Comparison of Environments

of US and Pakistani
Companies
How environmental forces change the polices of a company


Monday, September 29, 2014
Syed Hashim Shah
2012377
Assignment: MS 311 (Industrial Management)
Submitted to Dr.Ijaz




Introduction
This assignment aims to explore the environments of companies and their strategies to manage
the dynamic environment. The companies chosen for study are Apple Inc. a US based
Company and Q-mobile, A Pakistani Mobile brand. The purpose of the study was to explore
how these two companies have successfully established themselves and have coped with
dynamics of environment. This work also will take insights in organizational culture of both
environments.
These two companies were chosen as they have brought innovation and have done huge
business. Companies belong to same domain in their services and products, and study aims to
study the business environment of company in a specific setting. US has glaringly different
culture and values from Pakistan. They have different history, different approach to social lives,
different norms and social practices. In Pakistani Society, Religion plays a very important role.
For example only halal foods have market here. Alcoholic drinks, pork, etc are frowned upon.
Along with That Pakistan is a Agricultural Country which is in a state of slow transition towards
industrialization. On the Other hand US is the world strongest Economy and heavily
industrialized country represented by its 2
nd
rank in CO2 emissions by consumption of fossil
fuel. Keeping in view, economic environment, socio cultural values, we have tried to analyze
both organizations.













Apple Inc.



Introduction
Apple Inc. fabricates and produces consumer electronics and their operated softwares and
applications. Apple is one of the giants of electronics markets for its innovation, quality, and
customer care. Based in Cupertino, California Apple has a worldwide network of stores. Its
most famous products are machintosh (Mac) , Ipods, and Iphones. Apples has roughly 50,000
employees throughout the world making it a distinctive multicultural organization. In 2010
Apple had a record revenue of $20.34 billion.

History
Apple was founded on April 1, 1976 by Steve Jobs, Steve Woznaik and Roland Wayne to sell
their home-made Apple I computer. In 1989-1991 Apple Introduced its Power Book and laptop
style computers. In 2006 Apple switched all its electronics to Intel Chips, giving it a further
boost in production and sales. Later in 2007 it revealed it iPhone and now latest version of
Iphone is iPhone 6. Now its planning to introduce iWatch, a smart watch with apps etc.

Apple Inc Mission Statement:
Apple is committed to bringing the best personal computing experience to students, educators,
creative professionals and consumer around the world through its innovative hardware,
software and internet offering.

Apple Inc Vision Statement:
Man is the creator of change in this world. As such he should be above systems and structures,
and not subordinate to them.

Business Envronment of Apple


External Environment:Any organization takes it resources (material, human) from the
environment and delivers products and services to the environment. Therefore, external
environment plays a pivotal role in shaping a company. Considering Apple Inc. We observe
following external factors influencing apple

Political: Apple is based in America and economy is pretty stable there with high taxations.
These increases in taxation force the company to raise prices and customer purchasing power
will drop down. The countries are politically stable and also Apple has huge reserve to help it
stabilize in times of crisis

Economical: Apple has a worldwide market, so it has to consider various factors while planning
business ventures in different areas. Population, purchasing power, lifestyle, fashion and trend,
religion and culture. Religion, culture and ethnicity etc profoundly affect the applications used
by users. Apple devices use softwares specifically designed for Apple. Lack of such software
would reduce the demand of the devices

Technological Trends:

Tech trends change with time in any society. Morphing the products with time, innovation and
meeting social needs is an important factor. For example earlier MP3 Players were not that
versatile, now with IPod, we have a range of options at our disposal to play music.

Legal issues:
Governmental and safety policies change with time to ensure public safety. If some company
doesnt respond by complying to legal requirements, the company can be sued, issued a legal
notice, closed etc. For example toxicity of materials used in Apples devices, Issues regarding
disposing the out dated technology,

Environmental: It focuses on recycling consideration, amount of pollution created by product
or services. Apple is electronic organization so it has to consider its packaging that it can be
recycled, also the materials used should be environment friendly. Energy Effieciency of devices
is also important in reducing the energy consumption facilitating users as well reducing
pollution.


Porters Five Forces Analysis
Michael Porter in his book competitive strategy in 1980s, outlined five basic forces which
shape an organization.
Supplier Power
Buyer Power
Threat of New Entrant
Threat of Substitute
Competitive Rivalry


Supplier Power: At the core of any electronic device is its processing chip so Apple buys its
chips from Intel which is one of the leading and most successful provider of chips. In this regard
Intel has significant power over Apple. Other choices that apple has for cost and quality issues.
Buyer Power: When Buyers have strong influence on the company, buyers have power to buy
or not buy that product we say that Buyer has power. This power is given to buyer by
competitors of that company
Threat of new Entrant: The narrower the domain of company, the likely its to get competitors.
Apple is electronic specific company, which makes it vulnerable to threat of new entrants.
Threat of Substitute:
Apple has higher prices than others companies selling smart phones in the market. These are
more customizable and user friendly. An example is Samsung Galaxy smart phones. Apple
Produces Music players, Computers and cell phone and there are many companies who sell
such featured products for the same price. So competition is fierce.

