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Apple incorporation

  1. 1. Introduction of Apple Computer, Inc.: Apple Inc., formerly Apple Computer, Inc., is a multinational corporation that creates consumer electronics, personal computers, computer software, and commercial servers, and is a digital distributor of media content. Apple's core product lines are the iPhone smart phone, iPad tablet computer, iPod portable media players, and Macintosh computer line. Founders Steve Jobs and Steve Wozniak effectively created Apple Computer on April 1, 1976, with the release of the Apple I, and incorporated the company on January 3, 1977, in Cupertino, California. For more than two decades, Apple Computer was predominantly a manufacturer of personal computers, including the Apple II, Macintosh, and Power Mac lines, but it faced rocky sales and low market share during the 1990s. Jobs, who had been ousted from the company in 1985, returned to Apple in 1996 after his company next was bought by Apple. The following year, he became the company's interim CEO, which later became permanent. Jobs subsequently instilled a new corporate philosophy of recognizable products and simple design, starting with the original iMac in 1998. With the introduction of the successful iPod music player in 2001 and iTunes Music Store in 2003, Apple established itself as a leader in the consumer electronics and media sales industries, leading it to drop "Computer" from the company's name in 2007. The company is now also known for its iOS range of smart phone, media player, and tablet computer products that began with the iPhone, followed by the iPod Touch and then iPad. As of 2012, Apple is the largest publicly traded corporation in the world by market capitalization, with an estimated value of US$626 billion as of September 2012. Apple Inc's market cap is larger than that of Google and Microsoft combined. Apple's worldwide annual revenue in 2010 totaled US$65 billion, growing to US$127.8 billion in 2011 and $156 billion in 2012. 1
  2. 2. Over View of Apple Incorporation: Establishment Type Founders Industry: Traded as Headquarter: Proposed Headquarter Number of locations Area served Key peoples Products Services Revenue Operating income Net income Total assets Total equity Employees Website April 1, 1976 in California (Cupertino), U.S.A Public (Multinational Corporation) 1. Steve Jobs 2. Steve Wozniak 3. Ronald Wayne Computer hardware Computer software Consumer electronics Digital distribution NASDAQ: AAPL NASDAQ-100 component S&P 500 component Apple Campus, Middle of Silicon Valley, 1 Infinite Loop, Cupertino, California, U.S.A California (Cupertino) , U.S.A 406 retail stores (May 2013) Worldwide 1. Arthur D. Levinson (chairman) 2. Tim Cook (CEO) 3. Steve Jobs (Co-founder & former CEO) Mac Apple TV iPod OS X iPhone iLife iPad iWork iPad Mini iOS Apple Store iTunes Store Apple Store online iBooks Mac App Store iCloud iOS App Store US$ 170.910 billion (2013) US$ 48.999 billion (2013) US$ 37.037 billion (2013) US$ 207.000 billion (2013) US$ 123.549 billion (2013) Around 80,000 (2013) 2
  3. 3. Apple Incorporation: Figure: Headquarter -Middle of Silicon Valley, 1 Infinite Loop, Cupertino, California, U.S. Figure: Proposed Headquarter - Cupertino, California, U.S. 3
  4. 4. Vision Statements Vision statement (most recent):―An Apple computer on every desk‖ – Steve Jobs Vision statement (proposed): ―To be the global leader in the consumer electronics industry.‖ ―To be the most admired company in the world and the most loveable brand people ever use‖ ―Every person around the global should taste at least i apple product‖ Mission statement (actual): Apple ignited the personal computer revolution in the 1970s with the Apple II and reinvented the personal computer in the 1980s with the Macintosh. Today, Apple continues to lead the industry in innovation with its award-winning computers, OS X operating system and iLife and professional applications. Apple is also spearheading the digital media revolution with its iPod portable music and video players and iTunes online store, and has entered the mobile phone market this year with its revolutionary iPhone. Mission statement (proposed): At Apple, we will not only continue to provide revolutionary and innovative products to the consumer electronics industry like the iPod and the iPhone, but we will also make every effort to give back to society while recognizing our responsibility as a global citizen who strives to reduce the environmental impact of the work we do and the products we create. Additionally Business Philosophy: • • • • We believe that we’re on the face of the Earth to make great products. We believe in the simple, not the complex. 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 don’t settle for anything less than excellence. Some advertisement and slogan of Apple Incorporation: Apple's first slogan, "Byte into an Apple", was coined in the late 1970s "Think Different" From 1997–2002, the slogan was used in advertising campaigns, and is still closely associated with Apple Apple also has slogans for specific product lines - for example, ―iThink‖ for the iMac promotion, 1998 "Say hello to iPhone" has been used in iPhone advertisements. “Small is huge”Mac mini, 2009 “Hello” for the Macintosh, Newton and iPod “The ultimate all-in-one goes all out” for iMac, 2011 4
  5. 5. Corporate Structure : 5
  6. 6. Division of Apple Incorporation: Apple has 4 main divisions: 1. Laptop and personal computer division 2. Music Division 3. Video and Sound division 4. Wireless network and Accessories Division Apple Logo: First Apple logo (April 1, 1976, Prototype) Figure: The original logo with Isaac Newton under an apple tree First official Apple logo ( May 17, 1976 to August 26, 1999) Current logo August 27, 1999 to still Figure: The ―bitten" rainbow apple Figure: The monochrome Apple 6
  7. 7. The success story of Apple Inc.: 1. 1976–80: Founding and incorporation Pre-foundation Fig.: Garage of Steve Jobs' parents' home in Los Altos, California 1969–1984: Jobs and Wozniak Steve Jobs and Steve Wozniak had withdrawn from Reed College and UC Berkeley, respectively by 1975. Wozniak designed a video terminal that he could use to log on to the minicomputers at Call Computer. Alex Kamradt commissioned the design and sold a small number of them through his firm. Aside from their interest in up-to-date technology, the impetus for "the two Steves" seems to have had another source. In his essay From Satori to Silicon Valley (published 1986), cultural historian Theodore Roszak made the point that the Apple Computer emerged from within the West Coast counterculture and the need to produce print-outs, letter labels, and databases. Roszak offers a bit of background on the development of the two Steves’s prototype models. In 1976, Wozniak started attending meetings of the Homebrew Computer Club. New microcomputers such as the Altair 8800 and the IMSAI inspired him to build a microprocessor into his video terminal and have a complete computer. At the time the only microcomputer CPUs generally available were the $179 Intel 8080 ($777.00 in present-day terms ), and the $170 Motorola 6800 ($738.00 in present-day terms ). Wozniak 7
  8. 8. preferred the 6800, but both were out of his price range. So he watched, and learned, and designed computers on paper, waiting for the day he could afford a CPU. When MOS Technology released its $20 ($82.00 in present-day terms ) 6502 chip in 1976, Wozniak wrote a version of BASIC for it, then began to design a computer for it to run on. The 6502 was designed by the same people who designed the 6800, as many in Silicon Valley left employers to form their own companies. Wozniak's earlier 6800 paper-computer needed only minor changes to run on the new chip. Wozniak completed the machine and took it to Homebrew Computer Club meetings to show it off. At the meeting, Wozniak met his old friend Jobs, who was interested in the commercial potential of the small hobby machines. Apple I The Apple I was sold as an assembled circuit board and lacked basic features such as a keyboard, monitor, and case. The owner of this unit added a keyboard and a wooden case. Steve Jobs and Steve Wozniak had been friends for some time, having met in 1971, when their mutual friend, Bill Fernandez, introduced 21-year-old Wozniak to 16-year-old Jobs. They began their partnership when Wozniak, a talented, self-educated electronics engineer, began constructing boxes which enabled one to make long-distance phone calls at no cost, and sold several hundred models. Later, Jobs managed to interest Wozniak in assembling a computer machine and selling it. Jobs approached a local computer store, The Byte Shop, who said they would be interested in the machine, but only if it came fully assembled. The owner, Paul Terrell, went further, saying he would order 50 of the machines and pay US $500 ($2.05 thousand in present-day terms ) each on delivery. Jobs then took the purchase order that he had been given from the Byte Shop to Cramer Electronics, a national electronic parts distributor, and ordered the components he needed to assemble the Apple I Computer. The local credit manager asked Jobs how he was going to pay for the parts and he replied, "I have this purchase order from the Byte Shop chain of computer stores for 50 of my computers and the payment terms are COD. If you give me the parts on a net 30-day terms I can build and deliver the computers in that time frame, collect my money from Terrell at the Byte Shop and pay you." 8
