Apple Inc., 2008

Topics: Apple Inc., Steve Jobs, Macintosh Pages: 15 (740 words) Published: February 22, 2014
5/14/2009

Apple Inc. Case Study

Key Success Factors

•Expertise in particular technology/research
• Proven ability to improve production processes
• Customer-need satisfaction
• Continued innovation

Recommended Strategy

Spread out consumer confidence in Steve Jobs to the
Apple team and stakeholders Develop and launch the
stakeholders.
MacBook Air Mini by 2nd quarter 2010 to encourage
said consumer confidence in Apple.

1

5/14/2009

Environmental Analysis
Internal Positive

External Positive

● Brand Recognition

● Highly technological society

● Customer Loyalty

● BRIC countries’ continued growth
Internal Positive

● Sterling Reputation

Internal Negative

External Negative

● Steve Jobs’ health concerns
● Stagnant Desktop line
● Lack of netbook product line

Five Forces Model

Supplier
Bargaining PowerModerate

● Global recession
● Poor IP protection in emerging
markets

Threat of SubstitutionLow
• Cost of switching
F
products is high
• Product loyalty is strong

Competitive
Rivalry-High
• Rapid and frequent product
innovation by large firms

• Only two CPU
manufacturers
(Intel/AMD)

• Product technology copying

• Small pool of talent to
choose from

Buyer Bargaining
Power-Moderate
• Infrequent Customer
Purchases
• Customer Switching
dd
costs are high
g
• Recession creates
decreased demand

• Large firms with disparate
unique strategies

Potential new
Entrants-Low
•High barriers to entry
•Incumbent firms spend to
keep out new firms

Apple Notebook Sales on the Rise!
12000
10000
8000
6000

Notebooks
Desktops
D kt

4000
2000
0
2001 2002 2003 2004 2005 2006 2007 2008

Mac percentage of revenue has
increased 15% since 2006…
…and iPod’s percentage of revenue
has decreased 20.8%.

2

5/14/2009

Product Life Cycles
Introduction

Growth

Maturity

Product lifecycle curve

Decline

iPod, all
models
Mac desktops

Sales

iPhone
NetBooks

Early majority
34%

Late majority
34%
Laggards
16%

Early adopters
13.5%

Diffusion
curve

Innovators
2.5%

Diffusion curve: Percentage of total adoptions by category.
Product life cycle curve: Time

Constraints
Industrial World Economic Slowdown
Apple’s dependency on Steve Job’s health
Technological Limitations
h l i l i i i
MP3 Market is shrinking rapidly
iPod Market is saturated
iPhone Cannibalizes part of iPod Sales

Alternatives
Do Nothing
Pro: No increased risk
Con: Continue being stagnant

Reposition the iPod
Pro: Increase the profit capability of a Cash Cow
Con: Placing advertising money into a lost cause

3

5/14/2009

Alternatives
Renovate the Mac desktop line
Pro: More competitive with other desktops
Con: Repositioning into a Market that is decreasing due to a global economic slowdown

Create a netbook based on the MacBook Air platform
Pro: Great for the psychology of the company and
shareholders, and stakeholders
Con: Expensive development in a recession

Alternatives Matrix
Alternatives
1

2

3

4

Key Success Factors
Expertise in particular
technology/research

.4

2

.8

2

.8

1

.4

3

Proven ability to improve
production processes

.1

2

.2

3

.3

2

.2

2

.4

.25

2

.5

2

.5

2

.5

3

1.5

.25

1

.25

2

.5

3

.75

3

Customer-need satisfaction
Continued innovation

Totals

1.0

1.75

Alternatives
1) Do nothing
2) Reposition iPod
3) Renovate Mac desktop
4) Create netbook based on MacBook

2.1

1.85

1.6

.75
4.25

Rating scale:
1: Black Hole
2: Flickering star
3: Shooting Star

Steve Jobs = Apple Inc.?
Apple’s Success is Related to Steve Jobs’
Standards, Not Steve Jobs Himself.
1) Regular Rules Don t Apply
Don’t
2) Micromanager
3) Intense Secrecy
4) Concentrated, Hard-Fought Innovation
5) Communicated Zeal
6) Radical Opacity

4

5/14/2009

Issue:...

References: Brigham, E.F., Daves, P.R. (2007). Intermediate financial
management
Chase, R.B., Jacobs, R.F., Aquilano, N.J. (2006).
(2008). Crafting and executing strategy: The quest for
competitive advantage
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