It is no secret that Apple Inc. is one of the most successful companies worldwide, however, many individuals believe that they remain “the best company in the world,” (http://www.businessinsider.com/how-to-run-your-company-like-apple-2012-2). In order to receive a reputation this strong, both your business plan and style must be perfected. It is easy for outsiders to take a look at the success levels that Apple Inc. has met and provide feedback as a satisfied consumer, however, taking a look at the inside operations of Apple Inc. will leave individuals impressed as well. The management style that Apple chooses to implement is a very effective style and it opens the organization to a great deal of opportunity.
Organizational Structure & Design
Considering all aspects of competition and the need to remain ahead of opponents, Apple takes the confidentiality aspect very seriously. When Steve Jobs was present within the organization, he was very keen when it came to privacy and keeping new ideas under the radar. Making sure that the ideas generated within the organization remained inside the corporation was very important in regards to staying ahead of the competitors; it still is very important today, even with Steve Jobs out of the organizational structure.
The CEO of the company plays a very dominant part when it comes to organizational structure. The CEO, Tim Cook, provides guidance and structure for the next tier of employees, which happens to make up the executive team for Apple Inc.. Cook also has a direct communication with VP’s whom report to Cook. After the tier of six individuals who fill the position of VP’s that are reporting to Cook, falls the majority of the VP’s for Apple Inc. which refer to the VP’s one tier up for assistance or guidance.
The type of structure that Job’s had implemented into Apple Inc. was very unique at the time and seemed to be very effective in the sense of success. Everything that went into and out of the corporation went directly through Steve Job’s office. The way that this is set up provides the CEO with the majority of duties and some individuals had said to believe that all of the company-drive should be split up and weighed out a little differently. (https://intothelook.wordpress.com/2013/11/24/organizational-structure-of-apple/)
The VP’s within the organization provide a good example of “function-based grouping,” (http://panmore.com/apple-inc-organizational-structure-features-pros-cons) which means that each individual has a task, or business function, in which they are focused on. This provides a sense of expertise for just about every business function within the organization. On the other hand, the lower tier take on a “product-based grouping” (http://panmore.com/apple-inc-organizational-structure-features-pros-cons) theme that uses a vice president for both different outputs and inputs.
Steve Jobs had it set up in a way that he had the final say in a lot of decision-making and a ton of responsibility in regards to the process of innovation and creation. When Tim Cook took over, he implemented a few changes that were focused primarily around the level of collaboration. Rather than Tim Cook having the first and final say on controversial or decision-making issues, more employees now have a say. Though Tim Cook still has the “spoke-and-wheel hierarchy” (http://panmore.com/apple-inc-organizational-structure-features-pros-cons) feel within the workplace, the small alterations made seem to be showing a positive effect on Apple Inc.
The type of departmentalization in which Apple implements is territorial departmentalization, which in more simple meaning, stands for an organization that chooses to group products by product line. Apple incorporates a high level of departmentalization. There are a handful of advantages, along with a handful of disadvantages that go alongside departmentalization by territories. An advantage that belongs to territorial departmentalization is that it “places responsibility at a lower level [and] places emphasis on local markets and problems,” (https://iedunote.com/departmentalization-by-territory.), while a disadvantage could be considered the fact that you must maintain a handful of employees that provide expertise in their abilities to be an effective manager.
Over the years, Apple Inc. has adopted a mechanistic organization versus an organic organization; this was inherited by the centralization within the organization and the standardization aspect that Apple heavily relies on. Apple easily applies the mechanistic structure into their organization due to their mass-production of technology-based products and their chosen and developed leadership style.
The Porter Analysis is done by analyzing five aspects of a business, these aspects are: industry rivalries, the threat of new entries, the power of suppliers, the power of customers and the threat of substitutes. Being such a technology-based company in such a tech-based era, Apple has encountered a handful of successful competitors; this takes a little bit of power away from Apple. Though Apple has remained on top of their competitors thus far, they must remain reasonable in a sense of pricing and staying fair due to the ability for consumers to make purchases from their common competitors, such as Samsung.
In regards to the potential of new entrants, Apple sits pretty comfortably. It would not be feasible for a company to start up in such a technology-based market and end up level with Apple. The market that Apple Inc. lies in would take both a great deal of time and a great deal of money for a competitor to enter. Apple provides a decent barrier, which is attractive to the investor’s eye.
