Apple Computer Inc Case 2011

[pic 1][pic 2]

Apple Computer, Inc.

[pic 3]

Submitted in partial fulfillment

of the requirements in Strategic Management

Submitted by:

Janice Alfonso

Reimar Campena

Angelique Cara Exconde

Nareena Mansukhani

Margarita Tabag

September 12, 2015

Executive Summary

Introduction

From the year 2008-2011 the United States had poor economic conditions and it resulted to unfavorable business circumstances that made it barely possible for any company to meet goals and fiscal targets. Though the economy is at the verge of collapse, Apple Inc. rose above the dire conditions and celebrated its record quarterly revenues and profits during the third quarter of 2011. During this time, the company’s stock price boomed to a level where Apple Inc. became the most valuable and demanded company by market capitalization worldwide. The growth revenues and profits came primarily from increased sales of iPhones and iPads, which improved by 142 percent and 183 percent respectively, from a comparison with the same period in 2010. In addition, the sales of Mac computers increased by 14 percent from third quarter 2010 and reached a record of 3.95 million units sold. Disappointingly, iPod sales had a year-on-year 20 percent drop from 9.41 million during the third quarter of 2010 to 7.54 million during the same period of 2011.

During the third quarter of 2011, though company sales were skyrocketing, it was overshadowed by deep sadness due to Steve Job’s illness-forced resignation, the last of his many medical leaves, and eventual passing due to cancer. Tim Cook took over the leadership of Apple Inc. and oversaw the introduction of successful new products while revamping the company’s supply chain and operating efficiency. As the new president, he faced many challenges and one of them was the decline in iPod unit sales. The silver lining, however, that lessened the blow of the iPod’s sales decline is the rapid growth in iPhones sales that is equivalent to $13.3 billion of the company’s third-quarter revenue total of $28.6 billion.

The company’s success in the smartphone and tablet computer markets had not gone unnoticed with its rivals - Google’s Android, RIM’s Blackberry, Nokia, Samsung and HTC - also competing in the same arena. Due to stiff competition, Apple’s managers are forced to work creatively and expeditiously to sustain the company’s growth and replicate the success it enjoyed under the guidance and supervision of Steve Jobs.

History and Background

Steve Wozniak and Steve Jobs founded Apple Computer in 1976 and started selling them under the name the Apple I to computer enthusiasts. Two years later, they produced their first major personal computer (PC) and named it the Apple II, and the sales for this new product was more than 10,000 units. However, their next product line - called the Macintosh (or Mac for short) became their holy grail and changed personal computing history through graphical user interface (GUI) which was user-friendly and allowed users to interact more with screen images rather than regular typing text commands. Nevertheless, despite the fact that the Macintosh, which was introduced in 1984, played a major role in personal computing history, it could not compete with the PC of IBM, which was introduced in 1981, as it was the preferred choice of business enterprises. One contributing factor is Apple’s very strict restrictions on the Apple Certified Developer Program that made it very hard for software developers to obtain Macs on discounts and also receive information materials about its operating system.