Audit Exercise Paper Two Student Name MGT/497 – Strategic Technology Planning for Organizations Professor Name January 16, 2012 Introduction This paper will refer to two audit exercises from Chapter three and Chapter four of the textbook. The first one will refer to demand for product, competitive response, level of novelty of the innovation, factor that could block the good outcome of an innovation, and other factors. The second audit exercise will involve the assimilation of a checklist for innovation with respect to the considered organization. It will also determine the readiness of the organization to implement an innovation strategy.
The company chosen for these audit exercises is Apple. Everyone has heard about this company and knows that the products of it are very important in our lives. According to Apple Inc. (2012), they mission statement says that they design Macs, the best personal computers in the world and they lead the digital music revolution with their iPods and iTunes online stores. The mission statement also says that the company has reinvented the mobile phone with their revolutionary iPhone and that they define the future of mobile media and computing devices with the iPad.
The goal of this company is to make the best mobile product from their phone. Remember what Steve Jobs said when people asked him about the purpose of this company. He said that the company will try and offer with their mobile phone what the people need and not what they want. Audit Exercise Chapter 3 This audit exercise will address demand for the product or products of Apple, factors possible to block the success of an innovation, their standards, competitive response, the level of novelty of the innovation, as well as other factors.
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White and Bruton (2011) give the following factors to determine the value of an option: favorability of demand for products, factors to speed adoption, factors to block the success of an innovation, the chances of strong competitive response, the likelihood that the possible competitive advantages are sustained, factors inside the company that allow setting standards, the costs to commercialize, the resources available to commercialize, the level of novelty that is captured by the innovation, development costs, certain opportunities that could be advantageous, and possible areas where damage might occur.
In dealing with all these factors, we will refer to the iPhone, the innovation that took Apple on its highest peaks of success. First we refer to the demand for this product. Ever since it was released to the public this product has been nothing but a success. The early prototype that went on sale in June, 2007 blew up the market. According to Vogelstein (2008), analyst were speculating that customers would snap up about three million units by the end of 2007, making from this phone, the fastest-selling smartphone in the history.
It was the same story with the following generations of the smartphone and the demand was higher even though they had their first powerful competitor by the end of 2008 when Android came to life with they G1 smartphone. In order to speed up the adoption of this product the company needs to make sure that they keep their quality standards as they are now. Innovation could be blocked if Apple makes structural changes inside the company or if the key employees in this position want to leave the company. Apple has received a big hit when the heart of this company left us.
Steve Jobs was the brain behind all the innovation at Apple and people will remember him a lot of years from now. Their direct competition is the Android operating systems with all the smartphone adopting it. Android is a powerful competitor which has gain a lot from the market of the smartphone and as it currently is, Google’s Android has a higher portion of the market in this area compared to Apple. To sustain a competitive advantage, Apple needs to keep innovate and offer quality to their dedicated customers.
When it comes to costs of commercialization, the company does well enough because the prices of producing the product are small compared to the prices at which the product is sold in the market. It seems that Google with their Android OS is a little in front of Apple with respect to technological advancement; this is why Apple need to direct some of their costs to research and development to keep up or become better than their competitor. They could leverage opportunities by being able to maintain their devoted customers and offer to them discounts or special promotions for the products.
This would attract other potential customers. The potential damage may occur if Apple is not able to stay in the competition or cannot innovate; they are threatened if Google’s Android is advancing faster and faster because people like to stay in touch with the technology and would choose the best product in the market. Audit Exercise Chapter 4 This audit exercise from the end of chapter four requires analyzing a figure which contains a checklist for innovative organizations to consider.
The questions at hand refer to ways of using the checklist in determining a company’s readiness to implement a strategy that would be innovative. It requires identifying at least a major area to be examined and addressing important considerations from this area. Figure 4. 7 is divided into four categories. It talks about vision, leadership, processes, and resources. We would refer to all of them in consideration to the company Apple. This time the chosen product will be the iPad. The same way Apple was ingenious by bringing the iPhone to the world, the same way was the story about the Ipad.
It was the same brain behind this product as well. The iPad was the first tablet pc in the world. People have seen the concept only in science fiction movies and they were very thrilled when the product came out to the market. It had the same success, the same higher demand as the iPhone did. Now, referring to the vision category and to the first question which asks whether or not the team (or the company here) has a clearly articulated vision, mission, or set of objectives, it has to be noted that Apple has it all clear up, even though things have declined a bit when Steve Jobs died.
However, all the employees in the company need to share the same vision so that they could put all their efforts in continuously creating the same quality products as they did so far. However, not everyone participated in creating the vision because this would be a tough thing to do. The vision came from Steve Jobs and it was shared progressively with all the important players from this company. The vision was to offer the people what they need most and not what they want.
This is attainable; however, it is attainable with a higher price because the company needs to invest time and resources in research and development to spot the necessities of the client and to try to satisfy them. When it comes to leadership, Steve Jobs is the name that perfectly connects to this term. According to Miami University (2007) leadership is the reciprocal process of mobilizing by individuals with specific values and motives, various politic, economic, and other resources in an environment of conflict and competition, to be able to realize goals independently or mutually held by both the followers and the leaders.
It may be a complex definition, but it has the power to point out all the important aspects of this discipline. The textbook asks: “Is excellence of central importance to the team? ” The answer in the context of Apple is “yes” because they are reaching their purposes through excellence, hard work, and a lot of skill. All the employees in this company are committed to fulfill the same vision and the present leader Tim Cook has the purpose of taking forward the words of Steve Jobs and encourage open idea exchanges.
The next category from the checklist for innovation strategy is about processes. At Apple probably not all the employees participate in decision making because this would not be appropriate. Imagine how would be to give a worker in assembly the power to make decisions about marketing strategies for the company. It would surely not be appropriate. However, all the employees are welcome to share their ideas and make recommendations to improve processes or products. They are even rewarded if their propositions are efficient. There is a climate of trust inside this company and it is mportant to maintain it because without good relationships, without communication, there will be conflicts, which lead to inefficiency and to lower productivity. When it comes to resources, Apple has a good way of managing them. Not only they try to make their quality products with a lower consumption of resources and money, but they have the possibility to charge more for their products in comparison with other companies in the same sectors. They are successful; however, this may not be the best strategy on the long-term. They should considering lowering a bit the prices; this would most likely increases their sales.
Conclusion Apple is a market leader and it represents a business model to other companies. Its position offers the company the ability to innovate, invest extensively in research and try to be better than it self. The company has been around for a while now, so they know how to do business efficiently. However, recent competition has absorbed some of its market. This should not be seen as a bad thing in the company but as a motive, as a spark to make the company constantly innovate and make the world a better place with their products. References Apple Inc. (2012).
Apple Corporate Information. Retrieved from http://investor. apple. com/faq. cfm? FaqSetID=6 Miami University (2007). What is Leadership? Retrieved from http://www. units. muohio. edu/saf/leadership/students/whatisleadership. html Vogelstein, F. (2008). The Untold Story: How the iPhone Blew Up the Wireless Industry. Retrieved from http://www. wired. com/gadgets/wireless/magazine/16-02/ff_iphone? currentPage=all White, M. A, & Bruton, G. D. (2011). The Management of Technology & Innovation: A Strategic Approach (2nd Ed. ). Mason, OH: South-Western/Cengage Learning.
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