Apple invested more than $1 billion dollars in the North Carolina center that wi

Question

Apple invested more than $1 billion dollars in the North Carolina center that will host the iCloud. For them to do so, they must perceive the iCloud to be a key component of their future. Using the principles listed in Figure 3-12 (page 88), explain all the ways that you believe the iCloud will give Apple a competitive advantage over other mobile device vendors

Figure 3-12 states:

Product Implementations:
1. Create a new product or service
2. Enhance products or services
3. Differentiate products or services

Process Implementations:
4. Lock in customers and buyers
5. Lock in suppliers
6. Raise barriers to market entry
7. Establish alliances
8. Reduce costs

Explanation / Answer

Apple Inc. can lock in customers by making it difficult or expensive for customers to switch to another product. This strategy is sometimes called establishing high switching costs. they can lock in suppliers by making it difficult to switch to another organization, or, stated positively, by making it easy to connect to and work with the organization. Finally, competitive advantage can be gained by creating entry barriers that make it difficult and expensive for new competition to enter the market. Another means to gain competitive advantage is to establish alliances with other organizations. Such alliances establish standards, promote product awareness and needs, develop market size, reduce purchasing costs, and provide other benefits. Finally, Apple Inc. can gain competitive advantage by reducing costs. Such reductions enable the organization to reduce prices and/or to increase profitability. Increased profitability means not just greater shareholder value, but also more cash, which can fund further infrastructure development for even greater competitive advantage.

Consider the following possibility: You work hard, earning your degree in business, and you graduate, only to discover that you cannot find a job in your area of study. You look for six weeks or so, but then you run out of money. In desperation, you take a job waiting tables at a local restaurant. Two years go by, the economy picks up, and the jobs you had been looking for become available. Unfortunately, your degree is now two years old; you are competing with students who have just graduated with fresh degrees (and fresh knowledge). Two years of waiting tables, good as you are at it, does not appear to be good experience for the job you want. You’re stuck in a nightmare—one that will be hard to get out of, and one that you cannot allow to happen. Examine Figure 3-12 again, but this time consider those elements of competitive advantage as they apply to you personally. As an employee, the skills and abilities you offer are your personal product. Examine the first three items in the list, and ask yourself, “How can I use my time in school—and in this MIS class, in particular—to create new skills, to enhance those I already have, and to differentiate my skills from the competition?” (By the way, you will enter a national/international market. Your competition is not just the students in your class; it’s also students in classes in Ohio, California, British Columbia, Florida, New York, and every place else they’re teaching MIS today.).

following are the points & example highlights the ways due to which iCloud will give Apple a competitive advantage over other mobile device vendors

APPLE, Inc.3 investment of $1 billion dollars in the North Carolina center. From its inception, APPLE invested heavily in iCloud and led the mobile industry in the application of storage and information systems for competitive advantage. Here we consider one example of an information system that illustrates how APPLE successfully uses iCloud to gain competitive advantage. APPLE maintains customer account data that include not only the customer’s name, address, their files & other folder , but also data about the identity of that customer and the locations where they resides. When the APPLE system creates the form, it fills the Company name drop-down list with the names of companies that the customer has shipped to in the past. Here, the user is selecting Prentice Hall.

When the user clicks on the Company name, the underlying APPLE information system reads the customer’s contact data from a database. The data consist of names, addresses, and phone numbers of recipients from past shipments. The user then selects a Contact name, and the system inserts that contact’s address and other data into the form using data from the database. Thus, the system saves customers from having to reenter data for people to whom they have shipped in the past. Providing the data in this way also reduces data-entry errors. On the right-hand side of this form, the customer can request that APPLE send email messages to the sender (the customer), the recipient, and others as well. The customer can choose for APPLE to send an email when the shipment is created and when it has been delivered.

The customer wants all three addresses to receive delivery notification, but only the sender will receive shipment notification. The customer can add a personal message as well. By adding this capability to the shipment scheduling system, APPLE has extended its product from a package-delivery service to a package- and information-delivery service. It has generated a shipping label, complete with bar code, for the user to print. By doing this, the company not only reduces errors in the preparation of shipping labels, but it also causes the customer to provide the paper and ink for document printing! Millions of such documents are printed every day, resulting in a considerable savings to the company. Note that only customers who have access to the Internet can use this shipping system.

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