The Internal and External Analysis of a Firm

The environmental influence has been discussed in this section by a PEST analysis
Political: Apple operates in more than a hundred countries (Apple, 2015). As a result, the political relationship between the home country and the host countries influence the business activities of Apple. The political structure is responsible for international trade taxes and other regulations. Moreover, the company outsources its manufacturing operations in other countries particularly in China (Moyer, 2012). As a result, the company needs to abide by the work regulations and worker rights of the host country.Economic: The global economic structure influences the success of the business operation of a firm. The economic condition affects the affordability of the consumers, which is reflected in the sales volume of the company. The weak economic condition of 2012 had negatively influenced the sale of iPhone. It had also decreased the stock price of the company by 3.8% as well as reduced the profitability of the company (Reuters, 2012).

Social: The social structure impacts the purchasing behavior of consumers. The rapid integration of technology in the daily life of the consumers has led to increased preference of the iPhones. The innovative feature of the iPhone has attracted a huge customer base. Moreover, the rise of the hectic lifestyle of the customers has increased the popularity of the iPhone and its usability to make life easier by better connectivity and activity organizing applications.

Technological: The global technological advancement has allowed Apple to incorporate innovative features in the iPhones. This, as a result, has increased the value addition of the product thereby attracting a large customer base. Adding innovative features to newly launched iPhones has allowed Apple to achieve a competitive advantage over its rivals.