APPLE, INC.
INNOVATIVE
CRISIS
Chair – Ryan Counihan
Crisis Director – Colin Palumbo
Vice Chairs – Ari Boyarsky and Kyle Choy
wamunc.com | march 20 – 23, 2014
Dear Delegates,
I am delighted to welcome you to WAMUNC XVI! My name is Ari Boyarsky and I’m
happy to be your vice chair for this session of the Apple Innovative Crisis Committee. I envision
this committee to be a high intensity crisis simulation that will challenge you to seek pioneering
solutions to problems that arise while still remaining true to Apple’s technical and detail oriented
policies. This committee will ask delegates to engage in a substantive and dynamic debate that
will hopefully shed light on the issues that Apple, Inc. must face in the future and how we as
consumers will be affected by these shifts.
However, let’s save the committee talk for later! Let me tell you a little about myself. I
am a freshman at The School of Engineering and Applied Science at the George Washington
University, majoring in Computer Science and concentrating in cyber security. I am also in the
Elliot School of International Affairs, where I have my second major in International Affairs
with a concentration in Security Policy. When I’m not studying, you can probably find me
working on Model UN as I am an active member of our traveling team. I also participate in the
International Affairs Society as a whole here at GW. I am a member of Engineers without
Borders and the Pre-Law Society. I love to play tennis, argue politics, and watch the West Wing,
House of Cards and Game of Thrones in my free time.
I promise that this committee will be the highlight of your high school Model UN career.
I can assure you that the substantive aspects of this session of the Apple, Inc. Innovative Crisis
will enlighten and help you to cultivate a more comprehensive view of Apple and the privatized
technology sector in this country, while also providing a fun and exciting experience. If you have
any questions that arise about the committee, please feel free to email me or one of my
colleagues on the committee staff with any inquiries.
Hope to see all of you soon in committee! Until then, best regards,
Ari Boyarsky
ariboyarsky@gwu.edu
Vice Chair, Apple Innovative Crisis Committee
Apple Inc. is a multinational corporation that creates and distributes both
hardware and software amongst other electronic goods. Steve Jobs once said
that Apple’s mission statement was “to make a contribution to the world by
making tools for the mind that advance mankind”. (Business Insider)
Introduction
Welcome to the March summit of Apple’s executive team! As one of the leading
technology companies in the United States and the rest of the world, we are at the forefront of
technological innovation. Apple has been committed to the revolution of the technology industry
landscape since its humble beginnings under Steve Jobs and Steve Wozniak.
We hope to continue this line of technological advancement while also keeping in mind
our goal as a corporation to increase revenue. In recent years, Apple has grown immensely and
revolutionized consumer markets ranging from the mobile device market to countless niche
software markets. Because of our expansion in such a wide variety of fields, Apple has become a
household name across the globe and our products have become a common sight throughout the
developed world.
Your goal in the approaching days is to work on continuing the trend of success Apple
has seen in the past decade. You should also focus on combating competition through
maintaining our grasp a market that has recently seen a host of other corporations attempting to
impede on Apple’s market dominance. Finally, it is important to sustain Apple’s immense
revenue while attempting to increase profit in the vast variety of markets Apple has claims in,
and addressing various scandals that have arisen recently about the company. Keep this in mind
while understanding the impact that Apple has on both the US and global economy in which it
operates.
Even in these tough economic conditions, we must strive to continue our success in the
current economic landscape. As a large multinational corporation, Apple has great impact on the
global political economy which in turn impacts Apple. We must be mindful of both the political
and economic struggles of the global economy. Therefore, it is essential that we work to address
our private interests as a corporation while being ever cognizant of governmental interests both
globally and domestically.
As members of Apple’s executive team, you must all remain aware of how your
decisions as individuals and as a group will impact the corporation as a whole. After all, we work
in a highly completive field where a fault in either image or product have the capability to topple
both individuals and organizations. Work to make a profit, but be aware of all the consequences
that may follow the decisions of a corporation like Apple, Inc.
History
Apple, Inc. previously known as Apple
Computer, Inc. was officially founded by Steve
Jobs and Steve Wozniak on April 1,1976. Jobs
and Wozniak had been friends for some time after
meeting for the first time in 1971. Wozniak was a
talented, self-educated electrical engineer and was
working on a system to make long distance phone
Figure 1: Apple I computer calls. It was Jobs who persuaded Wozniak to assemble a computer and sell it. This first product,
a personal computer (see figure 2), would be called the Apple I. Jobs and Wozniak, who had to
sell off their own belongings in order to build the machine, independently financed the project.
Jobs then approached a computer store that offered him the deal that if Jobs were to sell 50 of his
computers to the shop. The store would buy each at $500 (equivalent to just over $2,000
currently). Jobs took the offer, buying the parts necessary to build the computers and selling all
50 within the 30 day period. The Apple I’s CPU was a MOS 6502 operating at 1 MHz with a
standard memory of 4 KB, less than the memory capacity of a CD today. The Apple I used a
television monitor for its display (a unique feature as most computers at the time lacked a
display).
