Case: Apple A

At the present scenario apple is one of largest vendors of personal computers in the world with record revenue of US 46.33 billion. Apple always followed a vertical integrated model for the last few decades which integrate hardware and software together; this is the main success factor of apple when compared to other PC makers who does the other way round by outsourcing some of its work to others.

At the beginning, when apple was launched it was the idea of Steve to follow vertical integration strategy for the company because he did not trust any outside party for product development. Apple was doing well at the beginning but treat of IBM was growing in the early eighties and the failure apple 3 made apple to loss its hand in the PC market. Steve jobs realized that IBM PC was mainly designed for corporate customers and Mac was designed for consumer market and for the same reason there was disagreement with sculley who believed in traditional distributor system and want Mac as a business tool. Due to this disagreement Steve was thrown out of apple which results in the collapse of the whole company later.

When Steve was called back to apple after a decade he was very methodical in allocating his resources , like he cut down the R&D spending and also removes all the product line to focus only on PC’s and laptops.

In the early 2000 apple was focusing its innovation in two areas ie hubs and spokes and was successful up to a great extent. iTunes was another innovative idea from apple which almost changed the concept of hearing music.

Steve has a different concept of retailing when he started the first apple store in Virginia, Steve felt that his products should be sold in separate outlet rather that with his competitors products which was actually a different concept all together. There was a halo effect prevailing the market after the launch of apple iPod and Steve always gave importance to products rather that profit and was successful up to a great extent.