The power of customers is driven by a handful of aspects such as “how many buyers or customers a company has, how significant each customer is, and how much it would cost a customer to switch from one company to another,“ (https://www.investopedia.com/terms/p/porter.asp). Apple Inc. holds a pretty dominant stand when taking a look at the number of consumers that they have. Apple provides very good quality products to their consumers, so the cost in switching from one company to another may not be a smart decision considering the decrease in quality that they could be taking.
The power of suppliers may be Apple’s biggest downfall. Apple has a lengthy list of suppliers that are located both in and out of the United States. Considering that Apple relies on 200+ suppliers, their suppliers hold a lot of power, however, they do have a lengthy list, which spreads out the amount that Apple depends on each individual supplier.
Apple has a comfortable stand in regards to the threat of substitutes. Apple provides consumers with very high quality products that can perform a handful of tasks; therefore it would not be easy or feasible to find a product that can out-perform an Apple Inc. product. Of the five forces that the Porter Analysis takes into account, this would be one of Apple’s most comfortable positions.
“We believe that we are on the face of the earth to make great products and that’s not changing. We are constantly focusing on innovating. We believe in the simple not the complex. We believe that we need to own and control the primary technologies behind the products that we make, and participate only in markets where we can make a significant contribution. We believe in saying no to thousands of projects, so that we can really focus on the few that are truly important and meaningful to us. We believe in deep collaboration and cross-pollination of our groups, which allow us to innovate in a way that others cannot. And frankly, we don’t settle for anything less than excellence in every group in the company, and we have the self- honesty to admit when we’re wrong and the courage to change. And I think regardless of who is in what job those values are so embedded in this company that Apple will do extremely well.”
Apple is a company that will continue reaching for success and growth within their profitable organization, the vision statement implemented really breaks that down and simplifies it in a sense of what the company values and is looking to obtain. The vision statement is a very detailed piece of work that puts into perspective their business plan and marketing strategies.
Apple’s mission statement has also been a piece of work that underwent changes and alterations over the years. The current mission statement is: “Apple designs Macs, the best personal computers in the world, along with OS X, iLife, iWork and professional software. Apple leads the digital music revolution with its iPods and iTunes online store. Apple has reinvented the mobile phone with its revolutionary iPhone and App store, and is defining the future of mobile media and computing devices with iPad.“
Within the mission statement, Apple is outlining all of the devices that they are well known for. They used this opportunity to capitalize on what they do and the quality products that they put out while attempting to out-shine their competition. Apple makes their intentions for the future of their organization very clear within the mission statement, they are in a sense saying that they are not done taking steps forward and they will continue to further develop as time goes on. Apple’s mission statement is a very powerful piece of work and it was designed to outshine competitors.
Apple is a company that takes their corporate social responsibilities (CSR) very seriously, as just about any multinational company attempts to do. Apple has greatly satisfied and fulfilled their company stakeholders and their CSR. Apple’s success is largely influenced by their stakeholder groups, which consist of their consumers, employees, investors and employees of suppliers and distributors. Apple puts a huge emphasis on the satisfaction of their stakeholders.
Consumers remain categorized as Apple’s highest level of importance. They aim to keep their consumers satisfied and are constantly looking out for the “next best thing” that Apple Inc. has up its sleeves. Apple also strives to preserve everything that is produced at an acceptable price level. Apple also takes part in a handful of programs, such as one for recycling, which provides reassurance of corporate social responsibilities.
Apple puts their employees as their second priority in a sense of their stakeholders. These stakeholders remain loyal based on compensation and career development. Apple strives to treat their employees very well and they provide competitive wages, along with great opportunities for development. Not only does Apple Inc. provide competitive wages and great career development aspects, they also provide very good compensation packages to their employees.
Investors also remain very important to Apple, as they do any corporation. Apple Inc. provides their investors with very appealing aspects in regards to investing such as high profit margins and very strong and competitive financial positioning. It becomes very attractive to investors when a company is labeled as one of the most lucrative companies worldwide. As previously mentioned, Apple also takes their CSR very seriously, which is yet another aspect that attracts investors.
