Apple Company: Innovation Strategy Implementation Dissertation

Abstract

In this paper, we set off to investigate how Apple’s innovation strategy has affected the firm. There are four main research questions in this study. The first one seeks to investigate how Apple’s innovative strategy has contributed to the firm’s competitiveness. The second one investigates the driving factors that have contributed to the company’s innovation strategy, while the third one explores the relationship between culture and innovation at Apple. The last research question investigates whether the company’s innovation strategy would sustain its future growth.

The researcher developed these research questions on a background of an uncertain economic environment where businesses have to grapple with the challenge of determining how an innovation strategy would apply to their internal and external business environments. Apple emerged as a perfect case study for this research because it is among a few companies in the world that have successfully adopted an innovation strategy. Consequently, the research questions highlighted above strived to outline how the company adopts its innovation strategy and how it has managed to do so, relative to its internal and external organizational dynamics. The aim of answering these research questions was to find out how this strategy has changed the firm.

Using a mixed-methods approach, we set off to collect data using two research approaches – the qualitative and quantitative techniques. The first part of the research review involved a quantitative research analysis, which identified two main themes of analysis through a document review process. The themes were leadership and culture. They emerged through a comprehensive review of more than 70 research articles that revealed the importance of leadership and innovation culture at Apple. This first part of the research also revealed that the works of Steve Jobs and Tim Cook contributed significantly to the nurturing of an innovation culture at Apple. This culture has been the pillar of its success. In the document analysis stage, we also reviewed the concept of innovation at Apple from different perspectives, including how it improved the firm’s competitiveness and how it has fostered inclusivity and diversity in the organization. Although there have been attempts by some observers to paint Apple as a company that has run out of ideas, our facts reveal otherwise because the company continues to produce new and innovative products in the market.

The second part of the review was a qualitative analysis, which sought the views of 12 experts, who worked in some of the most reputable corporate consultancy firms around the world. The researcher recruited them using the purposive sampling technique. This technique gave the researcher power to seek only expert opinions about the research issue. The researchers sought the views of the respondents relative to the findings of the quantitative analysis, which showed that culture and leadership were instrumental in driving Apple’s innovative agenda. The respondents affirmed the findings of the document review because they also said that Apple’s leadership and cultural phenomenon were the driving forces of its success. Inclusion and diversity also emerged as other subthemes of our analysis. They showed the power of leadership at Apple, which recognized the importance of individual contribution to the organization’s innovation strategy.

Although many companies have imitated some of Apple’s innovative products, they have experienced difficulties imitating the company’s culture of innovation. Indeed, those who have tried to do so have failed in that regard. A keen look at the company’s innovation strategy shows there is no particular formula that other companies could effectively use to achieve the same results. Otherwise, other companies could have easily replicated the same culture or bought their way into Apple’s success. Consequently, we find that some essentials of the company’s culture hinge on effective leadership and skill development.

Key sections of this paper also demonstrate that Apple’s innovation strategy would be the driving force of its future growth, relative to its proficiency in securing its business ecosystem (hinged on the use of its iOS) and its strong brand appeal that other companies have failed to match. A deeper analysis of these findings also revealed that the company’s leadership, under Tim Cook, would continue to support innovation at the firm because this is its key competency. If we focus on the skills that the company’s employees profess today, we find that Apple is unrivaled. Indeed, the company has developed unparalleled skills in software, hardware, and service development. These skills have not only emerged in the mobile phone market, but also in the PC market where the company has leveraged some of them to provide its customers with an elegant experience where technology and innovation are at the center-stage of the company’s service and product packages.

This paper recommends that going forward, the company needs to make sure that it protects its uniqueness, particularly regarding the use of its iOS and its safeguard of its quality processes, which have been the driving forces of its brand appeal. As part of its future strategy, this paper also proposes that the company needs to pay attention to its customers’ needs and develop products that resonate with the same. This would be a departure from its technology pull strategy, which thrived during the Steve Jobs era. A market pull strategy would help it to improve the acceptability of some of its innovations because, as things stand, some of the latest innovative products produced by the company have failed to live up to the hype of some of its past products, such as the iPad and iPod. This paper highlights this outcome as a key indicator that the company needs to substitute its technology pull strategy for a market pull strategy.

Introduction

Background of the Research

In today’s globalized world, innovation is a prerequisite of economic development. More importantly, economic experts attribute the importance of innovation to the preservation of competitive advantage (Cooper 2000; Chan & Mauborgne 2005). Indeed, as INTECH (2013) points out, innovation has played a key role, in the economic development of many societies. However, in the 20^th century, the field of economic science witnessed rapid changes in technology, which also brought significant changes in innovation (Léger & Swaminathan 2014). During this time, scientists made significant developments in different fields of science, including nuclear physics, biotechnology, organic chemistry, and others (Tolfree & Mark 2007).

In the past decade, the role of technology has changed yet again, as more people pay attention to the importance of understanding the creative process of innovation and the need to understand the process of generating new ideas. People have paid attention to these processes because they drive innovation and development in different cadres of society (Léger & Swaminathan 2014). For example, the Information Technology (IT) sector drives different levels of innovation and development change in the world today. The leading economic sector that embodies the true potential of innovation development in IT. For example, changes in the shape, form, and functionality of mobile phones have characterized this trend because 30 years back, mobile phones were as large as a brick (Garvin 2000).

A decade ago, they significantly reduced in size, but they still performed the same function as they did decades back. Indeed, today, we not only have mobile phones, but smartphones that act as cameras, receivers, credit cards, and even medical diagnosis gadgets. Such changes emerge as manifestations of today’s innovation-oriented society. Some observers refer to the changes as the advent of the knowledge economy (Cooper 2000; Chan & Mauborgne 2005). Some key characteristics of such an economy are the efficient use of knowledge and communication strategies (Erat & Kavadias 2008). The efficient use of these resources outlines the nature of innovation.

Such trends have brought to the fore the importance of information and knowledge exchanges in the development of today’s economy and society. “Dynamism, flexibility, change and responsibility” (Princeton Education 2015, p. 2) are some new concepts that are driving the innovation wheel today. As such, many companies are starting to embrace innovation as a core part of their strategic focus. Some of them have started to use it as a basis for competitive advantage, while others use it to improve their operational efficiencies and reduce costs. Although the benefits of innovation are straightforward, some of these companies have failed to realize their true benefit, or change (positive) by embracing this strategy. Therefore, “getting it right,” when embracing an innovation strategy is often a difficult process.

Problem Statement

As highlighted above, innovation is a key concept in the preservation and development of business competitiveness. Therefore, businesses use this platform to outwit each other when looking for new customers or increasing their market share (Desvaux & Devillard 2008). Usually, the most successful organizations are the most innovative, while the least successful organizations are the least innovative (INTECH 2013). However, innovation is not a linear concept. In other words, many factors influence whether organizations succeed, or fail when adopting such a strategy. For example, some innovations may be unsuccessful because of their high costs, inapplicability to relevant business problems, or their wrong implementation (Ibusuki & Kaminski 2007). Others may be beneficial because they directly address known market, or business, problems, or are developed in a cultural context that readily embraces them (Tsafarkis, Grigoroudis & Matsatsinis 2011).

Therefore, there are many issues to consider when companies adopt or implement, an innovation-centered strategy. Culture, business environment, internal organizational dynamics, and management attitude are some relevant factors that could affect the success of different companies when adopting an innovation-centered strategy (Cameron & Quinn 2006; Hofstede & Bond 1984). Based on the variability of these factors, it is wrong to assume that different companies would achieve the same level of success when adopting such a strategy. Here, it is important to analyze innovation on a case-by-case basis. Stated differently, there is a need to understand how such a strategy would align with the specific organizational and business dynamics of a specific company. In this study, we analyze how Apple’s innovation changed the company.

Research Aim

To find out how Apple’s Innovation Strategy has changed the firm in the past ten years

Research Questions

• RQ1: How has Apple’s Innovation Strategy contributed to the company’s overall competitiveness?
• RQ2: What factors have contributed to Apple’s Innovation Strategy?
• RQ3: What is the relationship between culture and innovation at Apple?
• RQ4: Will Apple’s Innovation strategy sustain the company’s growth?

