Over the years, Apple has revolutionized the smartphone industry — sometimes, with great advances from model to model; and other times, with more modest changes.
According to Statista:
“Since its introduction in 2007, Apple’s iPhone sales have consistently increased, going from around 40 million units sold in 2010 to more than 230 million iPhones sold in 2015 alone. iPhone sales worldwide generated more than 155 billion U.S. dollars in revenues in 2015. As sales increased, the iPhone gained space within the company, and has become the most successful Apple product to date. “
“The iPhone’s share of the company’s total revenue has jumped from about 25 percent in the beginning of 2009 to around 70 percent in the first quarter of 2015. As of the first quarter of 2016 (4Q ’15 calendar year), iPhone’s share of Apple’s revenue was at 68 percent, the third highest figure to date. Much of the iPhone’s success can be attributed to Apple’s ability to keep the product competitive throughout the years, with new releases and updates.”
Here’s an interesting video that shows how the iPhone has evolved over the years across several attributes.
Forty years ago, Apple was founded by 20-something young guys– some say, in a garage (Steve Wozniack disagrees with that depiction 🙂 ). Despite a number of ups and downs over the years, we know that Apple has emerged as the most valuable company in the world. Here is a video on the history of Apple.
In today’s post, we want to show that other small startups have also been very successful and remain so today. So, the answer to this question — Can you start a business in your garage? — is a resounding yes. And this remains true today.
As Matthew Anderson recently observed for TheSelfEmployed.com:
“For many people, the idea of just starting their own business lies somewhere in the realm of fantasy. It’s something for someone else to do, something that requires investors and business know-how, or something an average person could never think of doing. The truth, however, is that starting your own business requires only one thing – determination. Well, if history is any indicator, a garage might help as well.”
- Amazon — “At one time, Amazon was simply an online bookstore; and founder Jeff Bezos ran the company out of his garage in Bellevue, Washington. Needless to say, the Amazon of today is just a bit bigger – the world’s largest online retailer. In keeping with its bookstore beginnings, the Amazon Kindle is widely regarded as the best E-reader on the market.”
- Disney — “Walt Disney and his brother Roy moved to California and set up the first Disney studio in a one- car garage behind their uncle Robert’s house in Los Angeles in 1923 to film and sell his Alice Comedies, which combined a live-action actress with an animated cat. Nearly a century later, Disney is one of the largest media corporations in the world.”
- Harley Davidson — “William Harley and his friend Arthur Davidson worked in a shed to make the motorized bicycle a reality. In 1903, Harley-Davidson was founded. Today, it is one of the most well-known motorcycle brands in the world; and you can buy anything from aprons to clocks and outdoor oil-can-shaped lights with the Harley-Davidson logo.”
- Maglite — “In 1955, Tony Maglica bought a lathe and set up a tool shop in his garage. After operating his business for 25 years, the innovative Mag-Lite was released in 1979. It is now the standard-issue flashlight for U.S. police officers and was referred to by the Wall Street Journal as the ‘Cadillac of flashlights.’”
- Yankee Candle Co. — “Sixteen-year-old Michael Kittredge created his first scented candles out of melted crayons for his mother in the family’s garage in 1969. When neighbors showed interest, he began producing the candles in larger quantities. With help from two high school friends, Yankee Candle Company was founded. Fast forward to 1998, Kittredge sells the firm that began with a gift for his mom to a private equity company for $500 million dollars.”
Click the image to read more from Anderson.
Scenario planning involves planning for the future by understanding that different marketplace outcomes may occur in response to any strategy and that each possible marketplace outcome must be planned for to avoid the worst case scenario.
Here’s a simple example: Suppose that a major soda company introduces a new non-carbonated cola beverage into the marketplace. These are just a few scenarios that are possible:
- The sales of the new beverage meet expectations and do not cannibalize the sales of other company products. Overall company revenues and profit rise.
- The sales of the new beverage meet expectations, but slightly cannibalize the sales of other company products. Overall company revenues and profits rise slightly.
- The sales of the new beverage meet expectations, but greatly cannibalize the sales of other company products. Overall company revenues stay the same, and profits fall somewhat due to the investment in the new item.
- The sales of the new beverage do not meet expectations and do not cannibalize the sales of other company products. Overall company revenues rise very little, and profits fall a lot due to the investment in the new item.
The premise of scenario planning is to anticipate the possibility of each of these outcomes occurring and have in place a pre-planned framework (contingency plan) to deal with each scenario.
Recently, Shardul Phadnis, Chris Caplice, and Yossi Sheffi wrote an article for the MIT Soan Management Review titled “How Scenario Planning Influences Strategic Decisions.” The authors reached three major conclusions:
- “The use of multiple scenarios is not necessarily an antidote for overconfidence. One should not assume that simply using multiple scenarios to evaluate a long-range decision will help alleviate the negative effects of decision makers’ overconfidence in their own judgment.”
- “Scenarios influence judgment — and their content matters. More than half the judgments in our studies changed after single-scenario evaluations. Scenario users became more favorable of investing in an element — either by increasing confidence in their original recommendation to invest, decreasing confidence in their original recommendation to not invest, or changing their recommendation to favor the investment — when they found the element useful in a scenario.”
- “The use of multiple scenarios can nudge executives towards more flexible strategies. Executives often choose strategies optimized for a particular environment. While such strategies may perform well in the environment envisioned at the time of their implementation, they may not be easily adaptable to new opportunities or in response to unexpected threats. Under such circumstances, evaluating strategic decisions using multiple scenarios can help executives appreciate the importance of choosing more flexible assets or approaches — even if doing so is not the most optimal choice for present-day conditions.”
Click the image to access the article.