Apple Inc., 2008 - Case Solution

Case Synopsis – Apple Inc., 2008

Apple Inc. was founded on April Fool’s Day in 1976 in a garage in Los Altos, California.

Throughout the entire journey, during the ups and downs, the company’s primary focus has been delivering the best experience and product to its customers.

Let’s take a look at the timeline of things that happened to understand the journey of Apple.

1. 1970s – The Start of an Era

• Apple Inc. was founded, and the first Apple I machine was developed to give ease of use to existing computer users compared with the existing DOS systems. This resulted in USD 1 Billion in sales in less than three years.
• Vendor specialization of the Mac Line – To maintain customer satisfaction and experience, the company never allowed third parties to develop or make clones of their computer systems.

2. 1980s – The Beginning

• IPO of Apple Inc. – and in the next couple of years, the company became the Industry Leader.
• BM, a major competitor, entered the computing market and challenged the company, resulting in a major change in Apple’s competitive position.
• With tough competition from IBM, the company’s Market Share dropped to 6.2%, and net income fell by 17% as the company could be clearly seen to go into crisis.
• Steve Jobs was also removed from the organization, and John Sculley was made the new CEO (he was hired by Pepsi-Cola for his excellent marketing skills).

3. 1990s – The Change of Hands

• The major focus during this time period was on low-cost production and also to shorten the Product Development Cycle.
• To achieve the above goals, Apple Inc., under John Sculley, entered into an alliance with IBM by forming a Joint Venture (Taligent) – with the sole aim of creating an exceptional and revolutionary Operating System (OS)
• However, the Gross Margin continued to drop to