On January 2, 2012, I wrote a piece for Time Magazine titled “Four Industries Apple Can Disrupt in the Near Future”. In it, I suggested Apple will someday impact the Auto, Watch, TV and Appliances industries. I encourage you to read it to see how close my predictions were three years back.
As I look at Apple today and try and peer into its future, I believe they are going to disrupt three other industries very soon. The first one is healthcare. Back in 2012, I don’t think any of us could have seen how Apple would link an iPhone or iPad to the health market. Yes, Apple did show one health app when they introduced the iPad in 2010 and we saw others over the first two years that perhaps hinted at this health connection. But what Apple is doing in health now and, more importantly, how they are positioning themselves to be a key broker of health data between a user and their healthcare providers is a very big deal.
Last summer, I had the former CEO of a very large HMO in my office. He told me he believed Apple would be critical to revolutionizing the healthcare information system. I believe Apple’s vision for changing the healthcare market is actually an imperative given to the current leadership by Steve Jobs. Sources have told me that, when Jobs got sick in the early 2000s, he was dismayed by the disjointed nature of the healthcare system. Some of his health records were in one place, others elsewhere and trying to get them under one roof or in the hands of a specific doctor for diagnostic purposes was a nightmare. As Jobs’ disease accelerated, it seemed keeping his health records together got even more difficult. By the mid 2000s, Jobs had already decided Apple had to find a way to help make the health industry more efficient and effective and set Apple’s future directions in health in motion. I wrote a piece in PC Mag last Sept that gives a more detailed look at why I believe Apple’s next big thing is related to changing the health market.
That is why Tim Cook and his team are so involved with helping users record their health data and working with the health industry to get that information into a unified format in a safe and secure way so a person’s healthcare provider can be more proactive in dealing with anyone’s health. Apple is now on a mission to deliver Jobs’ vision for the market and it will be the last major contribution to Apple’s future that Steve Jobs left us.
Another industry Apple is disrupting is the design world. Jony Ive and Apple have set in motion a design emphasis that has forced folks in the tech industry to rethink how they design products. But, in talking with people in other industries where design is part of their product’s road map, I am told Apple’s attention to detail and design has spilled over to their world as well. In the past, for many in various industries, design had not been a priority. At best, it was the second or third issue dealt with when creating a product. In a piece I did for PC Mag I stated design has become a key differentiator for the tech market and mention a report from John Meada, a design partner at Kleiner Perkins, called “Design in Tech Report,” and it is worth downloading if you are interested in how design is going to shape Silicon Valley and the tech world in the future. I am seeing people from all types of industries looking much closer at the way Apple creates and designs products and taking hints from Apple when then they create products for their own companies.
Apple is even having a disruptive impact on construction and building codes. In a recent piece in Business Insider, they speak with a former construction worker who was involved with Apple’s new spaceship campus. He states that, in creating this new building, Apple is sparing no cost to build what will probably be considered one of the most highly designed tech campus’ ever built. The article quotes this worker as saying:
“The project is so extensive — and Apple is so demanding — that Apple Campus 2 has effectively “raised the bar for construction standards,” our source tells us.
Other tech companies’ buildings apparently don’t even come close. Having worked on other construction projects with tech companies, the person says “this far exceeds that level … with all the local subcontractors and contractors being brought together from around the country it really is gonna elevate the construction standard. You know, if Apple now has raised the bar for construction standards, what’s the next project? Is it gonna be higher than that? Is it gonna be an Apple standard?”
I also spoke with someone aware of the new Apple Campus design and they said, “Apple’s attention to design and detail is as if Apple was creating a new product, not a new building. The Apple mindset for design and the integration of technology into the campus itself is pure Apple and will make it the envy of builders around the world when it is finished.” It appears Apple’s new campus will be studied by architects, builders and building designers and possibly be disruptive to this industry as well.
Apple has also influenced the world of retail with their stores and become a gold standard in customer service and customer satisfaction.
It is no wonder then that Apple has become one of the most powerful and influential companies in the world and I suspect the Apple way of doing things will become more ingrained into the fabric of other industries in the future.
The thing is, for the majority of the post war period large companies have been run with priorities of Profit/Shareholders. Customers were only useful to that end. Shoddy goods were perfectly acceptable as long as they were legal. The mantra has been “good enough”, design was irrelevant. Whether, Microsoft, Dell, IBM, Ford, General Motors. Design was/is cosmetic i.e. part of marketing.
Most people don’t get the fact that Apple has an old aesthetic, artisanship, to make something as if you were making it for yourself. This is completely foreign to the modern, large corporation, were cost/budget is the major consideration. It’s like they still have to sign their products. This is alien to the business school generation and to be fair, to many commentators on these forum.
