I need some help explaining these charts please. The first page is a financial statement for Apple inc. the second page is a projected statement for Apple Inc. I have to do a talk over on my powerpoint presentation and I am having a hard time trying to explain these charts. I need some numbers and percentages in it but mostly a script or how to explain these findings. I need to be able to talk at least 2 minutes about each page to cover the time I am suppose to talk all together about the presentation. I am just having a hard time putting all this information I gathered into words.

Income Statement Revenues Cost of Goods Sold Gross Profit Operating Expenses EBIT Interest Expense EBT Tax Non-Recurring Events Net Income 9/26/2015 $233,715,000 140,089,000 93,626,000 23,396,000 70,230,000 0 70,230,000 19,121,000 0 51,109,000 9/24/2016 $215,639,000 131,376,000 84,263,000 24,239,000 60,024,000 0 60,024,000 15,685,000 0 44,339,000 Percent Change -1 -7.73% -1 -6.22% -1 -10.00% 1 3.60% -1 -14.53% #DIV/0! #DIV/0! -1 -14.53% -1 -17.97% #DIV/0! #DIV/0! -1 -13.25% APPLE, INC. Diane Lindsley & Miranda Hendrickson March 3, 2017 Design/Execute Strategy INTRODUCTION Apple Inc. is the technology company that has led the industry with innovation.... VISION STATEMENT To become the world number one's innovator and quality manufacturers of electronic equipment and computer hardware and software. MISSION STATEMENT \"Apple is committed to creating value for the consumers worldwide by adhering to the innovation and quality of our products. We are determined to master the market through the adoption of technology that will enhance the growth of the market share and profitability levels. We value our employees and promise to uphold integrity, quality, excellence, openness, and responsibility in our operations.\" INTERNAL ASSESSMENT STRENGTHS: Innovation with Computers and Phones Create designs that set the trends in the marketplace Brand Loyalty Best in Class Product Assortment WEAKNESSES: Restriction with outside platforms High Retail price point Low Supply - High Demand EXTERNAL ASSESSMENT OPPORTUNITIES: Brand conscious consumers Product Expectations Compatibility with Microsoft Expansion in product line THREATS: Products being compatible with other software Economic Uncertainty Significant increase in competition Dependency on customer loyalty SWOT Analysis: Rapid Innovation Brand Loyalty Create assortment Introduce innovative patented designs BGC matrix RECOMMENDATION: EXPAND COMPUTER RETAIL STORES: Worldwide locations for the exclusive products Product assortment awareness and training assistance with purchase Originality of Apple products and what they have to offer #1 Store front in the world with Sales per Foot in Brick and Mortar Spokesperson to appeal to the younger generation with iconic RECOMMENDATION: products Product line that has a personality, sleek designs, sense of style Influencer for younger demographic to leverage future purchases Cutting edge, elite, product assortment, sought by everyone Build brand awareness RECOMMENDATION: Greater compatibility with other operating systems Customer demands integration Open up an untapped customer base with iTunes Interchangeable operating systems for customer satisfaction EPS/EBIT Click a picture, and then click the Format Picture tab to create your own frames and make picture corrections such as adjusting contrast and brightness or cropping the picture for just the right look. PROJECTED FINANCIAL STATEMENT Click a picture, and then click the Format Picture tab to create your own frames and make picture corrections such as adjusting contrast and brightness or cropping the picture for just the right look. Picture Styles give you great looking \"frames\" in a single click. Apple Strategic Case Analysis Diane Lindsley & Miranda Hendrickson Design/Execute Strategy - BUS - 8993 - A01 Dr. Jake Stewart March 3, 2017 Apple, Inc. (NYS: Appl) _____________________________________________________________ By Diane Lindsley & Miranda Hendrickson www.Apple.com, (Appl) _____________________________________________________________ 2 Table of Contents: OVERVIEW___________________________________________________________4 TIMELINES AND MILESTONES_________________________________________5 APPLE EXECUTIVE TEAM & ORGANIZATIONAL CHART _______________6 VISION STATEMENT__________________________________________________7 MISSION STATEMENT_________________________________________________7 OBJECTIVES AND STRATEGIES_______________________________________8-9 REVISED VISION AND MISSION STATEMENTS___________________________9 EFE MATRIX________________________________________________________10 IFE MATRIX_________________________________________________________11 CPM________________________________________________________________12 SWOT MATRIX______________________________________________________13 SPACE MATRIX______________________________________________________14 BCG MATRIX________________________________________________________15 IE MATRIX__________________________________________________________16 GRAND STRATEGY MATRIX_____________________________________________________________17 QSPM________________________________________________________________18 RECOMMENDATIONS______________________________________________19-21 CURRENT FINANCIALS CHARTS & PROJECTIONS____________________22-24 REFERENCES________________________________________________________25 3 Overview: Apple Inc. is the technology company that has led the industry with innovation, product design, and revolutionary product development within multiple different