Significance of Research

Undoubtedly, innovation has multiple advantages to organizations that strive to adopt it. The importance of this research manifests through the understanding of these advantages, especially regarding how they improve organizational processes and firm competitiveness. Apple Inc. is perhaps the best example to evaluate as we try to understand the advantages of adopting an innovation strategy to improve a firm’s competitiveness or organizational processes because it is arguably among the most successful companies that have embraced an innovation strategy that is largely responsible for its corporate and global success (DeCarlo 2011).

In this regard, the findings of this study would help other companies to understand how to implement an innovation strategy and how to leverage it for improved business success. This understanding would only happen if we understand how Apple has implemented such a strategy and how it has managed to remain successful by embodying such a strategy, as part of its corporate culture (Cameron & Quinn 2006). Therefore, by understanding the adoption of an innovation strategy at Apple, other companies would learn how to use such a strategy for their benefit (Den & Belschak 2012). The findings of this paper would also add to the growing body of knowledge surrounding corporate strategic development. Stated differently, the findings of this study would be useful to the field of academia. The structure of this dissertation appears below.

Structure of the Dissertation

This dissertation has six main chapters. The first chapter is the introduction chapter, which provides a background of the research issue to provide the right context of analysis and to help the readers get the gist of our intended analysis. This chapter also outlines the problem statement, the research aim, the research questions, and the importance of the study. The second chapter is the literature review section, which contains a review of key concepts, theories, and models relating to the topic of discussion. Generally, it presents what other researchers have said about the research issue and identifies the literature gap that justifies the existence of this dissertation.

The third chapter is the research methodology for this paper. It explains the different steps and processes undertaken by the researcher to answer the research questions. The fourth chapter is the findings section, which outlines the responses, or findings, of our analysis. The fifth chapter provides an analysis of these findings, relative to current theories, models, and discussions of how innovation has affected Apple. The fifth chapter summarises the dissertation findings and outlines the responses to the research questions. It also reflects the research process and outlines different recommendations that would guide how other researchers use the findings of this report.

Literature Review

Introduction

This chapter presents the findings of a critical analysis of published resources/documents about the research issue. It presents our findings after assessing existing literature surrounding our research topic through a summary of what other researchers have written about the issue and through comparison and evaluative analysis of their views about the RQs. Therefore, the guiding principles of this analysis are enshrined in the RQs, which seek to understand how Apple’s innovation strategy has contributed to the company’s competitiveness, the factors that have contributed to the company’s innovation strategy, the relationship between culture and innovation, and whether the innovation strategy would sustain the company’s growth. Before delving into the details of what other researchers have written about these research issues, it is important to understand what innovation is all about.

Definition of Innovation

According to INTECH (2013), innovation is “the application of new ideas to the products, processes, or other aspects of the activities of a firm that lead to increased value” (p. 4). In the context of this definition, innovation emerges as a process of value-addition that should ideally benefit customers. Inherent in the definition of innovation is the concept of novelty because we need to measure its degree to understand whether innovation has taken place, or not (Cooper & Edgett 2010).

Therefore, based on this understanding, people need to understand how much novelty is required to realize a significant change in an organization’s processes, or product changes, to agree that innovation has occurred. INTECH (2013) says the key to comprehending this problem is to understand that innovation often occurs when a company brings to the market a truly novel item and not to imitate a different company’s product. Therefore, the adoption of a new technique, or product, which is already in the market, does not also constitute innovation. While trying to understand the relevance of innovation to organizational processes, some researchers emphasize the importance of perceiving technology as a process, or a series of steps, as opposed to an activity (Léger & Swaminathan 2014). Therefore, true innovation occurs after the successful completion of all steps as outlined below.

Stages in the Innovation Process

The innovation process occurs when companies, or people, follow distinctive steps below

According to the diagram above, there are five distinct stages involved in the innovation process. They include research and development (stages one to three), commercialization (stage four), and diffusion (stage five). The main input at each stage of the innovation process is knowledge. For many companies, knowledge represents skilled personnel and specialized equipment (Léger & Swaminathan 2014). The time involved in using these resources is the multiplying factor that often uses knowledge to create a novel item, or product. The success of each stage is outlined in the emergence of an output. This transition represents a process of tangibility to intangibility because at the onset of each stage is knowledge, while the end process is a new product or a new process. The first three stages of the innovation process mostly involve the research and development (R&D) process, which emerges in basic scientific knowledge, or plans, for new process development (Princeton Education 2015). They may also emerge as prototypes of new products, or processes. This is the stage where observers often say that a company is making new inventions (Antonelli & Nicola 1997).

The R&D activity often represents premarket activity among different agents of change in an organization. Mainly, scientific institutions, public universities, and lone investors are the main change agents that have produced some of the world’s best-known innovation processes (Tolfree & Mark 2007). Based on the description of the first three stages of innovation above, innovation does not occur until the fourth stage when there is a marketable product, or process (Cooper 2000; Chan & Mauborgne 2005). After the completion of this stage, another process ensues – diffusion of innovation stage. This is the fifth stage of the innovation process. At this stage of innovation, there is widespread adoption of the new products, or processes, in the market (Princeton Education 2015). Here, Princeton Education (2015) says it is important to understand that the innovation process is not linear because there are different kinds of feedback that a company often receives and relies on to tweak the outputs (products, or processes). This fact means that there is feedback at different stages of the innovation process.

Types of Innovation

According to Coombs and Paolo (1987), there are two main types of innovation – product innovation and process innovation. As its name suggests, product innovation involves the introduction of new products in the market. Usually, the goal of doing so is to improve product quality and widen the scope of the product range. Researchers have given the example of the introduction of the Apple iPod to replace the Sony Walkman as an example of product innovation (Tolfree & Mark 2007). Process innovation differs from product innovation because it focuses on the steps taken to produce the products in question. Stated differently, it involves using new ways of making goods and services. Chan and Mauborgne (2005) give an example of employees using a touch screen to indicate when they have arrived at a doctor’s appointment (as opposed to talking to a receptionist), as an example of process innovation. Some researchers have said that organizational change is also a new type of innovation (the third category) (Djellal & Gallouj 2013). However, others have disputed this categorization and instead presented it as an offshoot of the process innovation category (Wells 2008).

Models of Innovation

Technology Push

Technology push is a model of innovation and a business strategy mainly propelled by a company’s quest to innovate because of its R&D process outputs (Antonelli & Nicola 1997). Joseph Schumpeter is the pioneer of this model. Through his book, “The Theory of Economic Development,” the author said that the ability of an organization to innovate mostly depends on the entrepreneur’s ability to do so (Michael 1994). There is no clear description of where the ability to innovate comes from, but experts often assume that it comes from a country’s economic system (Wells 2008). Nonetheless, according to Schumpeter, the main driver of economic development is innovation (Michael 1994). According to this pioneer, economic development mostly depends on the industry’s ability to innovate and not necessarily the market’s ability to absorb such innovations.

To justify his ideas, he said that most innovations in product development were mostly responsible for the emergence, or development, of new industries (Michael 1994). From this point of view, Schumpeter argues that product innovations are more important than process innovations. He bases his arguments on the understanding that process innovations only lead to the increased efficiency of existing industries, while product innovations lead to the creation of entirely new industries (Djellal & Gallouj 2013). Usually, the end is ignored in technology push models because companies that adopt this market approach mainly want to use the knowledge they have developed or accrued through their R&D processes, without properly understanding whether such technology is useful to the market, or not.

Wells (2008) says the best example of a technology push model is the introduction and embracing of the touch screen technology in smartphones. Appearing as published research by E.A. Johnson at the Royal Radar Establishment UK, its pioneers introduced this technology as a game-changer in the IT field (in the 1960s), but it took almost five decades for the world to embrace it (Antonelli & Nicola 1997). Most of its R&D development happened in the 1980s when companies started directing many resources to its development. At this time, Hewlett Packard (HP) was among the first companies to apply the technology in developing their gadgets (Antonelli & Nicola 1997). Apple started doing so in the early 1990s through its Newton PDA gadget. Since then the technology has evolved to be mainstream. Its application in the Smartphone development is most noticeable.