Competitive Rivalry
Competition between existing companies for taking a greater portion of sales. This includes
reduction in prices, promotional offers, extra free features etc. Apple prices are currently higher
than their counter parts. Quality aside, but other companies offer same features of almost
same quality with significantly low price. Therefore threat level is very high for Apple.

Countering Threats:

A brand name: Apple has earned a brand name. It can be seen in the society that people go for
brand name instead of checking quality or seeing their needs. Like a trend in the society,
everyone wants an idevice.
Quality: Despite the variety of products available in market, users claim that Apple products
run much more smoothly. Along with that aesthetic design of Apple products also gives them
an edge over other products.
Organizational Culture:
Organizational Culture means the beliefs, norms, values that employees follow. It gives us a
feel of that organization. Geert Hofstede gave some parameters about culture, the cultural
dimensions.
Geert Hofstede Cultural Dimensions:

Hofstede found five different cultural dimensions in his study of interaction between national
and organisational culture.
Power Distance: represent the power within the society is divided equally or unequally and
what extant society accepts this power distribution.
Individualism: individualism is the one side against its opposite. Individualism/ collectivism
represent the people act according to self interest or the interest of group.
Masculinity: masculinity against its opposite femininity represents the distribution of role
between genders.
Uncertainty Avoidance: it refers the member of the society requires structure and boundaries
at work place. High uncertainty avoidance societies are intolerant of risk. Low uncertainty
avoidance societies are where risk and anomaly widely accepted.
Long-term Orientation: it refers to society accent attached to future against the present and
past. In long term people appraise action and approach that affect the future and in short term
people appraise action and approach that affect present and past.


Suggestions
Apple is a worldwide organization, making it an effectively multicultural company. Focusing on
the head quarters in America, we see more individualism in the company. America is a highly
individualistic society. Also the power distance within the organization is very low. Apple is
highly future oriented. It has low uncertainty avoidance, innovates and ventures new products.
There is little effect of gender difference on work performance and duties.
Apple doesnt have a wide network of retailers and distributors. e.g. there are about only 300
official Apple stores in UK. With increased networking they can reach a wider range of
customers. Lowering prices can also boost its sales.
Though the Apple itself provides complete set of
services to its users, many users attempt to jail-break
the devices which mean that now any operating
system can be installed on Apple devices which apple
highly disdains. This limitation, keeps a lot of
customers from buying Apple Products.



Q mobile
Introduction
Q-mobile is a brand of Digicom has recently appeared in the market. Q-mobile is new but
Digicom has a successful history in selling cellular phone services in Pakistan. In a short span of
time, Q-mobile has been able to make a significant impact on Pakistani market. Oweing to its
future orientation and extensive Research Facilities, it has garnered a significant portion
Consumer electronics. Starting with simple bar phones and then becoming the seller of worlds
slimmest Smartphone, it has left many in awe. Then moving to QWERTY Era, and from Social
Networking & high-end Music phones to the feature-based business phones; Q-Mobile is on a
road to overcome the technological barriers and provide a complete mobile lifestyle
solutions. Its featured products include simple phones, Qwerty, noir-Smartphones, and now
tablet PCs. Its comparatively low cost than market giants makes it a viable option for a majority
of consumers in Pakistan. Infact, Q has sweeped the markets in a short span of time. Its a
brand that is accessible to every social strata.



Mission Statement:
To develop path-breaking technologies and efficient processes that incubate newer markets,
enliven customer aspirations and continue to make Q-Mobile a trusted market leader amongst
people.



Environment:
Any organization takes it resources (material, human) from the environment and delivers
products and services to the environment. Therefore, external environment plays a pivotal role
in shaping a company. Considering Q We observe following external factors influencing it:

Political: Pakistan has always been through political turmoil and fluctuating policies. Such
circumstances make it difficult for companies to survive and reach their full potentials. Still Q
has managed to trickle through all the political instabilities. Political factors include government
regulations and legal issues and define bothformal and informal rules under which the firm
must operate. Some examples include:
tax policy

employment laws

environmental regulations

trade restrictions

political stability
All these factors should be kept in mind while the functioning of the
organization takes place. For the success of any organization, political
relations should be good so that it in favor of the development of the
economy.
Economical:
Pakistan has very unstable economy; purchasing power of the common man has decreased
over the years. Q has targeted every social strata of Pakistan. Followiing economic factors must
be kept in view:
Economic Growth Rate
Inflation rates
Value of Currency


Technological Trends:
Q has effectively responded to changing tech trends of Pakistan. Pakistan majority population is
young and shows keen interest in electronic devices. It has produced devices meeting the
pocket power of all customers, yet keeping the most wanted features at a low cost! In its low
cost models, It has compromised a bit a on display and size of the phone, yet has added camera
features, video and audio playing and recording features, radio and SD card feature. And that
too around the cost of 2000 rupees.
Legal issues.
Governmental and safety policies change with time to ensure public safety. If some company
doesnt respond by complying to legal requirements, the company can be sued, issued a legal
notice, closed etc. Though law enforcement is not that strict in Pakistan, yet maintaining ethical
standards helps in creating an image internationally.