Examples, there is no manufacturer that builds the required spec of curved glass that meets Apple design spec’. No problem, build a factory for the job. Time and time again, there was no machine that did what they required. Design and pay for the machine. This is what the old artisans did. The product vision was the king. There was passion for the product. This is very difficult for the McKinsey generation of management to understand and doesn’t fit into any business schools mantra. There are no business schools that teach “Love your product”!
You’ve beautifully encapsulated almost all that is good about Apple. Some of the bad too.
“make something as if you were making it for yourself.”
All well, good, and proper, until that becomes too rigid as well as self serving.
No problem. Buy from someone that DGAF!
Unfortunately, I mostly do, and provide the GAF part myself… 🙂
As DesDizzy says, Apple’s attention to design and detail may be characteristic of companies that manufacture expensive products. From a business perspective, it seems there might not be room in the budget for makers of more moderately-priced items to adhere to that quality standard.
I doubt Apple will be able to disrupt the health care system, unless they become very good in the cloud application and solution.
A perfect example of that is the way Google is replacing them in the education sector with their GAFE suite of cloud application and solution with Chromebook.
Two completely different spaces in this case in operations. In this case, Apple is not going to become the cloud provider this is where healthcare is already moving to a more digital health agenda. It is more the hardware which drives the opportunity. Even with the regulations for health approved devices, it appears Apple has built the team to be able to integrate with regulated health practices in ways others will not. Of course Doctors can always prescribe a wearable which will likely happen also, but they will be specific not general purpose.
By also building better sensors around health into their products they create new opportunities for healthcare. The disruption comes in the opportunity it creates for others in terms of healthcare services. It could be the traditional incumbents who adjust or it will create opportunities for others.
The same sort of disruption is coming to banking and financial services and Apple Pay, and Android Pay to a degree will have a lot to do with this. I’ll explain this in my post on Monday.
I think we need to be clearer on what we mean by cloud. Apple, in regards to healthcare, has no problem with storing your HealthKit information in the cloud, if and only if it is encrypted in a way so that only you can see what’s inside. In fact, as I recently learned, iOS will only back up you HealthKit data, even locally in iTunes, if you have encrypted it. They will not let your unencrypted health data leave your device unless you have specifically chosen which data you want to share and with whom.
Apple is happy to be your safety vault for your all your health information, and that alone is very significant, especially if doctors in the future would give you your medical records in a digital format.
From HealthKit, the user can choose to share limited information with any cloud service (through sharing the info with the device provider’s app). The cloud service will use your data and analyse it to provide additional benefit over simply storing it.
My understanding is what Google is providing in education is a administration system. It is a system that systematically manages a large number of students. When applied to health, it would be just one of the cloud services that consumes data from HealthKit. It would be orthogonal to HealthKit and read or write to HealthKit based on what the user allows.
We could easily have a situation where the user stores all his encrypted health information in Apple’s cloud and connects to his/her doctor who uses Google’s cloud to manage multiple patients, sharing only the data that the doctor needs. They can easily coexist. They serve different purposes.
Regarding how this will affect iOS and Android sales, it depends a lot on what Android will provide as a HealthKit alternative, and whether regulations will allow that data, which will hopefully contain medical records and be much more sensitive than simple fitness tracking data, to be analysed for ad targeting purposes (which I find very unlikely).
Why does Android’s “healthkit” need to be ad-based ?
Google have no problem to use a variety monetization methods. For example , they monetize the nest through charging electricity companies for load regulation(“demand-reponse”).
And there’s certainly little transparency to allow Google to charge without consumers noticing.
True. It will be interesting to see what they do.
Ben , if we’re talking about impacting healthcare, we need to look at the demographics. It’s generally agreed that older people and people with lower income are the major share of chronic disease suffering(which might benefit from quantified self).
But exactly in those combined demographics – iPhone ownership is relatively low – and we’re even talking about people who don’t own a smartphone.
All this tend to offer Google a bigger opportunity to impact healthcare.
Not to say that HealthKit won’t have an impact, it will.
Also i think a lot of the battle won’t be on convincing people to use stuff(btw most of the wearable stuff today is probably useless medically with a few medical product exceptions) – but offering doctors/insurers products that are so good, so validated that they must prescribe them to their patients.
And this tends to require a more technological approach(like weekly ,non painful , blood tests at home for a variety of parameters – theranos might aim there , complex sensors for allergy sufferers, etc) – because in those cases you can offer clinicians proven tools to home prescription – or investment in proving new sensors.
Well said. I find the tone of the article as being too Apple centered, when, in fact, it could have taken the path of digital technology improving healthcare. Granted, it was buried in the business context of Apple, so it was Apple centric. The same article could have been written for many Apple competitors.
A Gartner report from the end of May 2015 estimates just over 5 million Chromebook sales in the education sector, worldwide, for all of 2015. You’d need iPad sales to the education sector to be just 8 percent of total iPad sales to be roughly even with Chromebooks. I suppose that’s possible but it doesn’t seem likely.