Less than a year later, the company was
incorporated in January of 1977. The Apple I
launched Apple in a direction of manufacturing
personal computers, with the successor to the
Apple I being the Apple II (see figure 3). The
Apple I had been greatly limited by the funding
available for the machine, with many of its
features were only meant for a prototype, and so
with the money earned from the I, Wozniak was able
Figure 2: Apple II computer to make major improvements to the design that eventually resulted in the Apple II. Presented on
the April 16, 1977, Jobs first introduced the machine to Toshio Mizushima who would become
the first authorized seller of Apple products in Japan. The II’s main difference from the I was a
newly reintegrated display. The display was now held in memory, which allowed for better
display of text and graphics. Eventually the II would even include color graphics. The II was
revolutionary as it came running straight out of the box, with a newly redesigned case which
meant that parts of the computer did not have to be plugged in. The Apple II revolutionized the
market and it may even be said that it fathered the personal computer market.
The next major upgrade in the personal computer market by Apple was the Apple III (see
figure 4). However, Jobs chose to forgo a cooling fan in the
design, which resulted in many of the machines overheating,
damaging the delicate circuit chips inside. Many of the III’s
were recalled and a new version that rectified the problem was
introduced. Yet, the scandals caused by this error had already
taken their toll on Apple.
Apple would continue down the path of building
Figure 4: Apple III computer personal computers while other competitors began to join the
market. The IBM PC was introduced and then the Xerox PARC. Apple fired back with a
computer that once again revolutionized the market – the Apple Lisa (see figure 5). It was the
first Apple computer to utilize a Graphic User Interface
(GUI). The user interface introduced the mouse, icon and
desktop into the public computing
lexis. The computer also featured
Figure 3: Apple Lisa floppy disks, integrating removable storage into the computer. However, the
Lisa was priced at over $23,000 in today’s dollars and didn’t sell nearly as
Figure 6: Apple Macintosh well as its predecessors.
The next major development with Apple came with the Apple Macintosh
(later known as the
Macintosh 128k, for its standard built in memory). The Computer was contained within the
monitor and came with a mouse and keyboard (see figure 6). It was initially released at a price of
$2,495 and contained an 8Mhz Motorola processor and 128 KB of storage. The computer was
made famous by the marketing success that was the
“1984” commercial run by Apple during that year’s
Super Bowl, pushing forward an image of Apple users
as independent and boundary-breaking thinkers.
At this point in time, John Sculley (see figure 7)
was the CEO of Apple. This resulted in a power
struggle between Jobs and Sculley, with the board of
directors striping Jobs of all duties and assigning him to
Figure 7: John Sculley the position of Chairman where he had little to no
impact on the company. This resulted in Jobs leaving the company, selling his stock in the
company, and instead buying up Pixar and founding the computer company NeXT (later
integrated into Apple). Prior to Jobs leaving the company, the stock had risen to $8 a share, after
his departure it dropped to $2 in 1985.
Under Sculley, Apple continued both the Apple and Macintosh lines of computers.
However, the Apple II remained as a major source of income for several years. Eventually, the
Mac became another product line – the original
model was Mac Plus released in 1986, a
continuation of the Macintosh 128k. Apple also
began embarking on portable computers. The
first attempt was the Macintosh Portable (see
figure 8) in 1989. The next variation of portable
Figure 8: Macintosh Portable computers was called the PowerBook, released in 1991, and was much more popular. It most
closely resembled the modern setup of a laptop. According to MacAddict magazine, the period
from 1989 to 1991 was the “first golden age” for Macs.
Apple faced its strongest competition in the 90’s due to Microsoft Windows 3.0 which
finally introduced a comparative GUI. Apple attempted to fight this new threat through the
creation of new product lines that were poorly marketed and differentiated. Apple began to
decline as their marketing strategies and product lines
failed. Apple also tried to partner with IBM to combat the
PC threat. However, this failed after Apple refused an
acquisition by IBM and was almost bought out by SUN
Microsystems.
During this period, Apple also experimented with
personal devices, such as personal digital assistants (PDA’s).
Figure 9: Steve Jobs on the cover of Time Magazine in 1999 Apple also attempted to outsource their OS by licensing it, yet Steve Jobs fought
the OS licensing contracts and ended the possibility of Macintosh clones while
Apple’s market share fell to 3% from their previous 10%. Eventually, Job’s
NeXT company won a bid for Apple to buy the OS in 1997, which
Figure 10: iMac led to the board of directors ousting CEO Gil Amelio while Jobs stepped in as interim. He
eventually became the CEO and served until August 24, 2011.
Figure 11: Apple Stock Prices since 1985 courtesy of Yahoo Finance
Jobs oversaw the reemergence of Apple in the technology market and a major spike in
Stock prices (see figure 11). Jobs’ first act as CEO was to create the iMac (see figure 10 above).