Socio Cultural trends:
Society is what a company delivers product too. Demands of society and social factors must be
kept in mind while manufacturing. They must analyze
Age distribution
Career inclinations
Population growth rates
Safety
Technological demands of consumers.
Q-Mobile mainly has four standards (GSM, Wi-Fi, Application and Multimedia) and about 85%
are Multimedia users. Multimedia is the main thing on which Q-Mobile are focused. Since
2008, Q has introduced 17 different cell phones all equipped with multimedia facilities and low
cost.

Pakistanis have low purchasing power. The quality nokia Phones are costly for an average
Pakistani where as low cost China phones have very serious problems in their software
updating and very crude features. Q mobile combines Quality and Low cost in a single package.
Therefore customers are moving towards Q mobile more and more.


Porters Five Forces Analysis
Supplier Power: At the core of any electronic device is its processing chip so Q buys it chipset
from British Based Company ARM Holdings plc. In this regard ARM has a significant power over
Q, as there are no other chipset providers apart from costly giants like Intel
Buyer Power: When Buyers have strong influence on the company, buyers have power to buy
or not buy that product we say that Buyer has power. This power is given to buyer by
competitors of that company. Pakistani buyers have high power over Q due to presence of
alternate brands of low cost like Nokia, China mobile, Sony Ericson.
Threat of new Entrant: The narrower the domain of company, the likely its to get competitors.
Q is electronic specific company, which makes it vulnerable to threat of new entrants. O
Threat of Substitute:Q has lower prices than others companies selling smart phones in the
market. These are more customizable and user friendly and low cost. Substitute include HTC,
Motorola and Galaxy phones in smart phone range, while nokia Sony Ericson and china mobile
are fierce rivals in low budget phones.

Competitive Rivalry
Competition between existing companies for taking a greater portion of sales. This includes
reduction in prices, promotional offers, extra free features etc. Q keeps its prices from its rivals
to attract more customers. Many persons still prefer Nokia which is an established brand and
has proven Quality. It will take some time for Q to make a brand name. Six companies in
Pakistan that are currently present in the cellular market are
1. Nokia
2. Q-Mobiles
3. Samsung
4. LG
5. Chine
6. Other
9- SWOT Analysis:
STRENGHTS
User friendly
Long time battery
Second position in market
Brand availability
Well-known brand
Extra accessories
Wi-Fi
Wide model range
Touch screen
Weakness
Technical weakness
Small users
No information in rural areas
No awareness
Physiological matters

Countering Threats:
Low Cost: Q offers Quality in afforadable prices, this has been a plus point for Q to increase its
market. Its phone are stable, strong body, Long battery lives make it a viable choice for
common person.
Promotions and Adverstising: Q has spent a great amount on advertisements in print and
electronic media. Along with that it has used several promotional tricks like gifts, free offers etc.





Marketing Strategy:

Q has benefited from the exceptional popularity of Indian Actresses in Pakistan like Kareena
Kapoor and Sonam Kapoor. Singers Like Atif Aslam etc. Q has targeted Young generation for its
smart phones and tablet devices.
The target market of Q-Mobile is as follows:
Youth
Sms conscious people
Multimedia conscious people
Middle class people
Internet surfing people
With the introduction of 3G and 4G services, Internet users are likely to rise in number and
sales of 3G based phones are likely to increase.



Comparison of Apple Vs Q environments

Both consumer Electronics companies manufacturing Phones and Tablets. Apple is an
established Global Brand, While Q is still within the boundaries of Pakistan. Q has been through
the fluctuating economy of Pakistan and is surrounded by customers of Low purchasing power
mainly interested in Multimedia, while in America, Apple products are being used for
education, business, and multimedia and in many other domains. Apple operates and sells in
an individualistic environment, people making independent choices. On the other hand
Pakistan is a collectivist society, needs of family come before Personal luxury. Therefore
penetrating such a market requires high business acumen. As bollywood films are very famous,
they have casted Kareena Kapoor and Sonam Kapoor in their ads to boost sales. Q specially
targets young generation, providing them with multimedia facilities. While Apple is used by
Americans for Education, Business plans, Music, Information management. This puts a pressure
on Apple to give a well rounded product with smooth activity while in use.