industries. Their focus is on technology, but they cross multiple different platforms with computers, music warehousing & download, and mobile phones. Apple has always differentiated itself from the competition by knowing and designing what the customer wants before the customer even knows that they wanted it. This intuition is what makes them the leader in the marketplace and a position that Apple intends to keep. Over the years, Apple has become a cult brand, thanks to products like iLife, iTunes, QuickTime, and the iMac lines, just to name a few. With a focus on design, simplicity, highly advanced technology and an unparalleled sense of luxury Apple has created an assortment that is the cornerstone of the company. Apple Inc. has developed features and benefits that are unique and best in class in the market today. Some of those products we know as iMac, iPod, iPhone, Apple Watch, and iPad. With the incorporation of the features and benefits, Apple developed these products with the customer in mind, creating a convenience that is unprecedented and creating a revolutionary era throughout the marketplace. As we selected Apple Inc. as a company to review we were pulled to their philosophy of \"think differently.\" As Apple has developed products throughout the market that are unique, simple, creative, topped off with luxury, you can't help but to be drawn to what this company can accomplish. With all of these attributes, they are also a very financially successful and profitable company as they continue to challenge their goals and objectives, to continue to create with the customer in mind. Apple may have started in the United States, but they are now a globally spread company with brick-and-mortar stores in 18 countries. You can also purchase Apple products from retailer across the United States. To assist with the international sales, they operate 23 international websites so that customers from 23 additional countries can purchase Apple products. Based on the technological developments, we are not certain that the Apple products are a luxury but now may be considered a necessity throughout the market. Not only does the simplicity, innovation, and creativity create a desire for the product, but there is also a relationship of trust as each product is launched. Owning products from Apple can help simplify your life. 4 5 Apple Executive Team: 6 Vision Statement: Current: Apple's current vision statement was introduced by CEO Tim Cook, \"We believe that we are on the face of the earth to make great products and that's not changing. We are constantly focusing on innovating. We believe in the simple not the complex. We believe that we need to own and control the primary technologies behind the products that we make, and participate only in markets where we can make a significant contribution. We believe in saying no to thousands of projects, so that we can really focus on the few that are truly important and meaningful to us. We believe in deep collaboration and crosspollination of our groups, which allow us to innovate in a way that others cannot. And frankly, we don't settle for anything less than excellence in every group in the company, and we have the self- honesty to admit when we're wrong and the courage to change. And I think regardless of who is in what job those values are so embedded in this company that Apple will do extremely well.\" (Lashinsky, 2009) Mission Statement: Current: \"Apple designs Macs, the best personal computers in the world, along with OS X, iLife, iWork and professional software. Apple leads the digital music revolution with its iPods and iTunes online store. Apple has reinvented the mobile phone with its revolutionary iPhone and App store, and is defining the future of mobile media and computing devices with iPad.\" (Federighi, 2012) 7 Objectives & Strategies: Apple has created a list of objective and strategies that will continue to move the company forward. In the technology market, they are the market leader and will continue to stay in that position as long as they focus on the four P's that will continue to build their company. The four P's are product, place, price, and promotion. Product: Maintaining the highest level of market share by offering premium products at a premium price, which in turn will achieve high-profit margins for the company. To make this initiative, they will continue to do as they have always done, create groundbreaking products as they innovate the design and features needed for future technologies. As trendsetters, the customer base will only expect the unexpected and Apple has always provided. However, to stay on top, they will need to strengthen their research and development team to stay ahead of the curve. They have swift competition that is coming at them from multiple directions, they will have to stay active and innovate to continue to stay on top. They also have to overcome complacency, they are the market leader, but that is their current state, they cannot stay in one place and expect to remain on top. Place: While Apple is a global company and you can find an Apple product at just about any location around the globe, they have to stay on top of supply to keep that trend going. A significant amount of their sales will come from their Apple store locations however to stay they will have to expand their distribution. Expand their presence online and with Big Box retailers so that their product assortment and accessories are available to the masses. While the demand is on the rise, make sure that you have the product in the customer's hands before they can decide