Steve Jobs' famous 2x2 Matrix Strategy
In 1997, something very important happened to Apple, a company that makes computers and other tech stuff. Steve Jobs, one of the people who started Apple, came back to help the company. At that time, Apple was having big problems. They were losing money and weren’t doing well against other computer companies like Microsoft and IBM.
Apple had too many products, which made things confusing for people who wanted to buy their stuff. It was also hard for Apple to make all these different things. The company was in such big trouble that they were close to running out of money completely.
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| From Podfeet |
Things were so bad that even Microsoft, which was Apple’s biggest rival, invested $150 million to help keep Apple alive. This might seem strange, but companies follow this strategy to maintain the ecosystem. Read the article below to understand one more incident like this.
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When Steve Jobs came back to Apple in September 1997, he started to make big changes right away. He stopped making some products that weren’t making money. He also decided to make fewer different products so Apple could focus on doing a few things really well instead of doing lots of things not so well.
Steve Jobs’ famous 2x2 matrix
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| Steve Jobs 2x2 Matrix Product Strategy |
When Steve Jobs came back to Apple, he had a clever idea to fix the company’s problems. He made something called a “2x2 matrix.” Jobs used this box to decide what products Apple should make.
Here’s how the box worked:
- On one side, he put “Desktop” and “Portable” (which means things you can carry around).
- On the other side, he put “Consumer” (for regular people) and “Professional” (for people who need really powerful computers for work).
This gave Apple four main types of products to focus on, instead of the 15 different kinds of computers they were trying to make before. This plan helped Apple in many ways:
- They could put their best people to work on just four main products, which meant those products could be really good.
- They could make new versions of their products more often - about every 9 months instead of every 18 months.
- While they were selling one version of a product, they could already be working on the next better version.
This plan made things much easier for people who wanted to buy Apple products. They didn’t have to choose between lots of confusing options anymore. It also made things easier for the people working at Apple. They could focus on making a few things really great instead of trying to make lots of different things.
This plan also helped Apple save money and work better as a company. They didn’t need to make and store so many different parts for lots of different products. All of this helped set up Apple to become very successful in the future and changed the way they thought about making and selling their products.
Products Steve Jobs Stopped Making
When Steve Jobs came back to Apple, he looked at all the things the company was making and decided to stop making quite a few of them. This was part of his plan to make Apple focus on fewer, better products. Here are some of the products he decided to stop:
- Newton: This was a small computer you could hold in your hand, kind of like today’s tablets but not as good. Jobs stopped making it in 1998 because he didn’t think it fit with his ideas for Apple’s future.
- Pippin: This was supposed to be a mix between a computer and a game console. Apple made it with another company called Bandai. They stopped making it in 1997 because not many people bought it - less than 12,000 in the United States.
- Twentieth Anniversary Mac: This was a special computer made to celebrate Apple’s 20th birthday. It was very expensive and looked cool, but Jobs stopped making it in March 1998, just a year after it came out.
- Mac clones: These were computers made by other companies that could use Apple’s operating system. Jobs made it too expensive for these companies to keep making them, so they all stopped.
- OpenDoc: This was a special kind of software that let different programs work together. Jobs decided to stop this project along with some others like it.
By stopping these products and others that weren’t doing well or weren’t really necessary, Jobs helped Apple focus on making a smaller number of really good products. This was a big part of how he turned the company around, changing it from losing lots of money to making money again in just one year.
How This Changed Apple?
Steve Jobs’ plan to focus on just a few products made a huge difference for Apple. In just one year, the company went from losing more than a billion dollars to making a profit.
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But it wasn’t just about money. This new way of doing things helped Apple start coming up with new and exciting ideas again. They began to focus more on making their products look good and work well, which became a big part of what people think about when they hear “Apple.”
By having fewer products, it was also easier for Apple to tell people about what they were selling. Customers could understand Apple’s products better, which made them more likely to buy them and use other Apple things too.
This big change didn’t just save Apple from running out of money. It also set the stage for Apple to become one of the most important technology companies in the world. It helped them get ready to make amazing new products that would change how we use technology in our everyday lives.
New Products
After Steve Jobs made his plan to focus on just a few main products, Apple started making some really amazing new things:
- iMac (1998): This was a computer that looked very different from others. It came in bright colors and had everything built into one piece, which was new and exciting at the time.
- iPod (2001): This was a small device that could hold thousands of songs. It had a special wheel that you could use to control it, which made it easy and fun to use.
- iTunes Store (2003): This was a place on the internet where people could buy and download music. It changed how people get and listen to music.
- iPhone (2007): This was a really big deal. It was a phone that you could control by touching the screen. It could also do many things that only computers could do before, like go on the internet and play music.
- iPad (2010): This was like a big iPhone that you couldn’t make calls on. It was bigger than a phone but smaller than a laptop, and it created a whole new type of device that many people loved.
These new products helped change Apple from a company that was mostly known for making computers into one that made all sorts of cool technology that people use every day. Each of these products was so good and different that it made other companies try to make similar things, but Apple’s were often seen as the best.
How Everything Works Together
The iPhone became super popular not just because it was a cool phone, but also because it worked really well with other Apple products and services. This is called an “ecosystem.” Here’s how it works:
- iTunes: This lets you manage your music and videos on your computer and iPhone.
- App Store: This is where you can get lots of different apps for your iPhone.
- iCloud: This lets you store your data (like photos and documents) on the internet so you can see them on any of your Apple devices.
Apple also made it so that if you have more than one Apple device, they can work together smartly. For example, you can start writing an email on your iPhone and finish it on your Mac computer.
All the above products look so cool at that time.
Later, Apple also made other things that work with the iPhone:
- AirPods: These are wireless earphones that connect easily to your iPhone.
- Apple Watch: This is a watch that can do some of the things your iPhone can do.
And they created services that make having an iPhone even better:
- Apple Music: This lets you listen to millions of songs.
- Apple Pay: This lets you pay for things using your iPhone instead of a credit card.
All of these things working together made people really like using Apple products. It also made it hard for people to switch to other brands because they got used to how well everything worked together in the Apple world.
Learnings from Apple’s Product Simplification
Apple’s big changes under Steve Jobs teaches us some important lessons about making products simpler and focusing on what’s really important.
Making things simple for people to use is actually very hard and takes a lot of work and understanding. Apple worked hard to make their products easy for everyone to use, not just tech experts.
This idea of keeping things simple didn’t just apply to their products. Apple also made their stores simple and easy to shop in. They let people try out products before buying them, which was a new idea for technology stores.
By making everything simple and easy to understand - from the products themselves to the way they sold them in stores - Apple created a strong and popular brand. They showed that focusing on doing a few things really well, rather than trying to do everything, can lead to big success.