INNOVATION MANAGEMENT
“APPLE, AN EXAMPLE OF INNOVATION”
Innovation Management
15.11.2022
INTRODUCTION
Apple is an American company that designs and produces electronic equipment,
software, and online services. It has its headquarters in Apple Park, California (USA),
and the European headquarters are in the city of Cork (Ireland). Some of its products
are, as we all know: iPhones, Macs, iPads, iPods, Apple Watch and Apple TVs.
It is currently one of the strongest companies in the world, with annual sales of
365.820 billion dollars (2021), and in the first position in smartphone sales. The first
two Apple stores opened in the United States in 2001. In 2003, it was expanded in
Japan, opening the first store outside the US. This was followed by the opening of
stores in Australia, Belgium, Japan, Canada, Denmark, the United Kingdom, Italy,
Singapore, Germany, Sweden, France, the Netherlands, Switzerland, Austria, South
Korea, Macau, Taiwan, Turkey, the United Arab Emirates, Poland, Thailand, and the
Republic of China, Spain, Mexico and Brazil. It has also authorized distributors in Saudi
Arabia, Norway, New Zealand, South Africa, Iceland, Estonia, Russia, Ireland, Finland,
India, Morocco, Luxembourg, Egypt, Portugal, Colombia, Argentina, Chile, Peru,
Panama, the Dominican Republic and Costa Rica.
HISTORY
The history of this company is closely linked to one person: Steve Jobs. He, along with
Steve Wozniak and Ronald Wayne, started in the garage of the house where Jobs grew
up in Los Altos, California, on April 1, 1976. Two weeks later, Wayne decided to retire
by selling his stock to his friends and he received in exchange 800 dollars of that time.
The first invention they created was a very the basic computer called the Apple I, with
a price of 3000 current dollars. Sometime later, specifically in 1984, they created their
first great invention, the Macintosh, a more advanced personal computer that was
even featured in an advertisement for Super Bowl XVIII.
Steve Jobs left Apple in 1985 due to friction with John Sculley (CEO of Apple), these
problems were mainly because Apple's top managers believed that Jobs was taking too
many risks, and they did not want to launch products that could fail financially.
Then Jobs founded NExt, which was absorbed by Apple in 1996 and Jobs returned to
Apple. Since then, Apple has not stopped growing at a very fast pace, founding, for
example, the first Apple Store and the iPod in 2001, the first iPhone in 2007, the first
App Store in 2008, or the first IPad in 2010
Sadly, on October 5, 2011 Steve Jobs passed away and Tim Cook replaced him at the
helm of Apple. From there, many people think that Apple's innovation declined,
considering the Apple Watch as the only innovation.
WHY IS APPLE AN INNOVATION
As we saw in class, “we understand innovation as from idea development novelty that
has completed the diffusion process”, and should have two conditions:
2
Innovation Management
15.11.2022
- First of all, it should include or respect cultural, ethical, economic, and socially
responsible conditions and requirements.
-
Secondly, it should be beneficial by the consumer, present a meaningful
experience and satisfy needs.
There is no doubt that Apple meets these conditions mentioned, and to a large extent
being an innovative company is its hallmark and what has led it to be what it is today.
DIALECTICAL SYSTEM
As we have learned, within a level there are four sections, from the most general to the
most particular: object, dialectical system, system and finally the model.
Objects are real and complete, and in one object many dialectical systems can be
founded, and in each dialectical system we can find systems, which are a part of an
object and are made up of many elements.
-
In our case the object would be Apple, the company, the brand.
-
The dialectical system would be the different parts or sections of the company:
finance, accounting, marketing, human resources, etc.
-
The systems would be the different products that Apple offers, such as iPhones
or iPads, which have different models such as the different types of iPhone and
are made up of many elements.
SOCIAL RESPONSIBILITY
Nowadays, Social Responsibility is taking more and more importance, and also in
companies. It consists, among other things, in being transparent, having ethical
behavior, responsibility, respect for workers, human rights and the environment.
Some companies did not take into account social responsibility because carrying out
some improvements increased a lot their costs, but lately they are realizing that
despite the initial cost, these improvements give long-term benefits and make them
have a good image worldwide.
