Overview

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.

Tasks

You are required to write a 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.
   
   


Analyse the impact of the selected innovation trend on the selected organisation. You should apply at least one strategy tool to analyse the impact, opportunities and threats to the organisation.


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 

Apple Inc. is an American multinational organization that deals with electronics and software. The company was established by Steve Jobs and Stephen Wozniak in the year 1976 (Dolata, 2017). The products being produced by the organization include computers, media players, mobile phones, computer hardware and software. The products are sold to a wide variety of targeted consumers such as government agencies, educational institutions, small and big corporation and individual consumers. The management and organization of Apple Inc. is based on geographical structure which is an example of divisional structures (Dolata, 2017).

Apple Inc. have considered the divisional structures to be a traditional organizational structure grouping people together working on the same product or processes, serving similar consumers. The company has an operating segment where consumers are grouped based on the preferences. As an illustration, the operating segments used by Apple are; America, Europe, Asia-Pacific, Retail and FileMaker operations. These segments determine the type of consumers and the products that will be supplied to them. The advancement in technology has led to increased innovation making Apple Inc. to release new gadgets and technologies for the purpose of fulfilling the needs of the consumers and the technological gaps that exists across the globe.

The innovation trends due to advanced technology have made Apple introduce Artificial intelligence in its gadgets (Brynjolfsson, Rock & Syverson, 2017). According to the latest reports, Apple Inc. was the first company to introduce artificial intelligence in the market to consumers when they launched the voice assistant Siri on their smartphones such as the iPhone. The programming of the AI used by Apple Inc. requires an increased level of data collection and mining. This innovative trend is due to the preparation of the future which will require the company to be an AI company and attend to the demands of the consumers.

Discussion: Apple’s Inc. Competitive position

Understanding the competitive position of Apple will involve understanding its environment. Organizational environment are the forces/institutions affecting the overall performance, operations and resources of the company (Wenzel & Koch, (2018). Organizational environment can be classified into internal and external. Both of these organizational environments have their own compositions. As an illustration; the internal environment is made up of the owners, board of directors, working environment and culture. Majorly, the internal environment is composed of the strengths and weaknesses of the organization. The external environment are the opportunities and threats that the organization has to deal with on a daily basis during the running and operations. External environment is made up of the consumers, suppliers, government, socio-political environment and technological environment. All these factors affect the competitive position of Apple.

Apple Inc. has been a leading innovative technological company. This has been based on the state-of-the-art software and hardware that they release to consumers. The innovative features that the company has been putting on their devices has affected their competitive advantage being that there are organizations mimicking their features to suit the needs of their consumers (Saebi, & Foss, 2015). As an illustration, the introduction of iPod made consumers to be a position to store their songs. The gadget is in a position of storing more than 1000 CD songs of good quality. These features make it easier for the company to penetrate any market and develop any kind of technology to suit the needs of their target market or operational segment. iPod is not among the products that was revolutionized by Apple. There are other products such computers where they were able to take the computers to the next innovative level. The revolutionized features such as numerous application and other hardware features made it convenient for consumers. Furthermore, Apple Inc. was not among the companies to introduce tablet but they were the first organization to make the tablets affordable to consumers (Dolata, 2017). From this explanation, there are reasons why the innovative trends have been successful for Apple. Some of these reasons include; defining the needs of the consumers.

According to the late founder Steve Jobs, he insisted that the company should not rely on the things that the consumer wanted on the market research but to always redefine the needs of the consumers. This will help in creation of more features that will dramatically change the tastes and preferences of consumers and the market (Saebi & Foss, 2015). This can be supported by the fact the introduction of iTunes and iPod revolutionized the music business. This was the kind of influence that Steve Jobs wanted and it has been a strategy leading to the success of the company. Secondly, the current trends in technology and consumer market has provided Apple Inc. with an opportunity to ascend in its innovative strategies. Take for instance, more than 60% of the American population and Asia-Pacific segments are using smartphones driven by application. There has also been an increased purchase of tablets over the last decade. This makes Apple highly positioned in the market.

Innovation strategy 

An innovative strategy is an action plan implemented by an organization to grow its market share and profits through product/service innovation (Hickman & Silva, 2018). Apple Inc. has been globally recognized as an innovative company which has been based on introduction of new products and innovative business models. Apple’s innovative strategies have been due to emphasis on creation of innovative and attractive products. This is evident by some of their gadgets such as iPod and iPad. The company’s innovative system has been characterized by their dedication to culture and not processes. Other innovative strategies include development of perfect mockups before releasing the products into the market, launching a paired design meeting where employees can brainstorm and generate ideas. Lastly, Apple do describe their strategies from the bottom to the top management (Brynjolfsson, Rock & Syverson, 2017). This makes it easy for the whole organization to chase one goal leading to increased understanding and communication.

The advancement in technology has made Apple develop artificial intelligence and the evidence is being observed from its recent operations (Norman, D. (2017). As an illustration, the building blocks of artificial intelligence which have been already set in motion are the numerous server farms having vast renewable energy to be matched, increased relationship with IBM and Watson, a growth in the health networks, purchase of the augmented reality firm Metaio and the recruitment of John Morel who is an expert in robotics.