There are so many ways healthcare could be disrupted, I’m sure there’s enough room for Apple’s and Google’s approach. The way I see it, Apple’s approach unbundles healthcare, empowering new entrants. Google’s approach would help hospitals and clinics be more effectively run.
Intereting. But, the KP Design in Tech Report you reference uses horrible design. Most pages very difficult to digest.
“ … campusES” is the plural.
I’ve followed the car industry longer and more closely than any other. One of the reasons the Japanese were able to be so successful, starting in the seventies, was their level of focus on quality and on driver experience. For many years, Honda owned customer satisfaction, and they did it with a design focus similar to Apple’s. Rather than chase “performance” or spec-sheet superiority they identified traits that made driving more satisfying for regular people, such as low belt-lines and hood-lines for revelatory outward visibility, control-arm (rather than strut) suspensions for faithful steering feel and response, mechanical reliability, and efficiency. They focused more on engine smoothness than peak power output, and tested and refined exhaustively to produce satisfying torque characteristics that gave a feeling of responsiveness and eagerness that surprised and delighted commuters and soccer moms who would not have been on anybody’s list of “enthusiast” drivers.
It didn’t hurt that in the Japanese culture of the time, companies were willing to make modest profits, instead seeing themselves largely as a mechanism for general prosperity and progress in which sustainable solvency was sufficient.
The American business culture, as typified by our auto industry, has by contrast always had the bottom line as its bottom line. This focus on profits (and, particularly, profit growth) as the primary motivator has always, to my personal dismay, resulted in products that mimic superficially the good qualities of their competition but are rarely able to elevate themselves to the level of surprise and delight. Bean-counters with spreadsheets have ensured that every dollar spent, with few exceptions, can be conservatively justified all the way through to the bottom line.
Apple is exceptional not just in its focus on the user experience, but because this ideology seems to go against the general American corporate culture. I’ve always agreed with the philosophy expressed by Jobs, Cook, Ive and others at Apple – that if you design the best products you can, then profits will follow – but what I think is unique about Apple, other than the very high level of their execution, is that they’ve brought those principles to an industry fueled by Moore’s Law, in what is still the world’s most vibrant, if sometimes misguided, economy.
I hope and sometimes let myself believe that these characteristics of Apple will spread to other industries. It’s extremely difficult to forsake short-term profits in the interest of often-speculative long-term benefits, but the payoff can be there not just for profits but for society in general.
You put a lot of thought into your post, and I don’t want to smear it. It’s largely right, and similar thoughts have crossed my mind. The rise of the “four cylinder” in the seventies comes to mind. I also agree that Apple is extremely good, from a hardware point of view at least, in building well thought out (if constrained) products.
Where we might differ, is that those Hondas, Datsuns, and Mazdas of the seventies, were not priced at Cadillac, BMW, and Mercedes levels. They were an honest product, at higher than competing quality, at an honest price. By analogy, I could never justify an i5 at $2K, especially since an i7 would never ruin, only improve, the experience.
As is often the case, your comment betrays a bit of bias in its tendency toward hyperbole/straw man.
Really, we are not talking about an iMac at “Cadillac, BMW and Mercedes price levels”. We are really talking about the difference between a “budget” car at 12k and moderate family car at 24k. 36K+ plus “luxury” cars don’t come into it.
You can wish the moderate family car had a 3.5l engine instead of a 2.5l engine (i5/i7), but there are other tradeoffs — airco, gps, airbags, entertainment system, etc., which the budget car at 12K wouldn’t have.
Your unreasonable expectations (that an iMac somehow represents “the height of unnecessary luxuruy” and should include *everything* for what it costs) are more in line with a car that costs at least 3 or 4 times as much as the 12K car that “you could get that allegedly does *just as much* (ie drives you from point a to point b), but in fact just gets you on the road”.
Getting on the road for as little as possible is one thing; reconsidering the job to be done and getting a comfortable family car that you rely on every day is another: both are a far cry from choosing a luxury car “just because you can”.
Please don’t allow your politeness to paint my contempt as a ‘teensy bit of bias’. 😉
The “race to the bottom” is good. It’s a value maximizer at a given price point, and is a consequence of competition.
At a given “experience” level, a mediocre spec heavily favors the manufacturer in the value proposition. User’s demands do grow, machines to get given away, or sold, etc.
Id be interested in your thoughts as to why Japan is now struggling and why the Taiwanese, the Koreans and the Chinese do not seem to have too much difficulty in becoming high-quality suppliers in certain markets.
Do you think Westernisation of Japanese management is to blame, or is there some kind of disruptive force? As you may imagine, Japanese talk about why they’ve fallen from grace quite often and there are a number of theories, many which are are simply old men complaining about today’s youngsters.
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