to align with another brand. Availability is key to the continued success of the brand. The Apple customer is loyal but it there is an issue with the supply and demand, there are other alternatives that are just as sleek and innovative, don't allow your customers to leave you for just another brand. Price: When you are dealing with a superior quality product, you are also dealing with a premium price. Keeping your profit markets high at the same time that you are gaining market share is a balancing act. Cutting edge product assortment with features and benefits that exceed the 8 competition, this will allow you to keep your prices higher than your competition and sustain premium pricing. Brand and quality of product assortment will keep your customers coming back. If they continue to focus on lowering cost so that they are more efficient this will allow them to keep your pricing in the market, just don't allow quality to take a hit for this initiative. Promotion: Apple is the best in class for marketing campaigns and promotional strategies. They have mastered building hype and creating anticipation with all new product launches. Customers will wait in line for days just to be the first one to get the new, latest and greatest product. In many cases, you didn't even know that you needed the product, but now you can't live without it. Their strategy of the annual conferences allows the demand to grow high before the product even hitting the shelves. When you have the name Apple in your corner, you are trendsetting. Continue to set trends, innovate within new product lines and take share, which will allow you to dominate the competition. Vision Statement: Revised: , To become the world number one's innovator and quality manufacturers of electronic equipment and computer hardware and software. Mission Statement: Revised: , \"Apple is committed to creating value for the consumers worldwide by adhering to the innovation and quality of our products. We are determined to master the market through the adoption of technology that will enhance the growth of the market share and profitability levels. We value our employees and promise to uphold integrity, quality, excellence, openness, and responsibility in our operations.\" 9 EFE Matrix: The provided EFE (External Factor Evaluation) matrix reveals the threats and opportunities of Apple Corporation. The EFE matrix shows ten opportunities and ten threats for Apple Inc. The opportunities comprise the extensive product line, online existence, fewer viruses on Mac computers of Apple, high tables sales, stores of Apple at universal scale, high demand of Apple brand, etc. The threats comprise economic insecurity, less compatibility of Apple's software with other, escalating competition, high expectations of consumers, etc. The ratings for threats and opportunities clearly signify that Apple has more opportunities instead of threats since the ratings for opportunities are in high range, either 3 or 4. However, the major ratings for threats are 1 or 2, except two threats that have high score 4. These two threats are augmented competitions and high expectations and demands from consumers for the products of Apple. The fewer ratings of threats signify that these threats can be tackled with good efforts. The total weighted score of EFE matrix is 3.26, which comprise significant dominance of opportunities. Consequently, EFE matrix signifies the high position of Apple Corporation in its outer environment. 10 IFE Matrix: The provided IFE (Internal Factor Evaluation) matrix reveals the weaknesses and strengths of Apple Corporation. The IFE matrix also shows ten strengths and ten weaknesses of Apple Inc. The advantages of Apple comprise its innovative approach, focused marketing, being a trendsetter, advanced products, significant budget, strong loyalty, and control on pricing in the market, best consumer service, and exclusive retail stores. The weaknesses comprise limited marketing, less compatibility of its software products with outer hardware products, dependency on new launches, slow turnaround and high demand, etc. The ratings for weaknesses and strengths clearly signify that Apple has more strength instead of weaknesses since the ratings for strengths are in high range, either 3 or 4. However, the major ratings for weaknesses are 1 or 2, except two threats that have zero rating. These two weaknesses comprise the short life cycle of products and lack of OPP assortment. The lower ratings for the weaknesses make it clear that the Apple has fewer weaknesses. The total weighted score of IFE matrix is 2.42, which comprise dominance of strengths. Therefore, IFE matrix signifies the strong position of Apple Corporation in its internal environment. 11 CPM Matrix: The CPM matrix makes a comparison among the success facets of Apple, Dell and Samsung Corporations. The scores of the three corporations are compared by their price competitiveness, financial position, brand name, management experience, advertising, product quality, market share, innovation, product assortment, and e-commerce. The total score of these entire ten facets is higher for Dell that is 2.86, although Apple and Samsung have the same total score that is 2.67. The scores are computed by ratings given to each success facets of these corporations. The ratings are given in the range of 2, 3 and 4. As we review the competition, Apple is being attached on all sides. Apple plays in the computer industry with Dell and HP; both are strong competitors in the computer industry. Apple also has a significant presence in the phone industry, and they are competing with Samsung and LG. Both markets have active players with a foothold in their perspective markets, Apple cannot stand still, or they will be left behind. 