well they are not getting any dividends, so maybe they should stop getting "ripped off" and go elsewhere.
There are large gaps in your understanding. The meanings of words seem to throw you down dead-end paths.
A friendly suggestion: Look up the word "profit" in a half-dozen dictionaries and a couple of encyclopedias. You don't know what you are talking about. That is the basic problem. You need to know what the subject is before you can form an opinion about it. If you find any support for "unless dividends are paid, there is no 'profit'" then please get back to me.
Seriously. I pointed out that the profits earned by the owners are dividends.
So lets repeat.
The owners of Apple earn no dividends therefore take no profits. Therefore their interest is elsewhere. If they wanted to get profits from a company - that is to earn any of the EPS - they would go elsewhere. Apparently the Apple shareholders are not interested in dividends which is profits divided amongst the shareholders. They profit from growth in capital.
Unfortunately a mediocre understanding of Econ 101 is not going to be much help here.
There are large gaps in your understanding. The meanings of words seem to throw you down dead-end paths.
A friendly suggestion: Look up the word "profit" in a half-dozen dictionaries and a couple of encyclopedias. You don't know what you are talking about. That is the basic problem. You need to know what the subject is before you can form an opinion about it. If you find any support for "unless dividends are paid, there is no 'profit'" then please get back to me.
Not what I said.
You said that investors care only about profit. Since Apple does not pay a dividend there is no profit earned per share of Apple stock, therefore the shareholders dont profit. That is the profit I am talking about, and the only profit the shareholders should care about - dividends per share. For Apple that is a big fat zero.
The company can earn profit internally all it wants, but the shareholders are not seeing any of it. So how can the investors care. There are dividend paying stocks which react differently to a reduction in dividend.
Here is an example for a dividend paying stock which halted it's dividend.
Fannie Mae, and Freddie Mac lost 90% of the value after that decision over a few days.
My second point is that a increase in margins would increase Apple's quarterly profit ( but not dividends). However, if Apple were to guide for higher profits based on higher margins but also guide for static growth, then their stock would collapse. I am pretty sure that has happened in their past. Investors have priced in future growth in market share and overall sales.
Which indicates most investors are in for capital gain, which means that Apple need to keep growing.
Thats a bit past the econ 101 y'all keep espousing.
The goal of any business is profit at the risk of a loss-- called the profit motive.
Everything else is secondary!
Dick, you are one of my favorite posters. I think, in this case, however, what we have is a communication problem. Technically, you're right ... without profit there ceases to be a company eventually .... but to say that everything else is secondary is to do a disservice to anyone that's in the game mostly for other reasons.
When trying to judge what motivates a company to make certain decisions there is always more than one reason, and imo, in Apple's case, profit is not at the top of the list, most of the time.
For me, what defines a company is: what is usually at the top of their list and how strong is their desire to maximize their profits?
The best example I can think of for a company whose desire to maximize profits was the Ford Pinto. The decisions made then didn't turn out well for anyone, especially. those who died, as a result.
Apple has made most of their decisions based on their desire to "make insanely great products" with the profit motive coming in somewhere down the line.
Dick, you are one of my favorite posters. I think, in this case, however, what we have is a communication problem. Technically, you're right ... without profit there ceases to be a company eventually .... but to say that everything else is secondary is to do a disservice to anyone that's in the game mostly for other reasons.
When trying to judge what motivates a company to make certain decisions there is always more than one reason, and imo, in Apple's case, profit is not at the top of the list, most of the time.
For me, what defines a company is: what is usually at the top of their list and how strong is their desire to maximize their profits?
The best example I can think of for a company whose desire to maximize profits was the Ford Pinto. The decisions made then didn't turn out well for anyone, especially. those who died, as a result.
Apple has made most of their decisions based on their desire to "make insanely great products" with the profit motive coming in somewhere down the line.
I never claimed that the goal was to maximize profits at the expensive of everything else.
But, profit is what motivated the creation of Apple, and in my observations of 32 years (sometimes from close contact, other times from afar) profit has been the motivating factor for all that they do.
Sure, Apple are inspired to create great products and change the world-- and they have, at least 4 times.
But, every product Apple funds is tied to a profit. They may chose to fund a product that offers minimal or no immediate profit, (ATV) -- but the long term goal of that product is to make a profit.
If questioned, closely, about what comprises his job as CEO of Apple, i suspect Steve's answer would
be something like:
1. to make a good profit
2. to make insanely great products (and services) that change the world.
3. to motivate and inspire all Apple people to do 2) while targeting 1)
And, I believe Steve does this better than any CEO I know of.