  9. 9. The credit manager called Paul Terrell who was attending an IEEE computer conference at Asilomar in Pacific Grove and verified the validity of the purchase order. Amazed at the tenacity of Jobs, Terrell assured the credit manager if the computers showed up in his stores Jobs would be paid and would have more than enough money to pay for the parts order. The two Steves and their small crew spent day and night building and testing the computers and delivered to Terrell on time to pay his suppliers and have a tidy profit left over for their celebration and next order. Steve Jobs had found a way to finance his soon-to-be multimillion-dollar company without giving away one share of stock or ownership. The machine had only a few notable features. One was the use of a TV as the display system, whereas many machines had no display at all. This was not like the displays of later machines, however; text was displayed at 60 characters per second. However, this was still faster than the teleprinters used on contemporary machines of that era. The Apple I also included bootstrap code on ROM, which made it easier to start up. Finally, at the insistence of Paul Terrell, Wozniak also designed a cassette interface for loading and saving programs, at the then-rapid pace of 1200 bit/s. Although the machine was fairly simple, it was nevertheless a masterpiece of design, using far fewer parts than anything in its class, and quickly earning Wozniak a reputation as a master designer. Joined by another friend, Ronald Wayne, the three started to build the machines. Using a variety of methods, including borrowing space from friends and family, selling various prized items (like calculators and a VW bus) and scrounging, Jobs managed to secure the parts needed while Wozniak and Wayne assembled them. But the owner of the Byte Shop was expecting complete computers, not just printed circuit boards. The boards still being a product for the customers Terrell still paid them. Eventually 200 of the Apple I's were built. Apple II Wozniak had already moved on from the Apple I. Many of the design features of the I were due to the limited amount of money they had to construct the prototype, but with the income from the sales he was able to start construction of a greatly improved machine, the Apple II; it was presented to the public at the first West Coast Computer Faire on April 16 and 17, 1977. On the first day of exhibition, Jobs introduced Apple II to a Japanese chemist named Toshio Mizushima who became the first authorized Apple dealer in Japan. The main difference internally was a completely redesigned TV interface, which held the display in memory. Now not only useful for simple text display, the Apple II included graphics, and, eventually, color. Jobs meanwhile pressed for a much improved case and keyboard, with the idea that the machine should be complete and ready to run out of the box. This was almost the case for the Apple I machines sold to The Byte Shop, but one still needed to plug various parts together and type in the code to run BASIC. Building such a machine was going to be financially burdensome. Jobs started looking for cash, but Wayne was somewhat gun-shy due to a failed venture four years earlier, and eventually dropped out of the company. Banks were reluctant to lend Jobs money; the idea of a computer for ordinary people seemed absurd at the time. Jobs eventually met Mike Markkula who co9
  10. 10. signed a bank loan for US$250,000, and the three formed Apple Computer on April 1, 1976. The name Apple was chosen because the company to beat in the technology industry at the time was Atari, and Apple Computer came before Atari alphabetically and thus also in the phone book. Another reason was that Jobs had happy memories of working on an Oregon apple farm one summer. With both cash and a new case design in hand thanks to designer Jerry Manock, the Apple II was released in 1977 and became the computer generally credited with creating the home computer market. Millions were sold well into the 1980s. A number of different models of the Apple II series were built, including the Apple IIe and Apple IIGS, which could still be found in many schools as late as 2005. Apple III Apple III While the Apple II was already established as a successful business-ready platform because of Visicalc, Apple was not content. The Apple III was designed to take on the business environment. It was released on May 19, 1980. The Apple III was a relatively conservative design for computers of the era. However, Steve Jobs did not want the computer to have a fan; rather, he wanted the heat generated by the electronics to be dissipated through the chassis of the machine, forgoing the cooling fan. Unfortunately, the physical design of the case was not sufficient to cool the components inside it. By removing the fan from the design, the Apple III was prone to overheating. This caused the integrated circuit chips to disconnect from the motherboard. Customers who contacted Apple customer service were told to "raise the computers six inches in the air, and then let go", which would cause the ICs to fall back into place. Thousands of Apple III computers were recalled and, although a new model was introduced in 1983 to rectify the problems, the damage was already done. 10
  11. 11. Apple IPO In August 1980, the Financial Times reported that"Apple Computer, the fast growing Californian manufacturer of small computers for the consumer, business and educational markets, is planning to go public later this year. It is the largest private manufacturer in the U.S. of small computers. Founded about five years ago as a small workshop business, it has become the second largest manufacturer of small computers, after the Radio Shack division of the Tandy company." On December 12, 1980, Apple launched the Initial Public Offering of its stock to the investing public. When Apple went public, it generated more capital than any IPO since Ford Motor Company in 1956 and instantly created more millionaires (about 300) than any company in history. Several venture capitalists cashed out, reaping billions in long-term capital gains. In January 1981, Apple held its first shareholders meeting as a public company in the Flint Center, a large auditorium at nearby De Anza College, which is often used for symphony concerts. (Previous meetings were held quietly in smaller rooms, because there had only been a few shareholders.) The business of the meeting had been planned (or choreographed) so that the voting could be staged in 15 minutes or less. In most cases, voting proxies are collected by mail and counted days or months before a meeting. In this case, after the IPO, many shares were in new hands. Steve Jobs started his prepared speech, but after being interrupted by voting several times, he dropped his prepared speech and delivered a long, emotionally charged talk about betrayal, lack of respect, and related topics. 2. 1981–89: Success with Macintosh The IBM PC IBM entered the personal computer market in August 1981 with the IBM PC. After examining a PC and finding it unimpressive, Apple confidently purchased a full-page advertisement in The Wall Street Journal with the headline "Welcome, IBM. Seriously". Microsoft head Bill Gates was at Apple headquarters the day of IBM's announcement and later said "They didn't seem to care. It took them a full year to realize what had happened". By 1983 the PC surpassed the Apple II as the best-selling personal computer. By 1984 IBM had $4 billion in annual PC revenue, more than twice that of Apple and as much as the sales of it and the next three companies combined, and a Fortune survey found that 56% of American companies with personal computers used IBM PCs, compared to Apple's 16%. 11
