Business Turnaround Strategies used in Apple by Tim Cook

By John Dudovskiy
February 18, 2014

Turnaround Strategies

Business turnaround can be defined as financial recovery of the company after the period of poor performance. The financial recovery can be achieved through implementing a specific set of strategies by the senior level management.

The most popular turnaround strategies include the following:

  1. Re-building around a profitable core business
  2. Re-branding
  3. Changing organisational culture.
  4. New product development
  5. Cost reduction through human resources downsizing and other measures

The choice of turnaround strategies listed above by a company depends on a wide range of factors such as situation in the marketplace, availability of resources, the present pattern of organisational culture and others.

Apple’s primary turnaround strategy relates to rebuilding around a profitable core business. Manufacturing of IPhone and IPad have proved to be highly profitable core business for Apple and the management is further increasing its focus on these core businesses through the introduction of IPad Mini, development of lower cost Iphones for emerging markets such as India and China, and committing to investment for further developments of IOS platform.

Changing organisational culture can be specified as another turnaround strategy currently in use by Apple CEO Tim Cook. Under former CEO Steve Jobs, Apple organisational culture was famous for being overly harsh, competitive and even exploitative of employees.

However, having a reputation for being a ‘nice guy’, Tim Cook is believed to be leading a ‘quiet cultural revolution’ to foster more communication between various levels of management and to make Apple nicer workplace in general. Specifically, the micro-management practice of former CEO Steve Jobs has been abandoned and the level of involvement of employees in strategic decision making has been increased.

Moreover, new product development has been employed by Apple CEO as additional turnaround strategy. Apple is believed to be developing watches and television that might have the same impact on respective products that Iphone had on mobile phones. However, the details of these new product lines are kept strict secret for obvious reasons.


Category: Management
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