Case Study 1: Apple 2008
Case Study 1: Apple 2008
1. Historically, what were Apple’s major competitive advantages?
Apple’s major competitive advantages over its rivals, historically, were: (1) the pioneering of the personal computer market with its easy-to-use Apple II in 1978; (2) the introduction of the first graphical user interface (GUI) with the Macintosh in 1984; (3) the winning, powerful combination of Wozniak’s technical skills, Jobs’ entrepreneurial zeal and vision, and Markkula’s business savvy and connections; and (4) a strategic, profitable sales base of the American classroom in an embryonic personal computer industry.
2. Why did Apple fail to build on these advantages to lead the industry?
Apple failed to build on these advantages because it lacked the ability to expand its marketing base to corporate America. IBM seized market leadership from Apple for this reason – mounting PC sales to over 500,000. IBM changed both its marketing and production strategies where Apple did not.
3. How has the structure of the personal computer industry changed over the last 20 years? What are the implications for the profitability of personal computer manufacturers?
Apple’s golden years were marked between 1986-1991 because of the company’s ability to manufacture both hardware and software. In this way, Apple was able to control all aspects of its computers, offering a complete desktop solution that allowed customers to “plug and play.” Huge profitability in this industry in the last 20 years came as a result of strategic manufacturing solutions along with the ability to manufacture and sell integrated and complicated systems. In this way, computer manufacturers are able to obtain huge profits because they are able to change premium prices, thus cornering global market shares. For example, the Apple I series, by 1990, was selling well in the education market and the Mac dominated the desktop publishing segment, generating high profitability margins.
4. Evaluate Apple’s strategies
1. Historically, what were Apple’s major competitive advantages?
Apple’s major competitive advantages over its rivals, historically, were: (1) the pioneering of the personal computer market with its easy-to-use Apple II in 1978; (2) the introduction of the first graphical user interface (GUI) with the Macintosh in 1984; (3) the winning, powerful combination of Wozniak’s technical skills, Jobs’ entrepreneurial zeal and vision, and Markkula’s business savvy and connections; and (4) a strategic, profitable sales base of the American classroom in an embryonic personal computer industry.
2. Why did Apple fail to build on these advantages to lead the industry?
Apple failed to build on these advantages because it lacked the ability to expand its marketing base to corporate America. IBM seized market leadership from Apple for this reason – mounting PC sales to over 500,000. IBM changed both its marketing and production strategies where Apple did not.
3. How has the structure of the personal computer industry changed over the last 20 years? What are the implications for the profitability of personal computer manufacturers?
Apple’s golden years were marked between 1986-1991 because of the company’s ability to manufacture both hardware and software. In this way, Apple was able to control all aspects of its computers, offering a complete desktop solution that allowed customers to “plug and play.” Huge profitability in this industry in the last 20 years came as a result of strategic manufacturing solutions along with the ability to manufacture and sell integrated and complicated systems. In this way, computer manufacturers are able to obtain huge profits because they are able to change premium prices, thus cornering global market shares. For example, the Apple I series, by 1990, was selling well in the education market and the Mac dominated the desktop publishing segment, generating high profitability margins.
4. Evaluate Apple’s strategies