The iMac featured a streamlined design as well as reintroduced Apple to the media spotlight. In
1999 Apple also released its first consumer laptop the iBook. In 2001, Apple introduced Mac OS
X which was based off of the NeXTstep OS to create a stable OS with a user centric GUI. Later,
in May of 2001, Apple introduced retail stores, which was a response to Apple’s previous poor
marketing strategies. In October of 2001, Apple introduced the iPod revolutionizing the digital
audio market and paving the way for the i-device product lines that would dominate the market
place.
At the turn of the millennium, Apple faced a slowing technology market and a drop in
profits. However, Apple CEO Steve Jobs took advantage of the time redesigning the iMac
streamlining its design within a flat screen LCD display. The iPod’s entry into the market
signaled this new focus on simplistic design. In 2003, the introduction of the iTunes Music Store
changed the music industry taking a 70% market share amongst online music services. The
Apple retail store also saw aggressive expansionism, proliferating from Tokyo out to the rest of
the world.
2007 saw another major innovation by Apple with the introduction of the iPhone,
securing 28% of the market share for the US smartphone market in just a single year. There were
major improvements in the Mac line of computers with new versions of the MacBooks, Mac Pro
and MacMini. The retail store also began selling other types of technology native to Apple
devices. Profit wise, Apple’s revenue streams grew significantly from 2005 on. Apple’s market
cap topped at $623.5 billion,
making it the most valuable
company in history. Apple’s
stock sold at $662 a share,
overtaking even Microsoft.
Steve Jobs left apple
in 2011 to begin his battle
against pancreatic cancer,
and he passed away on
October 5th of 2011. The
past decade saw Apple rise
Figure 12: Apple products from 2008 to 2010 image courtesy of www.intelligenthq.com to the forefront of the technology industry, leading innovation in numerous technology sectors
under the guidance of Steve Jobs. After Jobs death, Tim Cook took over as CEO of Apple, Inc.
Currently, Apple faces a highly competitive market where it must work to continue to innovate
in the areas that will allow to maintain its dominance of the technology industry.
Current Status of Apple Inc.
Timothy D. Cook, successor of Steve Jobs and current CEO of
Apple Inc., quickly took charge when given his new position and his
influence hasn’t stopped growing since. He is familiar to the
position, since he had previously taken the role during Job’s earlier
leaves of absence. Prior to joining Apple, Cook has held chief roles
in other technology and software companies, namely Compaq,
Intelligent Electronics, and IBM.
Figure 13: CEO Tim Cook
In early 2012, Apple’s Board of Directors awarded Cook 1 million shares, vesting in 2016 and
2021. As of 2012, his total compensation package of $378 million makes him the highest paid
CEO in the world. He had the idea of closing factories and warehouses, replacing them with
contract manufacturers, causing the company's inventory to fall from months to days. His hope is
to stimulate the recovery of Apple by effectively predicting demand and delivering product on
time. This method known combined with ‘planned obsolescence’ allows the producer to sell
enough units to meet demand without having a large stockpile of outdated devices.
However, the future of the company is not all in economic changes. Cook's direction is to
build a culture of harmony. In other words, this means purging the company of people with
disagreeable personalities, even those Jobs held close. The executive board has seen many of its
large, influential members leave since the coming of Cook. Despite this factor, Cook has long
since sought to make Apple a kinder company. For example, he and many other executives
decided to push the company in the direction of philanthropy, a move that Job’s would have
never wanted. Recently, the site featured ads for charitable organizations that have been
displayed on the Apple homepage. This is the first time a subject unrelated to a product or the
affairs of the company have been linked on the homepage. Cook also previously posted a strange
warning video on the Apple site asking consumers to respond to any concerns in quality of
product or even Apple’s business practice. In the video Cook is quoted as saying,
“As Dr. Martin Luther King once said, the time is always right to do what's right. At Apple, we
do the right thing. Even when it's not easy. If you see something that doesn't meet our standards,
speak up. Whether it's a quality issue or a business practice, if it affects Apple's integrity, we
need to know about it.”
The video has since been removed by Apple, but whether he was speaking for any issues in
general or addressing a particular concern is still a mystery.
2012 under Cook was Apple's most productive year with over 15 products released.
Some of these include the iPhone 5/5C/5S, iPad Air, iPad Mini, and devices with Retina display.
Although Apple’s signature originality in that matter seems to be low, profits continue to
skyrocket past competing electronic companies. At the end of Cook’s first fiscal year (2012), the
company managed a record profit of $41.7 billion on $156.5 billion revenue.
However, since then, Apple has had a few minor hiccups. Apple stocks greatly dropped
in price from just over $700 in September 2012 to below $400 in April 2013. This was due to the
initially high price of the newly released iPhone 5 that spooked investors who believed that the
expensive smartphone would fail to rival Samsung’s. The predicted trend did carry out, but
fortunately for the company, the sales of the iPhone 5 and its successor, the iPhone 5S/5C, have
continued to grow since April. Meanwhile, stock value is once again beginning to increase to
what it once was.
