Capstone, Assignment 4

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BUS 499
Capstone
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Company Background Mergers and acquisitions are as old as business itself. In 2014 mergers and acquisitions are happening at an alarming rate. In May, 2014, Apple announced it would acquire Beats Electronics for $3 billion dollars. Apple is an international corporation co-founded by the late pioneer Steve Jobs. Apple’s current CEO is Tim Cook. He has previously worked for its competitors, Compaq and IBM. Apple has insisted on improving the way their suppliers treat their employees around the globe. The company recently posted the following to their website: We’ve strengthened our programs to help suppliers protect student interns and other at-risk workers. We’re continuing our efforts to end excessive work hours. In 2013, our suppliers achieved an average of 95 percent compliance with our maximum 60-hour workweek. We’re driving responsible sourcing of minerals, and we’ve publicly released a list of smelters and refiners in our supply chain to promote transparency (Corporate Responsibility, 2014). The Beats Electronics acquisition brings an electronic company that specializes in headphones and speaker technology. Beats Audio is the technology behind the brand. The brains behind the brain of Beats is Jimmy Iovine and Andre Young, AKA Dr. Dre. The acquisition may prove to be a natural transition for the company. Beats Electronics have had their products included automobiles and computers. So the move to Apple is not a move that was completed without thought and merit. This paper will discuss the acquisition of Beats Electronics by Apple, INC. With most corporations seeking to expand globally, this paper will also discuss the National Football League (NFL) a company that operates solely in the United States.

For the corporation that has acquired another company, merged with another company, or been acquired by another company, evaluate the strategy that led to the merger or acquisition to determine whether or not this merger or acquisition was a wise choice. Justify your opinion. Before Apple decided to acquire Beats Electronics, the electronic world was witnessing a global phenomenon with the explosion of Beats by Dre. Beats by Dre could be seen all across the globe from local and national sporting events to the World Cup. The founders are hands on with their products. During the acquisition, Jimmy Iovine and Dr. Dre received executive positions in Apple. They tune every product created personally. Early on they we visionaries and wanted to provide a quality product. In an interview, Jimmy Iovine stated that Dr. Dre came to him and stated he wanted to create a sneaker brand. He said almost immediately he replied to him not let’s make speakers. Beats created specific headphones for the stars of different countries to wear during the World Cup. Beats Audio speakers can be found in selected Chrysler motors vehicles and selected HP computers.

For the corporation that has not been involved in any mergers or acquisitions, identify one (1) company that would be a profitable candidate for the corporation to acquire or merge with and explain why this company would be a profitable target. The National Football league could benefit from the acquisition of the Canadian Football League (CFL) or the Arena Football league (AFL). Currently these two leagues operate on their own. The acquisition of the CFL would expand the available talent pool for the NFL. It would also increase its merchandise sales and provide a global effort of expansion. Currently the most popular sport in the world is Soccer. American Football is popular only to this continent. Many years ago an attempt to create a world football league was a failure. The WFL lasted two seasons from 1974 to 1975. I believe that if the NFL acquires the CFL they would be able to expand globally. The first thing they would have to do is unify the rules of the game. Currently the goal post for the NFL, AFL, and CFL are located in different locations. Each has a different field size. By expanding there would be more players, so the season could be extended. For safety players would only be able to play a certain amount per year. This also provides more jobs in the industry

For the corporation that operates internationally, briefly evaluate its international business-level strategy and international corporate-level strategy and make recommendations for improvement. Apple’s international business level strategy is stated below by its CEO, Tim Cook in response to the global business website, business insider: What qualities do you look for in terms of what you think will produce effective collaboration? And what's your role as CEO in fostering that kind of collaboration?

“You look for people that are not political. People that are not bureaucrats. People that can privately celebrate the achievement, but not care if their name that is in the one in the lights. There are greater reasons to do things.

You look for wicked smart people. You look for people who appreciate different points of view. People who care enough that they have an idea at 11 at night and they want to call and talk to you about it. Because they're so excited about it, they want to push the idea further. And that they believe that somebody can help them push the idea another step instead of them doing everything themselves.

