investment will return the Apple with high

percentage of profit. This idea of starting a division for the production of processors and memory

chip will be act as the competitive strategy through which Apple Inc. will be able to compete in

complex or competitive business environment. This design of processor and self-ability to

produce such products will help the organization (Apple Inc.) in generating high revenue in

result of high demand of their product in market. Apple Inc. is already a successful business line,

and placed on position of second highest mobile seller, thought they already having a good value

chain structure of business. As now they are depending on Samsung and other suppliers of

processors and memory chips but this will help Apple Inc. to improve their value chain structure

to gain a competitive advantage in market. This product or part will help in improving the

computing speed of mobile phones and other electronic devices like Notebooks, iPad and iPod

etc.

Apple Inc. is not selling much in promotion of their products, as market is being

competitive and they need to move to new market, so they need to start advertising about their

products. New markets and marketing of their product will result in increase in the demand and
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increase in market share of the firm. Increase in processing speed will help Apple Inc. in

differentiating their product from their rivals. Without making their own processor will lead to

dissatisfaction or decrease in confidence of customers. Their target market is high class they are

not concerned about the price but they prefer the quality, as their products involves legacy so this

business model will help Apple Inc. in differentiating their products from competitors and to

gain a competitive advantage.

As this product is designed or manufactured to increase the satisfaction or confidence of

customer. This product is based on the customer focus, by analyzing the demands and their needs

of high processing speed has resulted in this division. It major focus is to provide the high speed

devices to provide solution to their customer’s problems in maintain a high quality of products.

Due to this technology Apple products specifically mobile phones will be of best quality

and fast devices in market. With the passage of time, most people are using phone to receive or

send emails and use mobile phones for business purposes so this technology or manufacturing

unit of processor will result in differentiating their product from competitors. As they are already

having a large number of loyal customers, and the provision of high speed products will result in

result in attracting more customers in result of word of mouth (Porter, 1987). Customers are

considered the essence of business, large number of customers will help the organization in

getting or attaining competitive advantage in market on the basic or high quality product along

with high speed and quality. As apple is having a number of other products which act as the

complimentary of these products; like music store, App store and software will help the firm in

getting competitive advantage on rivals. After attaining the competitive advantage, firm is

required to sustain that competitive advantage. By differentiating their products and services will

help Apple in sustaining competitive advantage in market.

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As apple is wants to be market leader and to provide high quality products, so this

division will help Apple Inc. in making the high speed and high quality products. This division

will also help the strategy maker in designing the strategy of becoming the market leader. As

their major focus is on becoming market leader so this operation will help Apple In becoming the

number one seller of mobile phones.

Starting of this division will help in generating a high value culture or competitive

environment in organization to provide opportunities to business in developing new and high

quality products and inventing new technology which would help the organization in sustaining

competitive advantage. This business does not involve in violation of corporate social

responsibility, but in reality it will help the firm in separating a budget for corporate social

responsibility activities. This business will help the firm in generating an ethical structure in firm

or developing high ethical values. These values helps the organization in working more

efficiently and effectively.

We can conclude that business of processor and memory chip for electronic devices will

help Apple Inc. in attaining competitive advantage and differentiating their products from

competitors. It will also help the firm in developing a strong brand image by providing high

quality products for their customers.

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References

Amit, R. H., & Zott, C. (2010). Business model innovation: Creating value in times of change.

Barney, J. B. (1995). Looking inside for competitive advantage. The Academy of Management

Executive, 49-61.

Porter, M. E. (1987). From competitive advantage to corporate strategy. Cambridge: Harvard

Business Review.