Organisation Analysis: The Apple Company Report

Introduction

The Apple Inc. is a renowned manufacturer of computers and mobile communication devices that was founded by Steven Jobs in 1975.

The company has been selected for analysis as it has featured on the Forbes Magazine, the Fortune Magazine, and other global business reporters as a global leader in computer technology and telecommunication industries.

The success of any firm depends on a number of factors that are well defined by various organisational theories. The theories put forward a number of perspectives that explain the interplay of various elements such as the structure, culture, leadership, and management of the organisation among others.

In the light of this conceptualisation, this paper presents a critical analysis of the Apple Inc. with respect to political, cultural, contingency, and bureaucratic perspectives.

Company Overview

The Apple Inc. was founded in 1975 by two school dropouts namely Steve Wozniak and Steve Jobs. The risk of dropping out of college for the two individuals was the first step towards building the global leader of technological innovation in hardware, software, and support services¹.

The company specialises in a range of products including computer and telecommunication devices. It has been a leader in the transformation of technology to suit diverse and dynamic economic eventualities. The business survived the 2008 economic downturn that led to the closure of many ventures.

The Apple Company enjoys a reputable and unmatched brand image around the globe. It was valued at $182.795 billion in 2014, making it the highest valued brand in the world. It has more than 98,000 employees around the globe whore are based in its many retail stores in 15 different countries².

The company repeatedly features on the Fortune Magazine and deserves the analysis. It boasts of a unique business model that has remained a mystery for many businesses worldwide. The propelling factors to its success include remarkable leadership that was first incepted by the founder, late Steve Jobs.

It also includes a corporate culture of enthusiasm and innovation that has led to the design, development, and distribution of tech-savvy products. Customers of the company have been known to have strong attachments to the Apple Inc.’s products.

Cultural Perspective of the Apple Incorporation

Organisational culture is a vital determinant of the overall success of any business. It shapes the behaviour and beliefs of the stakeholders of the organisation including the management and employees³.

The creation and management of the organisational culture is an evolutionary perspective that is imposed by the leaders before it gradually diffuses to the members.

Organisational effectiveness is contingent on the ability of the association to induce the right cultural values in the behaviour of its employees.

There are different forms of organisational culture including innovative, entrepreneurial, market, and hierarchical perspectives. There has been empirical support for the existence of a relationship amongst the culture, roles, behaviour, and perceptions of the employees.

Organisational culture can be defined as the pattern of basic premises that a particular firm develops in an attempt to cope with challenges of the macro environment by adaptation and integration of various success factors in the micro-environment.

The effects of such developments have a significant influence on the behaviour of the employees. Regardless of the size of the organisation, there are two theoretical problems must be resolved.

Firstly, it has to deal with the organisational survival, growth, and environmental adaptation strategies. Secondly, the internal integration that defines the daily functioning of the organisation and its ability to adapt to both the internal and external environments has to be taken into account.

The Apple Company has a highly pronounced culture of innovation. Through its founder Steve Jobs, the company hinges on technological innovation for its unmatched success that everybody in the world can see and accept through its tech-savvy products⁴.

Innovation is highly valued in the Apple Company as it is the cornerstone for its success.

The establishment has a group of highly talented people who are responsible for the innovative ability as manifested in the manufacture of the latest high technological electronic devices such as the iPhone, iPod, Apple watch, iPad, and personal computers among others.

It also plays a vital role in software development. The Apple Inc. uses the slogan ‘Imperfect Makes Improvement’ as a concept that shapes the innovation culture in its organisation.

Its organisational culture holds that self-motivated individuals can work harder if they have autonomous control over their efforts than when a boss micromanages their actions.

It is believed that there is lesser time consumed when few people are involved to make a decision necessary to effect an organisational change than when the process involves too many hierarchical involvements of different stakeholders.

The company’s unique culture is responsible for its swift response to the changes that are effected faster than its competitors. The state of affairs results from decisions that are formulated and executed at the lowest levels possible.

The company also holds that it is easier to launch a new project when there are only a few people who can approve it. In line with its innovative culture, the Apple Company builds on the drive to outperform and succeed as its guiding principles.

The company’s structure smoothly marries with the culture. This aspect significantly contributes to the enormous and sustained growth of the Apple Inc. The organisational structure assumes a top-down philosophy whereby decisions are made by the people on the ground.

Employees at different levels make decisions; hence, the structure allows for quick responsiveness and solutions to emerging eventualities without necessarily having to engage the senior management.

There two types of norms that define the constructive culture of the Apple Company namely competitive and self-actualisation norms. The competitive norms involve settings whereby the employees work hard to outperform each other and rewards for their performance are recognised through appraisal procedures.

On the other hand, self-actualisation is characterised by creativity and quality rather than quantity. Employee development and self-actualisation are vital features of the Apple Company’s culture. The workforce is encouraged and supported to develop individualised role orientations.

A college student Cwynar, who joined the Apple Inc. in an internship program, reveals that the company is offers the best work environment because of the support and development that new employees are given ranging from instillation of company’s culture and role differentiation.

The senior managers once told him that the sky is the limit at the Apple Inc. The managers were always looking for new ways to help him and his less experienced colleagues to grow personally and professionally.

The company embraces robust employee socialisation processes for its fresh workforce and the less experienced. The newly recruited employees are taken through induction processes where the key areas of focus are identified.

Employees are enrolled in comprehensive career development programmes that train them in areas of growth including client service, business development, innovative abilities, and teamwork.

Bureaucratic Perspective

Organisational Structure

Organisational structure refers to the allocation strategies of responsibility and power in a firm. It shapes how work procedures are executed by the organisation’s members. It is the internal pattern of relationships, power and communications.

