The Boston Consulting Group (BCG) published its ranking of the most innovative companies of 2021. The first line was taken by Apple, with Alphabet, Amazon, Microsoft, and Tesla also in the top five (Steers, 2021). The 6th position goes to Samsung; IBM Corporation takes the 7th place, and Chinese ICT giant Huawei occupies the 8th (Steers, 2021). In tenth place is Pfizer, which invented one of the vaccines for the coronavirus (Steers, 2021). Beyond that, Pfizer is one of the world’s largest drug manufacturers. Innovation is not just about making a new device; it is also about writing software code. That is done in companies that run a search engine, an operating system, or companies that make smartphones. That is why Apple has been the most technologically advanced company globally for years, and others like it are growing in that ranking year after year.
In addition, Fast Company magazine ranked the innovative companies of the world that managed to stay afloat in the corona crisis and showed a creative approach to the problems and fearlessness in the face of the crisis. In tenth place is Graphika, an American analytics company that detects and explores Internet communities using artificial intelligence (Fast Company, 2021). Fifth place went to SpringHill Company, a marketing and entertainment company that produces movies and TV series (Fast Company, 2021). Analysts noted the company’s openness to collaborating with new authors, giving the opportunity to become famous even to those who do not have the money for paid promotion. Elon Musk’s space company is one of the most ambitious startups in history, which is why it takes fourth place in the rating (Fast Company, 2021). Third place goes to Shopify, one of the most popular platforms for creating online stores (Fast Company, 2021). The analysts could not single out one leader, and therefore Pfizer-BioNTech and Moderna shared first and second place.
In recent decades, there has been a significant increase in interest in innovation among academic economists, which is logical since innovation has become one of the main factors of economic growth. Innovations are a necessary condition for the development of production, increasing the quality and quantity of the appearance of new goods and services. In a market economy, they are a driving force of competition. Due to them, it is possible to use modern technology and production organization to ensure the enterprise’s success and efficiency. Innovations have a positive impact on the development of enterprises and the country’s economy (Jin & Choi, 2019). Today’s market realities demand that companies change their approach to innovations (Ogrean, 2019). They should be a constant requirement, not an option, and their presence determines the firm’s survival in the market among competitors (Ogrean, 2019). A correlation can be found that the more innovative a company is, the greater its capitalization.
Everywhere in the world, companies that have achieved leadership on global scale use strategies that differ from each other in every way. To succeed in the marketplace, companies must create unique development plans. However, the basic principles of firms are the same by nature. Every company achieves competitive advantage through innovation, and Apple is no exception. Moreover, all firms undertake ways to compete in the best possible way (Chavaglia et al., 2019). Innovation is polysemous, and it can manifest itself in the way a product is designed and in the way goods are produced (Chavaglia et al., 2019). Innovations do not always have to be complex in order to produce success in the marketplace. Most of them are a set of minor improvements rather than a breakthrough in terms of technology (Chavaglia et al., 2019). It is precisely because of these incremental steps that Apple succeeded. Apple’s innovations have not always been breakthroughs, but they have improved customer attitudes toward the devices they produce.
Innovations play an important role in the management process of the enterprise, being the basis for maintaining them on the market and improving competitiveness. They are among the most critical factors determining the development of the economy of individual countries and enterprises (Gobble, 2018). Innovation requires the commitment of enterprises to adequate funding, appropriate personnel, knowledge, the right skills and culture, creativity, and openness to new ideas. Moreover, it stimulates competition and is a strategic resource and a fundamental element of enterprise progress (Gobble, 2018). Among the companies that are leaders in innovation, the best is Apple. For many years, the company has been leading the ratings of the most technologically advanced and successful organizations. Apple’s ability to manage innovation provides the company with a competitive advantage and high capitalization.
Today Apple is a company that has gained the status of a legend, all because of constant innovation, which is part of the company’s policy. It was founded by Steve Jobs and Steve Wozniak, and it revolutionized computing in just a few years. Although the company had had periods of stagnation and moments when it seemed that Apple was on the verge of bankruptcy, the firm has managed to overcome these difficulties. Apple has been able to become a leader in many ways because the manufacturer places such a high value on innovation. The company’s real breakthrough was not the first Apple, which was the lot of enthusiasts and was not produced in really large quantities, but the Apple II. This computer was first shown to the public in 1977 at the West Coast Computer Faire (Dormehl, 2022). The Apple II was the exhibit’s centerpiece, as it was the first personal computer. Not only that, the computer was capable of playing back color pictures and sound and had a built-in Basic programming language. Since then, innovation has been the most critical factor in the company’s prosperity.