  12. 12. Xerox PARC and the Lisa Apple Lisa While Apple Computer’s business division was focused on the Apple III, a separate group was focused on a computer that would change the world. While the Apple III was another iteration of the text-based computer, this new machine would feature a completely different interface and introduce the words mouse, icon, and desktop into the lexicon of the computing public. In return for the right to buy US$1,000,000 of pre-IPO stock, Xerox granted Apple Computer three days access to the PARC facilities. After visiting PARC, they came away with new ideas that would complete the foundation for Apple Computer's first GUI computer, the Apple Lisa The first iteration of Apple's WIMP interface was a floppy disk where files could be spatially moved around. After months of usability testing, Apple designed the LISA interface of windows and icons. The Lisa was introduced in 1983 at a cost of US$9,995 ($23.4 thousand in present-day terms. Because of the high price, Lisa failed to penetrate the business market. 12
  13. 13. Macintosh and the "1984" commercial Macintosh The Macintosh 128k was announced to the press in October 1983, followed by an 18-page brochure included with various magazines in December. Its debut, however, was announced by a single national broadcast of the now famous US$1.5 million television commercial, "1984". It was directed by Ridley Scott, aired during the third quarter of Super Bowl XVIII on January 22, 1984, and is now considered a "watershed event" and a "masterpiece." 1984 used an unnamed heroine to represent the coming of the Macintosh (indicated by her white tank top with a Picassostyle picture of Apple’s Macintosh computer on it) as a means of saving humanity from "conformity" (Big Brother). These images were an allusion to George Orwell's noted novel, Nineteen Eighty-Four, which described a dystopian future ruled by a televised "Big Brother." For a special post-election edition of Newsweek in November 1984, Apple spent more than US$2.5 million to buy all 39 of the advertising pages in the issue. Apple also ran a ―Test Drive a Macintosh‖ promotion, in which potential buyers with a credit card could take home a Macintosh for 24 hours and return it to a dealer afterwards. While 200,000 people participated, dealers disliked the promotion, the supply of computers was insufficient for demand, and many were returned in such a bad shape that they could no longer be sold. This marketing campaign caused CEO John Sculley to raise the price from US$1,995 to US$2,495 ($5.61 thousand in present-day terms. Two days after the 1984 ad aired, the Macintosh went on sale. It came bundled with two applications designed to show off its interface: MacWrite and MacPaint. Although the Mac garnered an immediate, enthusiastic following, it was too radical for some, who labeled it a mere "toy". Because the machine was entirely designed around the GUI, existing text-mode and command-driven applications had to be redesigned and the programming code rewritten; this was a challenging undertaking that many software developers shied away from, and resulted in an initial lack of software for the new system. In April 1984 Microsoft's MultiPlan migrated over from MS-DOS, followed by Microsoft Word in January 1985.[36] In 1985, Lotus Software introduced Lotus Jazz after the success of Lotus 1-2-3 for the IBM PC, although it was largely a flop. Apple introduced Macintosh Office the same year with the lemming’s ad, infamous for insulting potential customers. It was not successful. 13
  14. 14. Macintosh also spawned the concept of Mac evangelism which was pioneered by Apple employee, and later Apple Fellow, Guy Kawasaki. Despite initial marketing difficulties, the Macintosh brand was eventually a success for Apple. This was due to its introduction of desktop publishing (and later computer animation) through Apple's partnership with Adobe Systems which introduced the laser printer and Adobe PageMaker. Indeed, the Macintosh would become known as the de facto platform for many industries including cinema, music, advertising, publishing and the arts. 1985: Jobs leaves Apple After an internal power struggle, the board of directors sided with Sculley and Jobs was stripped of all duties. Jobs, while taking the position of Chairman of the firm had no influence over Apple's direction and subsequently resigned.[38] In a show of defiance at being set aside by Apple Computer, Jobs sold all but one of his 6.5 million shares in the company for $70 million. Jobs then acquired the visual effects house, Pixar for $5M ($10.6 million in present-day terms[11]). He also went on to found NeXT Inc., a computer company that built machines with futuristic designs and ran the UNIX-derived NeXTstep operating system. NeXTSTEP would eventually be developed into Mac OS X. While not a commercial success, due in part to its high price, the NeXT computer would introduce important concepts to the history of the personal computer (including serving as the initial platform for Tim Berners-Lee as he was developing the World Wide Web). 1985–1997: Sculley, Spindler, Amelio Corporate performance Under leadership of John Sculley, Apple issued its first corporate stock dividend on May 11, 1987. A month later on June 16, Apple stock split for the first time in a 2:1 split. Apple kept a quarterly dividend with about 0.3% yield until November 21, 1995. Between March 1988 and January 1989, Apple undertook five acquisitions, including software companies Network Innovations, Styleware, Nashoba Systems, and Coral Software, as well as satellite communications company Orion Network Systems. Apple continued to sell both lines of its computers, the Apple II and the Macintosh. A few months after introducing the Mac, Apple released a compact version of the Apple II called the Apple IIc. And in 1986 Apple introduced the Apple IIgs, an Apple II positioned as something of a hybrid product with a mouse-driven, Mac-like operating environment. Even with the release of the first Macintosh, Apple II computers remained the main source of income for Apple for years. Mac family At the same time, the Mac was becoming a product family of its own. The original model evolved into the Mac Plus in 1986 and spawned the Mac SE and the Mac II in 1987 and the Mac Classic and Mac LC in 1990. Meanwhile, Apple attempted its first portable Macs: the failed Macintosh Portable in 1989 and then the more popular PowerBook in 1991, a landmark product 14
  15. 15. that established the modern form and ergonomic layout of the laptop. Popular products and increasing revenues made this a good time for Apple. MacAddict magazine has called 1989 to 1991 the "first golden age" of the Macintosh. On February 19, 1987, Apple registered the "" domain name, making it one of the first hundred companies to register a .com address on the nascent Internet. 3. 1990–99: Decline and restructuring Early-mid-1990s In the late 1980s, Apple's fiercest technological rivals were the Amiga and Atari ST platforms. But by the 1990s, computers based on the IBM PC had become more popular than all three; they finally had a comparable GUI thanks to Windows 3.0, and were out-competing Apple. Apple's response to the PC threat was a profusion of new Macintosh lines including Quadra, Centris, and Performa. Unfortunately, these new lines were marketed poorly by what was now "arguably one of the worst-managed companies in the industry". For one, there were too many models, differentiated by very minor graduations in their tech specs. The excess of arbitrary model numbers confused many consumers and hurt Apple's reputation for simplicity. Apple's retail resellers like Sears and CompUSA often failed to sell or even competently display these Macs. Compounding matters was the fact that, although the machines were cheaper than a comparable PC (when taken into account all the components built-in which had to be added to the 'bare bones PC'), the poor marketing gave the impression that the machines were more expensive. Inventory grew as Apple consistently underestimated demand for popular models and overestimated demand for others. In 1991, Apple partnered with long-time competitor IBM and Motorola to form the AIM alliance. The ultimate goal was to create a revolutionary new computing platform, known as PReP, which would use IBM and Motorola hardware and Apple software. As the first step toward the PReP platform, Apple started the Power Macintosh line in 1994, using PowerPC processors from Motorola and IBM. These processors used a RISC architecture, which differed substantially from the Motorola 680X0 series that were used by all previous Macs. Parts of Apple's operating system software were rewritten so that most software written for older Macs could run in emulation on the PowerPC series. Apple also refused IBM's offer to purchase the company, but later unsuccessfully sought another offer from IBM, and at one point was "hours away" from an acquisition by Sun Microsystems. In addition to computers, Apple has also produced consumer devices. In 1993, Apple released the Newton, an early personal digital assistant (PDA). It defined and launched the PDA category and was a forerunner and inspiration of devices such as Palm Pilot and Pocket PC During 1995, a decision was made to (officially) start licensing the Mac OS and Macintosh ROMs to 3rd party manufacturers who started producing Macintosh ―clones‖. This was done in order to achieve deeper market penetration and extra revenue for the company. This decision lead to Apple having over a 10% market share until 1997 when Steve Jobs was re-hired as 15