Although sales of the iPhone are higher now than they were ever before (Apple sold 33.8
million iPhones in the quarter, versus 26.9 million a year ago), profits have seen a slight decline
over the 2013 fiscal year. Notably, Apple received a profit of $7.5 billion for the fourth quarter,
on revenue of $37.5 billion, which is down from earnings of $8.2 billion on $36 billion in
revenue during the same period last year. This is likely to be a result of the decrease in sales of
other products that are currently not developing as fast as the iPhone. The revenue on Mac and
iPad sales have gone down 15% and 13%, respectively.
Character List
1. Director – William Campbell – Former CEO of Intuit,
currently on the board of directors at Apple. He formerly
worked for apple as the Vice President of Marketing. He
graduated from Columbia University in 1962 with a degree in
economics, and he was later hired by John Sculley to become
Apple’s VP of marketing.
William Campbell – Image Courtesy of CNN 2. Director - Millard Drexler – The Current CEO and chairman of J. Crew
Group. Prior to this, he served as the CEO of Gap Inc. He is also a director at
Apple inc. and has been since 1999. He received his MBA from Boston
University and began his career as a vice president of
Millard Drexler – Image Courtesy of Boston University merchandise at a New York department store that would later be
acquired by Macy’s.
3. Director – Albert Gore – Former Vice President of the United States
under Bill Clinton, He was later the nominee for the presidency in 2000,
but lost the election to George W. Bush, despite winning the popular vote.
Albert Gore – Image courtesy of Tom Raftery and Wikipedia.com He graduated from Harvard College and is on the board of directors at Apple as well as a
serving as an advisor to Google.
4. Director – Robert Iger – The CEO of The Walt Disney Company, he was
named president in 2000 of Disney and in 2005 became its chief executive. He
helped the company acquire Pixar, Marvel and Lucasfilm, thus expanding the
influence of the Disney Company. He also serves as a board
member of Apple Inc.
Robert Iger – Image courtesy of Angela George 5. Director – Andrea Jung – A graduate of Princeton
University, JUNG is a Canadian-American and was the CEO of Avon
Products, resigning in 2012. She continues to serve Avon as an executive
Andrea Jung – Image courtesy of Avon Advisor while maintain a spot on the board of directors of Apple, Inc.
6. Director – Ronald Sugar – The CEO of Northrop Grumman Corp.,
Sugar is originally from Toronto. He is a graduate of UCLA and also a
member of the board of directors of both Apple, Inc. and the Chevron
Ronald Sugar – Image courtesy of CNN Money/APP/Getty Images Corporation. He maintains a Ph.D. in electrical engineering and sits on the
Board of Trustees of USC.
7. CFO – Peter Oppenheimer – the senior vice president and CFO of Apple, Inc. He
oversees the financial side of Apple from the treasury to its internal audits
and human resource functions. He reports directly to Tim Cook, the CEO
of Apple.
Peter Oppenheimer – Image courtesey of Apple, Inc. 8. Software Engineering – Craig Federighi – Senior Vice President of Software
Engineering, he reports directly to Tim Cook. He oversees the development of software
including the iOS, Mac OS and other software engineering challenges that Apple faces.
He is responsible for driving Apple’s innovation from a technical stand point.
9. Marketing – Philip Schiller – Senior Vice President of Worldwide Marketing at Apple,
He aids in the presentation of Apple products and extensive marketing campaigns. He
directly aids Tim Cook and is a graduate of Boston College.
10. Legal – Brice Sewell – Senior Vice President and General Counsel, Sewell
is the primary legal and government liaison for Apple. He oversees legal matters
from intellectual property to security and government compliance. He previously
worked at Intel where he led legal affairs there, he received his J.D. from George
Washington University.
Brice Sewell – Image courtesy of Apple, Inc. 11. Retail and Online Stores – Angela Ahrendts – She is the
CEO of Burberry and confirmed in 2013 that she will also head the retail
efforts of Apple. She responsible for overseeing the success
of Apple’s retail and online stores, their marketing campaigns
Angela Ahrendts – Image courtesy of the Huffington Post and their retail efforts. She is a Senior Vice President.
12. Hardware Engineering – Dan Riccio – Senior Vice President of
Dan Riccio – Image courtesy of Apple, Inc. Hardware Engineering, he leads the engineering team that make possible the
mechanical advances of the Mac, iPhone, and countless other Apple products.
He joined Apple as the Vice President of Product Design before taking over the hardware
aspect of the iPad. Dan worked at Compaq previous to Apple as the Manager of
Mechanical Engineering.
13. Industrial Design and Human Interface – Jonathan Ive – The Senior Vice
President of design at Apple, he oversees the development of the interface of
Apple products as well as the design aspect of those products. Design
being an integral part of the success of Apple products, his designs
have been said to have set the course of design for the future. He
Jonathan Ive – Image courtesy of Apple, Inc. began at Apple as a consultant before working his way up the
corporate ladder.
