Technology Strategy
Apple’s technology strategy is to change the world through technology. They have remodeled the field of consumer electronics. This was not always the case. Initial Apple products such as the Next computer, the Newton PDA, the Lisa computer, the Pippin player and the Apple TV did not do so well. In fact, Apple’s ability to rise above the tide and be successful was in doubt as compared to its competitors like Microsoft. Currently, Apple is among the most profitable and innovative companies in the world with the largest market share for tablets.
Creating a good technology strategy is normally a messy affair. Apples ability to anticipate and discern the direction emerging markets in technology take has been core to its technology strategy. It has been able to track strategic technologies and use forecast to plan corporate strategies. Apple focuses on product discovery with the goal of creating transformative products not understood yet. This underscores its strategy statement, to contribute to the world by making tools for the mind that advances humankind.
In order to meet this goal, Apple has continually involved stakeholders. Steve Jobs for example was able to convince record companies that online music was the future for their industry. This way, he was able to lead the establishment of the iTunes music store, clearing the way for the iPod, the first successor to Sony’s Walkman. Apple has been able to exemplify a human-focused technology strategy thereby changing the world through technology.
A culture of focusing on the future deriving inspiration on achievable possibilities sets the standards for technology sourcing, innovation and design. The innovation cycle at Apple stretches over at least 5 years into the future. This effectively sets the pace for achieving the technological purpose outlined for the company.
Core competencies
In this spirit, Apple’s iPhone has redefined the purpose of a mobile phone from just a phone to an internet client, digital media player, camera, GPS navigator among a host of other features. The introduction of the iPad brought in a completely new gadget in the consumer electronics market. This has drastically changed preference for gadgets and the view of handheld devices. Deployment of a touch screen on both the iPad and the iPhone has completely changed the way users interact with devices.
Unveiling of the iPod coupled with a complete online music store, iTunes changed the fortunes of the records industry. Starting from the design to the features, Apple’s gadgets have continuously set the trend for the better period on consumer electronics market. This has even led to coining of new terms such as ‘smart gadgets’ to exemplify Apple’s pace setting competencies.
Over the years, the brand Apple has continued to grow and flourish. Devices that carry this brand depict a symbol of fashion and class. In the sphere of technology, Apple as a brand depicts sleekness as well as class. This is a competency that the company to rides on in driving sales and keeping client loyalty.
Industry Dynamics
Apple’s strategy is its ability to track technology trends and forecast the direction of technology in order to change the world. Innovatively and in a timely manner, it has been able to introduce products in the market that have been increasingly rewarding. Over the last couple of decades, technology has been changing at a tremendous rate. The risk of becoming obsolete is extremely high and even worse the ability to predict the future is a tricky affair.
In its early years, Apple completely lost to its competitors in sales and market share. Its products were unable to compete favorably on all fronts to the level that its future was in doubt. Competition from IBM in the PC market and Microsoft in the PC Operating Systems market challenged Apple to redefine its strategy. The return of Steve Jobs after his departure in 1985 marked a turning point for Apple’s fortunes. There was more concentration on design and employment of innovative technology.
Overtime, Apple remodeled its strategy to changing the future through technology. This brought an end to focus on market research to drive production. Focus shifted to product discovery guided by tracking trends and precisely timing introduction of new products into the market.
The strategy at Apple has seen the introduction of gadgets fondly referred to as smart gadgets. The face of technology has been known to keep changing, ideally the fastest changing field of the current day and age. Apple was able to align its strategy with this change and it has paid off in the best conceivable way. Today, Apple tops the charts of technology companies and on a wider scale, a top player in profitability across the divide.
Technology Sourcing and Internal Innovation
Over the years, Steve Jobs has served the role of chief innovator at Apple. Steve insisted that even when a company has smart engineers, there is need for gravitational force that pulls them together. In his perspective, the gravitational force is a product-oriented culture. Internal innovation at apple is very customer centric. The focus is to create desire for their clients to interact with their computer or mobile devices and provide for their basic needs. Innovation cycle for products stretches 5 to 10 years into the future making it impossible for competitors to catch up. A relentless pursuit to improvement is subtle to Apple’s internal innovation.
In sourcing for technology, innovators and designers at Apple study new ideas and ways to promote customer interaction. This is opposed to the traditional mode of sourcing for technology that looks to solve clients’ specific problems. Often, Apple begins with a new idea for a multimedia interaction and designs a product enabling that interaction. The human-centered approach stems right from the sourcing of ideas to design. The concept of Design Thinking enables a focus on the customer experience in the design of products.