  16. 16. interim CEO to replace Gil Amelio. Jobs promptly found a loophole in the licensing contracts Apple had with the clone manufacturers and terminated the Macintosh OS licensing program ending the Macintosh clone era. The result of this action was that Macintosh computer market share quickly fell from 10% to around 3%. 1996: Return of Steve Jobs In 1996, the struggling NeXT company beat out Be Inc.'s BeOS in its bid to sell its operating system to Apple. Apple purchased Steve Jobs' company, NeXT on December 10, 1996, and its NeXTstep operating system. This would not only bring Steve Jobs back to Apple's management, but NeXT technology would become the foundation of the Mac OS X operating system. On November 10, 1997, Apple introduced the Apple Store, an online retail store based upon the WebObjects application server the company had acquired in its purchase of NeXT. The new direct sales outlet was also tied to a new build-to-order manufacturing strategy. CEO On July 9, 1997, Gil Amelio was ousted as CEO of Apple by the board of directors. Jobs stepped in as the interim CEO to begin a critical restructuring of the company's product line. Microsoft deal At the 1997 Macworld Expo, Steve Jobs announced that Apple would be entering into a partnership with Microsoft. Included in this was a five-year commitment from Microsoft to release Microsoft Office for Macintosh as well as a US$150 million investment in Apple. As part of the deal Apple and Microsoft agreed to settle a long-standing dispute over whether Microsoft's Windows operating system infringed on any of Apple's patents. It was also announced that Internet Explorer would be shipped as the default browser on the Macintosh, with the user being able to have a preference. Microsoft chairman Bill Gates appeared at the expo on-screen, further explaining Microsoft's plans for the software they were developing for Mac, and stating that he was very excited to be helping Apple return to success. After this, Steve Jobs said this to the audience at the expo: If we want to move forward and see Apple healthy and prospering again, we have to let go of a few things here. We have to let go of this notion that for Apple to win, Microsoft has to lose. We have to embrace a notion that for Apple to win, Apple has to do a really good job. And if others are going to help us that's great, because we need all the help we can get, and if we screw up and we don't do a good job, it's not somebody else's fault, it's our fault. So I think that is a very important perspective. If we want Microsoft Office on the Mac, we better treat the company that puts it out with a little bit of gratitude; we like their software. So, the era of setting this up as a competition between Apple and Microsoft is over as far as I'm concerned. This is about getting Apple healthy, this is about Apple being able to make incredibly great contributions to the industry and to get healthy and prosper again. 16
  17. 17. The day before the announcement Apple had a market cap of $2.46 billion, and had ended its previous quarter with quarterly revenues of US$1.7 billion and cash reserves of US$1.2 billion, making the US$150 million amount of the investment largely symbolic. Apple CFO Fred Anderson stated that Apple would use the additional funds to invest in its core markets of education and creative content. 4. 1999–2006: Apple's comeback & Return to profitability iMac, iBook, and Power Mac G4 While discontinuing Apple's licensing of its operating system to third-party computer manufacturers, one of Jobs's first moves as new acting CEO was to develop the iMac, which bought Apple time to restructure. The original iMac integrated a CRT display and CPU into a streamlined, translucent plastic body. The line became a sales smash, moving about one million units each year. It also helped re-introduce Apple to the media and public, and announced the company's new emphasis on the design and aesthetics of its products. In 1999, Apple introduced the Power Mac G4, which utilized the Motorola-made PowerPC 7400 containing a 128-bit instruction unit known as AltiVec, its flagship processor line. Also that year, Apple unveiled the iBook, its first consumer-oriented laptop that was also the first Macintosh to support the use of Wireless LAN via the optional AirPort card that was based on the 802.11b standard; it helped popularize the use of Wireless LAN technology to connect computers to networks. Mac OS X In 2001, Apple introduced Mac OS X, an operating system based on NeXT's NeXTstep and incorporating parts of the FreeBSD kernel. Aimed at consumers and professionals alike, Mac OS 17
  18. 18. X married the stability, reliability and security of Unix with the ease of a completely overhauled user interface. To aid users in transitioning their applications from Mac OS 9, the new operating system allowed the use of Mac OS 9 applications through the Classic environment. Apple's Carbon API also allowed developers to adapt their Mac OS 9 software to use Mac OS X's features. Retail stores In May 2001, after much speculation, Apple announced the opening of a line of Apple retail stores, to be located throughout the major U.S. computer buying markets. The stores were designed for two primary purposes: to stem the tide of Apple's declining share of the computer market, as well as a response to poor marketing of Apple products at third-party retail outlets. IPod In October 2001, Apple introduced its first iPod portable digital audio player. The iPod started as a 5 gigabyte player capable of storing around 1000 songs. Since then it has evolved into an array of products including the Mini (now discontinued), the iPod Touch, the Shuffle, the iPod Classic, the Nano, the iPhone and the iPad. Since March 2011, the largest storage capacity for an iPod has been 160 gigabytes. 2002–2007: iTunes, iPods, Intel transition Moving on from colored plastics and the PowerPC G3 In early 2002, Apple unveiled a completely redesigned iMac, using the G4 processor and LCD display. The new iMac G4 design had a white hemispherical base and a flat panel all-digital display supported by a swiveling chrome neck. After several iterations increasing the processing speed and screen sizes from 15" to 17" to 20" the iMac G4 was discontinued and replaced by the iMac G5 in the summer of 2004. In 2002, Apple also released the Xserve 1U rack mounted server. Originally featuring two G4 chips, the Xserve was unusual for Apple in two ways. It represented an earnest effort to enter the enterprise computer market and it was also relatively cheaper than similar machines released by its competitors. This was due, in no small part, to Apple's use of Fast ATA drives as opposed to the SCSI hard drives used in traditional rack-mounted servers. Apple later released the Xserve RAID, a 14 drive RAID which was, again, cheaper than competing systems. In mid-2003, Steve Jobs launched the Power Mac G5, based on IBM's G5 processor. Its all-metal anodized aluminum chassis finished Apple's transition away from colored plastics in their computers. Apple claims this was the first 64-bit computer sold to the general public. The Power Mac G5 was also used by Virginia Tech to build its prototype System X supercomputing cluster, which at the time garnered the prestigious recognition of the third fastest supercomputer in the world. It cost only US$5.2 million to build, far less than the previous No. 3 and other ranking supercomputers. Apple's Xserves were soon updated to use the G5 as well. They replaced the 18
