BM2212

Names: Cruz, Mary Joy, Encarnacion Cerina, Aquino Rose Ann Section: BSTM BT60
Date: March 15, 2023

Apple Inc.
When Steve Jobs and Steve Wozniak launched Apple in 1976, their primary purpose was to make great
computers that people love to use. Twenty-four years later, Apple was still a computer company when it
launched the iPod, a device that took the company into the music industry.
But Apple was not the first computer company to make a small, handheld MP3 player with a mini-hard
drive that could store an entire music library. That honor goes to Compaq, which HP later acquired.
Compaq developed an MP3 player before Apple, but the company decided this was not an industry and
product market it wanted to enter. Compaq decided not to pursue the MP3 business because it saw its
mission as being a computer maker, and music players fell outside of that mission. Instead of refining the
design and launching its MP3 player on the market, Compaq sold the technology to a Korean company.
In contrast, Apple decided that this product market was not outside its mission. Apple’s decision was
influenced by its external analysis. Apple looked at the multibillion-dollar music business and quickly
realized that no company was offering legal digital downloads. The market was wide open because of the
challenges of protecting the files from being easily copied.
Apple’s top executives also considered its internal capabilities. Unlike Compaq—which only made
computer hardware but not software— Apple had vast experience creating software for Apple computers.
It also had far greater design expertise than Compaq. The company had long been hailed for the cutting-
edge designs of the iMac and some of its other computers.
Apple decided to channel its internal capabilities into creating software to navigate an MP3 player. Apple’s
software engineers developed the innovative “flywheel” design for navigating the iPod. Likewise, it
channeled its design capabilities toward designing a product that was elegant and small enough to fit in
your pocket.
As a result of formulating a strategy to enter the MP3 player market—and subsequently, the iPhone, iPad,
and Apple Watch— Apple’s mission has broadened. The company no longer focuses on just being a
computer maker. In fact, in 2007, it changed its name from Apple Computer Inc. to Apple Inc. to reflect
this change in its mission.
Answer the following questions: (4 items x 10 points)
1. How did apple achieve a dominant position in the market as a seller of both songs and
musicplayers?

When the iPod was released, the company entered the music industry. Apple wasn't the
first computer company to develop a tiny, portable MP3 player with a mini-hard drive
that could store an entire music library, but after researching the multi-billion-dollar
music industry, the company realized that no one was offering digital downloads. Apple
creates MP3 player software. because of creating a strategy to enter the MP3 player
industry.
 2. Which phase in the evolution of strategic management is present in the given case?

It was a significant development when Apple produced an MP3 player with a mini-hard drive
that could store an entire music collection, allowed for legal digital downloads, and produced
software with a better design than competing products.

3. Which type of strategy is being employed by Apple in the given case study?

A plan at the corporate level. A crucial element of its strategy is the growth of its markets and
products. Apple, which also created an MP3 format, digital downloads, and software,
succeeded in creating a better design.

4. What competitive advantages contributed to Apple’s success?

Competition. Because Compaq, and not Apple, was the first company to produce a small,
portable MP3 player with a mini-hard drive that could hold an entire music collection. Apple
decided to create MP3 player navigational software using internal resources. Compaq
produced only computer hardware, not software. With years of experience, Apple has created
software for Apple computers. It also had a lot more design experience than Compaq did.

Rubric for grading:

CRITERIA PERFORMANCE INDICATORS POINTS
Content Provided pieces of evidence, supporting
8
details, and factual scenarios
Organization Expressed the points in a clear and logical
2
of ideas arrangement of ideas in the paragraph
TOTAL 10
Reference:
Dess, G., Eisner, A., Lee, S., McNamara, G. (2021) Strategic Management: Creating Competitive Advantages (10th ed.) New York.
McGraw-Hill Education.

01 Activity 1 *Property of STI

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