12 SWOT Matrix: The SWOT matrix describes the SO, ST, WO, and WT strategies. This model describes the role of brand loyalty and product innovation for the Apple Corporation in gaining the attention of its consumers. However, these two aspects also enhance the customer's expectations from Apple, which increase the need for more innovations for Apple. Also, the necessity of increasing marketing and production line for Apple has been mentioned in the matrix. 13 SPACE Matrix: The SPACE matrix compares the position of Apple with Dell and Samsung. External and internal analyses have been performed to specify the position of Apple. The comparison of the SPACE Matrix has been made by the following four facets, FP (Financial Position), SP (Stable Position), CP (Competitive Position), and IP (Industry Position). The position of Apple has been described by a number of central facets (liquidity, product quality, cash flow, leverage, market share, etc.) and outer facets (growth potential, inflation rate, profit potential, competitive pressure, etc.). FP and CP belong to internal analysis, and SP and IP belong to external analysis. The matrix clearly signifies that the competitive position and stable position of Apple is not good, although Apple does have strong financial position and industry position. From the plane, it can be seen that Dell does have a more stable FP (5.0) than Apple (around 2.5). However, the IP position of Apple (around 3.0) is stronger that Dell (1.0). The SP of Samsung is great that Apple and Dell. 14 BCG Matrix: A BCG matrix is a diagram that classifies a company's products as either question mark, rising star, cash cows, or dogs depending on the market potential of the products. If we start with the Dog products, it would have to be the Apple's TV product. It had the potential to take over the TV market, but the product was expensive and slow to market. As we round the corner to the Cash Cow, the iPod is a well-established product line but with the continued advancement of the mobile phone, the need for an MP3 device may have a shortened life span. This product is still a viable product for the moms and dads that want their children to have some mobility but not a phone. The stars of the show would have to be the iPad and the iPhone product line. Both have growth potential in the marketplace and customers embrace the technology. The last category is the Question marks and the Mac computer would fall within this category. The computer is best in class but the customers do not understand or believe that the price is worth the product. The competition is strong with HP and Dell within this category. 15 IE Matrix: The IE matrix describes the position of Apple Corporation by IFE and EFE weighting scores given to it. Together the IFE and EFE scores are provided in the range of 1.0 to 4.0 points. The IFE weight rating is weak at 1.0 and becomes strong up to 4.0 points. Likewise, IFE weight score is low 1.0 and becomes high up to 4.0 points. The total IFE weighted score of Apple is around 2.0 points that is in the middle of the horizontal line, although the EFE weighted score of Apple is near to 4.0 points. Therefore, EFE weight of Apple is high than its IFE score. Concluding, the position of Apple is strong as per the IE matrix. 16 Grand Strategy Matrix: As we review the Grand Strategy Matrix for the product assortment within the Apple Brand, here is what we find. There are multiple products that fall within the question marks and the stars, while others fall within cash cows. The total Apple program and the iPhone and the iPad are in a strong competitive position and have rapid market growth. The company created an industry with both products that the customer didn't know they needed or wanted until they understood what they were missing. There is brand loyalty to the product line, and Apple continues to innovate and expand the customer's imagination. The other categories are stable but; they have other opportunities that hold them back from being top performers. The Apple Watch was second to market, and Fitbit had already created a foothold in the marketplace. The Fitbit products are similar in functionality, but Apple customers already purchased the Fitbit product and have no need for the Apple Watch product at this time. There is also the issue with the high price point for the product. The Apple Watch and the ITunes program have the same issue; they are only compatible with iOS devices, which limits their reach. This is a philosophy that Apple will either continue to embrace or they will need to open up their platform, which will increase the customer reach. 17 QSPM: The QSPM matrix describes the weight for the AS (Attractiveness Scores) and TAS (Total Attractiveness Scores) by weakness and strengths. There are ten strengths and ten weaknesses mentioned in the matrix. As we review the strengths, weaknesses, opportunities, and threats, we can see that both options are viable for growth within the Apple initiatives. Opening a computer retail store and engaging with other operating systems will give the customers that they have been asking for within the product assortment. 