I never claimed that the goal was to maximize profits at the expensive of everything else.
Quote:
Originally Posted by Dick Applebaum
The goal of any business is profit at the risk of a loss-- called the profit motive.
Everything else is secondary!
I suspect that you and I are hung up on semantics, but for the record, if everything else is secondary, how do you explain non-profit organizations and the like.
Steve has already stated many times that he and others at Apple don't "do this for the money", but rather to make the products that they would like to have. Obviously profits are necessary and near the top of the list but if you were somehow able to take away the passion for excellence that is a part of Apple's DNA .... that company would surely fail just as fast as if there were no profits ... just like before SJ was re-hired.
In any case , it's way past my bedtime .... but I still like your posts, even if we don't agree on this one.
But, profit is what motivated the creation of Apple, and in my observations of 32 years (sometimes from close contact, other times from afar) profit has been the motivating factor for all that they do.
No, whenever Jobs has been involved, the motivating factor has always been producing great products. Profit flows naturally. It was when Jobs was chucked out and profit became the main motivating factor that everything went wrong.
Quote:
Originally Posted by Dick Applebaum
If questioned, closely, about what comprises his job as CEO of Apple, i suspect Steve's answer would
be something like:
1. to make a good profit
2. to make insanely great products (and services) that change the world.
3. to motivate and inspire all Apple people to do 2) while targeting 1)
No he wouldn't. We know he wouldn't because he's said many times that his job is all about number 2.
Quote:
Originally Posted by Dick Applebaum
And, I believe Steve does this better than any CEO I know of.
Don't believe a word he says. This example should be plenty enough to convince you that he is full of shit.
You are not providing any proof. Why would he need any more money?
Let me repeat that Apple's share price depends on continued growth, and that means continued growth in market share. If they were to announce a licensing agreement with some preferred manufacturers in countries where they were not very competitive - say the East - and also stated that this would affect margins and short term profit in that area , the share price would still go up on the potential increase in the spread of iOS, and the greater competition to Android.
In any case the idea that all companies are full of bean counters and making profit for shareholders is all that gets real human beings up in the morning is nonsense. Making money for people you dont know is not much of a incentive, at the end of the day, particularly as the shareholders in this case get no dividends.
although Econ 101 is being used abundantly here, nobody has answered my question as to why Apple does not use it's brand to produce WIndows machines parallel to it's Mac OS offerings, trading on the high end Apple brand. People like the industrial design. I can see that making money ( garnering an extra, say, 5% more of the market) , and not cannibalising shares of the Mac OS as it will attract people who like the look of a Mac but have too much investment in software to move.
Why wont they do this? Because that is not what Apple does.
Econ 101 doesnt actually explain the world, in fact most economists have moved away from the idea that human beings are rational economic actors. Since corporations are full of humans they are not rational economic actors either, and neither is the market full of "econs" ( the word used in Nudge to describe rarional actors) but humans.
And the humans in Apple want to beat Android. This doesn't mean they will, but it means they will sacfrice margins to do it, if they need to.
I do seem to be unable to communicate my ideas to you.
Below, is your latest post with referencing partial posts of mine. Intentional or not, truncating my posts changed their meaning or emphasis.
For the record, I believe in the "profit motive" and want to be clear about what I mean.
I have added back the truncated portions of my posts in blue, and will try to parse them for clarity.
Quote:
Originally Posted by Dick Applebaum
I never claimed that the goal was to maximize profits at the expensive of everything else.
Quote:
Originally Posted by Dick Applebaum
I never claimed that the goal was to maximize profits at the expensive of everything else.
But, profit is what motivated the creation of Apple, and in my observations of 32 years (sometimes from close contact, other times from afar) profit has been the motivating factor for all that they do.
Sure, Apple are inspired to create great products and change the world-- and they have, at least 4 times.
But, every product Apple funds is tied to a profit. They may chose to fund a product that offers minimal or no immediate profit, (ATV) -- but the long term goal of that product is to make a profit.
If questioned, closely, about what comprises his job as CEO of Apple, i suspect Steve's answer would
be something like:
1. to make a good profit
2. to make insanely great products (and services) that change the world.
3. to motivate and inspire all Apple people to do 2) while targeting 1)
And, I believe Steve does this better than any CEO I know of.
In the complete version of this post, I try to make the point that Apple came into being because of the profit motive. WOZ has said at the time he didn't want to leave his job at HP. I don't know
what motivate Jobs. But Mike Markkula invested the money and convinced to the 2 to form a "real" business.
At the end of the post I try to clarify that reasonable/good/fair "profit" is the goal -- not maximizing profit or profit at the expense of all else.
