Part A: Introduction to the Organization and the Organizational Design
Apple Inc. is an American multinational electronics and software company established by Steven Jobs and Stephen Wozniak on April 1, 1976, in Cupertino, California. Apple designs, manufactures and markets personal computers, portable media players, mobile phones, computer software, computer hardware and peripherals. The Apple Store, which is a retail store owned and operated by Apple Inc., has opened 283 stores as of December 2009, which are located in 10 countries. The company's products are also sold worldwide through its online stores, its direct sales force, and third-party wholesalers, resellers, and value-added resellers. Music, audio books, iPod games, music videos, episodes of television programs, and movies can be downloaded off the iTunes Store on Mac or Windows computers, and on the iPod Touch and iPhone. Apple's most popular products include their line of Macintosh personal computers, iPod portable media players, and the iPhone.
Apple Inc. sells its products to individual consumers, small and mid-sized businesses, educators and consumers in enterprise, government, creative, information technology and scientific markets. The company's total net sales was $36 537 million and they employed approximately 34 300 full-time equivalent employees and 2500 full-time equivalent temporary employees and contractors as of the end of their fiscal year on September 26, 2009.
Apple manages and organizes its business based on a geographical structure, which is one of the divisional structures. The divisional structure is a traditional organization structure which group together people who work on the same product or process, serve similar customers, and/or are located in the same geographical region. In regards to Apple, their geographical structure group together jobs and activities being performed in the same geographical region. The company has created operating segments based on the location and nature of customers. The operating segments are the Americas, Europe, Japan, Asia-Pacific, Retail and FileMaker operations. The Americas, Europe, Japan and Retail operations are Apple's reportable operating segments. The Americas, Europe, Japan and Asia Pacific segments do not include activities associated with the Retail segment. Asia Pacific includes Australia and Asia, excluding Japan. The Americas segment encompasses North and South America. European countries, the Middle East, and Africa are part of the Europe segment. Regarding the company's retail segment, these are the retail stores operating in the U.S. and international markets. Similar hardware and software products and services are provided to the same types of customers by each reportable operating segment.
Apple Inc. is such a large corporation that it has all levels of management from upper to lower. The organization has all types of managers including line managers whose work directly contributes to the production of apples goods and services. They also have staff managers who use their special technical expertise to support line workers (marketing, accounting, human resources, and legal services). As shown in the diagram below of how Apple's top managers are organized, the company has both functional managers, who are responsible for one area of activity, and general managers, who are responsible for complex areas.
This design is appropriate for the organization because their process of creating this geographical structure has appeared to benefit them from their results, which included a 36% gross margin in 2009, and helped them accomplish their mission and objectives. It allows their expertise to be focused on specific customers, products, and regions, which all have unique cultures and different requirements.
Steve Jobs the CEO and Co-Founder of Apple Inc. is known for having a temperamental management style. He has gone against the traditional management style, being strict with employees causing some fear but also praising them. Jobs is a perfectionist who pays close attention to detail, which can drive some of his subordinates crazy from his constant demands. He has a �no compromise" attitude when developing products for Apple. He creates many prototypes and mock-ups which are constantly being edited and revised by being passed back and forth between designers, engineers, programmers, and managers, and then back again. His obsession with excellence has created an amazing development process which turns out great products.
Based on Steve Jobs's management style I believe he is not following a traditional approach to management. He appears to be following one of the behavioural management approaches, McGregor's Theory X and Theory Y. I believe he has some of the qualities of a theory 'X' and theory 'Y' manager. Jobs has theory 'X' characteristics because he prefers to lead others and expects staff to listen to his commands. His drive to change the world leads him to scream and shout at employees. In contrast, he also has some of the qualities of a theory 'Y' manager because he wants his staff to be imaginative and creative and to also be involved by participating in the design process. Jobs believes debating between his employees fosters creativity, therefore he gives creative partners a lot of rope.
In the ever constantly changing environment of the computer/electronics industry, I also see Steve Jobs following the modern management approach of contingency thinking as the competitive environment is always changing. Jobs is always required to understand the situation and respond to it in the appropriate way. Apple is also a learning organization, which is a continuing management theme. The organization continuously changes and improves, using lessons learned from prior experiences. Information sharing, teamwork, participation, and learning are all valued within the company.
