Apple 2
- 1. APPLE Inc. “THINK DIFFERENT” PRESENTED TO: PRESENTED BY: Prof. R.K. DE ROHIT CHANDRA SIMRANJEET SINGH RAJAN MITTAL PARMEET SINGH MANVIR SINGH LMT School Of Management
- 2. CONTENTS • HISTORY • COMPETITIVE ENVIRONMENT • APPLE’S STRATEGY • GROWTH • CHANGES AT THE HELM • DECLINE OF APPLE • APPLE STRATEGY • SWOT • CONCLUSION
- 3. “Change the World through Technology” • On April 1, 1976, as Apple Computer Inc. STEVE JOBS & STEVE WOZNIAK (Co- founder) • Industry: Computer Hardware and Software, Consumer Electronics • By 1976, Wozniak developed programming language for 6502 microprocessor. • In 1978, Apple – II was presented. • In 1979, Development of VisiCALE.
- 4. Sales
- 5. 1Q Market Share08 Low Market Share Dell HP Acer 6.6% Apple Toshiba Others
- 6. Competitor Environment • High Competition • Share of Dell and HP • Microsoft and Intel-Leaders of Software • CE Industry- Sony, Nokia, Samsung, Cisco, Motorola
- 8. GROWTH In1980, 25000 Apple II was sold & largest stock offering. In 1982, Huge infrastructure of retail & touch $1B. Focus on dealers. Launched program “Kids Can’t Wait”. New computer models II-e & LISA GUI , interface between People & Machine.
- 9. CHANGES AT HELM In 1983 , growing invincibly & production demands was high. They move to STEWARDSHIP MANAGEMENT STYLE. John Sculley was elected president & CEO in 1983. Zeal for technological innovation On LISA project needed to be harnessed. In 1985 , Jobs ousted from the board. Reestablished Apple as pioneer in GUI. Unique features for PC & captured the attention of users.
- 10. APPLE UNDER SCULLEY • Macintosh less expensive than LISA. • IN 1985, departure of Jobs & Wozniak. • IBM forceful enter into PC market & apple demand was depressed. • Reengineering the organization in 1986. • Vision was to target office computing. • Sales were $1.96B to $5.3B in 1989.
- 11. • Proliferation of clones, led to slow down of market share growth. • Apple was decentralized in 1988. • Separate division for product development & manufacturing • Change in organizational structure cause problems between marketing and R&D. • Process improvement initiatives • Smart manufacturing and geared the company to a market pull then technology push.
- 12. DECLINE OF APPLE • Refused to license its OS to other computer manufacturer. • Technology proprietary and exploit it only in its own products. • Microsoft with windows, diffuses its technology by putting on IBM PC. • Finally realized its mistake of superior technology. • In 1991, participate in IBM/Motorola/Apple consortium.
- 13. Contd. • Five distinct initiatives: b. Better integration with IBM compatibles c. New family of Reduced instruction set computers (RISCs) d. Open system environment known as AIX. e. Multimedia joint venture f. Next generation of OS software based on object oriented programming.
- 14. Contd.. Aim was to break Intel & Microsoft strong hold on PC market. In 1993, Michael Spindler took over as CEO & aggressive actions was taken. Cost cutting measures: Laying off 2500 workers. Freezing executive salaries Canning some projects Reducing R&D by $100M a year.
- 15. Contd. • In 1996, Gilbert Amelio, replaced Spindler as CEO. • Second Quarter loss was $740M. • In 1997, stock fell to 12 year low • Jobs was brought back as an advisor. • He declined as CEO & remain CEO at PIXAR , a new hi-tech venture.
- 16. Apple’s Strategy • Apple employs a Product Differentiation • Drawbacks as a result of their strategy include: ● Not appealing to Price Conscious Consumers ● Risk of Imitation by Competitors ● Risk of Change in Customer Taste
- 17. Differentiation Strategy Sustainable Competitive • Unique Features and characteristics Advantage • Commands Premium Price • High Customer Service • Superior Quality • Prestige • Rapid Innovation
- 18. Core Competencies (In Current Scenario) • Differentiation Strategy • Value Creation
- 19. Differentiation Strategy Sustainable Competitive • Unique Features and characteristics Advantage • Commands Premium Price • High Customer Service • Superior Quality • Prestige • Rapid Innovation
- 20. Value Creation Process Apple I,II,III Mac FF Focus On Education C o eMac n v Music Strategy (iTunes) e r Lifestyle Strategy Video Strategy (iMovie) Adding Value g e n Internet Strategy (iTools) Digital Hub c iMac e
- 21. Apple’s Problems
- 22. Strengths • Branding • Innovation • Differentiated Product • Superior Quality • Retail Strategy
- 23. Weaknesses • High Price Proprietary System • Niche Market, Less Penetration • Cannibalization
- 24. Opportunities • Fast growing Industry (Customer Electronics Industry) • Technological Innovations • Extend new products to loyal customers • High Potential music phone market • Strategic Alliances
- 25. Threats • Extensive Competition • Substitute Products • Low prices of Competitors • Technical Advancements • Economy downfall
- 26. CONLUSION • Free flow of information permits innovation. • Venture Capital as strong Catalyst. • Synergy between an inventor & Entrepreneur. • Packaging leads to success of product. • Worked feverishly to project this philosophy. • Incremental Innovation need to be managed with same as vigor as radical innovation. • Importance of forming alliances with competitor. • Decided to license OS. • Attempted to reorganized R&D activities several times
- 27. THANK YOU LMT School Of Mangement