Eddy Cue – Image courtesy of Apple 14. Internet Software and Maps – Eddy Cue – Senior Vice President of
Internet Software and Services, he oversees the online portion of Apple. This
includes the iTunes Store, the App Store and other Cloud-based services offered by the
company. His job requires that he build and strengthen these services which are
considered vital to the customer experience of Apple’s consumers. He received his
degree in Computer Science and Economics from Duke.
15. Operations – Jeff Williams – The Senior Vice President of Operations.
He oversees the day to day affairs of Apple and is responsible for management
and assuring that Apple provides products of the highest quality standard. He
worked on the launch of the iPhone and iPod, and also worked for IBM prior to
Jeff Williams – Image courtesy of Apple, Inc. Duke.
Apple. He received a BS in Mechanical Engineering and later an MBA from
16. Global Outsourcing – Michelle Brown – The Head of the Global
Outsourcing Department, she graduated from the University of California
Santa Barbara and previously worked for COPC Inc. She oversees
outsourcing, workforce management, and vendor management.
17. Field System Engineering – Manny Freitas – The Senior Director of
Michelle Brown – Image courtesy of LinkedIn Field Engineering at Apple, he previously worked as the Executive Vice
President of Worldwide Operations for Packeteer. He manages and leads professional
services such as systems engineering and consulting engineering. He also worked as the
Vice President of Customer Support at Adobe Systems and the Director of Sales and
Field Operations at Schlumberger Technologies. He graduated from William Paterson
University of New Jersey with a BS in Business.
18. Technology – Kevin Lynch – Kevin Lynch is the President
of Technology at Apple, and previously worked for Adobe as their
CTO. He has a close connection with Adobe Flash and even backed
the product against various attacks from Apple
Kevin Lynch – Image courtesy of macgasm.com while at Adobe. He has a history in developing
Mac apps and is a major figure in Silicon Valley. Prior to Adobe he
worked for Macromedia.
19. Sales and Services – Debbie Siek – The Vice President of Sales and
Services, she heads Apple’s sales team and is also responsible for ensuring
Apple’s high standards of service. She was previously the Vice President
Debbie Siek – Image courtesy of cable360.net of Customer Care at COX communications and prior to this worked at Delta Air Lines as
the Vice President of Reservation Sale and Customer Care.
20. Communication, Europe – Alan Hely – Originally from Glasgow and currently residing
in London, Hely heads the communications departments of Apple for Europe, his title
being Communications Director for Europe. He oversees the IT and communications of
Apple for Europe and works more specifically with marketing communications in
Europe. He is credited with Apple’s branding in Europe, and he helped to create the hype
that surrounded Apple releases there.
21. Communication, Japan – Takashi Takebayashi – The Senior
Manager of Public Relations for Apple in Asia. He is in charge of
Takashi Takebayashi – Image courtesy of LinkedIn corporate communications in Japan and surrounding areas. He previously
worked for AOL as the director of Marketing and PR as well as
American Express as the PR manager. He graduated from Keio
University with an economic degree and then from the
Thunderbird School of Global Management with an MBA in
marketing.
Steve Dowling – Image courtesy of Businessinsider.com 22. Corporate Communications – Steve Dowling – An Apple
spokesperson and Head of Corporate Communications. He is the primary spokesman for
Apple and is in charge of delivering corporate communications.
23. HR and Apple University – Joel Podolny – The former dean of
the Yale School of Management, he earned his Ph.D. from Harvard
university graduating manga cum laude. He served on the faculty of
Stanford Graduate School of Business and Director of
Research at Harvard University. In 2009, he stepped down
Joel Podolny – Image courtesy of CNN Money and Brian Smale from his position as dean at Yale and began working for
Apple as the Senior Vice President of Human Resources. He
also became the dean of Apple University – Apple’s executive training
program. He is also on the board of advisors for Greenwich Associates, a
financial services consulting firm.
Douglas Beck – Image courtesy of hearinghealthmatters.org 24. Northeast Asia Sales – Douglas Beck – He is the Vice President of Northeast Asia Sales
and currently works from Japan. Previously he served as a reserve officer in the US Navy
and prior to this as the chief strategy officer at Charles Schwab. He also worked as a
partner at McKinsey and Company, graduating from Oxford with a degree
in International Relations and from Yale with a bachelors in East Asian
Studies.
25. Latin America General Manager– Anderson Teixeira –
Previously a high ranking executive at Sony Ericsson, he currently works
at Apple as the head of the Latin America region. He is commonly referred
to as the head of Latin America and currently working out of Florida. He is in charge of
sales and marketing strategies for the region. He is originally from Brazil.
26. North America sales – Zane Rowe – The Vice President of Sales of North America at
Apple, Inc. He was previously CFO and Executive Vice President at United
Continental Holdings, Inc. There he was responsible for the financial
operations of United. He also worked at the same position at Continental
Airlines. He serves as a director at ARINC, he is also a trustee at EmbryRiddle Aeronautical University. He holds a bachelors in Aviation Business
Zane Rowe – Image courtesy of Continental from Embry Riddle and an MBA from San Diego State
University.
