Differences of Apple and Microsoft Corporate Culture

Competitive Strategies

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BUS 508 Contemporary Business

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Differences of Apple and Microsoft corporate culture

Scully (2011) gave a bird's eye view of Apple and Microsoft corporate culture. He said "In Steve's world, 'No compromises'.' In Bill's world, 'Hey, compromise is alright. We'll get it right the third time. We just want to have a land grab'." According to Scully, the two have entirely different approaches, both very, very successful. But in the era of consumer electronics, the Steve Jobs approach is a hands-down winner. Williams (2011) said that if there is one key difference between Microsoft and Apple, it is secrecy. Apple rarely shows its hand before a product is ready to ship. Microsoft usually offers sneak previews of products months, sometimes years, in advance. Sethi (2012) revealed the two corporate values that Apple implements - value and cost culture:

When it comes to customers, Apple applies the notion of value. For example, Apple's pricing strategy that is driven by its focus on the value. The customer is willing to pay a price that is equal to the product's perceived value to the customer. However, as long as the customers are satisfied, Apple is under no obligation to reduce its prices. When it comes to workers' wages and working conditions, Apple uses its dominant market position or buying power to acquire these services at the lowest possible price, thus keeping the largest share of the profit for itself and yielding the lowest possible share to the workers. It is not important that the added costs of better wages and working conditions represent an infinitesimally small proportion of the overall costs. It's all relative; if these additional costs are higher than those of Apple's competitors, they could adversely impact the company's stock price in the short run.

On Microsoft's bureaucratic culture, Eichenwald (2012) wrote that 'more employees seeking management slots led to more managers, more managers led to more meetings, more meetings led to more memos, and more red tape led to less innovation'.

Analyze three (3) ways that each unique culture has benefited by the others

1. In 1997, Steve Jobs settled Apple's law suit against Bill Gates in exchange for Gates to invest millions of dollars at Apple. Steve's realistic approach towards Microsoft benefited both computer companies. This agreement was summed up in the conversation between the two tech wizards recorded by William Isaacson's and published by Jackson (2012): I called up Bill and said, 'I'm going to turn this thing around.' Bill always had a soft spot for Apple. We got him into the application software business. The first Microsoft apps were Excel and Word for the Mac. So I called him and said, 'I need help.' Microsoft was walking over Apple's patents. I said, 'If we kept up our lawsuits, a few years from now we could win a billion-dollar patent suit. You know it, and I know it. But Apple's not going to survive that long if we're at war. I know that. So let's figure out how to settle this right away. All I need is a commitment that Microsoft will keep developing for the Mac and an investment by Microsoft in Apple so it has a stake in our success.'

The conversation ended with Microsoft investing $150 million in Apple in exchange for Apple dropping its lawsuit against Microsoft. This is a win-win solution plaguing Apple and Microsoft. Both thrived and Apple eventually won the competition.

2. Mac's Environment