Now, Apple launches the unique MacAir, the world’s thinnest laptop, the thickness of which is about the same as a human finger. Due to the use of a modern video chip and CPU, in addition to the unique portability, this product also has an enviable functionality. Apple’s constant striving to improve the quality of its products and its support for innovation within the company makes it an innovative leader. Moreover, it gives the firm a competitive edge over other firms. Apple remains a major industry innovator with its award-winning computers, OS X operating system, iLife, iWork, and professional applications. Apple changed the digital music world with its iPods and iTunes online store. The firm also turned cell phones upside down with its unique iPhone and App Store. It should come as no surprise that Apple tops the list of the world’s most innovative companies compiled by magazines like Fast Company and the Boston Consulting Group. This kind of stability may give an indication that innovations are what is particularly valued today.
According to business theory, as firms grow and become more complex, they transition from a functional to a divisional structure. In this way, responsibility and control were distributed evenly. Thanks to this transition, top managers can effectively evaluate the quality of their work. Many corporations have made this change in structure and succeeded, but Apple is committed to a different approach. Apple’s primary objective is to create products that enrich people’s lives. This involves the development of fundamentally new categories of products like the iPhone or Apple Watch and their continuous improvement. Creating innovation is facilitated by an organizational structure built around expertise. It is based on the premise that the most experienced and competent experts should make decisions on ongoing issues.
Apple competes in markets where there are constant technological shifts and breakthroughs. Therefore, it must rely on the insights and insight of people with a deep understanding of the technologies behind those breakthroughs. A company needs to anticipate which innovations will be in demand in the smartphone and computer market long before it gets feedback and reliable forecasts from the market itself. To have a better chance of making the right choice, technical experts, not general managers, should have the deciding vote. In a company with a functional structure, the reputation of a specialist or team serves as the controlling mechanism when making decisions. Finding a balance between controlling costs and creating added value for customers is more manageable when decisions are made by leaders who know their field well, rather than general managers who are more concerned with targets. While the fundamental principle of the traditional organization structure is a combination of responsibility and control, the functional structure is based on a combination of knowledge and decision-making power.
A business opportunity is an opportunity to successfully implement an idea under specific market conditions. In essence, it is an innovation whose success has been analyzed in advance. Here the story of how the decision was made in 2016 to install a dual-lens camera with portrait mode in the iPhone 7 Plus is illustrative. Many were convinced that the users’ enthusiasm for the new product would justify all the expenses for it. This example demonstrates the company’s propensity to identify business opportunities. Where other companies would have preferred to make the safe choice and not install a dual camera, Apple took the risk.
In addition to the dual camera, Apple has opened consumers up to the benefits of the touchscreen. It was not Apple that first began to equip its devices with touch screens. However, it was not until the release of the company’s smartphone that the convenience of a touchscreen became apparent. The firm took the innovative opportunity to modify the idea of touch screens and succeeded. Notable is the story of how, in 2010, Apple began developing its own A4 microchip, which first found its way into the iPad tablets (Grothaus, 2021). Soon after that, the iPhone 4 was equipped with a new processor. Since then, Apple has installed a new proprietary microchip in every new model of its smartphone, allowing it to achieve outstanding results in device performance. The company considered it possible to realize this business opportunity in specific market conditions, which ultimately led to success.
Apple tends to find innovative opportunities where companies do not notice them. The firm analyzes consumer demand and also improves on the designs of other manufacturers, and in this way, creates a unique product. Among the conclusions that can be drawn about the company’s entrepreneurial abilities is the importance of being extremely attentive to the market in order to succeed. It is also sometimes necessary to take a risk because this will give the opportunity to make an extra profit. Experts who have the most comprehensive data about the product being produced must manage the innovation process. This is the crucial lesson that can be learned from the Apple case.
References
Chavaglia, J., Filipe, J., & Caleiro, A. (2019). Creativity and innovation: A contribution of behavioral economics. International Journal of Innovation Studies, 3, 12-21.
Dormehl, L. (2022). Today in Apple history: Apple II brings color computing to the masses. Cult of Mac.
Fast Company. (2021). The world’s 2021 most innovative companies.
Gobble, M. A. (2018). The importance of management innovation. Research-Technology Management, 61(8), 54-58.
Grothaus, M. (2021). Does Apple make their own processors? KYM.
Jin, S., & Choi, S. (2019). The effect of innovation capability on business performance: A focus on IT and business service companies. Sustainability, 11(5246), 1-15.
Steers, S. (2021). BCG announces top 50 most innovative companies of 2021. Technology Magazine.
Ogrean, C. (2019). Some insights on the world’s most innovative companies and their defining characteristics. Studies in Business and Economics, 14(2), 88-104.