Over a span of more than 30 year, Apple Computer has existed paradoxically as one of the greatest business successes and as a company that sometimes failed to realize its potential. Apple Inc. ignited the personal computer industry in the 1970s,1 bringing such behemoths as @ IBM and Digital Equipment almost to their knees; stagnated when a series of CEOs missed opportunities; and rebounded tremendously with the return of its cofounder and former CEO, Steve Jobs. The firm represents a fascinating microcosm of business as it continues to leverage its strengths while reinventing itself.
Corporate history
The history of apple Inc. is a history of passion, whether on the part of its founders, its employees, or its loyal users.2 It started with a pair of Stevens who, from an early age, had an interest in electronics. Steven Wozniak and Steven Jobs initially put their skills to work at Hewlett Packard and Atari, respectively. But then Wozniak constructed his first personal computer-the Apple I-and, along with jobs, created the Apple Computer n April 1, 1976. Right from the start, Apple exhibited an extreme emphasis on new and innovative styling in its computer offerings. Jobs took a personal interest in the development of new products, including the Lisa and the first, now legendary, Macintosh, or “Mac.”
The passion that Apple is so famous for was clearly evident in the design of the Mac. Project teams worked around the clock to develop the machine and its operating system, Mac OS. The use of graphical icons to create simplified user commands was an immensely popular alternative to the command line structure of DOS found on IBM’s first PCs.
When Apple an IBM began to clash head-on in the personal computer market, jobs recognized the threat and realized that it was time for Apple to “grow up” and be run in a more businesslike fashion. In early 1983, he persuaded john Scullery, at that time president of Pepsi-Cola, to join Apple as president. The two men clashed almost from the start, with Scullery eventually ousting jobs from the company.
The launch of the Mac reinvigorated apple's sales. However, by the 1990s, IBM PCs and clones were saturating the personal computers market. Furthermore, Microsoft launched Windows 3.0, a greatly improved version of the winter operating system, for use on IBM PCs and close. although in 1991 Apple had contemplated licensing its Mac operating system to other computer manufacturers, which would enable it to run on Intel-based machines, the idea was nixed by then chief operating officer Michael Spindlier in a move that would ultimately give windows the nod to dominate the market.
Apple continued to rely on innovative design to remain competitive in the 1990s It introduced the very popular PowerBook notebook computer line, as well as the unsuccessful Newton personal digital assistant. Scullery was forced out and replaced by Michael Spindlier. After a difficult time in the mid-1990s, Spindlier was replaced with Gil Amelia, the former president of National Semiconductor. This set the stage for one of the most famous returns in corporate history.
Joss’s Return
After leaving Apple, Steven Jobs started NeXT computer, which produced an advanced personal computers with a sleek, innovative design. However, the computer, which entered the market last in the game and required proprietary software, never gained a large following. Jobs then coproduction the Pixar computer-animation Studio, which coproduced a number of movies with Walt Disney Studios, including Toy Story, Monsters, Inc., Finding Memo, Ratatouille, and Up.3 Cofounder Alva Ray Smith says of jobs, which was running the struggling Pixar: "we should have failed, but Starve just wouldn't let it go."4
In late 1996, Apple purchased Ne XT, and Jobs returned to Apple in an unofficial capacity as advisor to the president. When Amelia resigned, Jobs accepted the role of “interim CEO” of Apple Computer and wasted on time in making his return felt. He announced an alliance with Apple’s former rival, Microsoft. In exchange for $150 million in Apple stock, Microsoft and Apple would share a five-year patent cross license for their graphical interface operating systems. He restarted offering Macs over the Web thorough the Apple Store.
Apple’s recent successes have included growing to command approximately 35% of operating profits in the computer market5 and 66% of the market share for computers priced over $1,000.6 Apple has also paid close attention to its international business by offering 36 country/language combinations of its Apple Store website. The focus on international markets has been a rewarding venture for Apple. According to its 10-Q filling ending March 27, 2010, Apple’s primary business segments include the Americas, Europe, Japan, Asia-pacific and Retail operations. The results of these operations in 2010 compared to the same time period in 2009 are as follows7:
Americas (Norte & South America)-26% net sales increase
Europe-63% net sales increase
Japan-51% net sales increase
Asia-Pacific-184% net sales increase
Based on these performance numbers, it is evident that Apple’s international operations are a significant contributor to overall sales growth.
Furthermore, Apple is committed to ensuring that operations around the globe operate in a responsible manner. The Apple Supplier Code of Conduct addresses such issues as labor and human rights, environmental impact, and ethics. This commitment is stated as: “Apple’s suppliers commit, in all of their activities, to operate in full compliance with the laws, rules, and regulations of the countries in which they operate. This Supplier Code of Conduct goes further, drawing upon internationally recognized standards, in order to advance social and environmental responsibility.”8
What Does the Future Hold?
Whenever critics argued that Apple should reinvent itself again, it did just that-and then some. It now sets standards with new corporate strategies, taking advantage of the explosion of personal electronic devices. In its first week, iTunes sold 1.5 million songs and captured 80% of the market share of legal music downloads. And now we're into new generation phones, wondering just what Apple will next bring to the market.
Casting an ominous shadow on the company was Steve Jobs' announcement in early 2009 of a six-month medical leave. While Jobs was on leave, chief operating officers Tim Cook handle Apple's day-to-day operations. Some analysts thought Jobs might transition into an advisory, and Cook would formally become CEO. Collins Stewart analyst Ashok Kumar said investors were reassured that Jobs would be back at the helm of the company he helped resuscitate over the past decade with successful products such as iPod, phone, and iPad.9
For most companies, such information is not crucial because they are not as closely associated with one person. But Apple May be an exception. Because he helped found Apple, Steve Jobs has been inextricably linked to the company and its brand.10 A lot of concern was expressed over Apple's ability to stay on its creative course without Jobs at the helm. Well, as we all know, Jobs did come back, even though his health remained a concern. The stock markets greeted him with share price rises, and consumer eagerly awaited Apple's next new product announcements. The "Jobs effect" was positive and evident, and this is due to his unique reputation. In April 2010 the iPod was launched in the Us and 300,000 units Were sold on the first day.11 The hype had begun four months earlier when Apple touted the iPod as a revolutionary device for browsing the web, reading and sending email, enjoying photos, watching videos, listening to music, playing games, reading e-books, and more. The iPod features a responsive, high-resolution touch-screen which lets users physically interact with applications and content.12 pied to nine additional countries worldwide. Two things that you won't find, however, are Adobe's Flash player or Google's advertisements, causing rifts, rivalries, and SEC involvement. Upon the announcement that the iPod would not support Adobe Flash, Apple's share price dropped 3%.13
So let's look into the future. Will Steve Jobs' limitations on software developers create significant backlash to threaten the success of his new products? It Jobs is the key to Apple 's achievements, how well can the firm do without him? And, what should Jobs himself be doing now to help prepare the firm for this eventuality?
CASE QUESTIONS
1. DISCUSSION-Apple sells stylish and functional computer era as well as a variety of electronic devices, and it operates retail stores. Describe the forces for change that beat help Apple keep its creative edge, and explain why.
2. DISCUSSION-Describe change strategies employed by Apple throughout its history. Consider its relationships with Microsoft and Adobe. What model of change leadership do you feel Steve Jobs embodies, and why?
3. FURTHER RESEARCH-Review what the analysts are presently saying about Apple. Make a list of the praises and criticisms, organize theme by themes, and then put them in the priority order you would tackle them if taking over from Steve Jobs as Apple's new CEO. In what ways can the praises and criticisms be used to create a leadership agenda for positive change and continuous improvement?