Apple Inc. is very modern in everything they do which has caused them to already follow some of the common trends including: shorter chains of command, less unity of command, wider spans of control and more delegation and empowerment. Today, technology companies are starting to not talk about their product, rather the �solutions" or �customer experience" that is offered. The organization is one of the most competitive because it is constantly being one of the first to look to new trends to improve, while others companies are still trying to compete and keep up with Apple's trends. Trends of today in the technology industry include: the demand for excellence, the pursuit of great design, the instinct for marketing, and the insistence on ease of use and compatibility. These trends have been with Jobs and Apple since the beginning, which has allowed it to succeed in what it has become today. Apple remains the last and only vertical integration company, meaning they make their own hardware and software, which is their greatest strategic advantage.
Through research of Steve Jobs's management style within Apple Inc, it appears the organization is adaptive. An adaptive organization has more decentralized authority, fewer rules and procedures, less precise division of labour, wider spans of control, and more personal means of coordination. Worker empowerment and teamwork is encouraged within Apple as Jobs believes �talented staff is a competitive advantage that puts you ahead of your rivals." He likes to work in many small teams, which is a characteristic of an adaptive organization. He does not like teams of more than 100 members because he believes they can become unfocused and unmanageable if they become too large. Members of the organization are encouraged to challenge Jobs's ideas to foster creative thinking. Adaptive organizations are built upon trust of the employees to get the job down through their own initiative. It is freeing people from control and restrictions and giving them the power and freedom to do what they do best to get the job done; which Jobs allows with his creative partners. The adaptive design works well for Apple Inc.'s competitive environment, which demands flexibility in dealing with the constantly changing conditions. Internal teamwork is encouraged in the company because of the demand for total quality management and competitive advantage.
Areas Where Improvement Could Be Made:
After analyzing Apple Inc.'s organizational design, types and approaches to management, and organizational trends, it appears the design is appropriate for the organization as they are able to accomplish their mission and objectives. As there is always room for improvement in business, Apple can re-engineer some of its processes to design new and better ways to carry out work in the organization. There are many advantages for large organizations that use a divisional structure, disadvantages include: reducing economies of scale and increasing costs through the duplication of resources and efforts across divisions. Rivalries can be created as divisions compete for resources and top-management attention, and divisional needs can take away from the goals of Apple as a whole.
Apple attracts the best highly motivated workers from around the world, therefore I believe it is not necessary for Steve Jobs to be so temperamental, by screaming and shouting at employees. It would improve the organization if he lost his �Theory X" qualities as his preference to lead others and expectations that staff should listen to his commands, can create passive, dependent, and reluctant subordinates who tend to do only what they are told to or required to do. Improving human skills creates a better ability for Jobs and others to work well with each other in cooperation. Less intimidation and threat of job loss in the organization would improve the quality of work life at Apple.
Source: Essay UK - http://www.essay.uk.com/free-essays/business/apple-inc.php
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America's Most Successful Companies: Steve Jobs and Apple Inc.
When Steve Jobs died on 5th October 2011, America - indeed the whole world - was held in a fitting pause. Whose life had not been made richer by a MacBook Pro? An iPhone? iTunes? These are just some of the products that enjoyed enthusiastic market reception following Jobs’ assumption of CEO role with the Apple Company in 1997. For many people, it is difficult to think of Jobs without thinking of Apple products and their impact on information technology and the social media. Under the leadership of Jobs, Apple introduced new technology and products that took the world market by storm. What made him and Apple so successful? In Harry McCracken’s article, Jobs emerges as an exceptionally gifted entrepreneur.
Jobs had a good eye for design and simplicity. When he co-founded Apple in 1976 with his friend Steve “Woz” Wozniak, Woz did most of the engineering work involved. But Jobs contributed strongly to the design of the products with an eye for easier use by consumers. Although the managing board found him incompetent to make managerial decisions and he resigned in 1985, he went on to create NeXT, another computer company. When Apple later bought NeXT, Jobs returned to the company with the same ideals. One of his initial successes was revolutionizing the music industry with the iPod and iTunes products.
Jobs also insisted on high quality products with cutting edge technology, earning the reputation of being a technological re-inventor and visionary. His insistence on the best sometimes translated into autocratic micromanagement. But his teams did deliver. After putting his company’s best in a product, Jobs took unabashed pride in presenting it to the world, making the unveiling of the products seem like an irresistible invitation to an experience he himself could not wait to go through again. Bud Tribble, a Mac software architect, called this tendency the Reality Distortion Field. Jobs did not just create quality products; he also knew how to sell those products.
Many people came to see Jobs as the very embodiment of Apple. Whereas this is a bit of a stretch, it does reflect how a CEO can be so immersed in the company that it appears he lives and breathes it. For Jobs, it was a devoted commitment, not merely to the company in and of itself, but to what the company was seeking to achieve: cutting edge technology in accessible design.
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