18 Recommendations: Strategy 1 Open six additional computer retail stores across the world (not just peripheral and accessories). Currently across the United States and Internationally, Apple has brick and mortar locations that only sell peripheral and accessories. If in the existing locations and the new locations, they add hardware to the sales floor. This will help bring awareness to the product assortment and offer assistance to the purchasing of the goods. Once you get the product in front of the customer, they will learn more about what the product can do and feel more comfortable with the larger purchase. The increased awareness will allow the customer and the employee explore the originality of the Apple products. 2 percent increase over the next two years in sales representatives for the computer hardware. Implementation & Results: Determine optimal location for Flagship retail store environment Select cities and countries will offer incentives to be the home of an Apple Store Budget to build in each location $27M (based on Chicago location) Create marketing hype for grand opening location This aligns with the current strategy for Place; increase their presence and expanding the Apple stores globally. Timetable: Six to Nine months to finalize location Nine months to build Flagship store location Coordinate Grand Opening with yearly launch of key product assortment Annual Objectives & Policies: Sales Increase over the next 2 years Profit increase with efficiencies from each new location - tax incentives Continued Brand awareness across the globe Strategy Review & Evaluation: Review store-by-store reporting - mall location vs. brick and mortar stand-alone locations. Continued Sales and Profit increase within each location 19 Strategy 2 Establish a spokesperson that will bring awareness to the sleek design, innovation, and the product specifications so that you can attract younger generations to buy into the product line and benefits of the products. Partnering with the right spokesperson can link them with Apple products and invoke a sense of style, memorable content, and unique product assortment. This influencer can leverage future purchase decisions as the customer continues down the path to obtaining products. Contracting one music spokesperson estimated $6 million. Implementation & Results: Align with top talent to become a spokesperson for the brand Align goals and initiatives between the company and the individual or group Create brand awareness within another demographic Establish relationship with Apple Brand and individual with product assortment/selection This could align with the strategy for Price: Creating a spokesperson for the brand will allow influence over a younger demographic within the industry, creating the illusion of cutting edge product assortment that is sought after by the elite. Timetable: Nine months to create a relationship with the right talent Launch relationship during music festivals - Coachella Annual Objectives & Policies: $6 Million to align with talent (yearly) $2 Million to advertise the relationship Sales increase for the primary product assortment Increased attach rate for accessories Increased profit for increased attached rate for accessories Younger brand awareness Strategy Review & Evaluation: Review relationship between Apple Brand and individual determine to attach to product assortment Increased sales and profit based on attach. Strategy 3 Add more features to current products for greater Windows / Intel compatibility. Features 20 such as iTunes software compatible with Windows based computers, Office programs loadable from PC installation disk (This would require a software agreement with Microsoft). Increasing the market share over the next 2-3 years by 30 percent will allow all product line to diversify and give the customer what they have been asking for with product development. $50 million is the estimated cost for Research and Development to create products that are compatible with both operating systems. Implementation & Results: Create opportunities that will open up other platforms to work within your environment Align goals between software giants Give the customer what they want and see the results Does not align with the Apple strategy but does align with the customer's needs. In the business world, the Apple customer is working on systems that are powered by Microsoft and Intel. They then have the Apple program on the personal devices. The customer wants more integration and smoother transition from one system to another. Timetable: One year to negotiate with other industry leaders One year parallel timeline to create compatible programs for integration Annual Objectives & Policies: Document attach rate for the new products Clear cut policies with what is acceptable between the organizations Strategy Review & Evaluation: Attach rate for the software Customer acceptance and integration Sales and profit increase Current Financial Charts & Projections: 21 22 23 24 Resources: Apple's Pricing Strategy - SlideShare. (n.d.). Retrieved from http://www.slideshare.net/pramodghadshi/apples-pricing-strategy Highly advanced technology simplicity and design and ... (n.d.). Retrieved from https://www.coursehero.com/file/plf3rdu/Highlyadvanced-technology-simplicity-an Lashinsky, A. (2009, January 22). The Cook Doctrine at Apple. http://fortune.com/2009/01/22/the-cook-doctrine-at-apple/ Craig Federighi, Apple's Vice President of Mac Software ... (n.d.). Retrieved from http://www.apple.com/pr/library/2012/08/27CraigFederighi-Apples-Vice-PresidentMolina, B. (2016, April 01). The 40 biggest moments in Apple history. http://www.usatoday.com/story/techews/2016/04/01/40biggest-moments-apple-history/82430458/ Linzmayer, O. W. (2006, March 30). 30 pivotal moments in Apple's history. http://www.macworld.com/article/1050112/macs/30moments.ht ml?page=0 25