Innovation Strategy Assignment for Apple

Question

Assessment Overview: This assessment must be completed by students individually. The assessment is designed for students to develop understanding of the close links between the business environment, business innovation strategy, business capabilities and business value creation. The assessment involves writing a 2000 word innovation strategy report in response to a real case.

Please note that academic misconduct and late submission penalties will apply to this assessment as per the university policies.

Assessment Context: Generally, innovation initiatives within a parent firm are driven by an innovation strategy. An innovation strategy is a subset of firm’s overall strategy. The innovation strategy describes the future development a firm’s innovation capabilities and the future direction of its innovation activities. A firm’s innovation strategy does not exist in a vacuum, it responds to a specific set of circumstances including innovation trends and provides an important context; direction; guidance; monitoring and facilitation of an organisation’s innovation initiatives. Thus, firms take care to diagnose the firm’s circumstances including innovation trends to inform the design and development of its innovation strategy.

Select one of the following firms (or organisations):

• Apple (electronic device manufacturer).
• CQUniversity (university education provider).
• Facebook (social media provider).
• Strava (social fitness application provider).
• Lego (toy manufacturer).
• Tesla (automotive manufacturer).
• Australian State Health (select a health care provider in Australia).
• Woolworths (retail supermarket chain).
• A firm or organisation that you are or have been employed at and therefore know well. It is important that no confidential information is included in the submitted report.
• If you suggest a firm or organisation other than the ones above, you will need approval from your assigned lecturer.

Select one of the following innovation trends:

• Artificial intelligence (Davenport & Ronanki, 2018; FiveFifty, 2018; McKinseyGlobalInstitute, 2018).
• Augmented reality (Porter & Heppelmann, 2017).
• Robotic automation (Tilley, 2017).

Ideally, your selected innovation trend is important to the selected firm or organisation as that makes the innovation strategy report important to its senior executives, the report interesting to read and the report writing exciting.

Assessment Tasks: You are required to write a 2000 word innovation strategy report to the board of your selected organisation. Your innovation strategy report must:

1. Succinctly introduce the selected organisation and selected innovation trend.
2. Succinctly define the following concepts and their relationships: the organisational environment, innovation trend, innovation strategy, innovation capabilities, innovation value creation and capture.
3. Succinctly describe how the creation of an innovation strategy ensures strategic alignment within organisations and why it is important.
4. Analyse the impact of the selected innovation trend on the selected organisation. You should apply at least one strategy tools to analyse the impact, opportunities and threats to the organisation.
5. Recommend how the organisation’s innovation strategy best responds to the innovation trend by answering the following questions.
   • How should the organisation organise its innovation activities?
   • What additional innovation capabilities should the organisation develop?
   • What innovation initiatives should it pursue?
   • How should the organisation ensure that it creates and captures value from the innovation?
6. Recommend how the organisation best ensures strategic alignment to address the innovation trend.

Answer

Introduction
In the technology-driven era, innovation is the main element that gives Apple Inc. an edge in the dynamic operational market setting. The electronic device manufacturer came into existence in the year 1976 and since then it has been able to strive and exhibit a profitable performance due to its smart innovative strategic approach. The innovation strategy can be defined as the creative plan that is used by a business undertaking to make advancements in terms of technology and the service or products that are offered in the market setting. This strategy is a segment of the entire business strategic model that provides direction to the innovative capabilities and innovative activities (Davenport & Ronanki, 2018).

In this innovation strategy assignment, the main focus is on the Apple Inc. concern because it is one of the most innovative business undertakings of the 21st century. The innovative trend that has been the main highlight in this innovation strategy assignment is the “Artificial Intelligence” as it has a profound impact on the businesses that function in the current times. According to McKinsey, AI is one of the prime innovative trends that have the power to revolutionize the way businesses are carried out in the current times (Chui & Francisco, 2017, p 1).