  19. 19. Power Mac G5 machines as the main building block of Virginia Tech's System X, which was ranked in November 2004 as the world's seventh fastest supercomputer. A new iMac based on the G5 processor was unveiled August 31, 2004 and was made available in mid-September. This model dispensed with the base altogether, placing the CPU and the rest of the computing hardware behind the flat-panel screen, which is suspended from a streamlined aluminum foot. This new iMac, dubbed the iMac G5, was the world's thinnest desktop computer, measuring in at around two inches (around 5 centimeters). 2004, however, was a turning point for Apple. After creating a sizable financial base to work with, the company began experimenting with new parts from new suppliers. As a result Apple was able to produce new designs so quickly over a short amount of time, with the release of the iPod Video, then the iPod Classic, and eventually the iPod touch and iPhone. Each Apple product thus far has been under equally high demand. On April 29, 2005, Apple released Mac OS X v10.4 "Tiger" to the general public. Apple's wildly successful PowerBook and iBook products relied on Apple's previous generation G4 architecture which were produced by Freescale Semiconductor, a spin off from Motorola. Engineers at IBM had minimal success in making their PowerPC G5 processor consume less power and run cooler but not enough to run in iBook or PowerBook formats. As of the week of October 24, 2005 Apple released the Power Mac G5 Dual that features a Dual-Core processor. This processor contains two cores in one rather than have two separate processors. Apple has also developed the Power Mac G5 Quad that uses two of the Dual-Core processors for enhanced workstation power and performance. The new Power Mac G5 Dual cores run individually at 2.0 GHz or 2.3 GHz. The Power Mac G5 Quad cores run individually at 2.5 GHz and all variations have a graphics processor that has 256-bit memory bandwidth. Retail store expansion Initially, the Apple Stores were only opened in the United States, but in late 2003, Apple opened its first Apple Store abroad, in Tokyo's Ginza district. Ginza was followed by a store in Osaka, Japan in August 2004. In 2005, Apple opened stores in Nagoya, the Shibuya district of Tokyo, Fukuoka, and Sendai. Another store was opened in Sapporo in 2006. Apple's first European store opened in London in November 2004, and is currently the largest store. A store in the Bullring shopping centre in Birmingham opened in April 2005, and the Bluewater shopping centre in Dartford, Kent opened in July 2005. Apple opened its first store in Canada in the middle of 2005 at the Yorkdale Shopping Centre in North York, Toronto. Later on in 2005 Apple opened the Meadowhall Store in Sheffield and the Trafford Centre Store in Manchester (UK). Recent additions in the London area include the Brent Cross Apple Store (January 2006) and the Apple Store in Westfield in Shepherd's Bush (September 2008). Also, in an effort to court a broader market, Apple opened several "mini" stores in October 2004 in attempt to capture markets where demand does not necessarily dictate a full scale store. The first of these stores was opened at Stanford Shopping Center in Palo Alto, California. These stores follow in the footsteps of the successful Apple products: iPod mini and Mac mini. These 19
  20. 20. stores are only one half the square footage of the smallest "normal" store and thus can be placed in several smaller markets. Apple’s International market Structure According to a report by a Congressional panel, Apple has avoided billions in taxes through the use of international subsidiaries. Apple has subsidiaries in Ireland where the company has negotiated a special tax rate of 2 percent. These units contract with manufacturers to assemble Apple products, sell the products to other subsidiaries for distribution, and return the profits up the chain of companies in the form of dividends. But some of these subsidiaries do not have a stated tax residence and pay no taxes at all. Intel transition 20
  21. 21. In a keynote address on June 6, 2005, Steve Jobs officially announced that Apple would begin producing Intel-based Macintosh computers beginning in 2006.[61] Jobs confirmed rumors that the company had secretly been producing versions of its current operating system Mac OS X for both PowerPC and Intel processors over the past 5 years, and that the transition to Intel processor systems would last until the end of 2007. Rumors of cross-platform compatibility had been spurred by the fact that Mac OS X is based on OpenStep, an operating system that was available for many platforms. In fact, Apple's own Darwin, the open source underpinnings of Mac OS X, was also available for Intel's x86 architecture. On January 10, 2006, the first Intel-based machines, the iMac and MacBook Pro, were introduced. They were based on the Intel Core Duo platform. This introduction came with the news that Apple would complete the transition to Intel processors on all hardware by the end of 2006, a year ahead of the originally quoted schedule. Apple and "i" Web services In 2000, Apple introduced its iTools service, a set of free web-based tools that included an email account, internet greeting cards called iCards, a service called iReview that gave internet users a place to read and write reviews of Web sites, and a tool called KidSafe which promised to prevent children from browsing inappropriate portions of the web. The latter two services were eventually canceled because of lack of success, while iCards and email became integrated into Apple's .Mac subscription based service introduced in 2002 and discontinued in mid-2008 to make way for the release of the new MobileMe service, coinciding with the iPhone 3G release. MobileMe, which carried the same US$99.00 annual subscription price as its .Mac predecessor, featured the addition of "push" services to instantly and automatically send emails, contacts and calendar updates directly to users' iPhone devices. Some controversy surrounded the release of MobileMe services to users resulting in expected downtime and a significantly longer release window. As a result of this, Apple extended the subscriptions of existing MobileMe subscribers by an additional 30 days free-of-charge.[67] At the WWDC event in June 2011, Apple announced its most up to date cloud service, iCloud, replacing MobileMe. This service kept most of the core services that MobileMe offered, however dropping iDisk, Gallery, and iWeb. Additionally, it added a number of other features to the group, including Find my Mac, iTunes Match, Photo Stream, Documents & Data Backup, and iCloud backup for iOS devices. The service requires users to be running iOS 5 and OS X 10.7 Lion. iPod and iTunes store 21
  22. 22. A 2nd generation iPod On October 23, 2001, Apple introduced the iPod, a portable digital music player. Its signature features included an LED, easy to use interface, and a large capacity drive (initially 5 GB) which was enough to hold approximately 1,000 songs. It was quite large when compared to the 20–30 songs of Flash-based players of the time. Apple has since revised its iPod line several times, introducing a slimmer, more compact design, Windows compatibility (previous iPods only interacted with Macintosh computers), AAC compatibility, storage sizes of up to 160 GB, and easier connectivity with car or home stereo systems. On October 26, 2004, Apple released a color version of their award winning iPod which can not only play music but also show photos. In early 2005, Apple unveiled a smaller iPod: the iPod Shuffle, which is about the size of a pack of gum. Speaking to software developers on June 6, 2005, Steve Jobs said the company's share of the entire portable music device market stood at 76%. Apple has revolutionized the computer and music industry by signing the five major record companies to join its new music download service, the successful iTunes Music Store, now known as iTunes Store. Unlike other fee-based music services, the iTunes Store charges a flat US$0.99 per song (or US$9.99 per album). Users have more flexibility than on previous on-line music services. For example, they can burn CDs including the purchased songs (although a particular playlist containing purchased music may only be burned seven times), share and play the songs on up to five computers, and, of course, download songs onto an iPod. The iTunes Music Store commercial model is one-time purchase, which contrasts with other commercial subscription music services where users are required to pay a regular fee to be able 22