I never said those things-- I don't believe them.
Quote:
Originally Posted by Dick Applebaum
The goal of any business is profit at the risk of a loss-- called the profit motive.
Everything else is secondary!
Quote:
Originally Posted by Dick Applebaum
The goal of any business is profit at the risk of a loss-- called the profit motive.
Everything else is secondary!
You can Yahoo or Bing the phrase for defiinitions-- here's one:
Quote:
In the free market economy, the profit motive is the ultimate purpose of a commercial enterprise, to earn a profit. The profit motive notion is closely related to the concept of self-interest. Adam Smith originally described the workings of the free market not in terms of profit motive, but as a by-product of individual self-interest. Under this philosophy, the profit motive is axiomatic, in that the only way a company can further the self-interests of its shareholders is to earn a profit. The profit motive is merely a proxy for providing income to shareholders. As an extremely focused definition of business purpose, the profit motive engenders considerable criticism of capitalism generally and multinational corporations in particular. These critics point out the profit motive apparently allows no room for the interests of the customer, the employee, or society and the environment, unless those interests happen to align with what the profit motive dictates. Perhaps the profit motive is a bit like democracy: the worst corporate objective, except for all the others that have been tried.
In the above, I am trying to make the point that in a business, profit is the primary goal, and other motivations are secondary, tertiary...
Again, "profit" is the goal -- not maximizing profit or profit at the expense of all else.
Why is "profit" the goal? Because it makes everything else possible!
Quote:
Originally Posted by Dick Applebaum
I agree (except you are rephrasing to make the investors happy)!
I was CEO/COO of a small corporation! Our corporate objectives:
1) return a fair profit to our investors
2) provide the best possible products and services to our customers
3) have fun
You did not include the prior post of mine above, but I added it, here, to illustrate the point about profit.
1) return a fair profit to our investors
Quote:
Originally Posted by newbee
I suspect that you and I are hung up on semantics, but for the record, if everything else is secondary, how do you explain non-profit organizations and the like.
Steve has already stated many times that he and others at Apple don't "do this for the money", but rather to make the products that they would like to have. Obviously profits are necessary and near the top of the list but if you were somehow able to take away the passion for excellence that is a part of Apple's DNA .... that company would surely fail just as fast as if there were no profits ... just like before SJ was re-hired.
In any case , it's way past my bedtime .... but I still like your posts, even if we don't agree on this one.
We are not talking about non-profits, charities, governments-- they have different goals, financing and organizational structures.
It is interesting that Bill Gates found that he could not pursue his charitable goals within the constructs of a business he started-- yet who would argue that it wasn't MS profits made this possible.
Sure, nobody is in it for the money alone... but without the money, very few would be in it at all.
Maybe a little history will illustrate the "profit motive" in action.
In 1993, Steve Jobs was CEO and majority stockholder in NeXT. Steve was already a multi-millionaire.
"NeXT withdrew from the hardware business in 1993 and the company was renamed NeXT Software Inc; subsequently 300 of the 540 staff employees were laid off.[1]?
Some posters, here, seem to think profit is a bad thing-- calling people fascists, right-wingers, etc.
I think the profit motive is a fantastic thing-- the profit motive allows us to take the risks to do the things we want and to change the world.
.
Who said it wasnt. The question is whether profit is the primary motivator, or secondary motivator or Apple. Thats the company in question.
You are quoting from (aging) textbooks.
What about answering my question. Quoting from me
Quote:
why Apple does not use it's brand to produce WIndows machines parallel to it's Mac OS offerings, trading on the high end Apple brand. People like the industrial design. I can see that making money ( garnering an extra, say, 5% more of the market) , and not cannibalising shares of the Mac OS as it will attract people who like the look of a Mac but have too much investment in software to move.
No, whenever Jobs has been involved, the motivating factor has always been producing great products. Profit flows naturally. It was when Jobs was chucked out and profit became the main motivating factor that everything went wrong.
First, Jobs was not "chucked out" -- he resigned after being told he would no longer hold any management position at Apple,
Producing products (great or mediocre) requires infrastructure,
Where do you think the required infrastructure comes from?
It doesn't just happen!
Hey, I have some great ideas (and I mean it) for products-- why don't you naturally flow some of those profits over here so I can build my products.
Profits are hard-- they don't naturally flow.
Steve & company built an insanely great product, the iPhone.
Then they had to market it, sell it, reduce prices, support it, repair it, replace it, refine it, enhance it, add apps to it, upgrade it...
It was/is profitable-- but there was no "natural flow" of profit.
