Best Comebacks - Rebooting Apple (online at http://www.forbes.com/2002/01/22/0122comeback.html)
Sustainable comebacks in big business are an amazing thing, partially because they are so seldom. It's rare that a once great company can lose its way (and tons of money) so profoundly and come back stronger than before.
But it does happen. There is always tough love involved--layoffs, divestitures, new management and new strategies. When it works, it works beautifully. This week, we look at four of the most impressive comebacks ever. These are once great companies that, for a variety of reasons, almost fell off the precipice before turning it all around.
Apple Computer There's no doubt Apple Computer (nasdaq: AAPL - news - people) is a pioneer. It invented computers "for the rest of us," that is, relatively easy-to-use interfaces with intuitive functions. It also came perilously close to irrelevancy. After the lifeblood of the company, co-founder Steve Jobs was ousted in a boardroom coup in 1985, Apple couldn't seem to do anything right. It had too many products and too little focus. Worse, it was paralyzed by two inept chief executives and an ineffective board of directors. Apple's already small market share was dwindling further. Over the course of 1996, it had racked up $1.5 billion in losses, and there were weekly speculations over who would buy the company. Sun Microsystems (nsadaq: SUNW - news - people) and Oracle (nasdaq: ORCL - news - people) had held discussions with Apple.
Then, in the summer of 1997 Apple stunned the world by announcing that Jobs would return as interim CEO. Even more shocking, Apple said it was partnering with its blood enemy Microsoft (nasdaq: MSFT - news - people), accepting a $150 million investment and agreeing to share certain technologies. Mac fans howled that Apple had sold its soul to the devil, but Jobs had a plan. He scrapped dozens of Apple products to focus on four lines--consumer desktops and portables and professional desktops and portables.
He also challenged our perceptions of computers, introducing the colorful iMac desktop, iBook laptop, the Cube (which flopped) and just recently the brand new iMac, which looks like nothing else. While Apple's market share has hovered at about 5%, the company has reestablished itself as an innovator in design and ease of use. And, through all the ups and downs, it has managed to hang onto a loyal customer base that other companies can only dream of.