Market Pull model

The market pull model differs from the technology push model because of the differences in focus. Jacob Schmookler (cited in Coombs & Paolo 1987) advanced this model through the assertion that demand-side forces were the most important forces in the development of new technology. He used the example of the opposite blades of a pair of scissors as a metaphor to highlight the importance of innovation and demand as the main forces needed in economic growth (Tolfree & Mark 2007). While the technology push model mostly focuses on a firm’s resource capability to innovate, as the main basis for the emergence of innovative products, the market pull model usually focuses on the market need as the main basis for innovation. In this regard, companies that adopt the different models have different motivations, or drivers, of their R&D processes (Coombs & Paolo 1987). According to the Open University (2016), the best way to implement this model is “to research the market thoroughly first, assess what needs exist, how far they are met by existing products and processes and how the needs might be met more effectively using a new or improved innovation” (p. 1). The diagram below illustrates this process.

A key characteristic of the market put model is the establishment of the market analysis stage before the R&D process. At a deeper level of analysis, researchers found that the market analysis stage adopts unique techniques that also manifest as distinct models (Cooper 2000; Chan & Mauborgne 2005). The consultancy model is one such model. This model involves consulting users about the type of innovation they need but falls short of the necessity to involve them in the R&D process. The main reason companies use the consultancy model to get information about its R&D process is their faith that they have the best experience to undertake such a process and their belief in understanding that the questions they have asked would provide them with all the information they would need for the same process as well (Djellal & Gallouj 2013).

Observers say this process is often useful for companies that want to enhance their innovation process but is not ideal for those that want to introduce a product in the market (Cooper 2000; Chan & Mauborgne 2005). Based on this challenge, researchers have proposed the use of the co-development model, which is the best alternative to use for such kinds of companies (Antonelli & Nicola 1997). Here, it is important to point out that the co-development model is the second technique used by companies to get information from the market. As its name suggests, the co-development model normally includes the views of customers in the R&D process. Researchers have said that this model is useful to companies that want to produce or introduce radical products in the market (Cooper & Edgett 2010). Different companies have adopted this strategy successfully. For example, Philips often involves its customers in the R&D process to get the best market reception for their innovative products (Cooper & Edgett 2010).

People have highlighted different concerns about the use of the market pull model. For example, some of them say that the mere identification of market needs does not guarantee that the innovation would meet the same needs (Gassmann, Enkel & Chesbrough 2010). For example, market research in the transport sector has highlighted the concerns of different road users who have proposed different strategies regarding how to improve road safety (Dutrénit & Sutz 2014). However, most of the innovations produced to address such concerns have failed to address these needs adequately. Such weaknesses of the model have also sufficed in the medical sector where multiple research studies have documented many medical conditions among patients, but innovations have failed to tackle them adequately. Some observers argue that the overconcentration of the innovation model has forced many companies to concentrate on developing new products and processes that meet the goal of incremental innovations, as opposed to radical innovations that could change the industry (Gassmann, Enkel & Chesbrough 2010). Based on these unique characteristics of the market pull model, it is important to point out that the technology pull model and the market pull model differ based on their drivers for change. The table below highlights this difference.

Chain-Linked Innovation Model

The chain-linked innovation model is another framework advanced by some researchers as falling in the same category as the technology pull model and the market pull model (Tolfree & Mark 2007). This innovative model mostly focuses on the technical activities that often underlie the innovation process (Tsafarkis, Grigoroudis & Matsatsinis 2011). It also embodies the influence of external market factors and the complex forces that underlie the process of innovation when understanding innovation processes (Chan & Mauborgne 2005). The diagram below provides an overview of the chain-linked innovation model. The diagram below shows a graphical depiction of the chain-linked model.

Culture and Innovation

For a long time, researchers have drawn a relationship between the role of culture and innovation by saying that both factors influence each other (Kaasa & Vadi 2008). Stated differently, successful companies that have realized the benefits of innovation have incorporated the concept as part of its culture, while those that have not realized the benefit of doing so continue to struggle with realizing the benefit of innovation in their firms. Many debates have explored this issue (Kaasa & Vadi 2008). However, understanding their origin depends on our understanding of the works of Hofstede (2011) who was a pioneer in explaining different cultural dimensions and their effects on innovation at different stages of a firm’s lifecycle. His works appear as the cultural dimension theory, which strives to explain the effects of culture on the values that people hold dear to their work/lives. His theory also explains how these values influence people’s behavior and practices in an organizational setting (Hofstede 2011). Proponents of the theory use a factor analysis framework to structure this relationship (Hofstede 2011; Hofstede & Bond 1984).

A study conducted by Kaasa and Vadi (2008) to explain how culture influences innovation collected evidence from European countries and related patent applications to different types of cultural dimensions. The power distance model is one cultural dimension that was investigated in the study and describes people’s attitudes towards management, institutional trust metrics, and multiple indicators relating to work-related power distance (Kaasa & Vadi 2008). Hofstede and Bond (1984) paint a clearer explanation of this relationship by saying that the power distance index generally refers to people’s acceptance of an unequal distribution of power in an organization. Those that subscribe to this power distance model often have hierarchical power structures (Kaasa & Vadi 2008).

Individualism vs. Collectivism is another cultural dimension proposed by Hofstede (2011), which strives to understand the degree to which people are integrated, or divided. People in individualistic societies often do not have many close relationships with people outside their immediate families. Their social mantra is often focused on the “I” as opposed to the “we” (Piepenburg 2011). A collectivist society, on the other hand, values relationships that extend beyond the immediate family. People in such societies often have in-groups that are characterized by a high level of loyalty and support (Hofstede & Bond 1984). The uncertainty avoidance index is the third type of cultural dimension that emerges from the cultural dimension theory (Piepenburg 2011). This cultural dimension measures the degree that a society, or community, would tolerate ambiguity in their lives. Stated differently, the uncertainty avoidance index often dictates the degree that society would accommodate uncertain events.

Organizations that have a high score on the uncertainty avoidance index often have strict rules and regulations that govern human behavior (Hofstede & Bond 1984). Therefore, their tolerance for uncertain events is often low (Kaasa & Vadi 2008). Such societies also believe in the importance of absolute truth; conversely, they would argue that one lie could potentially dictate everything (Hofstede & Bond 1984). A society that has a low score on the uncertainty avoidance index often accommodates varied thoughts and ideas about an issue. Therefore, such societies have fewer regulations because no one set of rules or practices could accommodate all the varied thoughts and ideas (Kaasa & Vadi 2008).

Masculinity vs. Feminism is the fourth cultural dimension of Hofstede (2011). Most masculine societies are driven by values that center on heroism, egoism, and assertiveness. Mostly, such societies measure success based on material accumulation (Kaasa & Vadi 2008). A feminist culture often subscribes to a different set of values that focus on cooperation and modesty (Piepenburg 2011). Most masculine societies are patriarchal because women are supposed to recognize the difference in values between men and women. A difference between long-term orientation and short-term orientation is another cultural dynamic that characterizes this theory (Hofstede 2011; Hofstede & Bond 1984). This cultural dimension strives to provide a relationship between a society’s past and present actions. Societies that have a low ranking on the long-term vs. short-term cultural prism often value the principle of steadfastness. Comparatively, societies that have a long-term orientation often value the skill of pragmatic problem solving (Hofstede 2011; Hofstede & Bond 1984).

Research has shown that companies, which have a short-term orientation of their operations often, have little, or no. economic growth, while those that have a long-term orientation often develop to a significant point of recognition (Herbig & Dunphy 1998). The last cultural dimension of Hofstede (2011) is the indulgence vs. restraint model. This cultural dynamic often refers to the degree through which people derive their happiness. Restrained societies are those that allow the free gratification of basic human desires. In other words, people find happiness in enjoying basic human pleasures, such as nature and having fun (Herbig & Dunphy 1998). Indulgent societies often derive their happiness from the observance of strict social norms. In such societies, people often believe that they are in control of their destiny and happiness. In this regard, they have little regard for factors that are out of their control, or norms, which may affect their happiness (Kaasa & Vadi 2008).