I've never met anyone in my life, maybe they exist, that could do something so incredible by themselves in companies with global footprints. In our world, in Apple's world, the reason Apple is special is we focus on hardware, software, and services. And the magic happens where those three come together.

And so, it's unlikely that somebody that's focused on one of those in and of itself can come up with magic and so you want people collaborating in such a way so you can produce these things that can't be produced otherwise. And you want people to believe in that.”(Yarow, J. 2013).

Apple’s corporate level strategy include remaining a global leader though providing a quality product around the world. Apple continues to a leader in the mobile market. There has been a lot of chatter across the web about the impending release of the iPhone 6. Apple has not confirmed this, but there has been many photos and videos of possible prototypes. Samsung is one of Apples competitors in the mobile market. They provide a product is a little larger in size but is far behind apple in battery life. Rumors state that Apple is trying to close this gap by solving the power issue of a larger phone. This strategy, if real, would help Apple gain some Samsung customers. The power issue with Samsung is the major complaint from its current customers.

For the corporation that does not operate internationally, propose one business-level strategy and one corporate-level strategy that you would suggest the corporation consider. Justify your proposals. The National Football League is an organization worthy of expanding globally. Their focus on safety for its players has strengthened over the years. This could be seen as them exercising its corporate responsibility. Globally this could be seen as an organization that protects their employees. Business level strategies indicate the choices the firm has made about how it intends to compete in individual product markets. The choices are important because long- term performance is linked to a firm’s strategies (Hitt, M. A., Ireland, R. D., & Hoskisson, R. E. (2012), p. 102). A good business level strategy for the NFL will be for them to develop an elaborate personnel relations campaign in Canada. Explain to the Canadian people our similarities for the love of football. They should use football players from both league to deliver the message to the fans. The fans will be more receptive to the acquisition if the players appear to embrace the change. A corporate- level strategy specifies actions a firm takes to gain a competitive advantage by selecting and managing a group of different businesses competing in different product markets. Corporate- level strategies help companies to select new strategic positions— positions that are expected to increase the firm’s value (Hitt, M. A., Ireland, R. D., & Hoskisson, R. E. (2012), p.164). The acquisition of the Canadian Football League by the National Football League would place them as the next best competitor to soccer. So they would have to position themselves globally through advertisement and exhibition games throughout the world. Whenever there is a summer Olympics, a new stadium is built for the event. These establishments can be used to stage exhibition football games around the world. The NFL should also expand their programming. As a big traveler, I have noticed that football is not shown regularly outside of the United States. Whenever I am abroad, I can always find a good soccer game on television. The game maybe between two teams that are not from the country I am in. That shows the reach of the game and the dedication of its fans. The NFL has to expand its reach like soccer and programing is the key. The focus on programing should start with replays of the games, during a time when most citizens are home from school or work. Advertising can be done in concert with the major shoe and fast food brands. Shoe brands such as Nike have a proven track record around the world. McDonalds has also found great success abroad. By the NFL teaming with such brands will help the transition into Canada and other countries.

Conclusion In conclusion, mergers and acquisitions are important to a company’s growth. However they must be prepared for the challenges they will face. There has never been an acquisition or merger to occur without facing issues. Every possible challenge cannot be predicted. It is up the corporate leadership to consider all the possibilities. They must develop corporate level strategies that focus on the strategic ways to increase the value of its organization. Sometimes organizations may need to team with other corporations outside of its industry. These alliances can prove to be vital to the success of the organization that has recently gone through a merger or the process of an acquisition.

References
Apple. (2014). Supplier Responsibility Retrieved from online: http://www.apple.com
Citigroup. (2005). Notice of Annual Meeting of Stockholders Retrieved from online: http://www.citigroup.com
Yarow, J. (2013) Tim Cook explains his strategy for running Apple Retrieved from online: http://www.businessinsider.com
Hitt, M. A., Ireland, R. D., & Hoskisson, R. E. (2012). Strategic Management: Concepts and Cases: Competitiveness and Globalization, 10th Edition