Let's Pretend!
Why did Steve reduce the price on the original iPhone?
I suspect that the profits were not "flowing" an the required rate.
Would the iPhone been a success at the original price?
If not, would it still have been an insanely great product?
Would the iPad have been a success without 3 years of iPhone success to pave the way? (remember the iPad was developed before the iPhone)
Without the profits of the iPhone would Apple have even offered an iPad product?
Dick, you're not getting it. I do not underestimate the importance of profit. I will admit that saying profit naturally flows from great products is over-simplifying it, and especially for a start-up it is sadly not the case. Clearly the systems and procedures now exist at Apple such that profit will flow from great products.
Anyway, you seem to be asserting that the first thing Apple thinks is "profit", then "great products", I'm saying they think "great product", then "how do we sell this profitably?".
Who said it wasnt. The question is whether profit is the primary motivator, or secondary motivator or Apple. Thats the company in question.
You are quoting from (aging) textbooks.
What about answering my question. Quoting from me
Quote:
why Apple does not use it's brand to produce WIndows machines parallel to it's Mac OS offerings, trading on the high end Apple brand. People like the industrial design. I can see that making money ( garnering an extra, say, 5% more of the market) , and not cannibalising shares of the Mac OS as it will attract people who like the look of a Mac but have too much investment in software to move.
First, you assume that Apple could do this and not compete with itself, lowering overall profits.
Second, you seem to assume that Apple could sell an Apple Windows machine at a higher profit than those already in that commodity market.
My personal opinion (and it is an opinion) is:
Why would Apple want to do that?
-- It, likely, would yield little or no profit
--They would need to support all the Windows idiosyncrasies, accessories, drivers, etc.
Anyway, you seem to be asserting that the first thing Apple thinks is "profit", then "great products", I'm saying they think "great product", [i
then[/i] "how do we sell this profitably?".
First ain't got nothing to do with importance.
No product will see the light of day at Apple if it does not provide a basis for adequate potential profits.
No matter how great it is. Apple does not exist to make great products. They exist to make large profits. The products are a means to an end, and not an end in and of themselves.
Again: No matter how great a product idea may be, if it is not likely to earn substantial profits, it will never see the light of day. The products are a means. The profits are the goal.
Dick, you're not getting it. I do not underestimate the importance of profit. I will admit that saying profit naturally flows from great products is over-simplifying it, and especially for a start-up it is sadly not the case. Clearly the systems and procedures now exist at Apple such that profit will flow from great products.
Anyway, you seem to be asserting that the first thing Apple thinks is "profit", then "great products", I'm saying they think "great product", then "how do we sell this profitably?".
I do get it.
I have a proven track record.
I started and ran a successful, profitable, business.
Of course, most creative people are not inspired by profits! But I contend they are motivated by them-- try taking away their paychecks and see how creative they are (finding new jobs).
Apple, being very profitable, has the luxury to invest heavily and experiment with "great new products".
But, I assure you, before an Apple product gets approved, the profit question gets asked and answered.
This doesn't preclude long-term strategies, where a business can forgo profits for years to gain competitive advantage-- and eventual profits which provide the required ROI.
Pharmaceutical manufacturers are a good example.
ATV, likely, is another!
Aside from special funding from governments, etc., most companies try to develop products that are great and profitable.
Another way of looking at it is:
Name some "great products" that were not profitable to the companies offering them.
No product will see the light of day at Apple if it does not provide a basis for adequate potential profits.
No matter how great it is. Apple does not exist to make great products. They exist to make large profits. The products are a means to an end, and not an end in and of themselves.
Again: No matter how great a product idea may be, if it is not likely to earn substantial profits, it will never see the light of day. The products are a means. The profits are the goal.
Why would you think that the two goals (great products and profits) are antagonistic to each other? They can coexist, you know, which results in Apple's success.
But, I assure you, before an Apple product gets approved, the profit question gets asked and answered.
I never said it doesn't.
Let me try and put it another way. If Apple were a person, what would be making it get up in the mornings? $ signs or the thought of developing and delivering world-changing products?
Comments
well they are not getting any dividends, so maybe they should stop getting "ripped off" and go elsewhere.
There are large gaps in your understanding. The meanings of words seem to throw you down dead-end paths.
A friendly suggestion: Look up the word "profit" in a half-dozen dictionaries and a couple of encyclopedias. You don't know what you are talking about. That is the basic problem. You need to know what the subject is before you can form an opinion about it. If you find any support for "unless dividends are paid, there is no 'profit'" then please get back to me.
Fer chrissakes crack open a dictionary.