Researchers have used the different cultural dynamics of Hofstede (2011) to assess the propensity of companies to adopt innovation as a core strategy. Some cultures are more likely to embrace such a strategy, based on the values they profess, while others are bound to need more convincing to do the same (Kaasa & Vadi 2008). Therefore, this cultural assessment criterion is important in understanding the relationship between culture and innovation. A study by Herbig and Dunphy (1998) delves deeper into this issue and points out that an organization’s culture determines how it would adopt innovation.

Piepenburg (2011) adds to this discussion and points out that organizational cultures, or societies, which profess a culture of individualism, tend to embrace innovation better than those that do not. Therefore, they are more likely to benefit from the same. Some researchers have discussed this issue further and pointed out that religion also plays a key role in influencing how organizations innovate and how their markets respond to the innovations (Kaasa & Vadi 2008). Particularly, they have pointed out how religion has created a sense of innovation bias among certain societies because religious societies are averse to innovation and its advantages, while secular societies, such as America or the UK, are not (Herbig & Dunphy 1998).

Implications of Innovation for different Companies

Many researchers have explained that increased innovation in the corporate sector often amounts to several advantages for the companies involved. Perhaps, cost reduction is one of the most recognizable advantages associated with innovation. To understand this principle in intricate details, it is important to recognize that many companies often have two main types of costs – fixed costs and variable costs. Researchers have used these categories to define average costs and marginal costs, which are essential to our understanding of the implications of innovation to different companies (Coombs & Paolo 1987). The diagram below shows a case where a company registered average cost (AC₁) and marginal cost (MC₁) before the onset of innovation or its addition to a company’s business strategy.

Before innovation, most firms often have the same average and marginal costs. This fact means that the same firms do not have fixed costs. In explaining this finding, researchers assume that the demand curve remains unchanged and is as depicted above (Princeton Education 2015). Similarly, they assume that many companies that operate in the industry (in a perfect market) set their prices at MC₁ (Princeton Education 2015)_. The output produced is Q₁ and is sold at a specific price P_1. The consumer surplus identified in the shaded area is the benefit associated with innovation. It emerges as the area between the demand curve and the price. The benefits accrue from the innovation process through the reduction of the average and marginal costs (Princeton Education 2015). According to the diagram above, the average and marginal costs are equal (AC₁ = MC₁) before innovation; however, after innovation, these costs drop to AC₂ and MC_2, which are similarly equal but represent lower values, which companies pass off to their consumers as reduced prices (Princeton Education 2015).

The reduction in prices manifests as P_2. At the same time, there is an increase in consumer surplus (identified by the shaded area). Indeed, after innovation, the surplus area is above P_2, but below the demand curve. For the above findings to make sense, it is pertinent to understand that one underlying assumption in the above illustration is the lack of intellectual property rights because the above example assumes that all firms have the knowledge needed for innovation (Gassmann, Enkel & Chesbrough 2010). Similarly, another underlying assumption of the above example is that when the innovation process occurs, all firms start to use the innovation immediately they get the knowledge to do so. There are some challenges associated with this assumption, but we are not going to get into them in the section of the paper.

Summary

This chapter has outlined different issues surrounding innovation. It has also presented how it applies to organizational growth and development. Similarly, it has also explained some of the models, typologies, and relationships surrounding the application of innovation as a corporate strategy. The underlying relationships between culture and innovation that have emerged in this analysis have also helped us understand the context of implementing innovation strategies. While these findings are useful in our understanding of the different tenets of innovation, they do not explain how the same typologies, models, and relationships apply to Apple. In this regard, there is a literature gap surrounding how the company has used these frameworks of analysis to implement a successful innovation strategy. This literature gap justifies the execution of the following chapters.

Research Methodology

Introduction

This chapter outlines the processes used to undertake this study. It covers different aspects of the researcher’s actions, including outlining the research strategies chosen, research design chosen, sampling strategies used, data collection methods applied, data analysis techniques used and the ethical considerations underlining the study. The details of this analysis appear below.

Research Strategy

The selection of a research strategy mostly depends on the nature of the research topic under investigation. Generally, researchers use two main types of research strategies– qualitative and quantitative techniques (Creswell 2013). Qualitative techniques are often useful in research studies that strive to investigate exploratory research issues (Frost et al. 2010). Usually, this research approach is important for people who would like to understand the motivations, reasons, or opinions surrounding different research issues. Most of their concerns are usually subjective (Creswell 2013).

Comparatively, the quantitative research technique is mostly applicable in research studies that want to quantify a research problem (Frost et al. 2010). It does so by way of generating numerical data. Researchers later transform the data into statistics that are usable in quantifying the research problem. Carroll, Booth, and Lloyd-Jones (2012) say that although researchers cannot use the qualitative and quantitative techniques interchangeably, they could use them complementarily. This assertion was the main basis for the use of the mixed methods approach as the main research strategy for this study. The mixed methods research approach uses aspects of both the quantitative and qualitative techniques to answer the research question.

The main motivation for using the mixed methods research approach was to have a stronger validity of the research responses (Frost et al. 2010). Based on the nature of the RQs, the mixed methods approach was useful in answering the RQs from different perspectives (Creswell 2013). Since the mixed methods research approach is complementary, it was useful in ensuring there were no gaps in the information collected from the study. In other words, the mixed methods approach allowed the researcher to use both the qualitative technique to answer questions or fill research gaps that inherently existed in the quantitative research approach (Creamer & Ghoston 2013).

The quantitative research approach was the first method used by the researcher to answer the RQs. It could not provide holistic discussions of the questions as the researcher intended. Consequently, we had to use the qualitative research technique to fill some of these research gaps. This interaction emphasizes the complementary advantages offered by the use of this research approach (highlighted above). This research approach also offered other advantages for the study, including minimizing the researcher’s assumptions in the study and generating new knowledge using concurrent and sequential qualitative and quantitative research approaches (Creamer & Ghoston 2013). The diagram below summarises how we used the mixed methods research approach to generate the research findings.

Research Design

According to Bulsara (2015), the mixed methods approach has different types of designs, including the triangulation model, instrument design model, data transformation model, an explanatory model. We discuss these research models below.

Triangulation Model

Creswell (2013) says this research design is often applied in primary research studies. Usually, this technique involves the use of different data collection processes, most of which happen at the same time. Through the multiple data collection points, researchers integrate data to clarify the research issue, or to have a better understanding of a research problem. There is no preference for qualitative or quantitative research approaches because all of them are treated equally. However, this research design dictates that the researchers report the findings of the different research approaches in different sections of the research paper (Welch et al. 2013). Generally, the discussions outlined in such a review often bring the salient points of the research issues together to form a coherent framework of analysis (Creswell 2013).

Instrument Design Model

This research design gives priority to qualitative data more than quantitative data. In other words, this research design has two phases of analysis, which give priority to the qualitative research design first, and later the quantitative research design (Grandy 2013). The integration of the two points of data collection often happens at the data analysis stage. In this research design, researchers undertake the qualitative research design first because they use it to develop instruments of data collection (Creswell 2013). For example, many researchers have used this technique for scale development or to create a focus group through which their findings would be useful in developing a questionnaire for further review.

Data Transformation Model

This research design is mostly applicable to researchers who undertake primary research. Here, they often undertake the quantitative research process first before participating in the qualitative research process (Bulsara 2015). The qualitative research process involves undertaking a survey through questionnaires and using the qualitative research approach to explain the findings in the surveys. The data analysis process could include the analysis of qualitative questions, open-ended questions, or the analysis of the same information through coded data (Grandy 2013).

Explanatory Model

Creswell (2013) says the explanatory model is the last research design of the mixed methods research approach. It often relies on a quantitative research design to answer the research question. The second stage is the qualitative process, which investigates the findings of the quantitative process in detail. Often, this research design follows up on the findings of the quantitative research process by simply interviewing a few people (Bulsara 2015). The reason for using the qualitative research process is to get a deeper insight into the quantitative findings.

The explanatory model was the chosen research design for this paper because we first relied on the quantitative research process to get an understanding of the research issue and later used the qualitative research process to clarify some of the findings. The motivation for using this research design was its ability to give the researcher allowance to gather quantitative research data using existing findings of the RQs and build on the same for a better understanding of the research aim.