In the supplier responsibility section, Apple explains: "Apple products are made
possible by millions of people in more than 50 countries. From sourcing to recycling,
we adopt the strictest standards to ensure that everyone in our supply chain of supply
is treated in a dignified, respectful and safe way"
We are going to show some of the actions this company has done:
3

HUMAN RIGHTS: Apple tries to be respectful with human rights by:
-
Doing surprise inspections and audits in factories and stores, in fact, last year
they carried out approximately 1100 inspections and found nothing significant.
-
If there is any problem, the suppliers must fix those problems and prevent their
recurrence, or even compensate those affected.
Innovation Management
15.11.2022
- Controlling very well the age of the workers to ensure that there is no child
exploitation. Suppliers must verify the age of workers before hiring them and
keep a record. In addition, they are audited from time to time. In the last two
years, Apple has not found any cases of child exploitation in its factories.
4
-
Carrying out interviews and surveys to their workers to see possible
improvements. Apple cooperates, for example, with organizations such as the
International Organization for Migration and the International Labor
Organization. Apple also tries to communicate many times anonymously with
its workers so that the opinion of the suppliers does not interfere.
-
Better training for workers, for example with the Apple Education Hub platform.
Offering both face-to-face and virtual sessions, training its workers in robotics,
programming, leadership, and other professional activities.

SAFETY:
-
Including measures to avoid chemical hazards or using safer, greener cleaning
products.
-
For example, during the covid 19 pandemic, preparing the spaces to have
proper social distancing, staggering the schedules, or maintaining an exhaustive
cleaning.
-
Apple has even received awards for these actions, such as "Safer Choice Partner
of the Year"
-
Apple also tries to provide modern and technologically advanced workspaces,
to act with a level of quality and precision according to its standards.

ENVIRONMENTAL RESPONSIBILITY:
-
Its goal in 2030 is to use only renewable energy. For example, during 2021 the
number of Apple suppliers that use renewable energy in their production has
doubled.
-
Trying to reduce the number of waste produced, from the beginning of the
manufacture of the product to the end.
-
It also tries to protect a natural resource as important as water, and 17 of its
facilities have received certification from the Alliance for Water Stewardship
(AWS), the main organization in this field worldwide.
-
As a curiosity, iPhone 13 is the first Apple product that incorporates one
hundred percent certified recycled gold.
-
In 2021 Apple manufactured the first battery made with recycled minerals.
-
Explaining to recycling professionals how to recycle their products and
elements.
Innovation Management
15.11.2022
INNOVATION TYPES AND SOURCES
Innovation is change, novelty, or the process of change. Innovations influence the
success and competitiveness of the market. Through innovation, changes,
improvements, and new ideas, and thus a better position in the market are achieved.
Innovative and new ideas are very important for the growth and future of any business.
Do innovations come in bursts, or do they have hours of work and research behind
them The way innovation is defined and the way innovation activity is measured has a
significant impact on the development of society, the country, and the world. Many
authors cite different definitions, sources, and types of innovation.
According to Peter Ducker, for example, there are seven sources of innovation, which
he defined in his book Innovation and Entrepreneurship (1985). Drucker divides
innovations into those outside the company and those inside the company.
Within the company we can see innovations in 4 areas:
1.
The Unexpected.
As the word implies, an unexpected idea. An idea that arises in a moment, that
happens unexpectedly, and leads to a new product, service or something bigger. This is
the easiest and simplest source of innovation.
2.
Incongruities
When there is a mismatch between what is and what should be, an opportunity for
innovation arises.
3.
Process Needs
If something is not working in the process of creation, it is very important to find out
what it is and make timely changes. It is necessary to replace the weak link or
restructure the existing process according to the new knowledge. More precisely, to
improve the process that leads to innovation. There is always a better way.
4.
Industry and Market Structure
The market is changing, so it is very important to follow the development of the
market because if you follow the changes, you can identify untapped opportunities.
Outside the company, we can look for innovation in 3 areas:
5.
Demographics
Demographic change is leading to new lifestyles and new needs, which in turn require
new products and services, i.e. innovations.
6.
5
Changes in Perception
Innovation Management
15.11.2022
Changes in the way people live and think lead to a need for new innovations. Smart
innovators recognize these changes and take advantage of them.
7.
New Knowledge
New technologies, knowledge and discoveries can completely change the industry.
New knowledge can be useful in developing new products. These are the innovations
people think of when they hear the word innovation.
