With raging inflation, broken supply chains, and a disrupted tech workforce from the impact of the COVID-19 pandemic, what's a savvy business to do? We already know what Apple will do: it will follow founder Steve Jobs' dictum, bow its figurative head, and "innovate" through uncertain times.
When things get tough...
Speaking to CNN many years ago, Jobs explained his approach:
"We had one before, when the dot-com bubble burst. What I told our company was that we were only going to invest to get out of the recession, that we were not going to lay off people, that had taken us a lot of effort to bring them to Apple , the last thing we were going to do was lay them off. And we were going to continue funding. In fact, we were going to increase our R&D budget to be ahead of our competitors once the recession is over. And that's exactly what we we did. And it worked. And that's exactly what we're going to do this time.
So now that we know what Apple is going to do, here's a quick look at some approaches you can take.
Rethinking the walled garden
Apple's Walled Garden is under attack. The company will be forced to make some changes, but it will try to draw a line around customer privacy and customers' right to choose security over competitive convenience.
Although the regulators do not seem very convinced at the moment, the argument has many merits and I am convinced that, even if compromises are made, concessions will be made.
Apple will simply rebalance its business proposals to work with what's left. But it won't happen without a fight.
Reinvent services
We've all heard how Apple's pivot to services revenue means that this segment of its business is now a bigger company (in terms of revenue) than IBM.
We've also heard persistent speculation that the company intends to expand its iPhone upgrade program with some form of consumer-focused Apple-as-a-Service proposition. Under this, you will rent, not own, your devices for a flat monthly fee. The idea is to make Apple's kit more accessible to more people, and the program will help Apple drive device recycling as EOL products are returned and consumers upgrade.
This shift to services makes the business more resilient and provides predictable, recurring revenue to help overcome unpredictable economic challenges.
Research and development
Apple's spending on research and development (R&D) continues to rise. It increased tenfold between 1999 and 2012, when it reached $3.000 billion. Apple in 2021 spent $21.910 billion on R&D.
The investment continues to pay off, with everything from improvements to iOS and macOS, new hardware, and new families of hardware to come, like AR glasses and Apple Car, being the result. But Apple is a child of its time, and I'm confident that part of what the company will explore will be solutions that answer the questions of tomorrow: How can technology drive CSR? How do you create a closed-loop manufacturing process? What about augmented and remote healthcare?
And don't forget the processors, software and services that can offer it all.
recruit to innovate
Apple has been known to buy small businesses from time to time. Sometimes it does this to acquire the inherent technology provided by the acquired entity, while other times the company likes to invest in recruiting teams for the expertise they have.
We don't always know which companies Apple bought later (sometimes much later), but we do know this: Apple has about $200.000 billion in cash, which means it has the kind of financial muscle needed to acquire innovative companies, while economic instability means there are now potential acquisition targets in a buyer's market. Money goes further when no one else has it, as VMware/Broadcom can attest.
Reveal what is to come
Apple is always working very, very hard on new products that it has never confirmed. We believe that the company recently showed prototypes of its AR glasses to members of its board of directors.
We also believe that the company continues to invest heavily in Apple Car and is now setting up the manufacturing and supply chains for these vehicles.
The company spends a lot of time talking about health, and we know that it continues to do research elsewhere, such as in wireless power delivery, ePaper, 6G, and many other building blocks needed to design future products.
We can easily predict iterations on existing products, including radical redesigns over time, but we can also anticipate entirely new product families, made possible by proprietary technologies like Apple Silicon and the upcoming Apple 5G modem.
rethink for the future
What is the future? Apple didn't look back when it introduced the concept of a "digital hub" at the turn of the century.
This center reflected the optimistic consumer philosophy of independence and self-sufficiency then prevalent; but tomorrow's consumer is much more likely to engage in sharing and collective responsibility.
So what are the appropriate paradigms for this perspective, and how can Apple (or anyone) articulate this philosophy into new products designed to reflect the world of tomorrow, rather than the planet we plundered yesterday?
We know Apple spends time thinking about it, just look at the work it does. Despite reactionary criticism of these commitments, research shows that tomorrow's consumers care deeply about these things and will reject brands that do not share these values. Think of the criticism Nike endured when it featured NFL quarterback and civil rights activist Colin Kaepernick in a marketing campaign. The reviews may have caused quite a stir, but the reality was that consumer confidence in the brand increased dramatically and sales increased by 31%.
This is why it is important to capture the correct philosophical message and highlight it.
What do you think?
How can you position your business to meet the needs of tomorrow's transformed reality? How to rethink and redesign your products and services? When it comes to technology, at least, Jobs may have dropped a shred of focus when he told CNN:
"Things are happening very slowly, you know. They're coming. These waves of technology, you can see them long before they arrive, and you just have to choose wisely which ones you're going to ride. If you choose unwisely, then you can waste a lot of energy, but if choose wisely, it happens very slowly, it takes years.was that we didn't want to go into a business where we don't own or control the core technology, because it would leave your head.
For a better future, look ahead, not back, but don't overlook history, which is always a useful guide.
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