27. Public Relations – Christina Caballero – The head of Public
Relations and Product Placement of Apple Inc. She graduated from
Florida International University with a degree in International
Christina Caballero – Image courtesy of LinkedIn Relations and previously worked for the Jeffery Group also specializing
in Public Relations and Communications where she worked with companies like
Discovery Networks, Nintendo, Kodak, and others. Prior to this, he worked at the
Systema Group and worked with Apple Computer Latin America.
28. Education – John Couch – The current Vice President of
Education, he graduated from Berkeley with a degree in Computer
Science and Electrical Engineering. He worked at Hewlett Packard as a
software engineer, and also coauthored a textbook for Cal-State San Jose.
Steve Jobs hired him as director of new products for Apple Computer,
John Couch – Image courtesy of onlindegress.org Inc. in 1978. He also served as an executive for Mayfield Trust and
DoubleTwist before returning to Apple as vice president of education.
29. Engineering – Jean-Francois Mule – The former Senior Vice President
of Technology Development at CableLabs, currently an engineering
director at Apple, Inc. He has extensive experience in software
development, and was previously the director of PacketCable
architecture and chief architect. According to Steve Jobs, he “cracked
the redesign of the television” to make it seamless and easy. Prior to
CableLabs, he worked at Clarent Corporations an executive and
started his career at IBM France.
Jean-­‐Francois Mule – Image courtesy of cruchbase.com 30. Special Projects – Paul Deneve – A business leader from Belgium, his
background is in fashion and technology. He reports to Apple CEO Tim Cook and
is in charge of the unmade Special Projects division of Apple. He previously
worked at the fashion brand Yves Saint Laurent and has also managed many luxury
Paul Deneve – Image courtesy of Wikimedia companies in the past including Courreges, Nina Ricci
among others. He graduated from the University of Chicago
and Stanford University.
31. Former Senior Vice President of Technology – Bob
Mansfield – The former Senior Vice President of Technology
for Apple, Inc. He was a senior director at SGI and a Vice
President at Raycer Graphics, which was acquired by Apple. He
Bob Mansfield – Image courtesy of zdnet.com stayed on as the Senior Vice President of Mac Hardware and
oversaw the iMac and MacBook. Apple announced in 2012 the Mansfield would no
longer be on the executive team as Senior Vice President of Technology but would rather
continue to work on the special project division under CEO Tim Cook.
Challenges Ahead
Apple lost its visionary leader Steve Jobs in the wake of a recession that saw many
corporations fail across multiple markets. Without Jobs, Apple must continue to work to
maintain its innovation engine if it hopes to stay at the top of a highly saturated market.
First, Apple must work to address the technology challenge ahead. Since the introduction
of the iPhone 4S, there has been talk of a drying-out of Apple’s innovation machine. The phone
did not introduce much improvement over older models. Rather, it was very similar to the 4 in
both technological capability and physical form. Though consumers saw much more revolution
in the iPhone 5 and 5s as well as the secondary line of iPhone’s introduced with the 5c, there has
been an overall decline in marginal improvement as signaled by the 4s which may be revealing
of a potential trend in future products.
In order to maintain Apple’s innovation at previous levels we must ensure that we sustain
multiple characteristics that have driven Apple’s success in the market place. Apple has a
powerful brand identity with consumers – it has become known for consumer oriented design
and has cultivated a persona in which it holds consumer faith on a high. Apple has also managed
to grow exponentially in the past decade, it must sustain this growth while also managing its
multitude of products at the highly competitive and visionary kevel that have allowed it succeed
on many market fronts. Finally, key to maintaining market innovation is capturing public
imagination with Apple products. It is the imagination of consumers that have allowed Apple to
thrive, Apple’s App Store has been key in keeping Apple a step ahead of competitors. With over
50 billion downloads today, and more than $10 billion paid to developers, it is the App Store that
has extended the capability of Apple’s devices while also using consumers to inspire more
consumers to continue to buy Apple products. Thus, key to maintain the App Store’s dominance
over similar products is Apple’s ability to capture the imagination of its consumers – inspiring
them to design products via the Apple platform. If we hope to maintain Apple’s innovative
powers we must ensure that these effects are continued and proliferated in the future.
Apple leadership also faces the challenge of living up to the legacy created by Jobs. Steve
Jobs led apple with a powerful vision. He has a strong command of the market, understating the
impact of both technical capability and artistic user oriented design in making Apple products a
success. Thus, we face a leadership challenge in the wake of the transition of power after the loss
of Steve Jobs. Apple’s future direction must be addressed in order to reinstall it as a leading
innovation powerhouse in the market. We must cement the strides already made Apple under
Jobs while also looking forward to a rapidly evolving market in which we must take a stand now
in order to be a major player in the future.