All innovations start with a small germ of an idea and are perfected through research,
publicity and experimentation; they affect success and competitiveness in the market.
The best example of this is certainly Apple, which, among other things, is at the top of
all lists of the most successful companies. It is one of the few companies whose user
numbers are constantly increasing. Which has led to Apple becoming a brand as an
original product due to quality and demand. All this would not be the case if Apple did
not have a unique innovative business strategy that is different from all book strategies
and therefore even more special. Under the leadership of founder Steve Jobs, Apple
broke all the rules and definitions from the books, and the main strategy for running
the company is certainly an incremental improvement. The founder's creativity and
innovation are the driving force behind the technological revolution that Apple has
unleashed. The foundation of success in creating the greatest innovative company is
the hobby of two friends that have evolved over the years into what Apple is today. The
company's greatest strength is a different way of thinking. Through its innovations, it
has completely changed today's world of technology, the way people communicate,
and the way we listen to music. Of course, this required years of work and good
organization. According to many studies, Steve Jobs was a great innovator, but also a
bit of a tyrant. He pursued success relentlessly. The CEO of Apple Innovation, Tim
6
Innovation Management
15.11.2022
Cook revealed what is behind the innovation machinery of this successful company.
There are eight rules for innovation in this company:
1.
Put people first
This innovative approach focuses on improving people's lives. "We are a group of
people trying to change the world for the better," Cook says. Technology is not the first
priority in this type of corporate policy; it is just a means to make people's lives easier.
2.
Align corporate culture with innovation strategy
Apple has established a corporate culture of innovation that leverages human
resources to achieve the corporate goal of continuous innovation and intelligent
problem-solving in development.
3.
Hire smart people and then empower them
A very important factor in creating innovation is certainly selecting the right people.
The company has a very rigorous hiring process. But in addition to selecting employees
well, Apple naturally focuses on maximizing the potential of its employees. "It doesn't
make sense to hire smart people and tell them what to do. We hire smart people so
they can tell us what to do," Jobs said. The company's policy, therefore, is to empower
and provide “a tailwind” for smart people, as well as their ongoing motivation.
4.
Balance between structure and flexibility
It is very important to strike a balance between meeting deadlines and allowing
flexibility, space and time to create and develop new innovations.
5.
Take the time to get things right
They complete their product development process long before the products
themselves hit the market. By improving their products step by step, they achieve
consistent success, reducing the risk of failure.
6.
Remember, customers are jewels
The customer is at the heart of the company and at the heart of innovative
development itself. Customer feedback and reviews are very important. By listening to
people, they develop the tactics and direction of the flow of their innovations.
7.
Look past the crowd thinking- and tune out the noise
Despite the human attack on individual products, the company believed in quality and
created innovations that proved to be right in many ways. People denied themselves.
8.
Have the courage to say no to big ideas
In the innovation process, it is important that they have the courage to say no to some
good innovative ideas for the good of the company and to conserve resources. Priority
policy is an important point in the creation process.
7
Innovation Management
15.11.2022
CREATIVE ENVIRONMENT AND IDEAS
Creativity is an increasingly desirable quality and ability, which is more and more
demanded in private and professional life. The purpose of creativity training is to
improve the quality of life of the individual and his environment. When a person is
creative, he is more likely to perceive opportunities as well as problems in his
environment and, based on his creative potential, to develop an idea that can be
turned into an innovation. Knowledge of the creativity and innovation process is the
key to success in developing an innovative new product.
Being creative is certainly not as easy as it sounds. It is a process that needs to be
encouraged from an early age. As Likar, Cankar & Zupan (2014) noted, children are
most creative before they enter formal education.
Once they enter formal education, from elementary to high school and then even to
university, they become less and less creative. The problem is clearly more one of toostandardized, overly-formal education. Although there have been attempts to improve
the situation, it is still stagnating. Therefore, Likar, Cankar & Zupan (2014) state that it is
very important that schools and the most recent research on creativity, innovation and
entrepreneurship converge and create good practices by following criteria:
“…being compatible with the existing conceptual and substantive starting points in
education;
-
being part of the school system;
-
having clearly defined goals;
-
adopting a friendly and user-oriented approach;
-
being adaptable and extensible in suitable conditions;
-
being sustainable; and
-
having identifiable and measurable results …” (p.3)
Modern motivation to promote creativity is often demanded by a human's work. When
entrepreneurs and managers understand how important innovative new productions
are for the growth and development of companies, the motivation to promote them
also increases. Creativity is a continuous process that does not have to be started and
finished by one person but should be stimulated by the creative thoughts of others. In
this way, people build up and take the best from everyone. From an early age, Steve
Jobs developed a sense or awareness that he was special and destined for greatness.
