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For many people, Apple is a confusing company:
On one hand, it’s an unquestionable success
- creating and then dominating entire categories
of products, and making more money than any
other business in the world.
By far.
But somehow it also seems unable to understand
its customers: removing features we love,
neglecting its own products, and making bizarre
trade-offs we never asked for.
So how can the world’s most profitable company
also be so foolish?
Many would say they can afford these mistakes
because of their exceptional marketing.
Others see them as disorganized and distracted,
really only coasting on earlier success.
These feelings are everywhere on the internet,
and frankly, they’re understandable.
By being such a secretive company, they sacrifice
the chance to explain themselves, leaving
us to speculate from the outside.
But theories like these only raise more questions:
If the goal is simply marketing to maximize
profit, why focus on so few products?
They should be using their brand to sell anything
and everything, like Samsung.
And why remove things like the headphone jack?
These are very deliberate decisions, yet they
guarantee far more negative press than they
make in sales of adapters.
Foolish as they sound, there must be some
kind of strategy here, it would take a miracle
for a truly dysfunctional company to be this
successful for this long.
Which makes sense: companies this big aren’t
driven so much by individual employees as
institutional principles.
So, you may hate their strategy, think they’re
overpriced, and disagree with every decision
they make, but by no means are they careless
or arbitrary.
The only way to make sense of all this - to
understand their success, predict their future,
and even explain their mistakes is to figure
out how they think.
And just three principles are enough to explain
almost everything.
This is The Grand Theory of Apple.
Apple is treated as a technology company,
and anything else would seem ridiculous.
But it would also be ridiculous to say its
goals are anything like other technology companies.
Their business may involve transistors and
resistors, but from their perspective, this
is only incidental.
Technology is actually the enemy - a distraction,
a source of confusion.
In the ideal world, no-one cares about RAM,
or even knows they’re using a computer:
they’re just drawing, or reading, or talking.
This may sound idealistic, but consider how
much it explains:
It’s why they’re obsessed with making
devices thin, light, and minimalistic.
Removing ports, bezels, and even buttons.
It also favors some devices over others.
Because from their perspective, each device
is fundamentally competing in the same category.
Which their executive Phil Schiller said quite
openly:
“The job of the watch is so you don’t
need to pick up your phone as often,
The job of the phone is to do more and more
things such that maybe you don’t need your
iPad,
The job of the iPad is to be so powerful and
capable that you never need a notebook,
The job of the notebook is to make it so you
never need a desktop”
Each device has the goal of moving in this
direction of smaller, less confusing technology
by making it’s more bulky, confusing neighbor
obsolete.
They’ve been so slow to update desktops
because, well, they’re the furthest from
their vision of what a computer should be.
There’s a huge group of fans and customers
who think Apple has changed, that they’re
now obsessed with making devices thinner at
whatever cost.
But this was always the goal, it’s just
now becoming technically possible to do so.
And their products may overlap with competitors
now, but make no mistake: the second it’s
possible to remove what they see as an unnecessary
distraction, they will.
And as it becomes easier to do so, they’re
going to look less and less like a technology
company at all.
When Steve Jobs came back to
the company in 1997, it was a mess: they were
selling a million different products with
no clear strategy.
So he simplified the entire company into one
simple chart.
They would make only one computer for each
market, but it would be really good.
They’ve grown much bigger since then and
they’ve had to expand that strategy.
But compared to their competitors, they’re
still extremely focused, to the point of leaving
money on the table.
Their brand alone they could sell just about
anything, but they choose very selectively
where to focus their attention.
Even a good idea is not enough to justify
their making it - they have to believe it’s
huge.
This constant fear of over-complicating things
is what allows them to put so much time and
so many resources into every project.
They’re able to plan years and years ahead
this way, investing in features that won’t
see the light of day until far into the future.
And if they decide something no longer justifies
their time and attention, you wake up and
poof, it’s gone.
Someday that will be the iPhone.
It’s
not that Apple doesn’t listen to feedback,
or even sometimes ask for it, but ultimately,
they consider their judgement more important
than yours.
This may seem incredibly stupid, but it’s
actually the biggest key to their success,
because without it, they could’ve only been
successful once.
Many companies create a very successful product,
but they milk it for as long as possible by
giving whatever customers ask for.
After Microsoft created Windows, they did
exactly this.
They’re obviously doing just fine, but it
meant they weren’t ready when the smartphone
took off.
Apple does just the opposite, they’re constantly
trying to compete with themselves.
Any other company would kill for the success
of the iPod, but Apple killed the iPod, with
the iPhone.
No one product lasts forever, so while it
hurts to kill your own success, it’s necessary
to stay on top in the long term.
This means not listening to your customers
asking for a better iPod, and instead creating
what they don’t even know they want.
This can be a really tough pill to swallow,
especially in more tangible forms - the removal
the floppy drive, CD drive, the old charger,
home button, headphone jack, and USB-A.
People were angry, often for good reason:
these seem like needless sources of frustration.
And you can bet Apple knows this.
But they also know they’re powerful enough
to survive these transitions.
They can afford to lose some customers and
receive some negative PR.
Because the up-side is HUGE.
Journalists write that these changes are signs
of a problem, but the only true danger is
if they stop.
When they start listening to customers, they
lose the chance to make the next big thing.
When the iPhone is released, they’ll still
be focused on improving the iPod.
Because, frankly, you and I aren’t going
to ask for the next big thing, we don’t
know what it is.
But Apple has to.
To them, part of their job, the service they
offer, is saying “No, we’re not going
to give you what you think you want”
And again, this can be incredibly frustrating,
sometimes they’ve just wrong.
The iPhone was late to the big phone market
because for the longest time, they thought
they knew better than we did.
And this mentality can also create a bit of…
insensitivity.
But it’s a risk they have to take, because
more often than not, ignoring the customer
has really paid-off.
A good theory not only makes
sense of the past but also makes testable
predictions about the future.
So if these principles really are at the heart
of Apple’s thinking, we can expect some
specific outcomes.
Firstly, if Apple is motivated more by these
values than pure profits, we can expect them
to keep making sacrifices that anger consumers.
They’ll keep investing in the Mac until
a point where they think the alternative is
better, whether that be a more powerful iPad,
a hybrid device, or something completely different.
Before consumers are truly ready, they’ll
pull the plug on perfectly profitable devices
to push towards the goal of smaller, less
complicated technology.
And right now as we speak, somewhere in California
Apple is working on something designed to
kill their current bestsellers.
Something designed to make their own business
obsolete.
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