  23. 23. to access musical content (but are able to access a larger volume of music during the subscription). The iTunes Music Store was launched in 2003 with 2 million downloads in only 16 days; all of which were purchased only on Macintosh computers. Apple has since released a version of iTunes for Windows, allowing Windows users the ability to access the store as well. Initially, the music store was only available in the United States due to licensing restrictions, but there were plans to release the store to many other countries in the future. In January 2004 Apple released a more compact version of their iPod player, the 4 GB iPod Mini. Although the Mini held fewer songs than the other iPod models at that time, its smaller size and multiple colours made it popular with consumers on debut with many stores having "sold out" their initial inventories of the devices. In June 2004 Apple opened their iTunes Music Store in the United Kingdom, France, and Germany. A European Union version opened October 2004 (actually, a Eurozone version; not initially available in the Republic of Ireland due to the intransigence of the Irish Recorded Music Association (IRMA) but eventually opened Thursday January 6, 2005.) A version for Canada opened in December 2004. On May 10, 2005, the iTunes Music Store was expanded to Denmark, Norway, Sweden, and Switzerland. On December 16, 2004, Apple sold its 200 millionth song on the iTunes Music Store to Ryan Alekman from Belchertown, Massachusetts. The download was The Complete U2, by U2. Just under three months later Apple sold its 300 millionth song on March 2, 2005. On July 17, 2005, the iTunes Music Store sold its 500 millionth song. At that point, songs were selling at an accelerating annualized rate of more than 500 million. On January 11, 2005, an even smaller version of the iPod was announced, this one based on flash memory instead of using a miniaturized hard drive. The iPod Shuffle, like its predecessors, proved so popular that it sold out almost immediately, causing delays of up to four weeks in obtaining one within a single week of its debut. This is despite the fact that critics had gawked at the lack of LCD screen in the Shuffle, a norm in almost all current flash memory based mp3 players. The iPod is giving an enormous lift to Apple's financial results. In the quarter ending March 26, 2005, Apple earned US$290 million, or 34¢ a share, on sales of US$3.24 billion. The year before in the same quarter, Apple earned just US$46 million, or 6¢ a share, on revenue of US$1.91 billion. In July 2005, the iPod was given a color screen, merging the iPod and iPod Photo. On September 7, 2005, Apple replaced the iPod Mini line with the new iPod Nano. While some consumers were put off by the high price tag (US$199 for 2 GB), and easily scratchable surface, the Nano had sold 1 million units in the first 17 days. 23
  24. 24. A month later, on October 12, 2005 Apple introduced the new 5th generation iPod with video playback abilities. The device is also 40% thinner than a 4th generation iPod and has a larger screen. On October 25, 2005, the iTunes Store went live in Australia, with songs selling for A$1.69 each, albums at (generally) A$16.99 and music videos and Pixar short films at A$3.39. Briefly, people in New Zealand were able to buy music off the Australian store. However, that loophole was quickly closed. On February 23, 2006, the iTunes Music Store sold its 1 billionth song. The iTunes Music Store changed its name to iTunes Store on September 12, 2006 when it began offering video content (TV shows and movies) for sale. Since iTunes' inception it has sold over 2 billion songs, 1.2 billion of which were sold in 2006. Since downloadable TV and movie content was added 50 million TV episodes and 1.3 million movies have been downloaded. In early 2010, Apple celebrated the 10 billionth song downloaded from the iTunes Music Store. 5. 2007–present: Success with mobile devices (iPhone, iOS, and iPad), Steve Jobs' death and Acquisitions & expansions On January 9, 2007, Apple Computer, Inc. shortened its name to simply Apple Inc. In his Macworld Expo keynote address, Steve Jobs explained that with their current product mix consisting of the iPod and Apple TV as well as their Macintosh brand, Apple really wasn't just a computer company anymore. At the same address, Jobs revealed a product that would revolutionize an industry in which Apple had never previously competed: the Apple iPhone. The iPhone combined Apple's first widescreen iPod with the world's first mobile device boasting visual voicemail, and an internet communicator able to run a fully functional version of Apple's web browser, Safari, on the then-named iPhone OS (later renamed iOS). iOS evolution: iPhone and iPad The first version of the iPhone became publicly available on June 29, 2007 in selected countries/markets. It was another 12 months before the iPhone 3G became available on July 11, 2008. Apple announced the iPhone 3GS on June 8, 2009, along with plans to release it later in June, July, and August, starting with the U.S., Canada and major European countries on June 19. This 12-month iteration cycle has continued with the iPhone 4 model arriving in similar fashion in 2010, a Verizon model was released in February 2011, and a Sprint model in October 2011, shortly after Jobs' death. On February 10, 2011, the iPhone 4 was made available on both Verizon Wireless and AT&T. Now two iPod types are multi-touch: the iPod nano and the iPod touch, a big advance in technology. Apple TV currently has a 2nd generation model, which is 4 times smaller than the original Apple TV. Apple has also gone wireless, selling a wireless trackpad, keyboard, mouse, and external hard drive. Wired accessories are, however, still available. 24
  25. 25. The Apple iPad was announced on January 27, 2010 with retail availability commencing in April and systematically growing in markets throughout 2010. The iPad fits into Apple's iOS product line, being twice the screen size of an iPhone without the phone abilities. While there were initial fears of product cannibalisation the FY2010 financial results released in Jan 2011 included commentary of a reverse 'halo' effect, where iPad sales were leading to increased sales of iMacs and MacBooks.[73] On March 2, 2011, Apple unveiled the iPad's second generation model, the iPad 2. Like the 4th generation iPod Touch and iPhone, the iPad 2 comes with a front-facing camera as well as a rear-facing camera, along with three new apps that utilize these new features: Camera, FaceTime, and Photobooth (only on iPad2). Steve Jobs' death Steve Jobs' would eventually become CEO and served in that position until August 2011. On August 24, 2011 Steve Jobs resigned his position as chief executive officer of Apple before his long battle with pancreatic cancer took his life on October 5, 2011. Resurgence compared to Microsoft Since 2005, Apple's revenues, profits, and stock price have grown significantly. On May 26, 2010 Apple's stock market value overtook Microsoft's, and Apple's revenues surpassed those of Microsoft in the third quarter of 2010. After giving their results for the first quarter of 2011 Microsoft's net profits of $5.2 billion were lower for the quarter than those of Apple Inc., which earned $6 billion in net profit for the quarter. The late April announcement of profits by the Five companies marks the first time in twenty years that Microsoft's profits have been lower than Apple's., and according to Arstechnica "this would have been 'unimaginable' 10 years before." The Guardian reported that one of the reasons for the change is because PC software, where Microsoft dominates, has become less important compared to the tablet PC and smartphone markets, where Apple has a strong presence. One reason for this was a surprise drop in PC sales in the quarter. Another issue for Microsoft is that their online search business has lost a lot of money, with a loss of $700 million in the first quarter of 2010. Although Microsoft's online division losses were high, even if they had made no loss Apple's profits would have been slightly higher. On November 25, 2013, Apple acquired a company called PrimeSense. 25
  26. 26. Financial history As cash reserves increased significantly in 2006, Apple created Braeburn Capital on April 6, 2006 to manage its assets. Financial period FY 1977 FY 1978 FY 1979 FY 1980 Net sales USD) 0.773 7.856 47.867 117.126 FY 1981 FY 1982 FY 1983 FY 1984 FY 1985 FY 1986 FY 1987 FY 1988 FY 1989 FY 1990 FY 1991 FY 1992 FY 1993 FY 1994 FY 1995 FY 1996 FY 1997 FY 1998 FY 1999 FY 2000 FY 2001 FY 2002 FY 2003 FY 2004 FY 2005 FY 2006 FY 2007 FY 2008 FY 2009[84] FY 2010 FY 2011 FY 2012 335 583 983 1,516 1,918 1,902 2,661 4,071 5,284 5,558 6,309 7,087 7,977 9,189 11,062 9,833 7,081 5,941 6,134 7,983 5,363 5,247 6,207 8,279 13,931 19,315 24,578 37,491 42,905 65,225 108,249 156,508 (Mil Net profits (Mil Revenue USD) growth unknown --0.793 916% 5.073 509% 11.698 145% 39.420 61 77 64 61 154 218 400 454 475 310 530 87 310 424 -816 -1,045 309 601 786 -25 65 57 266 1,328 1,989 3,495 6,119 8,235 14,013 25,922 41,733 186% 74% 69% 54% 27% -1% 40% 53% 30% 5% 12% 12% 13% 46% 20% -11% -28% -16% 3% 30% -33% -2% 18% 33% 68% 39% 27% 53% 14% 52% 66% 45% 26 Return on net sales --10% 11% 10% 12% 10% 8% 4% 3% 8% 8% 10% 9% 9% 5% 7% 1% 3% 4% -8% -15% 5% 10% 10% 0% 1% 1% 3% 10% 10% 14% 16% 19% 21% 24% 27%
  27. 27. Stock 'AAPL' is the stock symbol under which Apple Inc. trades on the NASDAQ stock market. Apple originally went public on December 12, 1980, with an initial public offering at US$22.00[85] per share. The stock has split 2 for 1 three different times on June 15, 1987, June 21, 2000 and February 28, 2005. Apple initially paid dividends from June 15, 1987 to December 15, 1995. On March 19, 2012, Apple announced that it would again start paying a dividend of $2.65 per quarter (beginning in the quarter that starts in July 2012) along a $10 billion share buyback which would commence September 30, 2012, the start of its fiscal 2013 year. Gene Munster and Michael Olson of Piper Jaffray are the main analysts who track Apple stock. Piper Jaffray estimate future stock and revenue of Apple annually, and have been doing so for several years. Timeline of Apple Inc. products See also: Timeline of Apple Inc. products, Timeline of Apple II family, and Timeline of Macintosh models Products on this timeline indicate introduction dates only and not necessarily discontinued dates, as new products begin on a contiguous product line. 27