The introduction of the artificial intelligence was a strategy that Apple chose to avoid lagging behind as it was when Google and Facebook were making great steps in acquisition of future technologies. Take for instance, Google in 2014 made a breakthrough in artificial intelligence technologies when they introduced the DeepMind (Dolata, 2017). With these new trends being used by rival organization, Apple introduced a voice assistant as the first artificial intelligence technology called Siri. Additionally, with the trends in artificial intelligence, Apple has organized a group of artificial intelligence team to research on the building tools and application that will be able to pair with the electronic devices being produced by Apple. Ensuring that innovative strategy aligns within organizations, asking questions within the company categorically such as questions about the customers, organization and the brand. Asking these questions is important in knowing the competency areas of the organization. The company should create an innovation challenge based on the strategic needs of the organization (Helbing, Frey, Gigerenzer, Hafen, Hagner, Hofstetter, & Zwitter, 2017). This will help in redefining the product brand and marketing strategies of the organization. After these investments, the company should evaluate with the help of a matrix to determine areas of improvement.

Innovation trend: Artificial Intelligence (AI)

Innovation is becoming a key strategic driver for organizations across the globe. When it comes to defining innovation, the definition will depend on the type of organizational environment. Innovation is a process in which an organization translates a new idea into a finished good or service that creates value or being purchased by consumers. Organizations across the globe are beginning to realize that innovation is not all about a single genius within the organization but a collaborative effort where employees within the organization contribute towards the creation and implementation of new ideas (Brynjolfsson, Rock, & Syverson, 2017).

Additionally, with the incorporation of the AI into all software. the company has also built a machine that can be used to learn known as Core ML. This is a learning machine that will be able to communicate to their users. According to a press conference released in June 2017, the company had announced that it will be releasing four models and also the iOS 11 to bring new features in their devices that will help to assist consumers while using Apple devices. The users’ actions are logged in where Apple will be using the data collected to predict the behaviors of the users. As a step towards being part of the innovation trends in AI, Apple had introduced the voice assistant Siri (Helbing, Frey, Gigerenzer, Hafen, Hagner, Hofstetter, & Zwitter, 2017).

The artificial intelligence in iOS used by Apple plays many functions such as detecting the patterns of data the application usage by the user. With the information collected, the AI will use a natural language processing and deep learning to establish an interaction with the user based on his/ her preferences as a user. Through pattern recognition and usability behavior, the AI will help in detecting any fraud taking place (Perez, 2018). Some of the application that Apple created to use artificial intelligence include;

• Replica: this is an app found in iPhones. It is capable of communicating with the user in the most natural ways being it is intelligent to an extent of knowing the preferences of the user. The app is capable of behaving like a friend being that the Deep learning neural networks fitted it with a capability to learn and adapt to the needs of the user (Perez, 2018).
• Aipoly: this is an app that was built for visually impaired users. Aipoly uses a computer vision technology. With this type of technology, the app will digitally process images with an object of identifying any object inform of the lens of the camera. The artificial intelligence technologies installed has enabled the app learn from past experiences hence making it easier to interact with the user. Most importantly, the app doesn’t require any internet connectivity (Perez, 2018).
• Seeing AI: this is an artificial intelligent application that Apple built for iOS used by visually impaired person to interact with the environment around them. Seeing AI uses the phone to detect the proximity of objects, detect weather and any other environmental conditions (Perez, 2018). Additionally, the app is intelligent enough to recognize emotional feelings.

Impacts of AI to Apple 

The use of AI will have numerous benefits to the organization. First, with the increase usage of the AI, the company will be able to analyze data through use of neural networks. With the data collected from the user, it will easier for company to detect cases of fraud. The accuracy of the information will depend on the usability leading to collection of more data (Norman, 2017). Secondly, through AI the company will increase its accuracy in data management and collection. AI techniques being used such as deep learning, image recognition can be used to improve consumer experiences while using these gadgets.

The use of AI has also some of its weakness such as the needs of resources which may be expensive to acquire. This is a major setback towards keeping up with the innovation trends and competing with other rival companies (Del Vecchio, Di Minin, Petruzzelli, Panniello & Pirri, 2018). An analysis based of SWOT discovers that, the major opportunities that Apple have is the advancement in technology and the continuous evolving needs. Apple continues to face a major threat from Google and Facebook as they continue to develop future technologies.

Recommendation

Innovation is a complex process hence Apple should find a way to organize its innovative activities. Based on the research found, Apple should first understand the market gap to ensure that they develop new ideas that will able to fill in the needs of the consumers. Planning for innovative activities will require Apple to make efforts in the following areas: organizational culture, organizational processes and appropriate tools. Achieving a culture of innovation, Apple should be transparent and trustworthy. This should be applicable to all the employees (Stark & Stewart, 2011). The cultural actions points will include; informing the employees about the decisions made by the management and rewarding employees based on their efforts a contribution to the organization. When it comes to organizational processes, Apple should be creating new processes that will be supporting ideas in the whole company. Innovation is a process where ideas are brought into tangible products. As a result, achieving this will require tools that will help in the innovative processes (Perez, 2018).

The innovation capabilities that should be developed by the organization include; carrying out an innovation assessment, engaging employees when making innovative ideas, identification of barriers to innovation and employing processes and systems that supports innovation (Stark & Stewart, 2011). An innovative strategy that Apple should pursue is going beyond the expectation of the consumers and rival companies. This will help in creating new ideas that will revolutionize the external environment. Additionally, the company should work in partnership with other organization to generate joint ideas. Creating and capturing value from the innovation will depend on how fast the company understands the needs of consumers, understanding its value proposition and identification of the targeted segments in relation to rival companies.

Conclusion