Apple Swot Analysis 4

Topics: Apple Inc., Steve Jobs, IPhone Pages: 8 (2554 words) Published: October 8, 2011

Apple Computer, Incorporated have gone through many up and downs to become the successful company that it is today. Co-Founder and current Chief Executive Officer Steve Jobs has been an innovator and strong leader in the direction of the company. A mutual fund manager should invest in Apple due to the track record Apple and Jobs has demonstrated. The following SWOT (strengths, weaknesses, opportunities, and threats) analysis of Apple will illustrate where the company has been and where it is going. Apple has set high standards for their products, which continues to challenge its competitors.

Steve Jobs and Steve Wozniak on April 1, 1976, both college dropouts, started Apple Computers. Jobs was a 26-year-old working at Atari and Wozniak was 21. Their partnership began several years earlier when Wozniak, a talented, self-taught electronics engineer, began building boxes that allowed him to make free long-distance phone calls. Several hundred boxers were sold and in 1976 Wozniak was working on another box--the Apple I computer, without keyboard or power supply--for a computer hobbyist club (Finkle & Mallin, 2008). Their original partnership began years earlier when they were designing a box to that could make free long distance phone calls. In 1976 Wozniak was already working on the first Apple Computer, the Apple I. Later that year the Wozniak began developing the Apple II while Jobs was continuing to work on the marketing campaign and gaining additional capital. Wozniak’s focus was on the engineering and Jobs was focused on building the business. By 1980 Apple went public and introduced the Apple III. Even with difficulties of the Apple III in the early 1980’s, Apple was the first personal computer company to reach $1 billion in sales. In 1983 Jobs appointed former Pepsi executive John Sculley as CEO who was known for his marketing expertise (Simmons, 2007). Sculley developed a strong reputation with his marketing strategies at Pepsi. Apple was competing heavily with IBM in the business computer (Finkle & Mallin, 2008).

In 1984 Apple released the Macintosh computer. The release of the Macintosh allowed Apple to penetrate the business computer market that was dominated by IBM at the time. In 1985 due to internal strife with the company at the time, Jobs left Apple to start his own company NeXT (Finkle & Mallin, 2008). With competition increasing to what Apple had to offer companies and pending lawsuits regarding the technology Apple used for their technology had Apple heading into the 1990’s without the momentum they had in the early 1980’s (Finkle & Mallin, 2008).

The 1990’s were a decade of poor management, continued internal strife, and changes in the industry. Apple’s profit share was decreasing, which caused them to lay off many workers. In 1993 CEO John Sculley was forced out and the three succeeding CEO’s did not improve Apple’s situation (Finkle & Mallin, 2008). In 1997 Steve Jobs returned to Apple as its interim CEO and started the process leading Apple to where it is today. Jobs decided to have the company strictly focus on desktops and portable computers. A critical decision Jobs made was to partner with one of their major competitors, Microsoft. This involved a commitment by Microsoft to produce Microsoft Office and Internet Explorer versions that were compatible with Apple’s Mac. Also as part of the agreement Apple agreed to create its Mac OS with Internet Explorer as its default browser (Finkle & Malin, 2010). Another partnership was formed with CompUSA to offer a “store within a store” at all of their 148 locations at the time. Both of these new initiatives were immediately successful. Because of the implementation of the agreement with CompUSA, Mac sales at CompUSA stores had more than quadrupled and sales from the Apple stores topped $12 million within the first 30 days of its existence (Finkle & Malin, 2010).

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