Running Head: Organizational Management Case Study
Date of Submission:
Organizational Management Case Study
Apple Inc. has many management plans, strategies and accomplishments, which have succeeded because of prudent management. The information was gathered from secondary sources; this includes books that have studied the rise of Apple inc. to become the world’s most respected company. The information was also gathered from internet articles and no primary sources were used. The information was analyzed by first identifying the research goals; the goal of this research is to find out about the management style of Apple Inc. and its contribution to the company’s success. Therefore the research has been classified into; management strategies, management strengths, management accomplishments and how Apple Inc.’s successes can be attributed to its management. The data is organized in a deductive manner, where the main idea is presented first followed by explanation, reasons and examples.
Apple Inc. was established 1976, and has remained very relevant in the market up to date. Over the years, it has enhanced its competitive edge in the market by launching new innovative products such as the iPod, iPad and iPhone. It has a loyal customer base all over the world and its products have been a smash success propelling the company into the Fortune 500’s most admired company for three consecutive years; 2008, 2009 and 2010.
Steve Jobs, the CEO of the company is also the co-founder of the company. A board of directors and a group of executives, all whom are extremely skilled and competent, also head the company. Through their innovative prowess, Apple Inc. has created products that have literally revolutionalized industries. These are the iMac, the iPod, the iPhone and the iPad. Apple is also the parent company of Pixar, an animation movie company. Over the last decade, Apple Inc. has been phenomenally successful, which can largely be attributed to the quality and style of its leadership and management. It has gone from making huge losses in the 1990s to a turnover of over $100 billion. More than half of its products are sold outside the United States; proving that it’s products are appreciated internationally.
One of the most successful management strategies of Apple Inc. has been branching from diversification to focus. In the late 1990s when the company CEO, Steve Jobs took over, he stopped the production of printers, scanners and potable digital assistants. The company was now solely focused on not several products that generated normal revenues but on few products that could have a great impact on the market. This led to the invention of the iPod, iTunes, the Mac PC and Mac OS X operating systems. These products have earned the companies high revenues and have earned Apple Inc. recognition as a respected and admired company.
The management of Apple Inc. regularly carries out a SWOT analysis to determine its current position and how it can enhance its market strength. This led to the invention of the iPhone, which was a revolutionary product that has won Apple Inc. loyal customers all over the world. The management realized that there was an opportunity in the market for a phone that could revolutionalize communication, hence the creation of the iPhone. The management also enhances its strength in the market by employing the best human capital available. It believes that if the employee is passionate about his product and his job, he will produce the best results possible. The company also discontinues the production of products that do not add significant value to the company. For instance, the company phased out the iPod Mini when iPod Nano was launched. Similarly, the production of printers and PDAs was stopped when Steve Jobs took over as CEO because they were not generating sufficient profits.
The leadership of Apple Inc. has focused its attention on innovation and product development. For instance, the original iPod has undergone a series of change and developments and is now available in several versions, which are iPod Shuffle, iPod Nano, iPod Classic and iPod Touch. The management is passionate about creating high-quality products that will make an impact in the industry. Apple Inc. also concentrates its efforts on re-inventing its current products as opposed to inventing several different products. This is illustrated by the fact that it owns only 30 products yet it is a multi-billion dollar company. The management of Apple Inc. has succeeded in making Apple a leading brand by being customer-focused in an industry where most organizations are profit-focused. The CEO of the company has been quoted as saying that the company’s innovations are meant to change people’s lives. This is evidenced by products such as the iPhone that has enhanced the way people communicate through features such as video communication. The company’s products have also proven to be extremely resourceful in business.
The management of the company promotes individuality. This is one of the distinguishing features of Apple Inc. The management encourages creativity among employees; this is a motivating factor for the employees because it makes them feel responsible for the performance of the company thus driving them to work at their best level. This has led to the creation of innovative stylish products that are much admired by consumers. Management also enhances the workforces’ creativity by involving them in the development of new products. Many of the company’s innovative products have been developed through collaboration within the company. http://money.cnn.com/2008/02/29/news/companies/amac_apple.fortune/index.htm
Despite being a large international company, Apple Inc. has a flat management structure, therefore facilitating faster decision making and implementation of plans. This structure also enables the company to react faster to changes in the market and to competitors. A shorter hierarchical structure also allows for effective communication therefore increasing the efficiency and effectiveness of the company. A flat management structure gives the management more responsibility over the performance of the firm, therefore increasing their sense of responsibility and in turn productivity and efficiency increases. Apple Inc. has a top-down management structure where power is concentrated on the CEO, whose management style is autocratic. Although a democratic style is more advisable in most cases, at Apple Inc., the autocratic leadership serves as a catalyst to its success. The leader of the company has through his leadership style, pushed employees to utilize their full potential towards enhanced productivity and success of the firm.
One of the company’s most important strategies has been to follow its gut instinct about the market and the products that it should innovate. It does not use consultants to carry out its market research; instead, they create opportunities by looking for gaps in the market. For instance, the iPod was invented to facilitate transfer of music through the internet. The management did not have to use consultants to realize that there was that gap. By not depending on consultants, the managers are able to relate with the market themselves and therefore come up with greater ideas.
One of the accomplishments of the management of Apple Inc is that it has successfully employed its product diversification strategy in creating brands that have changed different industries. The management is also keen to take advantage of any new gaps or opportunities in the market. For instance, the CEO of Apple Inc. has been quoted as saying that they developed the iPhone because he hated the cell phones that were being produced at the time. This gave the company an opportunity to diversify into the mobile communication industry. Apple Inc began as a company that manufactured computers and over the years has ventured into the music industry with the invention of the iPod, the mobile communication industry through the iPhone and most recently the movie industry, through Pixar.
The management of Apple Inc. has contributed to its success through two key factors, which are innovation and passion. Apple Inc. is known for creating products that redefine technology and industries. Their passion inspires creativity, which leads to the innovation of dynamic products. The management has also contributed to the success of the company due to their attitude towards risk. This is well illustrated by the fact that they do not carry out researches on the market rather they are directed by their instinct and great ideas. This enables them to think outside the box; thus come up with great products. The management is not afraid of failure; they believe that failure is a part of success. This gives them an edge over their competitors because it enables them to recover from failed projects faster. This is illustrated by the fact that it was able to recover from huge losses in the 1990s to become a highly profitable company. The success of Apple Inc. can also be attributed to the vision of its management, which is to change the world. To this end, they have led the creation of products that even its competitors are unable to rival. The management has also contributed to the success of the firm by investing in a workforce that is highly talented and skilled.
During the global financial crisis, Apple is one of the few companies that did not lay off its workforce; the management believes that each employee is valuable to the company. This motivates the workforce to work towards enhancing the performance of the company, regardless of their position in the company. The management of the company is planned in such a way that if the CEO were to resign or cease working for the company, any other executive would be over to take over from him. Apple Inc. prides itself in a highly competent management team. The whole team has unity of purpose that is to create dynamic products for the market. Therefore, making it easier for them to work collectively and enhancing their performance. The executive of the company also focuses its attention on the most crucial projects and leaves other projects to the employees. Therefore, instead of multi-tasking they are able to engage their efforts and energies to the development of strategies and products that will make a great impact on the market and the organization.
Deutschman, Alan. The Second Coming of Steve Jobs. Virginia: Broadway Books, 2001. Print.
Jason, D., O’Grady. Apple Inc. Connecticut: Greenwood Press, 2009. Print.
Morris, Betsy. “What makes Apple golden” Fortune: America’s Most Admired Companies. March 3 2008. Web. January 2 2011.