Data Collection Techniques

We collected data from two sources – document reviews and interviews.

Document Analysis

The main data collection technique for this paper was the document review process. Data collected through this method were solely for purposes of obtaining quantitative data as the basis for the rest of the study. Using this approach, we reviewed books, journals, and credible websites as the main basis of our analysis. The documents came from reputable databases such as Emerald Insight, Google scholar, Sage Journals, and the likes. The keywords for the study were “Apple,” “Innovation,” and “Culture.” The aim of undertaking the document review process was to understand the context, causal meanings, and patterns in the implementation of an innovation strategy at Apple. To get the best information, we analyzed the documents for their applicability to the research issues, significance to the research questions, and their meaning to the overall research purpose (Unluer 2012).

Interviews

We recruited 12 respondents as informants in the study. They came from different business consultancy firms in the United Kingdom (UK) and the United States (US). We only interviewed 12 respondents for the study because of limited resources and limited time in completing the study. Furthermore, this study only focused on one company and not an industry or a selection of different companies in an industry. Therefore, we believed that 12 respondents could provide adequate information for the study. The narrow scope of the study and the modesty of the research questions also made it simple to understand the research findings based on the sample of respondents chosen. The interviews were open-ended because we wanted to get qualitative answers from the interviewees. The interviews were generally short (30 minutes or less) because we only had a few questions to ask the respondents. There was an option of making follow-up questions to the respondents if there was a need to do so. Before, interviewing the respondents, they had to sign a consent form to affirm their willingness to participate in the study.

Sampling Technique

We sampled the respondents using the purposive sampling technique. This sampling technique was appropriate for the study because we required informants who could provide expert opinions about the research issue. Indeed, as Altheide (1987) observes, unlike the random sampling technique, which strives to include a diverse group of people, the purposive sampling technique usually does not deviate much from common characteristics of respondents as chosen by the researcher (Tsang 2014). One motivation of using the purposive sampling technique was its ability to allow the researcher to develop the sample using incremental building blocks (Abrams 2010). Using this technique, we used every stage of the sampling process to develop another. In other words, we started with a critical case sampling of one respondent who was a friend of mine working with a leading consultancy firm in London. He connected me to other respondents who gave their views about the research issue. The respondents were cooperative and enthusiastic to participate in the study.

The purposive sampling technique was appropriate for this paper because it allowed the researcher to gather expert views only. In other words, I asked the respondents to recommend someone whom they believed were knowledgeable about the research topic. Their collective views were assumed to be peer-reviewed. One significant disadvantage of the chosen sampling technique is its likelihood to contain researcher bias (Bulsara 2015). This bias emerges from the fact that the researcher mostly relies on his discretion to make judgments about who to interview (Burmeister 2012). To overcome this bias, we tried to distance ourselves from this weakness by making sampling decisions, based on the accepted criteria. Therefore, we avoided making decisions that would try to prove a specific point, or support a specific theory.

Procedure for Contacting the Respondents

In no particular order, we sent invitations to the respondents to participate in the study via email. Initially, we sent 15 email invitations to a similar number of respondents. However, one of them failed to respond, while two expressed their regrets for their unavailability to participate in the study. Therefore, cumulatively, we had 12 respondents who participated in the study. They readily expressed their enthusiasm to participate in the study. Seven of them were willing to meet the researcher (physically) to participate in the study. However, because of logistical reasons, we chose to use Skype as the main interactive platform to get the views of the respondents.

Data Analysis Technique

The data analysis process stems from the use of a mixed-methods research approach. The first step of the data analysis process involved the inclusion of pretested data and results through the quantitative analysis process. We subjected the information received from this process through the qualitative review process. This step led us to have the quantitative post-test data and results, which were available for further analysis. Bernard and Ryan (2010) define this approach as the sequential embedded design process. Part of this strategy involved the coding and theme identification process as the basis for discussions in the paper. The coding process involved the assignment of numerical codes to each group of information that represented one theme (Finfgeld-Connett 2014).

For example, we assigned code 1 to all research information that talked about the relationship between innovation at Apple and the organization’s competitiveness. We also assigned code 2 to all information that talked about the second RQ, which sought to find out the factors that contributed to Apple’s innovation strategy. Code 3 was for all information related to the third RQ, which strived to understand the relationship between culture and innovation at Apple. Lastly, we assigned code 4 to all information that explained how Apple’s innovation strategy contributed to the organization’s competitive advantage, which was the main point of discussion for RQ4. The following table summarized how we assigned different codes to the research information we obtained.

As highlighted in the above table, we assigned the codes according to the content of the RQs. The purpose of doing so was to ease the data analysis process by creating a strong alignment between the data analysis process and the goal of comprehensively answering the RQs. Therefore, we attributed all the themes identified in the study to specific RQs.

Ethical Considerations

Consent

As mentioned in this chapter, all the interviewees had to give their consent before participating in the study. Before doing so, we informed them of their right to withdraw from the study, without any repercussions. Similarly, during the interviews, the interviewer informed the respondents of their right to give their honest opinions about the research topic, freely. The open-ended nature of the questions asked in the interviews guaranteed this fact because there was a deliberate attempt not to constrain the informants’ responses when answering the RQs and to allow them to give as much information as they could. One of the most common challenges we found when doing so was to find commonly running themes from the responses given. However, whenever the informants deviated from the main research issue, the researcher had to steer them back to the right context of the discussion. The main challenge of using this technique was its time-consuming nature.

Trustworthiness

It is a common problem among qualitative research studies that some respondents may give dishonest views, or that they may not trust the true intention of the researcher in conducting the study (Wiewiora et al. 2014; Bulsara 2015). To address the second issue, the researcher informed the respondents that the only purpose of conducting the study was to fulfill academic goals. To make sure that the information obtained from the respondents was reliable, we subjected the findings through a member-checking process. In other words, we contacted the respondents again to give them a synopsis of the findings. They were to give their views regarding whether the findings reflected their true opinions, or not.

Privacy and Anonymity

To conduct this study, we made sure that the information collected from the study was private. In other words, we respected the wishes of the respondents to provide their views about the research issue anonymously. Therefore, the names of the respondents and the firms which they worked for do not appear anywhere in this paper. Collectively, these factors explain the ethical considerations in the study.

Findings

Quantitative Review (Document Review Findings)

Some of the key themes that emerged in our review included the following:

Themes

Leadership

Most of the documents we reviewed highlighted the leadership theme when explaining the role of Steve Jobs in leading Apple to be one of the most recognized brands in the tech market (Sonnenfeld 2011; Bass 1990; DeCarlo 2011). Some of the documents highlighted the same theme interchangeably with the concept of management (Isaacson 2012). Most of them did not distinguish between the two concepts as they mostly highlighted how Steve Jobs managed to develop some of the most notable products in Apple’s array of revolutionary gadgets (Yoffie & Penelope 2012; Isaacson 2012). Many researchers mentioned the introduction of the iPad as one of Apple’s most revolutionary and iconic products (Copeland 2010; Sonnenfeld 2011; Bass 1990; DeCarlo 2011).

As a subset of the leadership theme, diversity, and inclusion also emerged as another important driver of Apple’s innovation strategy. This subtheme mostly surfaced as an admission by the company about what makes it tick (Apple Insider Staff 2007). For example, according to the Apple Company website, the organization considers itself the leading innovative company (Apple Company 2016). It made this remark when it asserted that diversity was a key driver of its innovation. As part of its commitment to uphold this principle, the company mentions an example of how it engages in many social efforts to recognize the rights of the LGBT community and the rights of minorities, both at work and in the national space (Apple Company 2016). It has done so through the advocacy for LGBTQ equality.

Apple also has diversity network associations that facilitate employee interactions, which consequently allow it to build important networks that it could use to build trust and create a sense of belonging for minorities in the organization. Some of these networking organizations include the Apple Jewish community, Apple Muslim Association, African-American Employee Association, Agnostic Community at Apple, Apple Asian Association, Apple Christian Fellowship, and Apple Indian Association (Apple Company 2016). Because of its inclusion strategy and the work of the above-mentioned organizations, Apple has managed to create a diverse employee workforce that includes people from different ethnicities and racial backgrounds. The diagram below represents the racial and ethnic percentages of employees at the company.