  28. 28. Apple's four challenges For years, Apple has been a popular company, both among consumers and among investors. Consumers have been raving about Apple’s ―cool‖ touch products that marry art and technology, fueling WOM and buzz every time the company would come up with a new product. Investors have been chasing after Apple’s stock, creating enough momentum to propel the stock to new highs. In recent weeks, Apple’s buzz and momentum seems to be fading away, however, as both consumers and investors have showed little enthusiasm for the company’s new product, the iPhone 4S. What happened? Is the company losing its buzz and momentum? Though it is too early to say for sure, Apple is facing four immediate challenges that may slowdown its buzz and momentum: 1. Technology challenge. Judging from the features of iPhone 4S, Apple’s radical innovation machine seems to be running out of steam. The new phone is a marginal rather than a radical improvement over its predecessor, both in terms of its physical attributes and technological capabilities. 2. Leadership challenge. The company is in the middle of a leadership transition that casts a cloud of uncertainty over its future. It will be difficult for Apple to thrive without Steve Jobs, as he was a leader with a strong vision, a man who knew the technology, the market, and the art, and he could combine altogether in blockbuster products; and he had the charisma to develop and spread the message to Apple followers, creating efficient and effective WOM and buzz campaigns. 3. Competition challenge. So far, Apple’s barriers to competitors and innovation magic have been formidable, and any company — from Nokia (NYSE:NOK) to Research in Motion (NASDAQ:RIMM) to Hewlett-Packard (NYSE:HPQ)– that has tried to challenge Apple have been trashed. In recent months, however, Apple has faced a serious challenge to two of its blockbuster products, the iPad and the iPhone. On the tablet market, Apple contends with an unlikely challenger: online seller (NASDAQ:AMZN). Last week, the company is expected to announce the release of its new version of the Kindle reader, which some analysts expect to be a serious challenge to Apple’s iPad. On the iPhone side, Apple faces a new challenge from Google’s (NASDAQ:GOOG) Android phones, especially if Google manages to integrate Motorola Mobility (NYSE:MMI) successfully to its organization. In fact, according to a Nielsen Survey, Android phones command a 43 percent market share, compared to 28 percent for iPhones. 4. Economy challenge. Though Apple enjoys a strong brand among consumers that makes demand for its products inelastic, its sales are sensitive to an impending down turn, especially in Europe. The Bottom line: As every rapidly growing company, Apple is facing headwinds that may cool its buzz and momentum, at least in the immediate future. 28
  29. 29. The secret of Apple's success: Apple's success – driven by the vision of Steve Jobs – has been to distil its ideas to their essence. By contrast, too many companies are overly complicated. Steve Jobs speaks during an Apple special event in 2010 in Cupertino, California. Apple's package-design team had just returned from its presentation to Steve Jobs, and the faces told the story – they had that "things didn't go exactly as we planned" look. "The suspense is killing me," I said to the project leader. "How'd it go this morning?" "Well," he said, "Steve hit us with the Simple Stick." Translation: Jobs had rejected their work – not because it was bad but because, in some way, it failed to distil the idea to its essence. Think brutal Clarity propels an organisation. Not occasional clarity but pervasive, 24-hour, in-your-face, takeno-prisoners clarity. Most people never perceive that this is lacking in their organisation, but 90% of the time it is. Just open a few random emails, activate your "brutal-vision", and read. The muddying messages are rampant. If people were brutally honest in their emails, the time we spend sorting through our in-boxes would surely decrease by half. Steve Jobs demanded straightforward communication from others as much as he dished it out himself. He'd cut you off if you rambled. He ran his business as if there were precious little time to waste, which well reflected the reality for Apple – as surely it does for any company serious about competing. This is probably the one element of Simplicity that's easiest to institute. Just be honest and never hold back. Demand the same from those you work with. You'll make some people squirm, but 29
  30. 30. everyone will know where they stand; 100% of your group's time will be focused on forward progress – no need to decode what people are really saying. There is a general perception that Jobs was the nasty tyrant who demanded allegiance, barked commands, and instilled the fear of God in those around him. While Jobs certainly did exhibit these behaviours, this portrait is incomplete. The man could also be funny, warm, and even charming. There is a huge difference between being brutally honest and simply being brutal. You can't let yourself be talked into going along with something when you know it can be better. Ever. To settle for second best is a violation of the rules of simplicity, and it plants the seeds for disappointment, extra work, and more meetings. Most disturbing, it puts you in the worst possible business position: having to defend an idea you never believed in. Your challenge is to become unbending when it comes to enforcing your standards. Mercilessly so. If you submit only the work you believe in 100% and approve only the work you believe in 100%, you own something that no one can take away from you: integrity. As often happens in life, one must often suffer the consequences of doubting before becoming a believer. I'm not proud of it, but that's the way I learned my lesson about standards. First came the uncomfortable pause. The offending comment would reverberate in the air, and it would seem as if the entire world went into slow motion as Jobs's internal sensors fixed on the origin of the sound wave. You could almost hear the meshing of gears as his "turret" slowly turned toward the guilty party. Everyone knew what was coming—but was powerless to stop it. Finally, the turret would lock on to its target. In a split second Jobs would activate his firing mechanism, and without a second thought he'd unload all his ammunition. It was uncomfortable to watch and even more uncomfortable to experience, but at Apple it was just a fact of life. Think small How many overpopulated meetings do you sit through in a year? How many of those meetings get sidetracked or lose focus in a way that would never occur if the group were half the size? The small group rule requires enforcement, but it's worth the cost. Out in the real world, when I talk about small groups of smart people, I rarely get any pushback. That's because common sense tells us it's the right way to go. Most people know from experience that the fastest way to lose focus, squander valuable time, and water down great ideas is to entrust them to a larger group. Just as we know that there is equal danger in putting ideas at the mercy of a large group of approvers. One reason why large, unwieldy groups tend to be created in many companies is that the culture of a company is bigger than any one person. It's hard to change "the way we do things here". This is where the zealots of simplicity need to step in and overcome the inertia. 30