LOl
Seriously. I pointed out that the profits earned by the owners are dividends.
So lets repeat.
The owners of Apple earn no dividends therefore take no profits. Therefore their interest is elsewhere. If they wanted to get profits from a company - that is to earn any of the EPS - they would go elsewhere. Apparently the Apple shareholders are not interested in dividends which is profits divided amongst the shareholders. They profit from growth in capital.
Unfortunately a mediocre understanding of Econ 101 is not going to be much help here.
There are large gaps in your understanding. The meanings of words seem to throw you down dead-end paths.
A friendly suggestion: Look up the word "profit" in a half-dozen dictionaries and a couple of encyclopedias. You don't know what you are talking about. That is the basic problem. You need to know what the subject is before you can form an opinion about it. If you find any support for "unless dividends are paid, there is no 'profit'" then please get back to me.
Not what I said.
You said that investors care only about profit. Since Apple does not pay a dividend there is no profit earned per share of Apple stock, therefore the shareholders dont profit. That is the profit I am talking about, and the only profit the shareholders should care about - dividends per share. For Apple that is a big fat zero.
The company can earn profit internally all it wants, but the shareholders are not seeing any of it. So how can the investors care. There are dividend paying stocks which react differently to a reduction in dividend.
Here is an example for a dividend paying stock which halted it's dividend.
http://www.bloomberg.com/apps/news?p...jhE&refer=home
Fannie Mae, and Freddie Mac lost 90% of the value after that decision over a few days.
My second point is that a increase in margins would increase Apple's quarterly profit ( but not dividends). However, if Apple were to guide for higher profits based on higher margins but also guide for static growth, then their stock would collapse. I am pretty sure that has happened in their past. Investors have priced in future growth in market share and overall sales.
Which indicates most investors are in for capital gain, which means that Apple need to keep growing.
Thats a bit past the econ 101 y'all keep espousing.
The goal of any business is profit at the risk of a loss-- called the profit motive.
Everything else is secondary!
Dick, you are one of my favorite posters. I think, in this case, however, what we have is a communication problem. Technically, you're right ... without profit there ceases to be a company eventually .... but to say that everything else is secondary is to do a disservice to anyone that's in the game mostly for other reasons.
When trying to judge what motivates a company to make certain decisions there is always more than one reason, and imo, in Apple's case, profit is not at the top of the list, most of the time.
For me, what defines a company is: what is usually at the top of their list and how strong is their desire to maximize their profits?
The best example I can think of for a company whose desire to maximize profits was the Ford Pinto. The decisions made then didn't turn out well for anyone, especially. those who died, as a result.
Apple has made most of their decisions based on their desire to "make insanely great products" with the profit motive coming in somewhere down the line.
Not what I said.
Since Apple does not pay a dividend there is no profit earned per share of Apple stock, therefore the shareholders dont profit.
Please look up the word in a dictionary.
Dick, you are one of my favorite posters. I think, in this case, however, what we have is a communication problem. Technically, you're right ... without profit there ceases to be a company eventually .... but to say that everything else is secondary is to do a disservice to anyone that's in the game mostly for other reasons.
When trying to judge what motivates a company to make certain decisions there is always more than one reason, and imo, in Apple's case, profit is not at the top of the list, most of the time.
For me, what defines a company is: what is usually at the top of their list and how strong is their desire to maximize their profits?
The best example I can think of for a company whose desire to maximize profits was the Ford Pinto. The decisions made then didn't turn out well for anyone, especially. those who died, as a result.
Apple has made most of their decisions based on their desire to "make insanely great products" with the profit motive coming in somewhere down the line.
I never claimed that the goal was to maximize profits at the expensive of everything else.
But, profit is what motivated the creation of Apple, and in my observations of 32 years (sometimes from close contact, other times from afar) profit has been the motivating factor for all that they do.
Sure, Apple are inspired to create great products and change the world-- and they have, at least 4 times.
But, every product Apple funds is tied to a profit. They may chose to fund a product that offers minimal or no immediate profit, (ATV) -- but the long term goal of that product is to make a profit.
If questioned, closely, about what comprises his job as CEO of Apple, i suspect Steve's answer would
be something like:
1. to make a good profit
2. to make insanely great products (and services) that change the world.
3. to motivate and inspire all Apple people to do 2) while targeting 1)
And, I believe Steve does this better than any CEO I know of.
.
I never claimed that the goal was to maximize profits at the expensive of everything else.
The goal of any business is profit at the risk of a loss-- called the profit motive.
Everything else is secondary!
