CORPORATE LEVEL STRATEGY OF APPLE COMPUTER INC.
Low level of diversification (1976-1996)
To examine what strategies have been used by Apple, we divided the period into two ages. The first age is in between 1976 until 1996 were we can observe that all the products sold by Apple were computer related. They started with Apple 1 and continuously developed their products up until the evolutionary of Macintosh. However, their development restrained only to computers, chips and software which indicates low diversification applied by Apple at that time.
Apple is considered as a Dominant Business type of diversification where between 70% and 95% of their revenue comes from a single business. From this case, the dominant business is the computer business while the supporting are software and chips businesses.
Through adaption of this strategy, apple able to penetrate the computer’s market share at the beginning. This is evidenced by Apple reaching annual sales of $100 million from its 1st computer and in 1984, the new Macintosh pushed Apple’s sales to $1.5 billion .However, soon Apple faced some competition when in 1981, IBM released its first personal computer and the computer market began to grow with more players come in into the market. Up until 1990, the competition become worst for Apple when Microsoft released Windows 3.0, the first universal software that could run on nearly every PC where it meets the demand of the consumers who wants the compatible operating systems. Loss amounted in 1996-1997 due to demand for standardize software & stiff competition. Due to those problems, adapting this strategy was no longer effective for Apple in generating revenues and conquering the market share.
Moderate to high level of diversification (1976-1996)
When Steve Jobs returned to Apple in 1997, he plans to diversify Apple business from computer to the hub of consumer digital lifestyle. The new strategy includes the development of new iMac,...
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