Apple: The Evolution

Tuesday, September 01, 2009 Heba Moeen 2 Comments

After their high school, old friends; Steven Jobs and Steven Wozniak started working in Atari and Hewlett Packard respectively. Out of the admiration for electronic invention, Wozniak designed a computer which later came to be known as Apple I. It was at the insistence of jobs that it got introduced in the market for sale. It was introduced in the market in 1976.

After having created Apple II, Wozniak got to be known as the ‘Apple Genius’. Initially, he distributed shares among family and friends who he thought were contributors in his hard work and helpers in bringing his dreams come true. Soon Apple went public, the Initial Public Offering was made on December 12, 1980, the starting price was $14 per share but sold at $22, the business mounted the steps too quickly that the share price closed at $29 per share witnessing a 32% rise. All 4.6 million shares were sold out within a matter of minutes and the company then had a market valuation of $1.778 billion , making the valuation of Wozniak’s part of the shares at $ 116,000,000 and jobs at $217,000,000. Wozniak then had the time and money to experiment and upgrade his computer models in whatever ways possible since his imagination had enough room to be made as lucrative as possible.
In 1981, suffering from air crash injuries Wozniak went through an amnesiac phase and soon after that took a two year break from Apple Corporation to complete his BS degree from University of Berkeley. Apple had more to witness with his joining in with the completion of studies.

Soon, Apple III was in the pipeline and with two years being spent, it was introduced on May 19, 1980. Where, Apple I and II was aimed at hobbyists and home users (more of a one man show by Steve Wozniak), Apple III was designed to target businesses and had been a product of a group effort. This model having two configurations had a price range of $4,340 to $7,800. This particular project was headed by Steve Jobs. It featured a built-in keyboard, a built-in real time clock and a video cable. However, it turned out to be a great remorse since some details were not paid much heed to at the time of conception. In February of the next year it was announced that Apple III would not have any built-in clock or calendar because National Semi conductors’ clock chips were not compatible with it. Soon the price was dropped and every body who had bought Apple III by that time was given a $50 rebate. To add more pain to the misery, it was found out that about 20% of these computers were useless as their chips fell out during shipment .

Steve Job’s idea about not having a fan proved to be a fatal disaster for the model. He thought that radio frequency interference emissions would be reduced and the aluminum structure would cool off the chips after conducting heat itself. When time came for the computers to be used, the chips got hot and fell out of the sockets in the wake of heat expansion. To add to it’s credibility, Apple exchanged non working Apple III’s with new ones (April 1981), however, this strategy too didn’t pay off that well, since the replacements were downright failures too.

In November of the same year, new updated Apple III was introduced at an even lower price of $3,495 and it was also announced that the previous problems were not associated with the design but rather was a manufacturing default. The new product model had a 5MB hard disk and new sockets . By December, 2000 old Apple III’s were replaced with this new model, however, sales remained at the lowest ebb due to the new bad reputation acquired. Over $60,000,000 were lost in the Apple III product line and eventually it was removed from Apple’s product list in 1985. Steve Jobs refers to lost amount as ‘infinite, incalculable amounts’, whereas, Steve Wozniak was of the view that throughout its conception Apple III had so many defects and flaws that when it was introduced again it should have been called Apple IV. When Apple III was introduced, the then CEO, Mark Markkula (1981) told the Wall Street Journal that Apple III had been designed to have a life span of 10 years, when later on it had turned into a market failure and ‘divested’ as a ‘dog’ product.

In spite of this failure, the company had enough fortune to keep having new experiments done. At the start, Apple gained momentum too quickly that no one could have thought about college dropouts being millionaires within years. According to Jobs, when he was 23, he had a net worth of lucrative amounts exceeding a million dollars, which exceeded $10 million after a year and by the time he turned 25, the net worth he possessed increased over $100 million. In the year 1982, Jobs was among the 400 richest people in USA, after getting his company, ‘Pixar’ public in 1997, his net worth as estimated by Forbes was $710 million and in the year 2002, he became even richer, then having a worth of $1.6 billion just at the age of forty seven .

It was Wozniak, who out of the goodwill of his heart let other employee (especially who had been working from the beginning) have stock options because he was of the view that it’s unfair for them who are only salaried whereas, only a few were becoming billionaires. Even though he faced resistance from Jobs and company lawyers about not following a stringent stocks requirement, he assumed it was a good deed he was performing for which he even received thank you letters by these employees for making them able to afford good houses and better education for their children.
Currently Apple’s stocks listed in NASDAQ have the symbol, ‘AAPL’ and as ‘Apple’ in the Tokyo Stock Exchange, whereas, the company is also listed in the Frankfurt Stock Exchange by the symbol, ‘APCD’.

Apple launched it’s Mac (Macintosh 512 K) pc in 1984 and received an excited uproar from potential customers. It was small, light, backed by a 3.5 inch floppy disk drive and people simply liked it’s sound quality. For following years to come different variations of Mac series were targeted at various mass and niche markets. Mac plus followed in 1986, then Mac II in 1987. In 1997, under the supervision of Steve Jobs, the product line was distributed further into sub categories, eradicating the confusion in the minds of people. They were distributed into categories such as, professional, consumer, desktop, and portable computers.

Apple’s logo was conceived by Steve Jobs and was designed by the graphic designer, Rob Janoff who created a rainbow striped logo of an apple bitten from the right side. Apple is one of the first companies to have a logo instead of it name to endorse it’s products. The logo has now got a silver chrome tint and the designer of the 1976 rainbow logo feels grateful that it only got upgraded not replaced with some other logo.

According to AMR Research, Apple has been ranked on the top for having the most brilliant supply chain management as they have been witnessing market expansion and growth with hardly any physical stock available every where to sell. Their online business has created much room for having a competitive edge over its competitors and have been able to have high stock turnovers due to its innovative strategy. Physical inventory need not be present for most of the sales.
By the research conducted by AMR, it was found that Apple had the highest score in terms of supply chain as compared to other competing companies. In 2007 alone, the company had a stock turnover of 45.8 and had witnessed a revenue growth by 24.3%, whereas, return on investments had been 13.8%.

By the end of the twentieth century, Apple Corporation had to meet the environment safety standard to give up using CFC’s in their products. It had to meet up with suppliers to devise a new plan for bringing into being a new process to produce their circuit boards. As, a result, their productivity increased and bottlenecks were reduced, moreover, the level of pollution at suppliers’ factories was controlled . CFC (chlorofluorocarbons) is a compound used in various industries (also used as a refrigerant) which forms chlorine after breaking down into simpler molecules as and when it is released into the air. This is also responsible for damaging the ozone layer and, therefore, has been a major concern looked upon by environmental activists.