The low percentage of employees who have undeclared racial backgrounds (in the above diagram) is by design because the company has strong internal controls that require its employees to state their racial or ethnic compositions (Apple Insider Staff 2007). Comprehensively, the focus on diversity emerged as a strong company value at Apple, which underlies the success of its innovation strategy.

Culture

The theme of culture also emerged as a prominent point of analysis in our analysis. Most of the documents we reviewed showed that Apple’s culture was a significant focal point for its success (Copeland 2010; Sonnenfeld 2011; Bass 1990; DeCarlo 2011). Many of the documents demonstrated that the company’s culture has helped it to support changes in the organization, and helped the administration to create new policies and new strategies that complement an innovation strategy (Yoffie & Penelope 2012; Unger, Rank & Gemunden 2014). Referring to the innovation strategy and its potential to help the company develop new products, most of the documents reviewed mentioned the iPhone, Apple Watch, and iPad as some of the most revolutionary products, which demonstrate the power of Apple’s innovation strategy (Copeland 2010).

However, some of the authors sampled showed a different aspect of the company’s corporate culture by saying that although Apple has a strong culture of innovation; it could convey both strengths and weaknesses of the firm (Uddin, Luva & Hossian 2013; Stavros & Hinrichs 2009). For example, Stavros and Hinrichs (2009) said the company’s culture limited it from exploiting the full potential of its employees because some of them are not necessarily “creatives.” To explain this point further, they said that those employees who are best known for improving efficiency and good administrative practices may feel out of place in a company that mostly encourages innovation at the expense of everything else (Stavros & Hinrichs 2009). Cameron and Quinn (2006) shared this view when they said that Apple’s culture of innovation makes it difficult for the company to optimize its human resources.

Nonetheless, a review of most of the documents, which highlighted culture as an underlying theme of the company’s innovation strategy, presented top-notch excellence, creativity, innovation, secrecy, and moderate combativeness as distinct features of Apple’s culture (Toma & Marinescu 2013). Some of them even drew a link between Apple’s leadership and culture by demonstrating that culture was a significant hinge of Apple’s leadership (Smets, Morris & Greemwood 2012). When explaining the concept of top-notch excellence, some of the authors pointed out that Apple was mostly fixated on employing the best workers in the industry (Copeland 2010; Sonnenfeld 2011; Bass 1990; DeCarlo 2011).

From a more practical point of view, people knew Steve Jobs for firing workers who did not meet his expectations and only retained those who did (Isaacson 2012). This tradition has firmly been entrenched under the leadership of Tim Cook. In this regard, excellence suffices as a key component of Apple’s culture, and it has manifested mostly in the company’s product and development departments (Smets, Morris & Greemwood 2012). When explaining the concept of creativity, the articles showed that the company mostly focused on employing employees based on their skills and knowledge. In other words, the company prefers that employees assigned to work in the design and development sections of the organization must have exceptional creative skills (Viegas-Pires 2013).

There was a consensus among many respondents who said that the creativity feature of the organization’s culture helped it to develop unique solutions to its business and consumer needs (Hurley-Hanson & Giannantonio 2013; Veiseh et al. 2014). Innovation was also another feature of the company’s culture, which manifested as a hiring requirement by the company’s managers. They always encourage their employees to be innovative in their work (Bajarin 2011). Steve Jobs who did not easily reveal the company’s secrets (even to its shareholders) introduced the concept of secrecy in the company’s corporate culture (Hurley-Hanson & Giannantonio 2013). The goal of maintaining the company’s secrets was to protect its proprietary information (Gallo 2009).

Some of the documents reviewed showed that most of the new employees at Apple were supposed to swear to a culture of secrecy (Hurley-Hanson & Giannantonio 2013; Veiseh et al. 2014). The same oath appears in the company’s policies, rules, and contracts (Apple Insider Staff 2007). Moderate combativeness was the last aspect of Apple’s organizational culture that we found. It emerged as part of Steve Job’s combative leadership style (Lashinsky 2011). Different historical accounts of Job’s performance at Apple showed that he often challenged his employees to see whether they had what it took to work at the corporation (Desvaux & Devillard 2008; Whalen 2014; Harvey 2001). Nonetheless, it is important to point out that under the leadership of Tim Cook; the combative leadership style is disappearing because he is slowly changing this aspect of organizational culture to be more sociable (Veiseh et al. 2014). Based on this finding, we could say that Apple’s culture today is moderately combative.

Qualitative Review (Interview Findings)

This section of the paper highlights the findings of the qualitative analysis section of our study. It is a product of a deeper analysis of the quantitative review (above), which showed leadership and culture as the main themes of the analysis. Although there were two other themes of company growth and competitiveness highlighted in the document review, we found out that the themes of leadership and culture were the main ones that required extra review because they shared an indirect relationship with innovation (growth and competition have a direct relationship with innovation). Based on this analysis, we asked the respondents to give their views about the two themes and explain their relationship with the concept of innovation.

As mentioned in the third chapter of this report, we initially intended to interview 15 respondents in the study, but only managed to get 12 of them to participate in it. The respondents were asked to give their views about different issues that emerged from the document review process. These issues centered on explaining the role of culture in supporting Apple’s innovation strategy and the role of leadership in supporting the company’s innovation strategy. These issues emerged as the two main themes in the document review process. We structured the interviews to give us more insight into them. We also sought the respondents’ views on how innovation would influence the company’s growth. They had the following to say.

Role of Culture in supporting Apple’s Innovation Strategy

When we asked the respondents to explain the extent of the role of leadership in influencing Apple’s innovation strategy, all of them argued that leadership played a fundamental role in creating a culture of innovation in the company. More importantly, they pointed out that leadership has been at the center of the company’s growth, performance, and valuation plans. One of the respondents said that he believes that Apple’s leaders set the pace of change not only in the organization but also in the industry at large. When asked to clarify this point further, he said, that Apple was possibly the only tech company that had users who knew its leadership. Referring to this point, he said,

Think about it, how many chief executives of tech companies do you know?…. I will wait (smiling), but I bet you know that Tim Cook is at the helm of Apple and you know that Steve Jobs was there before him. You would not find that many tech users even know who the chief executive officer of Samsung is….. Apple’s leadership has gained a larger than life form and if Cook proves to his shareholders that he could perform the same way as Jobs did, or even better, Apple could soar to great heights.

Other respondents believed that Apple’s leadership has played a key role in boosting the company’s success because many employees at the company have often looked up to the company’s leadership for motivation and guidance. The company’s leadership has not failed in this regard because it has been able to play a pivotal role in the company’s success by showing a positive attitude towards new ideas. One of the respondents said that the company’s leadership has been a pacesetter to other companies in the way that it removes all the obstacles and red tape to innovation success. By doing so, it has also diverted the company’s attention and resources to those projects that align with its innovation strategy.

One of the respondents added to this debate by saying that good leadership at Apple has provided an interface between the company’s employees and its management. When asked to state the type of leadership at Apple, he said that the company subscribes to a democratic leadership style. He also said that this leadership style has seen the company’s managers participate in idea generation and execution. Another informant believed that the company’s leadership has often provided good oversight of new processes and provided timely feedback about ongoing projects to give the innovative team enough time to correct or improve, on their ideas.

Some of the respondents said that leadership and culture at Apple were one in the same thing. When asked to clarify this issue further, they said that the company’s leadership has played a significant role in creating the innovative culture in the first place and making all other employees subscribe to it. Like the other respondents, they mostly attributed the innovative leadership style to Steve Jobs. They said he provided strong leadership to the employees through a culture that fostered innovation and openness. This is why Tim Cook adopted the same leadership style. He was respecting a culture that was already in place. Few respondents believed that such a culture would change any time soon. Most of them agreed that both culture and leadership play a significant role in supporting Apple ‘s innovation strategy.

Will Apple’s Innovation Strategy drives the company’s Future?