Apple’s employees of suppliers and distributors make up the indirect stakeholders that the company preserves. These individuals are treated comparably to their employees; they receive competitive wages and countless benefits. Apple looks out for their employees and their suppliers and distributors by making sure that they are well taken care of. “Apple has a Supplier Code of Conduct. The company monitors and imposes requirements on the employment practices of firms in its supply chain. Part of Apple’s policy is to terminate business relations with suppliers that continue to fail or refuse to satisfy this Code of Conduct. Apple’s 2014 assessment of suppliers shows that 92% of suppliers now comply with the 60-hour workweek rule,”
The corporate strategy that makes Apple stand apart from their competitors is differentiation in various aspects. Apple strives to create a product of quality that is going to stand out to consumers. Not only is the American multinational technology company striving to create a product that will stand out, however, they are also putting a huge emphasis on market expansion. Apple products are created with such advanced technology that leaves consumers very satisfied.
Tim Cook takes on and displays the situational leadership theory, meaning that there is not one, singular leadership theory that he goes by. Cook alters the style of leadership that he is going to take on regarding various factors such as the magnitude of the issue, the segment that he is working with and the sequential order of events. However, until Cook recently altered the leadership style that Apple implemented, Jobs had put into effect an unconventional leadership style, he strived to push employees to think deeper, using more complexity and he was very blunt to criticize. Both leadership styles have contributed to the great level of success that Apple Inc. has encountered.
As many successful businesses, Apple considers Maslow’s hierarchy of needs and places a heavy focus on the needs listed. Apple takes all-levels into high consideration. “They have fulfilled their employee needs of physiological by setting an average salary of $108,483 which basically can ensure survival,” (https://managementofapple.wordpress.com/motivation/), this is a very high average pay and can undoubtedly ensure survival factors. As mentioned earlier, Apple Inc. also provides their employees with incomparable benefits, which also meets priority needs alongside a competitive salary.
While Apple meets Maslow’s lower-order, important needs, they also meet the higher-order needs. Apple provides a great deal of positive feedback to their employees, not only feedback, but employees can also receive salary increases and bonuses for preforming well on the job. Apple takes recognition within their organization very seriously and will not hesitate to reward an outstanding employee, which meets the sense of self-actualization on Maslow’s hierarchy. Any company that places such a threat on competitors within the market segment must provide their employees with a high level of motivation in order to ensure that they are providing their best work for the company.
Apple has a very successful human resources department with very exclusive techniques, of which they actually prefer to release minimal information on. Apple’s HR representatives are trained to put an immense amount of effort into recruiting; they spend a lot of time recruiting the most superior employees from other firms, frequently competitors (http://management-training-guru.com/2013/12/hr-strategy-at-apple-make-their-employees-creative-and-innovative/). Apple displays their open job opportunities on their company website as well to provide a competitive entry and appeal to all individuals.
Apple incorporates a different style of training than a lot of other companies; they actually hold a number of training classes referred to as “Apple University.” Throughout Apple University, you learn the ins-and-outs of the company, all of the way from the history to the perceived future. Upon completion, you receive a diploma that recognizes your contribution to the training and development program. Though this seems to be a different style of training and development, it has definitely seemed to be effective ever since the ‘university’ was put into play.
As far as the performance appraisal process within the organization goes, the individuals who are deemed to be the ‘best fit’ for the position are selected and are moved into the interview process, where they will start of with a practical exam and their skill sets will be evaluated. If the exam goes well and their skills seem to meet the level that Apple is searching for within the employee, they will go through rounds of face-to-face interviewing, where levels will depend on the position in which the individual is applying for. After being selected for the position, an employee for Apple will sit down with them and go over the benefits, pay and a further job description. After the individual accepts the job, they will take place in training and will in due time be moved into their given position where they will be evaluated again. (https://www.quora.com/What-is-the-recruiting-and-hiring-process-of-Apple-How-does-one-contact-their-HR-department)
I personally would unquestionably be interested in joining Apple Inc. as an employee. I believe that they treat their employees very well and the benefits are incomparable. Their training and development opportunity is very appealing to me as well. The aspect of Apple Inc. that I liked the most is that employees receive recognition and even benefits and/or advancements for their hard work within the organization. The aspect that I disliked the most was the fact that the hiring process seems to be very long and in a sense drug out, however, that is to be expected when applying to be a part of such an exceptional corporation.