- Joined
- Aug 29, 2008
- Messages
- 26,712
- Points
- 113
Why Apple Keeps Winning (No, It’s Not the Products)
By Thomas A. Stewart | August 23, 2010
I’m watching fascinated as Apple scales up in China. A month ago Liu Chuanzhi, the CEO of Chinese computer-maker Lenovo, said that Apple didn’t care about what’s becoming the world’s biggest computer market and suggested that the company would be unable to make up for lost time. A week or so later, Steve Jobs opened a gorgeous new Apple retail store in Shanghai, one of 25 planned in China. (The usual line of customers camped out overnight before the opening.) In doing so, he’s going up against Lenovo on its home turf — a national champion in a country that roots, roots, roots for the home team. Liu’s jibe sounded like an attempt to undercut Jobs’s ribbon-cutting by playing a patriotic “Buy Chinese” card. Jobs, for his part, was — as usual — pretending his competitors don’t exist.
But Jobs — whose genius as a strategist is underappreciated by people who see him as merely a marketer or the high priest of the Cult of Cupertino — put one of his trumps on the table. No, not his products, fabulous though they often are. A trump card is one that gives you the right to win, and Apple’s right to win comes from its mastery of customer experience. It’s hard to articulate but easy to feel: every Apple interaction — from the feel of an iPod in your hand to the techie who fixed my wife’s iBook at a reseller in Hong Kong, his hair the color of a blueberry iMac — somehow ignites the same synapses in your brain.
Customer experience is Apple’s keystone capability — the one that joins and supports the others in a system that brings expertise, offerings, and assets together fast and flexibly. I don’t know anyone at Apple; I’m basing this on what I read and what I know as a customer myself. For evidence of how adamant Apple is on the topic, consider how it has treated AT&T, its monogamous iPhone partner. As we all know, AT&T’s network groaned under the unexpectedly heavy bandwidth burden of iPhone use. According to a recent story in Wired, AT&T executives fruitlessly asked Apple to take steps to tamp down demand for bandwidth:
“They tried to have that conversation with us a number of times,” says someone from Apple who was in the meetings. “We consistently said ‘No, we are not going to mess up the consumer experience on the iPhone to make your network tenable.’ They’d always end up saying, ‘We’re going to have to escalate this to senior AT&T executives,’ and we always said, ‘Fine, we’ll escalate it to Steve and see who wins.’”
The point isn’t that Jobs is difficult, though by all accounts he is. The point is that Apple has defined a truly distinctive way to play, built around a set of capabilities that consistently deliver a customer experience as unique and recognizable as DNA.
Together this point of view and capability system allow the company to make strategic moves that look insane but end up insanely great. Apple has been able to play and win across at least half a dozen wildly different industries: computers, music distribution, music players, telephones, physical retailing, online retailing, and whatever industry includes the iPad (I think it’s a personal entertainment device and will compete as much with TVs as with PCs or readers). Next up — coming soon to a device near you — will be advertising. Every academic strategist will tell you that kind of breadth is impossible; it’s one of those things that work in practice but not in theory.
Last week I wrote about fluidity: how to compete on multiple fronts simultaneously without getting overstretched or bloated. Few companies exhibit fluidity better than Apple. In this case, the trick seems to be the company’s ability to hew to one consistent a value proposition for all its customers; to build capabilities that deliver that value; to sell only what fits; and to leverage the hell out of the whole shebang.
By Thomas A. Stewart | August 23, 2010
I’m watching fascinated as Apple scales up in China. A month ago Liu Chuanzhi, the CEO of Chinese computer-maker Lenovo, said that Apple didn’t care about what’s becoming the world’s biggest computer market and suggested that the company would be unable to make up for lost time. A week or so later, Steve Jobs opened a gorgeous new Apple retail store in Shanghai, one of 25 planned in China. (The usual line of customers camped out overnight before the opening.) In doing so, he’s going up against Lenovo on its home turf — a national champion in a country that roots, roots, roots for the home team. Liu’s jibe sounded like an attempt to undercut Jobs’s ribbon-cutting by playing a patriotic “Buy Chinese” card. Jobs, for his part, was — as usual — pretending his competitors don’t exist.
But Jobs — whose genius as a strategist is underappreciated by people who see him as merely a marketer or the high priest of the Cult of Cupertino — put one of his trumps on the table. No, not his products, fabulous though they often are. A trump card is one that gives you the right to win, and Apple’s right to win comes from its mastery of customer experience. It’s hard to articulate but easy to feel: every Apple interaction — from the feel of an iPod in your hand to the techie who fixed my wife’s iBook at a reseller in Hong Kong, his hair the color of a blueberry iMac — somehow ignites the same synapses in your brain.
Customer experience is Apple’s keystone capability — the one that joins and supports the others in a system that brings expertise, offerings, and assets together fast and flexibly. I don’t know anyone at Apple; I’m basing this on what I read and what I know as a customer myself. For evidence of how adamant Apple is on the topic, consider how it has treated AT&T, its monogamous iPhone partner. As we all know, AT&T’s network groaned under the unexpectedly heavy bandwidth burden of iPhone use. According to a recent story in Wired, AT&T executives fruitlessly asked Apple to take steps to tamp down demand for bandwidth:
“They tried to have that conversation with us a number of times,” says someone from Apple who was in the meetings. “We consistently said ‘No, we are not going to mess up the consumer experience on the iPhone to make your network tenable.’ They’d always end up saying, ‘We’re going to have to escalate this to senior AT&T executives,’ and we always said, ‘Fine, we’ll escalate it to Steve and see who wins.’”
The point isn’t that Jobs is difficult, though by all accounts he is. The point is that Apple has defined a truly distinctive way to play, built around a set of capabilities that consistently deliver a customer experience as unique and recognizable as DNA.
Together this point of view and capability system allow the company to make strategic moves that look insane but end up insanely great. Apple has been able to play and win across at least half a dozen wildly different industries: computers, music distribution, music players, telephones, physical retailing, online retailing, and whatever industry includes the iPad (I think it’s a personal entertainment device and will compete as much with TVs as with PCs or readers). Next up — coming soon to a device near you — will be advertising. Every academic strategist will tell you that kind of breadth is impossible; it’s one of those things that work in practice but not in theory.
Last week I wrote about fluidity: how to compete on multiple fronts simultaneously without getting overstretched or bloated. Few companies exhibit fluidity better than Apple. In this case, the trick seems to be the company’s ability to hew to one consistent a value proposition for all its customers; to build capabilities that deliver that value; to sell only what fits; and to leverage the hell out of the whole shebang.
