1. Apple Case Analysis Issues and Outlook SWOT Summary
External Analysis
Internal Analysis
Strategic Recommendations
Mission
Goals
Strategic Action Plan

2. Issues and Outlook: 1993 and Beyond
Is Apple successful?
Past/current strategy?
What are the main concerns/issues that confront Apple?
Where is Apple headed in the future?

3. Comparative Market Share (%) by Revenue

4. Financial Snapshot: Revenue and Net Income (in $millions)

5. Breadth of Competitive Scope
Apple’s Business Level Strategy
Source of Competitive Advantage
Cost
Uniqueness
Cost
Leadership
Differen-
tiation
Broad
Target
Market
Breadth of Competitive Scope
Focused Differen-
tiation
Focused Low Cost
Narrow
Target
Market 89

6. External Analysis Influences from Remote Environment
Influences from Competitive Environment
Promoters of / Barriers to Change
SWOT Summary
Competitor Analysis

7. Analysis of the General Environment
Demographic
Economic
Competitive
Environment
Political/Legal
Global
Technological
Sociocultural 10

8. Industry Growth (in $billions)

9. Analysis of the Competitive Environment
Threat of New Entrants
Threat of New Entrants
Bargaining Power of Suppliers
Rivalry Among Competing Firms in Industry
Bargaining Power of Buyers
Threat of Substitute Products 23

10. Microprocessor Volume Installed Base - Millions of Units

11. Strategic Group Map Pre-Windows
Premium
Sun
Apple
Price
Compaq
IBM
Clones
Low
Broad
Narrow
Strategic Focus - Differentiation

12. Strategic Group Map Post-Windows
Premium
Sun
Apple
Price
Compaq
IBM
Clones
Low
Broad
Narrow
Strategic Focus - Differentiation

13. Internal Analysis Resource-based View Analysis of:
Core Competencies
Core Weaknesses
Value Chain Analysis of:
Value-enhancing Activities
Value-diminishing Activities
Promoters of / Barriers to Change

14. Human Resource Management Technological Development
Value Chain Analysis
Firm Infrastructure
Human Resource Management
Support
Activities
MARGIN
Technological Development
Procurement
Service
Inbound
Logistics
Outbound
Logistics
Marketing
& Sales
MARGIN
Operations
Primary Activities 59

15. SWOT Summary
Strengths
Weaknesses
Opportunities
Threats

16. Revised Mission/Intent Statement
“Apple ………………………………..”
Definition of Industry
Description of Core Values
Description of Basic Strategic Approach
General Identification of Customer Base

17. Revised Mission
To position Apple as the world leader in man-machine interfaces though the development of ergo- and cerebro-nomic software and interface devices required for electronic and electromechanical applications.

18. Goals
Financial
Strategic

19. Goals 20% ROS by 1994 40% Share of O/S Market by 1994
Develop 3 New Interface Devices by 1994
Achieve full interoperability with
Intel and RISC microprocessors by 1993
Top 4 Software Vendors by 1993

20. Strategic Action Plan Strategic Action #1 Strategic Action #2
Details about specific value chain activities
Resources required
Expected benefits (re: a particular SWOT item)
Strategic Action #2

21. Milk Mac
No new manufacturing and R&D investment in existing hardware products
Outsource next 3 years’ production to Malaysia:
Send VP Mfg. and 3 Engineers on “Sourcing Mission”
Benefit: Decrease COGS from 53% to 33%

22. Apple Core “Open system” O/S (a.k.a. Pink)
not processor specific
head-to-head with Windows
increase installed base
increase ISV applications
Shift 80% of R&D budget to Core
Benefit: Increase ROS from 5% to 20%
(NOTE: O/S production has COGS average 19% percent of sales vs. 66% in hardware manufacturing.)

23. Apple’s Recent Actions
1993
Cut Mac prices 26%
down from a 20-40% premium
PowerPC with IBM and Motorola
PowerMac
PowerBook laptop
Overseas expansion; Japan (2% to 15%)
Newton (PDA)
1994
Layoffs and Mfg. Rationalization
Pushed Pink
H-P joined Apple and IBM
Sculley resigns; Spindler is new CEO

24. 1995
Attack educational and desktop pub markets
License Mac O/S (aka Copeland)
Record revenues; $69 million net loss
Fujitsu starts price war in Japan
Terminated Taligent and Kaleida
Jobs and Woz are back
Accepted $150 million from MSFT
Intros iMac

25. Actual Results:

26. Stock Price

27. Comparative Market Share (%) by Revenue

28. Revenue Comparison (in $millions)

29. Profit Comparison (ROS %)