Product, Process or Strategic Innovation

Product, Process or Strategic Innovation

Apple's iPod or what being devoted to innovation really means

Surnamed "the 21st-century walkman" by Apple's CEO - Steve Jobs, iPod is a world famous brand of portable media players that was launched on October 23, 2001. The concept occurred as a result of the U.S.-based corporation's attempt to identify new market opportunities that would boost its sales. Consequently, the question that endorsed the emergence of the innovation was: "What can we do to make more people buy Macintoshes?" (Kahney 2006).

One of the first pertinent answers found by Apple was taking advantage of the fact that people raved about music and would have done everything in their power to listen to their favorite songs. For instance, they traded tunes on online music stores like Napster or added speakers to their computers in order to ensure the necessary conditions for a pleasant musical atmosphere. Therefore, Apple bought the license for Sound Jam MP music player belonging to a smaller company and hired Jeff Robbin for enhancing its performance. Indeed, the programmer did a marvelous job and significantly improved the device, thus launching the iTunes product within the framework of the MacWorld Expo held in January 2001 (Kahney, 2006).

Yet, despite being involved in the development of the item mentioned above, the company didn't forget its initial question and continued digging for additional alternatives. Thus, Greg Joswiak (Apple's vice president of iPod marketing) decided to take a look at the existing music players and finally concluded that: "The products stank." The main argument backing up his statement was the small memory available (32/64 MB) which didn't allow the user to store numerous songs, thus being equivalent to an ordinary CD player. Still, there was a product which boasted increased memory. This was the Nomad Jukebox manufactured by Creative, a device which took pride in its 2.5-inch Fujitsu hard drive which stored thousands of tunes. However, Apple's rival also had serious drawbacks such as: the device's significant weight and size, the slow Universal Serial Bus used for transferring files from the PC to the Jukebox, the unfriendly interface and the batteries' short life which sometimes lasted for only 45 minutes (Kahney, 2006).

Hence, the idea of coming up with a major breakthrough in terms of musical players started to have a clearer shape.

First of all, Apple had the possibility of outrunning its competitor due to the FireWire connector which was able to transfer the content of a whole CD in a few seconds and an impressive MP3 library in a few minutes.

Secondly, enhanced batteries and displays were expected on the market due to the revolutionary evolvement of the mobile industry.

Thirdly, in February 2001, Jon Rubinstein (Apple's hardware engineering chief) made a decisive discovery while visiting Toshiba in Japan. During his tour, the Japanese executives brought into the lime light a small drive with a 1.8-inch-diameter that had been recently manufactured but hadn't been given a specific purpose: "They said they didn't know what to do with it. Maybe put it in a small notebook," Rubinstein stated. "I went back to Steve and I said, 'I know how to do this. I've got all the parts.' He said, 'Go for it.'" (Kahney, 2006).

Rubinstein's nose proved to be extremely sensitive and immediately detected the advantage that Toshiba was practically laying on a tray. Having all the necessary ingredients, he decided to go for the new project and drew up a team encompassing both engineers and designers. As he didn't want to charge the staff involved in the new Macs' development with additional tasks, he chose to hire engineer Tom Fadell who had been recommended to him by a mutual acquaintance. This was surprised at receiving such a quick proposition from Apple: "I called Tony," Rubinstein said. "He was on the ski slope at the time. I didn't tell him what he was going to work on. Until he walked in the door, he didn't know what he was going to be working on" (Kahney, 2006).

Under the new team leader, employees started to work at the innovation heavily relying on external suppliers like Toshiba for the 1.8-inch drive, Sony for long lasting batteries, Texas Instruments for control chips, Portal Player for the basic hardware pattern, and Pixo for the software.

Nevertheless, Apple also relied on its in-house 'provisions': "We didn't start from scratch," Rubinstein said. "We've got a hardware engineering group at our disposal. We need a power supply, we've got a power supply group. We need a display, we've got a display group. We used the architecture team. This was a highly leveraged product from the technologies we already had in place" (Kahney, 2006).