Therefore, it is not surprising that he valued intuition and personal awareness more, or
rather, considered them more important than abstract thinking and intellectual or
8
Innovation Management
15.11.2022
exact logical analysis. Over time, he began to believe that he could instill in others a
sense of self-confidence, ambition, and a kind of historical mission. This ability enabled
him to get creative engineers to embark on ventures they thought impossible. Usually,
this particular motivation happened through Jobs' temper tantrums and personal
insults. He knew how to be charismatic, even hypnotic, but also cold and brutal, and
sometimes he manipulated people. But it was also an unusual process of personnel
selection, because only the strongest, or rather the most competent, creative and
resilient, 'survived'. In this peculiar way, Jobs created a core of creative and technically
competent engineers who brought revolutionary and superior technical solutions and
devices to the market. Innovation is a key process on which Apple's development is
based. The constant commitment to innovation processes and dedication to excellence
have enabled numerous and continuous revolutionary technological breakthroughs.
Although he valued geniuses and gathered them into project teams and respected
their initiatives, Jobs at the same time had a strong need to control all basic processes.
He focused his efforts and control on creating radically innovative products and
building a company that would last forever. Such a company can be built with a
distinctive feature that sets it apart from the competition at first glance.
"You always had to be a little different to buy an Apple computer. I think the people
who buy them do think differently; they are the creative spirits in the world. They are
not just out to get a job done, they are out to change the world. We, too, are going to
think differently and serve the people who have been buying our products since the
beginning. Because a lot of times people think they’re crazy but in that craziness, we
see genius and those are the people we’re making tools for." said Steve Jobs once.
For creativity and innovation to succeed in a company, managers must ensure that the
company has an environment that supports this approach (Agbor 2008).
Creativity is therefore so necessary that humanity cannot do without it. Like air, it helps
us breathe, exist, survive and enjoy life. It comes about, first and foremost, through
inspiration. And for a person to learn how to overcome it, it is worth listening to
yourself and the whole world around you.
DIFFUSION OF NOVELTIES
Innovation has its most important impact on the economy through the diffusion of new
technical knowledge, from its first worldwide implementation in the production of
goods and services to its adoption and adaptation by enterprises located in different
places across the globe. Innovations happen constantly and almost daily. While
innovation new to the enterprise may be only capturing the ability of an enterprise to
use and adopt new knowledge, it is also a precondition for economic growth and
development. According to Rogers, those innovations in some cases do not become the
new standard due to the lack of proper diffusion, despite having many advantages.
Only a very small percentage of the typists have switched to using the improved layout,
while most of the today´s society still uses the older design. (Rogers, 2003). Also, to
9
Innovation Management
15.11.2022
explain what is diffusion exactly, it is a process by which an innovation is communicated
through certain channels over time among the members of a social system. (Rogers,
2003). An innovation is an idea, practice or object perceived as new by an individual or
other unit of adoption. The diffusion process typically involves both mass media and
interpersonal communication channels. And, in today’s world, information
technologies such as the Internet and cell phones which combine aspects of mass
media and interpersonal channels, represent formidable tools of diffusion. (Morris &
Organ, 1996). New products, services or processes entering the market are rarely
completely new, as their design is more frequently derived from other alternatives and
complementary technologies or products. (Brandenburger and Nalebuff, 1995)
However, in just ten years, Jobs had led Apple to an intense innovation era: the iPod,
the iPhone, and the iPad created new markets and brought billions of dollars to the
investors. The process of innovations’ adoption has been subject of study in numerous
fields as medicine, agriculture, military, and business; As stated by Gladwell (2000)
three factors are indispensable to have a successful diffusion: first, the innovation must
be adopted at an early stage by a influencers or leaders; second, the innovation must
have characteristics that convince consumers to acquire it and, third, the social
environment will determine the innovation scope. In business management, the
concept of innovation shall be differentiated from technology and knowledge, as stated