Never before has Apple faced the competition that currently exists in the technology
market. Nokia has evolved as a powerful player in the mobile device market, while HewlettPackard, Dell and IBM all compete with Apple in the computer market. While Microsoft
challenges Apple in the software development market, now not only at a desktop level but in the
mobile device market as well. The search engine giant Google has also made a name for itself in
the mobile device market with the Android mobile OS– which itself has spawned greater
competition from HTC and Motorola. In 2011 it was revealed by a Nielson survey that the
Android market share was 43% while Apple’s iPhone controlled 28% of the market. Google is
also experimenting with its own desktop OS –Chrome – while also offering web services that
challenge Apple’s presence in the software market at every turn. Amazon.com created a new
problem for Apple with the release of the Kindle line of products while also competing with
Apple on a retail perspective contending with everything from iTunes to the Apple retail stores.
The emergence of social media behemoths such as Facebook.com and Twitter.com create a
potential for a new competitor on a software level at any time.
This competitive market has emerged in a time of great economical strife worldwide. The
recession of 2008 created an environment in which large company’s vanished from the market
place. Although, Apple survived through the recession while still increasing revenue this was
under the guidance of Steve Jobs. Apple enjoys a demand inelastic market with a very powerful
name, economic downturn could severely cripple Apple if it does not work to quickly resolve
any issues that might exist with its modernization engine.
Also key to maintaining Apple’s dominance in the future is ensuring that scandals that
currently exist with Apple and that may exist do not clout Apple as a leader of innovation with a
consumer first policy. We must balance our needs to maintain positive public image with a need
to continue to profit in the short and long run. That said, we must also understand that our
publicity impacts our influence and standing both politically and economically. Current scandals
that have surrounded Apple have been issues of the use of sweatshops, unethical business
practices and environmental harm. Apple was accused of engaging in anti-comptitive actions
such as banning the applications of competitors – specifically Apple’s ban over Google Voice.
Apple’s anti-Adobe Flash iPhone OS, although Jobs has claimed this was for technical and
interface reasons many have argued that it unfairly attacked Adobe. iTunes as also criticized for
limiting music downloading platforms on Apple devices, especially in the EU in which
consumers are guaranteed a right to multiple retail markets.
The most major labor scandal that surrounds Apple is the use of the Foxconn factories
used to manufacture Apple products. Apple owes much of its success to its ability to outsource
electronic production to Asia. However, the Foxconn factories have been called sweatshops with
12 hour work shifts playing into a 50 hour work week common with a wage of $1 to $2 an hour.
Foxconn is a Taiwanese company that has employed over a million employees in china in order
to produce Apple products. Apple is able to make over 58% of the iPhone value in profit. To add
to this scandal in 2009 a video emerged of Foxconn guards beating employees. In 2010, 16
workers committed suicide in the Foxconn factories. In response to this Apple forced workers to
sign a contract stating that they would not commit suicide. Foxconn employees were also found
to work in harsh conditions – specifically they were exposed to the toxin nhexane which is used
to clean the iPhone display. During this process the employees were not given proper ventilation
mechanisms to reduce risk which resulted in workers developing multiple neurological problems
including the loss of motor abilities.
Along with these issues, Foxconn has also been accused of forced child labor. After the
2010 suicides in order to solve a shortage of workers, Foxconn hired “interns” to work in the
factories, having the Henan Province supply 100,000 students to work in factories under the
coercion that students who failed to work as intern would not be allowed to graduate. These
“interns” have become a major part of the Foxconn workforce constituting almost 15% and a
major source of controversy for Apple.
Apple has also been criticized for causing environmental harm. In 2007 Apple’s board of
directors decided to continue the use of a environmentally harmful toxins in the production
process. Later in 2011 a Beijing environmentalist group accused Apple of polluting surrounding
areas with toxic metals and waste. In response Apple has attempted to utilize renewable energy
sources making 75% of its facilities worldwide run on renewable energy.
The most recent scandal that currently surrounds Apple is the company's involvement
with the NSA. It was revealed by The Washington Post that Apple was part of the companies
involved in PRISM the surveillance program run by the NSA that was exposed by the leaks of
Edward Snowden. According to the leaks the NSA has access to the servers of Apple, which the
company itself has expressly denied as true.
So far these scandals have done little to seriously impact Apple’s overall consumer image
and profitability. However, as these scandals progress into the future we must be wary of the
potential issues that may arise from allowing these controversies to continue,. It will be up to you
as Apple’s executive leadership to determine what further actions if any must be taken by the
corporation in tackling these multifaceted issues on both a PR and corporate level.
The Committee
This summit of the Apple executive team has been summoned for the purpose of
addressing how Apple will proceed into the future after the loss of Steve Jobs, the introduction of
new leadership and the possible innovation crisis that has been so noted by the media. As a
corporation Apple must deal with a wide variety of issues on a day to day basis, and it will be
your task to set the tone for the future of Apple through how you decide to handle these issues.
All problems and solutions will be introduced on a time sensitive basis – solution must address
all facets of an issue. Delegates will also be responsible for balancing the issues that face Apple
and prioritizing them accordingly.
