Apple 2008 Case Study

Topics: Apple Inc., Personal computer, Apple II series Pages: 13 (3213 words) Published: July 24, 2012
University of San Carlos
Department of Business Administration
School of Business and Economics


In Partial Fulfilment in the course

Submitted to:
Dr. Rene Paquibut

Submitted by:
Jon Daniel Chua
Daieian Vanesa A. Portillo
Roxanne M. Baring
Marie Vane Quiño

Submitted on:
July 17, 2012

The early years of Apple. Two young electronics enthusiasts, Steve Jobs and Steve Wozniak, started a company selling a primitive personal computer that Wozniak had designed, on April Fools Day 1976. Their company was located in Steve Jobs garage. Jobs was the one who suggested to name their company Apple.

In 1976 their first machine was Apple I. And by late 1976, Woz was working on a replacement, Apple II. The Apple II was introduced in 1977 at a price of $1,200.

By the end of 1980, Apple had sold more than 100,000 Apple IIs, making the company the leader in the embryonic personal computer industry. In the fall of 1980, Apple introduced its next product, the Apple III. And reintroduced a reengineered Apple III in 1981. In that same year IBM PC took the lead in the market leadership. IBM had what Apple lacked, an ability to sell into corporate Americans.

By 1980, two other important projects were underway at Apple, Lisa and Macintosh. Lisa was originally conceived as a high-end business machine and the Macintosh as a low-end portable machine. It was in these times that Jobs was reportedly driving people on his project nuts with his demands to make these projects possible in just a short time.

Apple’s Vision is that “They weren’t making a computer, they were making history.”

Apple in that time was experiencing a hard time trying to please and fulfil Jobs goal to produce and ship the products early 1982.

In 1984, the Macintosh certainly captured attention for its stylish design and utilization of a graphical user interface, icons, and a mouse, all of which made the machine easier to use. Jobs ever the perfectionist insisted that not a single screw should be visible on the case. Early sales were strong; then faltered. The Macintosh lacked an important feature; it had no hard disk drive, only one floppy drive and insufficient computer memory.

In early 1985, Apple posted its first loss. Because of Jobs actions and decision making problems. Drastic actions should be taken but cannot be done while Jobs was running the Macintosh division. Then, Jobs was taken out of the project as the management.

The golden years. In 1985 Apple had licensed its “visual displays” to Microsoft, to defend its right to develop Windows.

In 1986, a new version of the Macintosh, the Mac Plus, was introduced. And sales started to grow again. What drove sales higher was Apple’s determination of the desktop publishing market.

The period between 1986 and 1991 were in many ways the golden years of Apple. Because it made both hardware and software, Apple was able to control all aspects of its computers, offering a complete desktop solution that allowed customers to “plug and play”. Apple was able to charge a premium price for its products.

In 1990, Apple sales reached $5.6 billion, its global market share, which had fallen rapidly as the IBM-compatible PC market had grown, stabilized at 8%. The dramatic growth of the PC market had turned Apple into a niche player.

Sculley the one who replaced Jobs thought that the company was in trouble. So Sculley had a game plan on how to deal with these problem, it involved number of steps. First, he appointed himself as chief technology officer in addition to CEO. Second, he committed the company to bring out low-cost version of the Macintosh to compete with IBM clones.

Introduced in October 1990, the Mac Classic priced at $999. He cuts prices for Macs and Apple IIs by 30%. The reward was a 60% increase in sales volume but lower gross margin. Third, he cut costs. The workforce was reduced by...
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