Apple Inc 2008 - Analysis

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APPLE Inc – An Overview
* Apple Inc (previously Apple Computer, Inc) is an American multinational corporation that designs and markets consumer electronics, computer software, and personal computers. * The company's best-known hardware products include the Macintosh line of computers, the iPod, the iPhone and the iPad. * Apple software includes the Mac OS X operating system; the iTunes media browser; the iLife suite of multimedia and creativity software; the iWork suite of productivity software and its iOS Mobile Operating System. * As of August 2010, the company operates 301 retail stores in ten countries, and an online store where hardware and software products are sold. * Apple Computer Inc renamed itself as Apple Inc inorder to mark its foray into the consumer electronics market in addition to its traditional focus on personal computers. APPLE Inc – Evolution Timeline

1976-1984 – The early years
* Co-founded by Steve Jobs and Steve Wozniak, Apple’s mission was to bring an easy-to use computer to the market. * Apple computers courtesy of their unique proprietary design, technical excellence and ease of use sparked a computing revolution and quickly became the industry leader during these years esp with the release of Macintosh. 1985-1993 - The Sculley years

* With Apple’s net income falling due to stiff competition from IBM-compatible PC’s, John Sculley who took over as CEO from Jobs in 1985, made some significant strategic business decisions. * Sculley’s strategy was to make Apple a leader in desktop publishing as well as in education. He also aggressively tried to bring Apple into the corporate world. * Although Apple offered a more complete desktop solution and enjoyed better brand loyalty than its competitors, Apple’s market share continued to plummet during the late 1980’s. * Inorder to overcome this setback, Sculley revamped Apple’s strategy by making it a low-cost producer of computers with mass-market appeal. Mac Classic was introduced on this objective. * Sculley also forged collaboration with Apple’s rivals (esp IBM) on mutually beneficial terms. * Sculley also aimed to drive down costs by shifting much of its manufacturing to subcontractors.

1993-1997 – The Spindler and Amelio years
* Despite Sculley’s measures, Apple could not sustain its profitability. As a result, in 1993 Michael Spindler took over as the CEO from Sculley. He inturn introduced measures to revive Apple. * Spindler again brought back the focus on core markets: education and desktop publishing. * He introduced the idea of creating Mac clones and killed the plan to put Mac OS on Intel chips. * International growth became a key objective of his agenda. He also moved to slash costs, reduced the workforce and the spending on R&D. * Yet, despite Spindler’s best efforts, Apple continued to lose momentum. . As a result, in 1996 Gilbert Amelio took over as the CEO from Spindler. * Amelio’s strategy made Apple to return to its premium-price differentiation strategy. Inturn he pushed Apple into high-margin segments such as servers, Internet access devices and PDA’s. * Amelio infact led Apple through three reorganizations and several deep payroll cuts. Yet, despite his best efforts, Apple’s market share continued to decline between 1996-1997. 1997-2007 – Steve Jobs and the Apple turnaround

* Steve Jobs, turned out to be Apple’s savior when he again took charge of the company in 1997. * He introduced a string of measures which marked a sharp turnaround in Apple’s fortunes. * Firstly, he recognized that the Mac clones were cannibalizing Apple’s sales. As a result he brought the Macintosh licensing program to an abrupt end. * Secondly, he consolidated and trimmed Apple’s product range by reducing the number of lines from 15 to 3. * Thirdly, he collaborated with Microsoft and reaffirmed their commitment to develop core products such as Microsoft Office for the...
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