by Rogers (1983), innovation is a new idea, technology is an instrumental design aimed
at reducing the uncertainty of the cause-effect relationship involved in the
achievement of a determined objective, and Benbya (2008), defined knowledge as the
mental capacity for effective performance. According to Rogers (1983, p. 162) every
member of the social system must face a five steps adoption of innovation’s process: 1)
Knowledge, as the first approach to the innovation and how it works; 2) Persuasion,
when the individual shows some level of acceptance or rejection to the innovation; 3)
Decision, when the individual or organization adopt or reject the proposed innovation;
4) Implementation, as the practical use of the innovation, and 5) Confirmation, as the
evaluation of the innovation’s implementation. Diffusion could be passive when peer
distribution within social networks is unplanned, informal, and horizontal or Active,
where the spread is planned, formal, and vertical. As stated by Glanz (2015) Innovation
has five characteristics that affect diffusion: Relative advantage, as the comparison of
attributes between the innovation and the former system; Compatibility as the
innovation fitness with the target market; Complexity as the Innovation’s grade of
difficulty to use; Trialability as the option to experiment with the innovation before to
adopt it and, Observability as a means of measuring the results of the use of
innovation. Numerous theoretical frameworks have been developed to explain the
Diffusion of Innovation; Everett M. Rogers was the pioneer when in 1962 published his
influential book Diffusion of Innovation, and developed a complete theory, analyzing
the elements of diffusion as “the process by which
1- an innovation
2- is communicated through certain channels
10
Innovation Management
15.11.2022
3- over time
4- among the members of a social system. (Rogers, 1983, p.11).
APPLE AS NOVELTY
Apple is an iconic technology American company, for the last 44 years the California
corporation has been a referent for innovation; According to Krishna (2019) is the first
company to reach $1 trillion in capitalization, more than 5% of the U.S. GDP, and larger
of 183 countries’ economy. In 2019, Forbes listed Apple as the most valuable brand
with $205.5 billion way ahead of Google ($167.7 billion), Microsoft ($123.5 billion),
Amazon ($97 billion), and Facebook ($88.9 billion). Many authors coincide with
affirming that Apple transformed the computer business, (iMac), music business
(iTunes and iPod), the Mobile telephone (iPhone) retail stores (Apple Stores) and
invented new markets for products like the iPad (Thomke, 2012)
Created in 1976 by Steve Wozniak an electronics genius and Steve Jobs, the
paradigmatic business leader and innovator, Apple rapidly reached success with the
Macintosh, one of the first personal computers; however, in 1985 Jobs radical
management style was the cause of his separation of the company, and a period of
failed products like Newton Personal Digital Assistant and Macintosh Performa brought
financial losses and investors hopelessness. In August 1997 the Board approved the
Next Computers acquisition and by this mean, Jobs returned as CEO, as stated by
Thompke (2012, p.6) he immediately stopped the licensing program, shut down two
divisions, eliminated 70% of new projects, moved the production overseas, changed
the distribution system, launched a direct sales website and started a sophisticated
marketing campaign, in just one year Jobs, transformed the company and launched the
iMac his first commercial blockbuster.
The iPad was introduced in January 2010 and sold 3 million units in just 80 days
(O’Boyle, 2019), with beautiful aluminum and glass design, a 1GHz Apple A4 processor,
and 16GB, 32GB, or 64GB storage capacities, 10-hour battery life, was offered with a
starting price of $499. The big iPhone (as called by critics) was something between a
personal computer and a smartphone, but was misunderstood for the computers’
experts, who criticized the lack of power and the elevated price for a non-sense
product. However, a new peak on sales was reached in the fourth quarter of 2014,
when 26 million iPad was sold for Christmas gifts. The iPad created a completely new
market, composed by kids, artists, businessman, elders, everybody found an
application to use in the tablet; Microsoft, HP, Dell, and Samsung was behind trying to
create their own tablets, for six years in a row iPad, was the best selling tablet and was
displaced by inexpensive Korean and Chinese copies. The main question is how Apple
created an entirely new market for a misunderstood product? As mentioned the
diffusion of innovations model could be utilized to identify who adopters were and
how the success and growth of the iPad are responsible. Diffusion of innovations refers
to the dissemination of abstract ideas and concepts, technical information, and actual
11
Innovation Management
15.11.2022
practices within a social system in which the dissemination refers to the flow or
movement from source to adopter, typically through communication and influence.