Innovation Trend – Artificial Intelligence
Artificial Intelligence (AI) is one of the most popular jargons that is taking the technology-based business undertakings by storm. In layman’s language, Artificial Intelligence can be defined as a computer-controlled robot to carry out certain activities that can be mainly performed by intelligent beings. Humans are the only species known to mankind who are associated with the ability to reason, find meaning generalize and learn from previous experiences.

In the current times, AI is in its inception stage but it has been understood that this innovative trend has the power to take innovation to new and unimaginable heights. In the current times, when the innovative setting is evolving at an extremely fast pace, the Apple Inc. brand must work on the AI model as it can strengthen its current innovative strategic framework (Innovative strategies and actions, 2018, p 2).

Organizational Environment of Apple
Some of the most crucial concepts have been covered in this section of the innovation strategy assignment that would help to understand how Apple has been able to grow in the competitive industrial setting by relying on its innovative approach (Panmore.com, 2018). The organizational environment of Apple Inc. is one of the key factors that have helped the brand to taste success in the competitive and uncertain market setting. The role of the business leaders is of paramount importance as they shape the environment of the firm and ensure that innovation forms the backbone of the business (Apple Leadership, 2018).

Concept of AI
In the recent times, Apple Inc. has been thinking of incorporating the AI concepts in its market offerings so that the customers can experience something which is totally new and unique for them. In fact, the brand has taken baby steps in this regard by introducing “Siri” in its iPhone. The unique features and enhancements of Siri have made iPhone a more personalized electronic gadget for the users. The AI basically gives suggestions to the users with queries (Techcrunch.com, 2017).

Innovative strategy implemented at Apple Inc.
Apple Inc. is the electronic manufacturing business that has always relied on advancing technology and innovation to create value for its target audience. It can be said that innovation is in the DNA of the business undertaking. It can be found in its management approach, the organizational culture and the marketing strategic model. The business has always tried to exploit the technological setting in which in functions so that it can meet the needs of the customers that have not yet been identified by them (FiveFifty, 2018).

Apple has always exploited the innovative technology to expand its product line and create something new in the market. Some of the most innovative offerings of the Apple Inc. brand that have a global fan following include the iPhone, iPad, smart watch, macOS, Keynote, iPod and many other electronic-based offerings. The main element that gives the offerings a competitive edge in the highly competitive market setting is the unique innovative features that are ingrained in them (McKinsey Global Institute, 2018). Even though Steve Jobs is no more a part of the reputed brand, Tim Cook has carried on his legacy by focusing on innovation to create value for the target audience in the dynamic market setting.

Innovative Capabilities of Apple Inc. firm
The innovative capabilities can be defined as the set of capabilities namely the technology development capabilities, the operational capabilities, the management capabilities and the transaction capabilities (Forbes.com, 2018). Over the years, the Apple Inc. brand has worked on its innovative capabilities to create unique offerings that are totally technology-based.

The core innovation skills include the expertise of the manpower, the robust Research and Development department and the innovative leadership model. The role of Steve Jobs is indispensable as he has strengthened the innovation capabilities of the concern (Forbes.com, 2018).

Source: (Zawislak et al., 2012)

Innovation Value Chain
The primary and support activities of the Apple Inc. firm revolve around innovation. Apple has a strong supply chain and it obtains its raw materials from several sources from all around the globe. The manufacturing operations are conducted in several countries but China is a critical component that strengthens the operational activities of the firm. Apple uses innovative and creative marketing tactics that give it an edge against its industry rivals. It offers comprehensive after-sales services to assist the customers while interacting with the brand (Pratap, 2018).

The support activities of the brand play a vital role as the technology model focuses on high-quality and unique offerings. The human resources make the best use of the skills and expertise to create value for the firm and the customers. The procurement is one of the main functions that make sure that the firm has a strong relationship with the suppliers. The firm infrastructure has evolved over the years which have helped the brand to adapt to the dynamic and innovative business environment (Porter & Heppelmann, 2017).

