Apple epitomizes a capabilities driven innovation strategy, but it wasn't always so. In the early 1990s the company squandered enormous resources and billions of dollars on a series of failed consumer product like Newton PDA. Its efforts to do everything itself, building capabilities as varied as cutting edge hardware development and volume manufacturing, led to huge losses and massive layoffs. But in 1997 Apple began to focus its portfolio and its capabilities.

In fact the company concentrated first on the capabilities at which it excelled, and which differentiated it clearly from its peers:

- An exceptional consumer experience

- Graphic User Interfaces

- Innovative Product Design

- Iconic Branding