(Rogers, 1983).
Apple product has a dominant design used in the relevant industry and appears to
change the nature of competition in the markets. After ten years, Apple first-mover
strategy still profitable, according to Reynolds (2019), iPad is the best seller tablet with
the 38% of the share market, far away is the closest competitor, Samsung, with 15%,
Huawei 10.3, Amazon 7.4%, Lenovo 5.8% and others (Chinese imitators) with 23%;
Using Roger’s Diffusion Model, we can affirm that the late majority of adopters
surpasses the expected 34%, since now the iPad market share still strong with 38%. In
ten years, Apple has sold 360 million iPads, now the market is declining as expected by
competition and new products, according to Nations (2019) new sales should be made
from some other avenue, such as business, new markets where people could not
originally afford a computer, or upgrades of people who thought their computer
needed substitution. Diffusion models have helped many companies to improve the
success of their new products in the market. Knowledge of how individuals perceive
innovation attributes and how to leverage social mechanisms to enhance adoption
provides valuable support to companies marketing their innovations. The diffusion of
the iPad as innovation is paradigmatic: one in twenty humans in the earth acquired an
iPad in the past ten years, Steve Jobs’s idea to have something between a computer
and a phone was an object of severe criticism by computers business experts; however,
as innovator Jobs risked his reputation and Apple future for an innovative technological
product and the bet paid off.
INNOVATIVE SOCIETIES
“The journey to creating a more inclusive workforce and the better world begins with
a commitment to a clear vision and accountability. At Apple, we take this responsibility
seriously, and we are continuing to make meaningful strides toward creating a more
inclusive and representative company.” Barbara Whye, Vice President of Inclusion &
Diversity. Technology surrounds our society with smart devices ranging from iPad,
iPhones, Apple TVs to more advanced technology regarding science, medical research,
and more. Innovations have become more and more crucial for our societies to grow
and advance. Innovations will always continue to advance and develop and it they have
the potential to positively affect people’s lives. The living standards of technological
advancements have become the main tool and way of interaction and connection
between society. Because of Apple advancements entertainment has become practical
and convenient. Living standards became better with Apple products. One of the latest
products is Apple watch. It is made as a fitness tracker and has the option to measure
the heart rate and etc. Also, each story has two sides. As far as we know how
technology and Apple helped us a lot of people don’t know the main facts about using
their product which they should correct. Nowadays when we need to take care of our
environment, profit is more important to Apple. Apple estimates that every single
iPhone 14 will create 61kg of carbon emission throughout its lifetime. On these
12
Innovation Management
15.11.2022
emissions, 79% are created during the production process and they are producing
millions of phones, iPad, MacBooks and etc. They are promoting their company like
green 'Environment' which is written on their webpage, but they are not talking about
their lack of caring. In fact, Apple's gross emissions (without carbon offsets) totaled
23.2 million metric tons of carbon dioxide for the year 2022 (notice the shift from kg to
tons. Of these emissions, approximately 70% came directly from the manufacturer of
what was then considered Apple's latest and greatest products. Our suggestion will be
if they want to lower its carbon footprint, they can release devices that can be
upgraded without needing to be replaces or recycled each time:
13
Innovation Management
15.11.2022
RESOURCES:
https://www.apple.com/
https://www.marketinginsiderreview.com/historia-apple-exitotecnologico/#:~:text=Los%20comienzos%3A%20la%20fundaci%C3%B3n%20de,1%20de%20abri
l%20de%201976.
https://www.apple.com/es/supplierresponsibility/#:~:text=Los%20productos%20Apple%20son%20posibles,forma%20digna%2C%2
0respetuosa%20y%20segura.
https://responsabilidadsocial.net/apple-avanza-en-su-responsabilidad-socialambiental/
https://www.braineet.com/blog/apple-innovation-culture
https://eng.gzs.si/Novice/ArticleId/79392/intrared-innovation-frameworks
https://www.forbes.com/sites/carminegallo/2011/03/31/apple-at-35-win-over-yourcustomers-the-steve-jobs-way/?sh=36252048c790
https://www.grin.com/document/167838
https://ivypanda.com/essays/apple-companys-creativity-and-innovation/
14