Apple Inc. (NASDAQ: AAPL) has long been recognised as an industry leader in technology. Since Steve Jobs returned to Apple in 1996, the company’s stock has risen by almost 20,000%, making it the most profitable technology business in the world. Products such as the iPod, iPad and the first iPhone took the world by storm. However, these products are not regarded for their technological power (indeed, competitors often outperform Apple in this regard), but rather for their  innovation.

Innovation is the enabler that allows new technologies to succeed. 1886 is regarded as the birth year of the car – however it wasn’t until 1913 that cars started to really impact the world. This was because of a ground-breaking innovation by Henry Ford: mass assembly. The time to build the Model T went from twelve hours to ninety minutes, and the cost from $850 to $300. In this case, mass assembly (the innovation) enabled cars (the technology) to change the world. In the case of Apple, it was the iPod that began their conquest of the consumer electronics market. The technology had been around long before Apple began development of the iPod in 2000, but it was Apple’s innovative design that enabled portable digital music devices to catch on. The design made it possible for anyone to store a large amount of digital music with only basic technical knowledge. This was a first in an industry were devices were clunky and awkward to use. Year-after-year, Apple would improve the iPod, with complementing services  such as iTunes being developed to further push the technology.

Incubating innovation is a complex process. Many organisations have tried and failed, investing millions into something that would ultimately never succeed. Microsoft once tried to compete with Apple’s music business, releasing MSN Music and the Zune as alternatives to iTunes and the iPod. The Zune was released in 2006/7, but is widely considered a flop and was discontinued in 2011. The device was clunky, awkward and generally “unsexy”. There is no guideline for innovation and throwing resources at a project will not make it succeed.

Instead, innovation is the result of a “perfect environment” – one that provides all the necessary elements for a creative solution. In the 2000’s, Apple had a perfect environment. The company brand was able to attract talent, the success of the 70’s and 80’s created the resources, the culture created the ambition, and management was willing to allow new project developments – and in fact pushed for them. With these elements in place, Apple was able to spend the next 10 years releasing one ground-breaking product after another.

Apple seems to have lost this essential mix, and the reasons are not clear. It may be that the death of Steve Jobs has had a strong impact on the organisational structure within Apple, making it harder for employees to initiate new projects. Whatever the cause, their product line is aging. The Apple Watch is the latest to be released. Without the Apple brand behind it, the Apple Watch wouldn’t have reached the same level of commercial sales that it did – and probably by some margin. The success of the 2000’s has really raised the bar, and makes a lack of innovation from Apple feel disappointing.

However, there is no reason why the company cannot keep pace with the success of the 2000’s. There are no limiting factors for Apple, given the huge wealth of talent and resources the company has access to. Crucially, they have found a very profitable customer base that blindly follow the company and buy their products (commonly known as “iSheep”). 78% of iPhone owners admit that they couldn’t imagine owning a different phone. They are clearly in no great risk of impending disaster. Apple still holds liquid assets of over $230bn (larger than the Federal Reserve of the USA), attracts world-class talent, has a culture that is famous for creativity, and has an experienced management team that were around throughout the 2000’s. Being comfortable is profitable and safe, but it is a trade-off that leaves behind innovation and risk – the defining aspects of the company culture.

For a repeat of the 2000’s innovation boom, Apple needs to be hungry again for growth. This may be hard given the size of the business, but it could be made possible through investments in innovative young companies and by restructuring the organisation to allow for more diverse product lines, similar to what Google did when it was restructured into the holdings company, Alphabet Inc. Maybe it is time for Apple to take a page out of Google’s book – they need to shake things up.