I suspect that you and I are hung up on semantics, but for the record, if everything else is secondary, how do you explain non-profit organizations and the like.
Steve has already stated many times that he and others at Apple don't "do this for the money", but rather to make the products that they would like to have. Obviously profits are necessary and near the top of the list but if you were somehow able to take away the passion for excellence that is a part of Apple's DNA .... that company would surely fail just as fast as if there were no profits ... just like before SJ was re-hired.
In any case , it's way past my bedtime .... but I still like your posts, even if we don't agree on this one.
Steve has already stated many times that he and others at Apple don't "do this for the money", .
Don't believe a word he says. This example should be plenty enough to convince you that he is full of shit.
But, profit is what motivated the creation of Apple, and in my observations of 32 years (sometimes from close contact, other times from afar) profit has been the motivating factor for all that they do.
No, whenever Jobs has been involved, the motivating factor has always been producing great products. Profit flows naturally. It was when Jobs was chucked out and profit became the main motivating factor that everything went wrong.
If questioned, closely, about what comprises his job as CEO of Apple, i suspect Steve's answer would
be something like:
1. to make a good profit
2. to make insanely great products (and services) that change the world.
3. to motivate and inspire all Apple people to do 2) while targeting 1)
No he wouldn't. We know he wouldn't because he's said many times that his job is all about number 2.
And, I believe Steve does this better than any CEO I know of.
On that we can agree.
Don't believe a word he says. This example should be plenty enough to convince you that he is full of shit.
Because if you don't agree, he must be lying, right?
Don't believe a word he says. This example should be plenty enough to convince you that he is full of shit.
You are not providing any proof. Why would he need any more money?
Let me repeat that Apple's share price depends on continued growth, and that means continued growth in market share. If they were to announce a licensing agreement with some preferred manufacturers in countries where they were not very competitive - say the East - and also stated that this would affect margins and short term profit in that area , the share price would still go up on the potential increase in the spread of iOS, and the greater competition to Android.
In any case the idea that all companies are full of bean counters and making profit for shareholders is all that gets real human beings up in the morning is nonsense. Making money for people you dont know is not much of a incentive, at the end of the day, particularly as the shareholders in this case get no dividends.
although Econ 101 is being used abundantly here, nobody has answered my question as to why Apple does not use it's brand to produce WIndows machines parallel to it's Mac OS offerings, trading on the high end Apple brand. People like the industrial design. I can see that making money ( garnering an extra, say, 5% more of the market) , and not cannibalising shares of the Mac OS as it will attract people who like the look of a Mac but have too much investment in software to move.
Why wont they do this? Because that is not what Apple does.
Econ 101 doesnt actually explain the world, in fact most economists have moved away from the idea that human beings are rational economic actors. Since corporations are full of humans they are not rational economic actors either, and neither is the market full of "econs" ( the word used in Nudge to describe rarional actors) but humans.
And the humans in Apple want to beat Android. This doesn't mean they will, but it means they will sacfrice margins to do it, if they need to.
Below, is your latest post with referencing partial posts of mine. Intentional or not, truncating my posts changed their meaning or emphasis.
For the record, I believe in the "profit motive" and want to be clear about what I mean.
I have added back the truncated portions of my posts in blue, and will try to parse them for clarity.
I never claimed that the goal was to maximize profits at the expensive of everything else.
I never claimed that the goal was to maximize profits at the expensive of everything else.
But, profit is what motivated the creation of Apple, and in my observations of 32 years (sometimes from close contact, other times from afar) profit has been the motivating factor for all that they do.
Sure, Apple are inspired to create great products and change the world-- and they have, at least 4 times.
But, every product Apple funds is tied to a profit. They may chose to fund a product that offers minimal or no immediate profit, (ATV) -- but the long term goal of that product is to make a profit.
If questioned, closely, about what comprises his job as CEO of Apple, i suspect Steve's answer would
be something like:
1. to make a good profit
2. to make insanely great products (and services) that change the world.
3. to motivate and inspire all Apple people to do 2) while targeting 1)
And, I believe Steve does this better than any CEO I know of.
In the complete version of this post, I try to make the point that Apple came into being because of the profit motive. WOZ has said at the time he didn't want to leave his job at HP. I don't know
what motivate Jobs. But Mike Markkula invested the money and convinced to the 2 to form a "real" business.
http://en.wikipedia.org/wiki/Mike_Markkula
At the end of the post I try to clarify that reasonable/good/fair "profit" is the goal -- not maximizing profit or profit at the expense of all else.
I never said those things-- I don't believe them.
The goal of any business is profit at the risk of a loss-- called the profit motive.