  31. 31. One must be judicious and realistic about applying the small-group principle. Simply making groups smaller will obviously not solve all problems, and "small" is a relative term. Only you know your business and the nature of your projects, so only you can draw the line between too few people and too many. You need to be the enforcer and be prepared to hit the process with the Simple Stick when the group is threatened with unnecessary expansion. In one iconic technology company with which I worked I found a framed sign in every conference room designed to nudge the employees toward greater productivity. The headline on the sign was how to have a successful meeting. The content read like it came right out of a corporate manual, which it likely did. It featured a bullet-pointed list of things like: "State the agenda at the start of your meeting," "Encourage participation by all attendees," and "Conclude your meeting with agreement on next steps". What these signs really said, though, was: "Welcome to a very big company! Just follow these signs and you'll fit in well." It's not hard to imagine Jobs, who actively fought big-company behaviour, gleefully ripping these signs off the wall and replacing them with Ansel Adams prints that might provide a moment of reflection or inspiration. If you ever work at Apple there will be no signs on the wall telling you how to run a meeting. Likewise, there will be no signs telling you how to tie your shoes or fill a glass of water. The assumption is that you are well equipped with brains and common sense and that you're a fully functioning adult. If you're not already a disciple of simplicity, you'll become one soon. Either that, or you'll decide you'd rather not be part of such a thing, which is okay too. Simplicity prefers not having to train a bucking bronco. If big companies really feel compelled to put something on their walls, a better sign might read: How to Have a Great Meeting 1. Throw out the least necessary person at the table. 2. Walk out of this meeting if it lasts more than 30 minutes. 3. Do something productive today to make up for the time you spent here. Think clarity This is an area where just about every business needs more work. Words are powerful, but more words are not more powerful – they're often just confusing. Understand that in your company's internal business and in communications with your customers, dissertations tend to drive people away. Though many writers never seem to grasp the point, using intelligent words does not necessarily make you appear smarter. The best way to make yourself or your company look smart is to express an idea simply and with perfect clarity. No matter who your audience is, it's more effective to communicate as people do naturally. In simple sentences. Using simple words. Simplicity is its own form of cleverness – saying a great deal by saying little. 31
  32. 32. Think human Unless you're in the business of sterilising things, business is no place to be sterile. Have the boldness to look beyond numbers and spreadsheets and allow your heart to have a say in the matter. Bear in mind that the intangibles are every bit as real as the metrics – are often even more important. The simplest and most effective way to connect with human beings is to speak with a human voice. It may be necessary in your business to market to specific target groups, but bear in mind that every target is a human being, and human beings respond to simplicity. Best advice: Just be true to your species. Doing business the Steve Jobs way It's natural for people to be resistant to change, large or small, so trying to change attitudes within an organisation can be difficult. But when you spread the word about the value of simplicity you are not spreading some oddball theory, you're echoing one of the most successful people in business history, Steve Jobs (right). If you refer to the benefits Apple has enjoyed by embracing simplicity, and make the appropriate parallels to your own business, you'll build a compelling case. You can spread the religion of simplicity project by project, by interacting with people and groups one at a time. Getting people to buy into a concept to the point where they start contributing their own ideas can literally create a movement within an organisation. Simplicity is a way of looking at every part of your job, the jobs of those around you, and the way your company operates. Once you start seeing the world through the lens of simplicity you'll be astounded at how many opportunities exist to improve the way your business works. Keep things simple I was in Paris in the past two weeks and had talks with various French telecommunications officials about many mobile-computing issues. But one conversation I had in particular emphasizes this keep-it-simple point. We were discussing how to compete with Apple — a major pastime for all Apple competitors and carriers these days — when the question of why Apple is really successful came up. And one exec nailed it when he said he felt that the real reason Apple is successful is because it has one product; in this case the iPhone. It minimizes the decision-making process for the consumer by making things simple. The person speaking was with a carrier in France, and he said that in their stores, they have to have as many as 25 different models of phones available. That makes it hard for his staff to be really knowledgeable about all of them all of the time, and their customers just have too many options to choose from. But Apple only has one iPhone model, and anyone who has gone into an Apple store understands that every staff member there knows a great deal about each of the four major products carried in its stores. Apple doesn’t have five iPhone models to choose from; it has only one. While this may seem limiting given the amount of smart phones available to users, the truth is the reverse. Our company has done consumer research for over 30 years, and consumers constantly tell us 32
  33. 33. that while choice is nice, in reality they want the process of choosing a tech product to be simple and not complicated by a plethora of choices. Yes, there are tech-savvy people who like more choices and sometimes even like complexity, but from years of experience as a market researcher, I can tell you that in the end, the majority of users are not tech-savvy, and keeping things simple for them is a plus. Apple understands this in spades and is never tempted to add multiple versions of an iPhone, iPad or even more than one or two types of iPods. This makes buying an Apple product simple. Conclusion: Of course, the last ten years tell a completely different story. Starting with the iPod, Apple has introduced a string of very successful products. Over the past five years, Apple’s market capitalization has increased $422 billion compared with an increase of Google of $13 billion. As Thomas Hazlett points out in this Wall Street Journal post, the iPhone is the single most popular smart phone commanding 73% of the mobile phone industry’s profits. He also points out that the iPad has a 68% share of the tablet market. Taken together, this success record has given Apple the world’s largest market capitalization. A recent article in Forbes even predicts that Apple may be the world’s first trillion-dollar company. What has created Apple’s record of success if it isn’t the reasons typically given by the pundits? There are many factors, and of course, I believe the most important is they have been doing better marketing than their rivals. I know, ―better marketing‖ is too general, so I will break it down according to what I call the seven building blocks of marketing. Beginning with the success of the iPod, Apple changed its name from Apple Computer to Apple Inc. to reflect its shift to products that go beyond computers. With its string of successes and escalating stock price, its corporate image continues to rise. During his wandering, Steve Jobs learned how to create effective branding platforms. Gone are the numbers and letters that caused confusion from the Apple II and III days. Instead there are the i-Platform products that are neatly designed in an attractive package to hook up with the Internet. They all begin with ―i‖ and end with a single syllable word (with the exception of iTV) – iPod, iPhone, iPad, iMac, iBook, iTunes, iBooks, and iCloud. For higher-end computers, Apple uses platform names such as the MacPro, MacBook, MacBook Air, MacbookPro. For OSX operating systems, Apple has been using the names of ferocious cats. Apple has become very proficient at coordinating and integrated these marketing strategies for optimum effectiveness. Unlike the old days when rivals positioned Apple advantages as negatives, Apple has learned to communicate its unique advantages as benefits to customers. Platform control for a better user experience Better Design for ease of use and superior aesthetics .Vertical integration of production processes to insure quality and meet demand. Fastidious attention to detail to exceed customer expectations. Ability to mass-produce a superior quality product. 33
  34. 34. References: 1. The Movie Jobs-2013 2.,the free encyclopedia 3. Apples/Apple's modern success story began with four investments made 10 years ago 4.'s International Business Management Concept 5. /Apples/Apple's success formula Wash, rinse, repeat, reinvent _ Apple - CNET News 6. Apples/Steve Jobs An Extraordinary Career _ 7. 8. 9. Apples/Steve Jobs’s Perfectionism and Apple’s Success 10. Apples/Strategic Management Case plus Case Answer Apple's Profitable but Risky Strategy _ Global Strategy 11. Apples/Strategic Management 12. Apples/The Analysis of Apple Inc. Marketing Mix. _ Kamal Lamido 13. The Secret to Apple's Marketing Genius (Hint It's Not Marketing) - Nigel Hollis 14. 15. 34