A typical example that exemplifies technology sourcing internal innovation at Apple is the iPod. Though not the first mp3 player, the iPod was a first of its type to simplify interaction between the computer, mobile phone and the music store. Through an iterative technique, innovations and are continually smoothened and simplified. Teams carrying out product development are tight-knit groups constantly testing and retesting each other’s work.
In the absence of Steve Jobs, the guiding principles left behind continue to drive innovation. This culture of innovation stems right across the divide in the company. Engineers and designers have mastered the principles of innovation, human-centric, product oriented design thinking.
Product Development Strategy
The product development strategy under Steve Jobs was to create premier products and charge premium prices. Lost to many are the subtle changes that Apple makes to its portfolio of products every time it introduces a new product into the market. For example, with the release of iPad 3, the price of iPad 2 reduced by $100. This was the same case with the release of the newest iPhone. This strategy enables the company to capture high margins with early adopters of their products while still broadening penetration among the price conscious clients. This also enables the company to ‘create space’ for newer products within its portfolio without necessarily exceeding the spending caps from its audience.
The ability to keep an eye on the future is subtle to the product development strategy at Apple. This directly chips from the technological strategy of changing the world with technology. This change is achievable with a clear insight to the future. Success and growth elicits expectation. Anticipation is normally high prior to any Apple event. Political pundits giving prospects of ‘the next big thing’ to expect from the technology firm characterize months leading to the events. This far, Apple has not disappointed. Through innovation and design, they have continued role out incredible improvements on their line of products. The sale of iPads continues to rise even with competitors such as Samsung, Blackberry and Amazon releasing their own version of tablets with arguably, features that provide advantage over the iPad.
Involving clients and other stakeholders has helped Apple establish its line of products over the years. The company has had some of the most successful product launches for being able to release products that meet the needs of the client and fulfill their requirements. This also inspires the human-centered approach in product development. The iPhone for example, has had the highest user experience ratings over all other smart phones since it has been able to fulfill the customer’s needs and desires. Another casing point is the involvement of stakeholders in the record industry with the inception of iTunes and the iPod by extension. This has greatly contributed to the success of these products and their continued support.
Optimization of the current portfolio of products is one among the latest tweaks to the product development strategy. Tim Cook has seen the carrying out of updates since he took the helm at Apple, on the iPad, the iMac and the iPod. This updates have successfully addressed some major client requirements. Most notably however has been the fixation to optimize performance and design. This gives the products a competitive age even with a variety of new competitive devices taking on the market.
Strategy to Protect Innovation
Innovation that results in new products and intellectual property is just as good as its protection. Apple Inc. ha patented a large number of innovations since its inception. A patent is a set of exclusive rights awarded by a sovereign state to an inventor for a limited period. A patent is a form of intellectual property. Patents registered by Apple give it exclusive rights and thereby allowing them to benefit exclusively from them. The process of coming up with technological innovation is complex. To this end, protecting an inventor’s work gives them the right to be the initial beneficiaries from their work all be it for a given period.
Owing to these exclusive rights, Apple was able to recoup on the infringement of its patents from Samsung following a lawsuit. A court in the U.S. ruled in favour of the company enabling it to benefit from a $1 million fine levied on Samsung. However, it is worth noting that patents may have geographical jurisdiction. A Japanese court rejected Apple’s suit against infringement of patents owing to the fact that the patent registered in the U.S. do not apply in Japan.
Trade secrets enable one derive economic advantage over their competitors. They cover information concealed from public knowledge thereby granting the owner of the information economic advantage. At Apple for example, Tim Cook takes credit for establishing one of the most efficient and effective supply chains. Information on its achievability is a closely guarded trade secret, one that has given Apple an edge over their competitors.
References
Strategy – Innovation at Apple. Wiki-Cases in Management. Retieved from
https://wiki.shanti.virginia.edu/display/wikiCASES/Strategy+-+Innovation+at+Apple.
Stark, K., (April 12, 2012). 3 Strategies to Adopt from Apple. Inc. Retrieved from
http://www.inc.com/karl-and-bill/3-strategies-to-adopt-from-apple.html.
(June 2013). Reaching Apple’s Success. GovernmentCIO Magazine.com. Retieved from
http://www.governmentciomagazine.com/2011/10/reaching-apple%E2%80%99s-success.
(October 27, 2009). Apple’s Core Competency in Innovative Design and Technology. Open
Surge Group. Retrieved from http://www.opensurgegroup.com.
(May 30, 2013). Apple’s New Product Strategy. TechCrunch. Retrieved from
http://techcrunch.com/2013/05/30/apples-new-product-strategy/.