Everything else is secondary!
The goal of any business is profit at the risk of a loss-- called the profit motive.
Everything else is secondary!
You can Yahoo or Bing the phrase for defiinitions-- here's one:
Quote:
In the free market economy, the profit motive is the ultimate purpose of a commercial enterprise, to earn a profit. The profit motive notion is closely related to the concept of self-interest. Adam Smith originally described the workings of the free market not in terms of profit motive, but as a by-product of individual self-interest. Under this philosophy, the profit motive is axiomatic, in that the only way a company can further the self-interests of its shareholders is to earn a profit. The profit motive is merely a proxy for providing income to shareholders. As an extremely focused definition of business purpose, the profit motive engenders considerable criticism of capitalism generally and multinational corporations in particular. These critics point out the profit motive apparently allows no room for the interests of the customer, the employee, or society and the environment, unless those interests happen to align with what the profit motive dictates. Perhaps the profit motive is a bit like democracy: the worst corporate objective, except for all the others that have been tried.
http://www.investorglossary.com/profit-motive.htm.
In the above, I am trying to make the point that in a business, profit is the primary goal, and other motivations are secondary, tertiary...
Again, "profit" is the goal -- not maximizing profit or profit at the expense of all else.
Why is "profit" the goal? Because it makes everything else possible!
I agree (except you are rephrasing to make the investors happy)!
I was CEO/COO of a small corporation! Our corporate objectives:
1) return a fair profit to our investors
2) provide the best possible products and services to our customers
3) have fun
You did not include the prior post of mine above, but I added it, here, to illustrate the point about profit.
1) return a fair profit to our investors
I suspect that you and I are hung up on semantics, but for the record, if everything else is secondary, how do you explain non-profit organizations and the like.
Steve has already stated many times that he and others at Apple don't "do this for the money", but rather to make the products that they would like to have. Obviously profits are necessary and near the top of the list but if you were somehow able to take away the passion for excellence that is a part of Apple's DNA .... that company would surely fail just as fast as if there were no profits ... just like before SJ was re-hired.
In any case , it's way past my bedtime .... but I still like your posts, even if we don't agree on this one.
We are not talking about non-profits, charities, governments-- they have different goals, financing and organizational structures.
It is interesting that Bill Gates found that he could not pursue his charitable goals within the constructs of a business he started-- yet who would argue that it wasn't MS profits made this possible.
Sure, nobody is in it for the money alone... but without the money, very few would be in it at all.
Maybe a little history will illustrate the "profit motive" in action.
In 1993, Steve Jobs was CEO and majority stockholder in NeXT. Steve was already a multi-millionaire.
"NeXT withdrew from the hardware business in 1993 and the company was renamed NeXT Software Inc; subsequently 300 of the 540 staff employees were laid off.[1]?
http://en.wikipedia.org/wiki/NeXT
I submit that, then as now, Steve was interested in creating insanely great products.
! assume he surrounded himself with insanely great talent,
Why would Steve lay off 56% of his work force?
Certainly, there were alternative actions possible, such as sell the hardware component of the business.
Finally, let's say you have this idea for an insanely great product, and you want to create a business to provide that product,
You build a "To Do" list of what must me done....
1) provide sustainable funding to build and market the product
2) successfully build and market the insanely great product
You cannot do 2, unless you accomplish 1 -- you never even get to 2.
In business, sustainable funding is provided by profits!
Yeah, I know, investors, venture capital, etc... What do you think drives them?
Some posters, here, seem to think profit is a bad thing-- calling people fascists, right-wingers, etc.
I think the profit motive is a fantastic thing-- the profit motive allows us to take the risks to do the things we want and to change the world.
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Some posters, here, seem to think profit is a bad thing-- calling people fascists, right-wingers, etc.
I think the profit motive is a fantastic thing-- the profit motive allows us to take the risks to do the things we want and to change the world.
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Who said it wasnt. The question is whether profit is the primary motivator, or secondary motivator or Apple. Thats the company in question.
You are quoting from (aging) textbooks.
What about answering my question. Quoting from me
why Apple does not use it's brand to produce WIndows machines parallel to it's Mac OS offerings, trading on the high end Apple brand. People like the industrial design. I can see that making money ( garnering an extra, say, 5% more of the market) , and not cannibalising shares of the Mac OS as it will attract people who like the look of a Mac but have too much investment in software to move.
No, whenever Jobs has been involved, the motivating factor has always been producing great products. Profit flows naturally. It was when Jobs was chucked out and profit became the main motivating factor that everything went wrong.
