In 1997 Wired released a list of 101 things that Apple needed to do to survive. The following blog post looks at that list to see what Apple did from that list, to what they didn't do. It's interesting while obviously they don't talk about the iPod (it was still 4 years away) they do note that Apple really needed a killer device.
91. Start a new special projects group led by either Jobs or another passionate and creative designer to create the next "insanely great" technology. This time, focus on rolling the technology into the existing Mac line; make sure developers are inspired and in the loop.
The sort of things that they had get out of the hardware business and stop making computers or that they should start selling their operating system to clones (which they did though it was a debacle).