Moreover, the American company touched upon the major battery draining problem and introduced a 32 MB memory buffer which prolonged batteries' life from two or three hours to 10 hours.

Another aspect that received the 'red carpet treatment' was design. This was the result of both the continuous prototype-making process and the close collaboration that designers established with their colleagues in the manufacturing department. The ideas that the latter developed were attentively analyzed for perfectly tailoring the iPod's look according to its conceptual backbone. As Robert Bruner, a partner at design firm Pentagram, stated, designers allotted 10% of their time to traditional design and 90% to coping with the manufacturing standards issued by their colleagues. Consequently, the iPod breakthrough was the outcome of sustained and cohesive efforts and not of a "passing on to the next" principle (Kahney, 2006)..

One of the most appreciated design features was the user interface's scroll wheel suggested by Phil Schiller (the head of the Apple's marketing department). This emphasized that the speed at which menus scroll must be directly proportional to the extent to which the wheel is turned. Despite being salutary, this idea didn't come out of the blue as it had several predecessors like scrolling mice, Palm thumb wheels, the HP workstation launched in 1983 or Bang & Olufsen BeoCom phones which allowed navigating the list of contacts (Kahney, 2006). Generally speaking, the click wheel encompasses five options: menu consisting of a list of items, center which allows choosing an item, play/pause, skip forward/fast forward, skip backwards / fast reverse. The American company was also aware of the possibility of accidentally crashing or freezing the iPod and therefore it included a reset alternative that implied switching Hold on then off, and afterwards pressing Menu and Center for six seconds (http://en.wikipedia.org/wiki/iPod).

Another interesting story closely linked to the innovating process refers to the birth of the iPod name. In order to find an appropriate brand that would accompany the "1000 songs in your pocket" tagline, Apple hired Vinnie Chico, a freelance copywriter from San Francisco. Being inspired by Apple's hub strategy and the new device's design, Chico linked the product to the 2001: A Space Odyssey movie and the memorable line "Open the pod bay door, Hal." Thus, the iPod name was coined for designating the revolutionary media player. As naming expert Athol Foden asserted, the appellative chosen by Apple was "simple, memorable, short and sweet" and provided the huge advantage of remaining valid despite the technology's evolution. Although critics accused Chico of stealing others' idea as the iPod name had already been trademarked by Apple for an Internet kiosk that never materialized, the copywriter stated that the brand was a simple coincidence. Consequently, it was accepted by the company and entered the market as an emblem for the newest media player (Kahney, 2006).

To conclude with, Apple's success was due to a mature vision which put a high emphasis on innovation. Understanding the latter's major role, the American company resorted to the products provided by various elitist companies and endorsed teamwork as this was considered to be essential for both an integrated approach and a successful outcome.

II) the iPod breakthrough has had a tremendous impact on the company's sales. Thus, if the U.S. market share amounted to 31% in January 2004, one year later this reached 65%. In July 2005, its value increased to 74%. The upward trend continued and Apple reported impressive quarterly earnings of $7.1 billion out of which almost 50% were due to the iPod brand. Except for the significant sales increase occurred within the media player segment, analysts also implied that consumers' appetence for iPods would lead to higher market shares for other Apple products such as Mac computers (http://en.wikipedia.org/wiki/iPod).

Secondly, the revolutionary product has brought contemporary technologies to a higher level. This can be successfully proved by the numerous awards that the company has received. For example, the iPod designer was awarded the President's Medal by the Royal Academy Engineering due to his contribution to promoting engineering excellence. Moreover, the item was declared the fourth best computer product in 2006 and the most innovative product of the year. Given the positive feedback, industries have decided either to modify their products for coping with the iPod and the AAC audio format or to regain their self-esteem by developing similar breakthroughs. Undoubtedly, the main beneficiary of such fierce competition is the customer who will be able to choose among several reliable products (http://en.wikipedia.org/wiki/iPod).