First, Jobs was not "chucked out" -- he resigned after being told he would no longer hold any management position at Apple,
Producing products (great or mediocre) requires infrastructure,
Where do you think the required infrastructure comes from?
It doesn't just happen!
Hey, I have some great ideas (and I mean it) for products-- why don't you naturally flow some of those profits over here so I can build my products.
Profits are hard-- they don't naturally flow.
Steve & company built an insanely great product, the iPhone.
Then they had to market it, sell it, reduce prices, support it, repair it, replace it, refine it, enhance it, add apps to it, upgrade it...
It was/is profitable-- but there was no "natural flow" of profit.
Let's Pretend!
Why did Steve reduce the price on the original iPhone?
I suspect that the profits were not "flowing" an the required rate.
Would the iPhone been a success at the original price?
If not, would it still have been an insanely great product?
Would the iPad have been a success without 3 years of iPhone success to pave the way? (remember the iPad was developed before the iPhone)
Without the profits of the iPhone would Apple have even offered an iPad product?
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Anyway, you seem to be asserting that the first thing Apple thinks is "profit", then "great products", I'm saying they think "great product", then "how do we sell this profitably?".
Who said it wasnt. The question is whether profit is the primary motivator, or secondary motivator or Apple. Thats the company in question.
You are quoting from (aging) textbooks.
What about answering my question. Quoting from me
why Apple does not use it's brand to produce WIndows machines parallel to it's Mac OS offerings, trading on the high end Apple brand. People like the industrial design. I can see that making money ( garnering an extra, say, 5% more of the market) , and not cannibalising shares of the Mac OS as it will attract people who like the look of a Mac but have too much investment in software to move.
First, you assume that Apple could do this and not compete with itself, lowering overall profits.
Second, you seem to assume that Apple could sell an Apple Windows machine at a higher profit than those already in that commodity market.
My personal opinion (and it is an opinion) is:
Why would Apple want to do that?
-- It, likely, would yield little or no profit
--They would need to support all the Windows idiosyncrasies, accessories, drivers, etc.
-- It would cheapen the Apple brand
-- It would compete for precious Apple resources
-- it is not where Apple sees the market going
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Anyway, you seem to be asserting that the first thing Apple thinks is "profit", then "great products", I'm saying they think "great product", [i
then[/i] "how do we sell this profitably?".
First ain't got nothing to do with importance.
No product will see the light of day at Apple if it does not provide a basis for adequate potential profits.
No matter how great it is. Apple does not exist to make great products. They exist to make large profits. The products are a means to an end, and not an end in and of themselves.
Again: No matter how great a product idea may be, if it is not likely to earn substantial profits, it will never see the light of day. The products are a means. The profits are the goal.
Dick, you're not getting it. I do not underestimate the importance of profit. I will admit that saying profit naturally flows from great products is over-simplifying it, and especially for a start-up it is sadly not the case. Clearly the systems and procedures now exist at Apple such that profit will flow from great products.
Anyway, you seem to be asserting that the first thing Apple thinks is "profit", then "great products", I'm saying they think "great product", then "how do we sell this profitably?".
I do get it.
I have a proven track record.
I started and ran a successful, profitable, business.
Of course, most creative people are not inspired by profits! But I contend they are motivated by them-- try taking away their paychecks and see how creative they are (finding new jobs).
Apple, being very profitable, has the luxury to invest heavily and experiment with "great new products".
But, I assure you, before an Apple product gets approved, the profit question gets asked and answered.
This doesn't preclude long-term strategies, where a business can forgo profits for years to gain competitive advantage-- and eventual profits which provide the required ROI.
Pharmaceutical manufacturers are a good example.
ATV, likely, is another!
Aside from special funding from governments, etc., most companies try to develop products that are great and profitable.
Another way of looking at it is:
Name some "great products" that were not profitable to the companies offering them.
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First ain't got nothing to do with importance.
No product will see the light of day at Apple if it does not provide a basis for adequate potential profits.
No matter how great it is. Apple does not exist to make great products. They exist to make large profits. The products are a means to an end, and not an end in and of themselves.
Again: No matter how great a product idea may be, if it is not likely to earn substantial profits, it will never see the light of day. The products are a means. The profits are the goal.
Why would you think that the two goals (great products and profits) are antagonistic to each other? They can coexist, you know, which results in Apple's success.
I do get it.
By "it", I meant the point I was trying to make.
But, I assure you, before an Apple product gets approved, the profit question gets asked and answered.
I never said it doesn't.
Let me try and put it another way. If Apple were a person, what would be making it get up in the mornings? $ signs or the thought of developing and delivering world-changing products?