Innovation strategy ensures strategic alignment
For innovative business undertakings such as Apple Inc., the innovative strategy forms an integral part of the strategic model. In the 21st century, no organizational strategic model can be formed without a unique innovative perspective. This statement holds well for Apple Inc. as the firm entirely relies on innovation to create unique offerings in the dynamic and competitive market setting (Grover, 2016, p 1).

In the case of Apple Inc., the creation of an innovative strategy ensures that there exists a strategic alignment within the business entity as it makes sure that innovative elements are integrated in different aspects of the organization including the organizational culture, the leadership approach and the organizational outlook. As per the journal by Ms. Grover, there exists a dyadic association between the two variables namely innovation strategy and business strategy. Apple has been able to strengthen its innovative model and grow the business operations due to the robust relationship that connects both of these elements (Grover, 2016).

Impact of Artificial Intelligence on Apple Inc. firm
The Artificial Intelligence is one of the most innovative concepts that has revolutionized the technology-based businesses especially Apple Inc. Even though Apple Inc. has always believed in staying ahead in the innovative setting, its exposure to the innovative model is pretty limited. As discussed earlier in this innovation strategy assignment “Siri” is the AI concept that the business has introduced to represent itself in the AI-driven scenario. The Artificial Intelligence concept has compelled the business to work on designing and offering AI solutions in the market that can totally revolutionize interaction and communication that take place in the current era (Evans, 2018).

In order to be at par with the dynamic technology-based environment, the Apple Inc. brand has created the building blocks that help it to create a robust technological infrastructure in the dynamic market context (Tilley, 2017). The AI has the power to reduce the work processes that involve manual activity and this could very well increase the automated processes that are conducted in the organizational context.

SWOT analysis
The SWOT analytical framework has been used as the main strategic tool to capture the strengths, weakness, opportunities and threats of the Apple Inc. business concern.

Strengths – Some of the core strengths that can help Apple to exploit the Artificial Intelligence setting include the robust technological Infrastructure, the unique ability of the marketer to develop and design its core business components that revolve around innovation, the reputed brand name and the loyal customer base (Jurevicius, 2018).

Weakness – The major weakness of Apple would be the limited degree of experience in regard to the concepts of Artificial intelligence. This could minimize the capability of the brand to exploit the dynamic market setting.

Opportunities – The AI is a unique opportunity that can act as the main pathway to create unique and innovative offerings that could be of unimaginable value for the target audience. It could minimize the involvement of human factors and strengthen the efficiency of the new business concept.

Threats – The main threat that arises before Apple relates to the uncertainty that exists in AI setting. It is a highly unexplored territory that could pose complex challenges for the business undertaking in the current times.

Recommendation to respond to innovative trend
Apple needs to organize its innovative model in a more methodical manner so that there is scope to develop the AI model. In order to succeed in creating unique AI offerings in the market setting, the role of the leaders and innovators is extremely crucial. They can play an active role to give the scope to the human factors to inculcate the AI model in various aspects of the firm. In order to give a boost to the AI initiative, Apple Inc. must focus on the innovative initiatives by strengthening the machine learning mode so that it can support the computer-based robotic model (Chui & Francisco, 2017, p 1).

The brand must also focus on crucial aspects relating to security and cloud supercomputing so that the innovative initiatives can be in sync with the AI business concept. Apple can ensure that it is able to create and capture value from the innovation approach by regularly keeping a tab on the technological advancements and changes that take place in the dynamic and uncertain technological environment. This approach can help Apple to be ready for AI which seems to be the future digital frontier (Tilley, 2017).

Recommendation for strategic alignment
The Artificial Intelligence trend is one of the most powerful innovative trends of the current times that have the power to completely transform and revolutionize technology and innovation of Apple. The Apple Inc. firm can make sure that the strategic alignment can address the innovative trend relating to Artificial Intelligence by making sure that all the functions that operate within the Apple Inc. firm are on the same page in terms of technology, and the understanding of the business goals (Tilley, 2017).

