Design Thinking and Innovation at Apple

Apple’s goal is mainly on generating creative ideas that focus on products that are different and those that will lead to sales and customer brand loyalty.

One key element of Apple’s strategy in computers, personal media players, tablet computers, and smart phones is product innovation, diversification and development. Over the years Apple has been very successful in integrating software and hardware in new developing products. Despite the struggling economy in recent years, Apple has been able to grow their market share and stay ahead of the game.

Apple was established as an IT company dealing in exclusively in computers. However, competition in the technology sector forced the firm to focus on other consumer products. The diversification strategy has seen Apple’s sales grow tremendously in the last decade, earning the firm the No. 1 brand position at Forbes. The Apple brand is recognized on an international scale and enjoys a strong recognition thanks to its aggressiveness when it comes to creativity and innovation (Tar, 2013). It has a large number of loyal customers who would purchase the new products regardless of the market price, which guarantees profits from the new division.

What is innovation at Apple? What is the (a) role of the product, and (b) role of their leadership in their success?

Apple has prospered internally and it is necessary to consider both strengths and weaknesses. Apple has lots of strengths, the major of them being it’s impressive brand reputation, Apple managed to position the brand as “premium products” for “elite” people. Customers are loyal and tend to stay in Apple’s ecosystem. Apple’s self-reinforcing ecosystem, it has a diverse ecosystem which integrates various hardware and software products into one large interactive space. Status of top innovator, Apple is perceived as the leading innovator and its products are highly anticipated. Apple’s very strong financial performance, high profit margins and very high liquidity. It’s network of retail stores, high-quality customer service helps to create advanced user experience. A powerful marketing strategy, Apple’s team masterly uses various marketing techniques to create a hype for their products and to strengthen the brand.

Apple came back from near extinction to become one of the most revered technology companies in recent memory. They achieved this status by developing innovative design products and pushing the limits of their marketing prowess. Apple is known for their ability to listen to consumers and revolutionize market segments by providing modern design laden and feature rich alternatives to the target markets. They employ strategies that might contradict normal convention by keeping their prices high to build a brand image of prestige and promote their products through word of mouth. The impact on marketing is hugely noticeable by other companies following suit with store models

Apple Inc. has been dedicated to innovation ever since the company was first formed. Apple's recent breakthroughs were a result of a new technologies convergence upon the "digital hub" strategy (Mortensen, 2010). This strategy has served Apple well; especially during the last few years. The iPad, iPod, and iPhone were all born from this strategy. Furthermore, producing these innovative, user friendly, and design oriented products has earned them a considerable amount of customer loyalty.

One of the worlds most valuable company is Apple. Apple leads the world in innovation with iPhone, iPad, Macs and many other devices. It all started when the 21 year-old college dropout. It was no straight path for him to get to what he created. It was more like a windy road. It was evident from his early years that he had no grand plan to do what he has done. However, Steve’s windy road growing up, jobs found inspiration and creativity and most

The closest comparison to this small computer at the time was the Altair 8800 and the Intel microprocessors used in calculators and watches. An improved version of the Apple 1 developed into the Apple 11, the first personal computer with graphics and a keyboard, and IBM soon followed Apple’s lead with their version of a small computer. The market for personal computers had been primarily in the business industry. Apple Computer sales netted $50 million by the last quarter of 1979 (Gitman & McDaniel, 2009) and Apple soon became the personal computer of choice for many small businesses and families, especially when Apple introduced the more user- friendly Macintosh computer in the 1980’s. The Macintosh was Apple’s first major step in adapting the personal computer to the desires of corporate America. In ten years, Apple had grown from two employees in a garage to a $2 billion company with over 4000 employees (Jobs, 1985). What began as a hobby for Jobs and Wozniak soon became an essential part of many households and established the foundation for the Apple empire.

“Apple uses promotional and advertising tools to capture the attention, interest, and desire of the consumer. Apple captures our attention and interest through innovating and sleek imagery of their products on Apple's official website as well as keynotes and other publication” (Villefranche, 2011). For example Apple just released the I phone 5 which was highly anticipated and the publicity that Apple had prior to the release was tremendous and also brought in many new customers. It has been said that the first weekend the I phone 5 was available they sold 5 million phones. Apple made a plan and set up objectives and goals that they desired. Through integrated marketing they have met those goals and it allows for them to set higher goals and reach them as well. Apple also knows their competitors very well and this allows them to be in this market and compete very well.

Even though Apple has encountered many setbacks, it continues to bring new and improve products to the market. Apple’s competitive strategy has been innovation. They have made an extraordinary effort developing, implementing, and executing its very unique strategy through innovation which has resulted in new product, and the enrichment of the existing ones. More specifically, Apple attempts to meet and supply the needs of a global market, by offering eager and enthusiastic consumers with innovated and high-quality products and services. Apple has employed a differentiation strategy linked to innovation with its three core products (computers, personal media player, mobile phones, tablets and other accessories). A key piece of their strategy involves meeting the needs of the converging digital electronics and computer markets. Apple has elected to implement its strategy by designing and developing proprietary operating systems and software technologies, thus allowing for strict protection of its intellectual rights.

Nowadays, Apple has positioned itself to be an innovator in the personal computer industry and Apple has developed by offering modern products compared to its competitors. According to Apple’s mission statement last year, “Apple designs Macs, the best personal computers in the world, along with OS X, iLife, iWork and professional software. Apple leads the digital music revolution with its iPods and iTunes online store. Apple has reinvented the mobile phone with its revolutionary iPhone and App store, and is defining the future of mobile media and computing devices with iPad.” (Business Management,

This paper aims to highlight and discuss the major challenges and opportunities which Apple Inc. faces while bringing innovation in the four primary areas of its business operations; including product innovation, process innovation, marketing innovation, and organizational innovation. The major focus of the paper is towards discussing the combination of all these processes which this organization follows and the major challenges which it faces in the course of its innovation or change strategies. The paper concludes by summarizing the importance of innovation for Apple Inc. in the light of the whole discussion.

In return, they have a strong financial backing, brand reputation, strong marketing and advertising teams. Apple plans to take these strengths and prosper off of them. Taking the amount of brand awareness they have built along with their benefit of retail stores the company can plan to use their strong marketing and advertising teams to launch a new product.

Promoting innovation is a big advantage for businesses although the failure rate of the innovation of new products is high (Hill & Jones, 2013:495). So, Steve Jobs strategy is blended art and technology in order to provide a simple and streamlined user experience. Thus, in 2007, Apple was in the forefront of