When we asked the respondents to give their views about the role of innovation in Apple’s future, there was a mixed response because some of them thought that innovation would still be a strong pillar of the company’s future development, while others believed that the company’s innovative days were over. Those who held this view said that Apple has not developed a new revolutionary product in a while and they were pessimistic that it could do so in the future. One of them said,

I think during the times of Steve Jobs, I would be a little more confident about the role of innovation in the company’s future. However, I cannot say the same now because under the leadership of Tim Cook… I do not think there would be much to expect. The iPhone, iPad, and iPod were the last revolutionary products from the company. Since then, most of Apple’s innovations have failed to gain traction. Talk about the Apple Watch, the Apple TV and the likes… I do not believe these products make us confident about the company’s prospects.

Two other respondents said that the innovation strategy would still be a key tenet of the company’s future growth, but they believed that this innovation would mostly be centered on improving the company’s products and processes, as opposed to coming up with new products. Based on this analysis, the respondents believed that innovation would have a mixed role in the company’s growth. In other words, the number of respondents who expressed positive views about the positive role of innovation in the company’s future was equal to the number of respondents who expressed pessimism about the future role of innovation in the company’s growth.

Discussion

Introduction

In this chapter, we review the findings highlighted in chapter four. The format of our discussion is relative to the RQs, which strive to understand how Apple’s innovation strategy has contributed to its overall competitiveness, the main drivers of Apple’s innovation strategy, the relationship between culture and innovation at Apple, and the role of innovation in the company’s future.

How Innovation has contributed to Apple’s Competitiveness

In today’s fast-paced world, the survival of companies depends on their proficiency in continuous improvement. In the context of this paper, continuous improvement manifests as the ability of companies to innovate. The use of advanced technologies to stay relevant to the changing dynamics of the external business environment is one example of how companies adopt continuous improvement as part of their organizational strategy. While the findings of this paper have shown that Apple has adopted such a strategy for its prosperity and success, the truth is that it needs to rely on the same strategy for its survival. At the core of the company’s strategy is its ability to set up a team of employees that could effectively innovate and come up with important solutions for their companies. Throughout the years, the company has used a technology push strategy because most of its products did not arise because of market research. The launch of the iPad, albeit a revolutionary product, demonstrates this fact because it emerged during Steve Job’s time. Most of its customers did not necessarily understand its use or the way it worked (Copeland 2010).

As highlighted in the literature review section of this paper, most companies that use the technology pull strategy do not take their customers’ opinions in high regard when making new products. Steve Jobs was infamously known for saying that customers do not know what they want (Steinwart & Ziegler 2014). In this regard, he believed the company had to give its customers products that they did not know they needed. However, to do so the company had to explain to them how such a product would be useful to their lives. This philosophy has been the main basis if Apple’s technology pulls model. So far, it has changed the company by improving its overall competitiveness because no other company has been able to apply such a strategy so well.

Relationship between Culture and Innovation at Apple

Apple’s organizational culture has been able to influence employee actions positively and promote its innovative streak in the tech world (Miller, Mabel & Mark 2014). Apple’s success in this regard affirms the views of other researchers who have affirmed the importance of culture as an organizational lever in creating change in the organization. Relative to this assertion, Salimi and Aveh (2016) say, “In a constructive culture, management ability, talent, creativity and innovation among employees create, promote and encourage the removal of barriers in this way in addition to innovation, background mental conditions favorable to the development of ideas there” (p. 1). Through this statement, we can draw comparisons of the role of culture in Apple to the role of a character in a person’s success. Indeed, in the same way, as character defines a man’s integrity and what he stands for, Apple’s organizational culture also determines what the organization stands for, and more importantly what it uses a lot of its resources for (Sok, Blomme & Tromp 2014).

At Apple, organizational culture has emerged as a system of common understanding among employees and management. This culture has created a need for increased precision and innovation at the California-based company because its culture meets employees’ psychological needs, such as affiliation and a sense of achievement of being associated with one of the best global companies to revolutionize the tech market. The success of Apple’s innovation strategy affirms the views of previous researchers who argue that innovative organizational cultures often have different and diverse job designs, in terms of content (to accommodate different types of talents available) (Salimi & Aveh 2016). In this regard, they benefit from a greater level of knowledge and skill that manifests as unrivaled innovation, which they use to outwit their competitors.

Factors Driving Innovation at Apple

Openness and Good Leadership

According to our analysis, innovation has emerged as a complex system that embodies different types of organizational processes that touch different departments of Apple, including the finance department, IT department (technological), and marketing department. Leadership is at the helm of the innovation strategy, which is the organ that pumps the blood of innovation throughout all departments mentioned above (Bass & Riggio 2006). Although the goal of Apple’s leadership is to improve the cohesiveness of these departments and to enhance their synergy in producing innovative products and processes, the organizational departments mentioned above work independently. Based on the findings we have deduced from our case study, we find that Apple’s quest to increase its efficiency through innovation was conceived with two goals in mind. The first one was to ensure the long-term and sustained growth of the business. The second one was to eliminate or minimize, all points of inefficiencies in the organization’s processes.

The organization’s leadership has played a fundamental role in making sure Apple achieves the above goals (Bass 1990). Most of the respondents sampled in this study agreed with this fact when they said that the company’s leadership has traditionally played an instrumental role in nurturing a culture of innovation (Den & Belschak 2012). None of the respondents disputed this fact. Observers have also affirmed the same (Bass & Riggio 2006). For example, an excerpt from Steve Job’s biography, done by Isaacson (2011), shows that the pioneer leader often held weekly meetings with some of the company’s operational heads to brainstorm about some of the best innovations to pursue. Whenever he disliked an idea, he was not afraid to air out his opinions and let the person who brought up such an idea know what he thought.

Generally, people viewed Jobs as an autocratic leader, but records show that he was often big on open discussions and debate about which direction the company should follow in its innovative journey (Den & Belschak 2012). From such meetings and debates, the company’s chief executives would envision the next steps the company would follow in developing existing product lines and brainstorm about the latest products it should produce (Burrows 2005). Such open discussions were also beneficial to the company because they ensured that all departments knew about new process developments (Weber & Tarba 2012). Therefore, it is uncommon to find that departmental heads are in on such projects at the last minute, as is often the case in most companies. Such a strategy has helped the company to remain focused on its goals. Some observers have described this leadership style as being “tightly integrated,” much like how most Apple products are (Wooten 2014).

The company’s leadership has often adopted a minimalist approach because it strives to focus on improving only those projects that are core to the company’s operations and abandoning those that take up too much time but yield fewer returns. Many researchers who attribute this leadership style to Steve Jobs, who was a minimalist by nature, have highlighted this approach (Mayo & Benson 2008). Historical accounts of his early life show that he gained this value from working on an apple farm because this leadership style is like pruning (Den & Belschak 2012). Comprehensively, many researchers who say that leadership is integral in the successful execution of innovative strategies have predicted the pivotal role of leadership at Apple.

Inclusion and Diversity

According to some of the respondents sampled, Apple has a strong innovation culture that fails to recognize idea limits. These principles were nurtured by the company’s management during the time of Steve Jobs and have been perpetuated by Tim Cook, who still subscribes to the principles of his predecessor (Lashinsky & Burke 2009). According to the company’s website, Apple takes pride in having a diverse workforce, which is the breadbasket of its innovation strategy. In line with the mantra of diversity, Apple considers itself a reflection of the world around it. In other words, it has strived to mimic the world’s diversity through its employee processes, including its hiring processes and its pay structure. In this regard, the company does not discriminate, or segregate, its employees based on different social constructs, such as sexual orientation, religious beliefs, or disability (among others).

The aim of doing so is to make all employees comfortable when coming to work. In other words, the company does not want some of them to feel like they have to leave certain aspects of who they are out of work. The inspiration for this philosophy is the understanding that people’s backgrounds, perspectives, and passions help create ideas that help the company remain competitive (Reich 1987). The company has demonstrated commitment and action in ensuring that its business practices demonstrate diversity at all levels of operation (Yunus & Tadisina 2016). For example, the company’s training program has helped existing and new employees to identify unconscious, racial, and gender biases among employees. These attempts are aimed at eliminating all barriers to innovation.

Will Apple’s Innovation Strategy support its Growth?