Since Apple uses innovation as the core element in all the levels of the organization, it can focus on real-time learning in the organization context that will align the overall learning on innovation and the AI concept of technology. According to Mckinsey, Apple can adopt the Artificial Intelligence concept by trying to mature in the digital sense.

Source: (Chui & Francisco, 2017, p 4)

In order to make sure the business strategy is at sync with the Artificial Intelligence trend Apple Inc. must make the digital model of the business more matured by strengthening the technological assets, the usage of the innovative elements in the business undertaking and the proper development of the skill and expertise of the labor. The business must also design a value chain specifically for the AI model that focuses on the smarter Research and Development model, optimized production and maintenance approach, improved sales and marketing and enhanced user experience. Such a holistic approach can play a vital role to make sure that the technological-oriented business undertaking can exploit the AI trend and make its name for itself (Chui & Francisco, 2017, p 4).

Conclusion
By this innovation strategy assignment we have come to the inference that Apple Inc. is one of the most innovative concerns that has the opportunity to exploit the innovative trend relating to Artificial Intelligence and create value for itself and the customers in the dynamic market setting. This innovation strategy assignment focuses on the innovative model of the brand and how it can align its strategic model with the AI trend.

References
Apple Leadership. (2018). Retrieved from https://www.apple.com/leadership/

Chui, M., & Francisco, S. (2017). Artificial intelligence the next digital frontier?. McKinsey and Company Global Institute, 47.

Davenport, T. H., & Ronanki, R. (2018). Artificial Intelligence for the Real World. Harvard Business Review, 96(1), 108-116.

Evans, J. (2018). Why Apple is developing artificial intelligence. Retrieved from https://www.computerworld.com/article/2927931/robotics/why-apple-is-developing-artificial-intelligence.html

FiveFifty. (2018). Real-World Artificial Intelligence. McKinsey Quarterly.

Forbes.com (2018). Apple Innovation Rules: Steve Jobs's Secrets. Retrieved from https://www.forbes.com/sites/johnwasik/2016/05/20/apple-innovation-rules-steve-jobss-secrets/#17131fe93a4b

Jurevicius, O. (2018). Apple SWOT analysis (5 Key Strengths in 2018) - SM Insight. Retrieved from https://www.strategicmanagementinsight.com/swot-analyses/apple-swot-analysis.html

Grover, V. M. (2016). Alignment of Business Strategy and Innovation Strategy: Strategic Benefits. Imperial Journal of Interdisciplinary Research, 3(1).

Innovative strategies and actions. (2018). Retrieved from http://ec.europa.eu/regional_policy/archive/funds/2007/innovation/guide_innovation_en.pdf

McKinsey Global Institute. (2018). AI, automation, and the future of work: Ten things to solve for. McKinsey Quarterly.

Panmore.com (2018). Apple Inc. Organizational Culture: Features & Implications - Panmore Institute.. Retrieved from http://panmore.com/apple-inc-organizational-culture-features-implications

Porter, M. E., & Heppelmann, J. E. (2017). Why every organization needs an augmented reality strategy. Harvard Business Review, 95(6), 46-57.

Pratap, A. (2018). Apple Value Chain Analysis. Retrieved from https://www.cheshnotes.com/2017/05/apple-value-chain-analysis/

Techcrunch.com (2017). Apple introduces the AI phone. (2018). Retrieved from https://techcrunch.com/2018/06/07/apple-introduces-the-a-i-phone/

Tilley, J. (2017). Automation, robotics, and the factory of the future. McKinsey Quarterly.

Zawislak, P. A., Cherubini Alves, A., Tello-Gamarra, J., Barbieux, D., & Reichert, F. M. (2012). Innovation capability: From technology development to transaction capability. Journal of technology management & innovation, 7(2), 14-27.