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Ideas for Impact

When Growth Stalls: A Case Study of the iPhone

November 13, 2020 By Nagesh Belludi Leave a Comment

If you got an iPhone in the last few years, you don’t really need to rush to replace it with the new iPhone 12.

In a sense, Apple is relying on other businesses to make this new lineup a success. Despite Apple’s assertions that the new iPhone 12 supports fast 5G cellular networks, the prevailing 5G networks in America just aren’t fast enough yet.

Feature Stagnation

Arguably, there’s not much further for the iPhone to go. It’s been improved through numerous versions since 2007, and there simply isn’t much left to do. The entire experience is probably as good as it ever needs to be.

Beyond better power, speed, design, battery, cameras, and display, Apple faces the horizon of what’s expectable from a smartphone. After a decade of relentless growth and absolute dominance, innovation has exhausted. Progress will become increasingly inconsequential. Through it all, Apple has successfully sustained premium-position captivity and thrived even as new, low-cost competitors are emerging worldwide.

When Growth Stalls

Apple’s growth trajectory is likely to look different in the future. The bulk of Apple’s future growth prospects will come from existing customers and not new smartphone adopters. Apple has been focusing on newer software and services to expand the user experience and retain customers.

Apple’s core product is ex-growth. In that sense, Apple is now like Microsoft and Alphabet. Faced with product stagnation, both Microsoft and Alphabet responded by pushing into entirely new areas to spawn growth, but with patchy successes. When it’s dominant Windows and Office franchises were stalling, Microsoft pivoted and had big hits with the Xbox and enterprise software but failed with MSN, Bing, and mobile. Google diversified with Android and Apps but repeatedly missed on social.

Idea for Impact: No one, no matter how historically innovative and powerful, is guaranteed immortality

Successful companies—and people—must evolve their competence or risk becoming marginalized. The roots of sustained success lie in being aware, innovative, and adaptable. Don’t become too focused on taking care of today and forget preparing for tomorrow. Your business model could be fragile.

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  4. Heartfelt Leadership at United Airlines and a Journey Through Adversity: Summary of Oscar Munoz’s Memoir, ‘Turnaround Time’
  5. Lessons from Peter Drucker: Quit What You Suck At

Filed Under: Business Stories, Leadership Tagged With: Apple, Change Management, Google, Microsoft, Strategy

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About: Nagesh Belludi [hire] is a St. Petersburg, Florida-based freethinker, investor, and leadership coach. He specializes in helping executives and companies ensure that the overall quality of their decision-making benefits isn’t compromised by a lack of a big-picture understanding.

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