As the executive team of Apple, each of you either occupies a position on the board of
directors or within Apple at the executive level. Therefore, depending on your position you will
be charged with different tasks. As a member of the board of directors you will be charged with
overseeing Apple directionally and strategically overlooking the operations of the company and
how it lives up to the policies and strategies that you work to establish. You may also be charged
with addressing legal and corporate concerns at a holistic level. As a member of the executive
operations staff, your task will be more specific to your positions, overlooking your individual
departments, ensuring that Apple continues to increase revenue, and executing the general
policies established by Apple. Therefore, you jurisdiction as a committee will be all-inclusive
ranging from the specific operations of departments to the general policies implemented by
Apple at a corporate and political level. The chair and vice chair of the committee will act as
Arthur D. Levinson, Ph. D. and Tim Cook respectively, and as both the chairman of the board
and CEO of Apple will act as the control and preside over the board of directors and operations
staff as noted in the Apple by-laws (found in full here:
http://corporate.findlaw.com/contracts/formation/apple-amended-bylaws.html). For the purpose
of proliferating debate and running the committee with efficiency the chair will reserve all veto
powers as well as power over the agenda and general procedure of committee.
Committee Procedure
As noted above the committee will be run by the chair and vice chair acting as Chairman
Arthur D. Levinson and CEO Tim Cook respectively. The committee will be run with a lax but
standard parliamentary procedure that will work to forward debate and sustain an efficient real
time crisis simulation.
Delegates will be able to utilize crisis at their leisure. The committee as a whole will
receive standard updates from crisis, but may also ask to receive more specific updates based on
topicality or from specific representatives and speakers. Individuals may also seek these more
specific updates or other forms of communication with crisis. All outcomes of interactions with
crisis will be at the discretion of the crisis staff. We hope to create an dynamic in which
delegates will be able to use their skills to collaborate and address various issues working at a
lifelike pace that will be both intellectually stimulating and engaging.
Important Information and Questions
Timing of Committee
Each committee session will correlate to three month time frame in which we will be able
to see the various economic, political and corporate outcomes of action taken in committee.
Personal Portfolio Powers
This committee will embody a large collection of people in leadership at Apple. Each of
you has extensive personal networks which expect to see you leverage. Those of you that are
operational officers also have control of your various departments and you may exercise the
powers granted you through these positions. If you are a member of the board of directors you do
not have direct control over operations at Apple though to make up for this your personal
networks and powers at an individual levels are very large to compensate for this. In order to
maintain fairness Crisis will impose restraints on the powers of all delegates, this will create a
balance of power in terms of portfolio powers that will present each delegate with an even
playing field. Delegates will be able to exercise their portfolio powers through written personal
directives to crisis (please label these as such).
Committee Directives
The committee will take actions through a directive based resolution system in which
operative clauses will be written and after a certain number of signatories is reached (this limit
will be set by the chair during committee) may be sent to the chair to be introduced and then
voted upon. Understand that apple as a corporation has a limited amount of funds and powers, if
a directive goes beyond these limitations the directive may be rendered null by crisis, even if
passed by the committee. Only committee directives that are passed will go to crisis, which will
then design the outcome of the directive based upon the operative clauses and current situation
both in and out of committee. Crisis will also update the committee on the progress of directives
and their impact on committee as necessary. Committee directives will also carry greater weight
in crisis due to their inherent nature of affecting the entire committee rather than particular
individuals. The committee may also chose to pass press releases or communiques as a pose or in
conjunction with directives as well.
External Legal, Political and Economic Situations
Apple is a large multinational organization that exists within a diverse competitive
market economy. Thus, all actions taken by this committee will have some impact both
domestically and globally on the economic and political landscapes of the time. This also means
that external politics and economics has an effect on Apple Inc. as well. As delegates it will be
your responsibility to balance these causalities to create the best situation externally for Apple to
compete in. Apple as a corporation is also open to legal action which it may also pursue, because
of this you will also be tasked with handling the various external and internal legal circumstances
that may arise as committee progresses.
Helpful Websites and Articles
In order to start you on your research we wanted to present you with potential websites
and articles that may help you in preparing for committee.
a. http://gawker.com/5864238/how-apple-is-burying-its-scrooge-image
i. An article on Apple’s public relation work
b. http://gawker.com/5847344/what-everyone-is-too-polite-to-say-about-steve-jobs
i. An article detailing how Jobs ran Apple noting his various failure and
successes
c. http://corporate.findlaw.com/contracts/formation/apple-amended-bylaws.html
i. The by-laws of Apple Inc.
d. https://www.apple.com/pr/bios/
i. Apple PR page – specifically the bios of Apple’s senior leadership
e. http://www.forbes.com/sites/susanadams/2013/09/27/is-apple-the-worlds-mostinnovative-company-still/
i. A Forbes article on Apple’s innovative machine
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Tate, Ryan. "How Apple Is Burying Its Scrooge Image." Gawker. N.p., n.d. Web. 24 Dec. 2013.
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