So far, we have seen that Apple’s innovation strategy is largely responsible for its general good business performance. Claims that the company is running out of ideas for innovation made us explore whether the innovation strategy would continue to drive the company’s growth in the coming decades, or not. A preliminary analysis of our findings shows that this would be the case. However, a deeper analysis of this statement reveals that the continuity of its innovation strategy would mostly hinge on two factors – the protection of its unique ecosystem and its sustained brand appeal. If we focus on the unique ecosystem alone, we find that since most of Apple’s devices run on iOS, it can easily shield itself from the competition that would often emerge from the proliferation of tech gadgets that run on Android and Google operating systems.

This exclusivity means that if customers want devices that run on the Apple iOS, they must buy Apple devices (only) because these are the only gadgets that use this operating system. Comparatively, many phone users have many choices regarding which brand they could purchase from the Android platform. For example, Samsung, HTC, and Sony are common Smartphone brands that all compete on the same platform (DeCarlo 2011). Some chipmakers such as Qualcomm and Intel are worsening this trend because they are helping these and many more companies develop more gadgets on the same platform, thereby increasing competition in the same space (Sun 2015).

This is why we find that there are many cheap phones on the Android platform (mostly because this operating system is open-sourced and available for everybody). Apple does not have much competition. Apple’s exclusivity supports the findings of many researchers who have pointed out that most people who use Apple gadgets cannot imagine using other gadgets. For example, a recent UK study revealed that more than 78% of iPhone users could not imagine using any other type of phone, while close to 60% of the sampled respondents professed a blind loyalty to the company’s brand (Sun 2015). Based on these findings, we find that as Apple’s customers continue to increase, most of them would remain in the company’s ecosystem. The diagram below reveals that this outcome is slowly becoming a reality.

The sustainability of Apple’s growth will also depend on the ability of the company to maintain its brand appeal because it is among the few luxury global brands. For example, according to Sun (2015), Apple is among the top brands for gifting in China and different parts of the world. Reports indicate that it has beaten different luxury brands such as Louis Vuitton, Prada, Cartier, and Chanel in the luxury brand segment (Wooten 2014). Apple’s brand appeal has enabled it to sell its products more expensively than its rivals, although its software and hardware specifications may be lower than its rivals. Collectively, the company’s brand appeal and its protected ecosystem are the keys to its innovative success. If it gets these three components of its overall corporate strategy together, it could easily sustain its competitiveness for many years to come.

Conclusion and Recommendations

Conclusion

In this paper, we set off to investigate how Apple’s innovation strategy has affected the firm. There were four main research questions in this study. The first one sought to investigate how Apple’s innovative strategy has contributed to the firm’s competitiveness. The second one investigated the driving factors that contributed to the company’s innovation strategy, while the third one explored the relationship between culture and innovation at Apple. The last research question investigated whether the company’s innovation strategy would sustain its future growth.

We developed these research questions on a background of an uncertain economic environment where businesses have to grapple with the challenge of determining how an innovation strategy would apply to their internal and external business environments. Apple emerged as a perfect case study for this research because it is among a few companies in the world that have successfully adopted an innovation strategy. Consequently, the research questions highlighted above strived to outline how the company adopted its innovation strategy and how it has managed to do so, relative to its internal and external organizational dynamics. The aim of answering these research questions was to find out how this strategy has changed the firm.

Using a mixed-methods approach, we set off to collect data using two research approaches – the qualitative and quantitative techniques. The first part of the research review involved a quantitative research analysis, which identified two main themes of analysis through a document review process. The themes were leadership and culture. They emerged through a comprehensive review of more than 70 research articles that revealed the importance of leadership and innovation culture at Apple. This first part of the research also revealed that the works of Steve Jobs and Tim Cook contributed significantly to the nurturing of an innovation culture at Apple.

Based on the findings described above, culture and leadership emerged as the significant themes of our analysis. These elements of discussion permeated through different aspects of our discussion, including the identification of factors that have contributed to the company’s innovation strategy and understanding of the relationship between culture and innovation at Apple. These two themes also helped us to understand the role of the company’s innovation strategy in the company’s growth and its contribution to its overall competitiveness as well. In our document review, we also found that organizational growth and competitiveness were two other themes that frequently emerged in the articles reviewed. However, we did not consider these themes to be of utmost importance to our study because they appeared in one-quarter of the articles sampled. Furthermore, they mostly focused on the effects of an innovation culture at Apple and not, necessarily, how the company has adopted the same strategy. Nonetheless, we found it pertinent to include these themes in our findings because they are part of the RQs, which strive to understand how Apple’s innovation strategy has contributed to the company’s overall competitiveness and how the same strategy would add to the organization’s overall growth.

In this paper, we have demonstrated that, for Apple, innovation is the main basis for developing a competitive advantage. However, the concept is still a challenge for many companies like it because the process of adopting an innovation strategy usually does not follow the same pattern of implementation or success. The themes of innovation and culture emerged as the moderating factors for innovative success.

Most of the articles we reviewed showed that the company’s innovation strategy is mostly responsible for the company’s overall global competitiveness. Most of the researchers sampled showed that Apple has quickly become one of the fiercest competitors in the tech market because of its innovative products. For example, Sun (2015) pointed out that because of the company’s strong business strategy, its shares have soared more than 250% in the past five years alone. This growth doubled the Nasdaq’s return (Sun 2015). Copeland (2010) said two products were the main contributors to this growth – iPad, and iPhone.

In this paper, we also reviewed the concept of innovation at Apple Inc. from different perspectives because it is one of the most noticeable global companies to have successfully implemented this strategy and realized improved competitiveness because of its adoption. Although there have been attempts by some observers to paint Apple as a company that has run out of ideas, the facts reveal otherwise because the company continues to produce new and innovative products in the market. This fact emerged through the recent launch of the iPhone 7, which has continued to stay true to the company’s innovation culture. A couple of new features of the phone have taken the market by storm. For example, the cordless earphone is a new feature found almost exclusively on the iPhone. Regardless of whether the market responds positively, or negatively, to such developments, it is difficult to assume that it has run out of innovative ideas.

Although many companies have imitated some of the company’s innovative products, they have experienced difficulties imitating the company’s culture of innovation. Those who have tried to do so have failed to succeed in that regard. A keen look at the company’s innovation strategy shows there is no particular formula that other companies could effectively replicate to achieve the same results. Otherwise, other companies could have easily replicated the same culture or bought their way into Apple’s success. Therefore, we find that some essentials of the company’s culture hinge on effective leadership and skill development (Ziegler & DeGrosky 2008).

If we focus on the skills that the company’s employees profess today, we find that Apple is unrivaled. Indeed, the company has developed unparalleled skills in software, hardware, and service development. Similarly, the company’s unparalleled skills in software and hardware development have not only emerged in the mobile phone market, but also in the PC market where the company has leveraged some of these skills to provide its customers with an elegant experience where technology and innovation are at the center-stage of the company’s service and product offing.

Recommendations

In this paper, we found that some essentials of Apple’s innovation culture hinge on effective leadership and skill development. Key sections of this paper also demonstrated that the company’s innovation strategy would be the driving force of its future growth, relative to its proficiency in securing its business ecosystem (hinged on the use of its iOS) and its strong brand appeal that other companies have failed to match. A deeper analysis of these findings also revealed that the company’s leadership, under Tim Cook, would continue to support innovation at the firm because this is its key competency. If we focus on the skills that the company’s employees profess today, we find that Apple is unrivaled. Indeed, the company has developed unparalleled skills in software, hardware, and service development. These skills have not only emerged in the mobile phone market, but also in the PC market where the company has leveraged some of them to provide its customers with an elegant experience where technology and innovation are at the center-stage of the company’s service and product packages.

Going forward, Apple needs to make sure that it protects its uniqueness, particularly regarding the use of its iOS and safeguard its quality processes, which have been the driving force of its brand appeal. As part of its future strategy, we also propose that the company needs to pay attention to the market needs and develop products that resonate with the same needs. This would be a departure from its technology pull strategy, which it perfected during the Steve Jobs era. A market pull strategy would help the company to improve the market acceptability of some of its innovations because, currently, some of the latest innovative products produced by the company have failed to live up to the hype of some of its past products, such as the iPad and iPod. This is a key indicator that the company needs to substitute its technology pulls strategy for a market pull strategy.

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