The influence of organisational structure on its overall success has inevitably been exhibited by leading businesses such as the Apple Inc. and Microsoft.

Several organisational structure theoretical constructs exist in modern business management. At the outset, there is the centralisation of decision-making whereby matters pertaining to the organisation are guided by the top hierarchical levels⁵.

This structure gives more authority to the top managers whilst employee involvement is given less attention. Some scholars refer this form of structure as the locus of authority in the organisation. The delegation of authority is not featured in organisations with the locus of authority.

In times of uncertainty, such organisations are subject to failure as the time taken to make effective decisions can be long.

Centralisation of power and authority on the top management has been deemed ineffective, especially in the twenty-first century where rapid changes and globalisation take the centre stage in business. Collaboration among employees and the management is highly valued in contemporary business practices.

Another organisation structure features flatness in hierarchy whereby the organisation has a number of areas in the hierarchy. In such cases, autonomy is exercised with an aim of controlling the behaviours of the employees⁶.

It is a traditional command and control form of authority among managers in the hierarchy that functions in response to the directives of the top leaders. The third conceptualisation of organisational structure reveals that the specialisation of the departments and employees exhibits a horizontal integration pattern.

The departments and employees in this structure are specialised and functionally integrated. Employees at the lowest levels can make decisions and implement them to effect changes that favour the organisational production and progression of activities without having to consult the top management.

Organisational theorists posit that a correlation exists between the structure and performance of the business⁷. An effective organisational structure corresponds with the unmatched success of the entity. Where the structure does not align with the organisational culture, challenges that leverage the level of success and sustainability arise.

The Apple Inc.’s Organisational Structure

The Apple Company adopts the third structure whereby specialisation and integration define the relationship between the employees and management. The company is a highly collaborative organisation that values the contribution and competitive edge of each employee.

The Apple Company has its main headquarters in Cupertino, California. It also has branches that are well established in multiple locations around the world.

The business is structured into three main areas of focus including hardware, software, and business support services. A visual representation of the company’s organisational structure as at 2008 is shown in figure 1.0 below.

Figure 1.0 The Apple Inc.’s Organisational Chart (2008)

Decision making processes in the Apple Company are based on the top-down approach. Currently, the Apple Inc. is under the leadership of the chief executive officer Tim Cook who replaced the late Steve Jobs on August 2011.

The CEO is overseen by a board of directors and other members of the senior management. The governance of the Apple Inc. is structured to foster principled actions, effective decision-making processes, and monitoring compliance and performance suitability.

Contingency Perspective

One of the core determinants of success in organisations is the ability to manipulate technology in its operations with a view of developing a competitive edge over other businesses⁸. Technology has been defined by organisational theorists as the means, activities, and knowledge utilised in the transformation of materials.

It involves the improved transformation of inputs into outputs for continued organisation operations. It encompasses both the utilised machinery and intellectual know-how utilised in the conversion of inputs into outputs.

Technology can be either core or peripheral. Core technology centrally defines the operations of the organisation⁹. For instance, the Apple Company uses both knowledge and machinery to produce iPhones.

On the other hand, peripheral technology acts side by side with the core technology to complement the overall success of the firm. For example, in the Apple Company, technology is utilised to prepare annual reports in the form excel and word documents.

According to Joan Woodward, technology can be classified into three forms based on production¹⁰.

Firstly, the small batch and unit production technology produces units in single bits at a time. This form of innovation is common in labour processes where workers play their roles from the start to the end of the product.

Secondly, large batch and mass production technology focuses on the output of many similar products that are simultaneously designed for undifferentiated markets.

Thirdly, it can be regarded as a continuous process of production whereby technology is utilised in the conversion of raw materials to produce multiple forms of products for a differentiated market.

The most important applicable innovation put forward by Joan Woodward is the large and mass production technologies that are associated with both centralised and bureaucratic organisational structures.

Continuous processes are linked with decentralised management structures. The type of technology applied in an organisation determines the degree of autonomy and latitude exercised by the individual employees in the organisation.

Employees have a self-rule over the company’s technological applications to ensure the designing, production, and introduction of high quality and unique products to the market. For the highly competitive industry, technology requires a high degree of employee autonomy as they control their intellectual knowledge.

In this regard, the Apple Company manages the power of the employees in its departments to ensure that their perceived decisions are evaluated and implemented. This situation in turn heightens the commitment and innovative culture in the firm.

The Apple Company’s products combine a mix of technological capabilities to give their customers the best experience of many services in one package. For instance, the iPhone 5 mobile device combines an internet connection, a portable music player, and touch screen interface among others.

Due to its unique features, the device together with other products and services saw the Apple Company generate approximately $80,477 million net sales in 2012. This amount reflected a 71% increment as compared to the previous year, 2011.

The Apple Company adapts swiftly to environmental dynamics, especially the competitive arena offered by other leading dealers in the same products such as the Samsung and Android Operating systems that command the greatest share of the smartphone market around the world.

The emergence of Android Operating System was the biggest challenge for not only the iOS but also the BlackBerry and Symbian software. Surprisingly, the company has remained stable despite the emergence of the competitive brands.

The Apple Inc. and Innovation Technology

The Thompson’s classification framework of organisational technology puts forward mediating, intensive, and long-linked forms of innovation that have been used in the Apple Company.

The mediating technology involves the interdependence between organisations in terms of the development that are executed to generate a successful product¹¹. The long-linked technology entails a sequential interdependence of tasks. The output of one task is the input of the following task.

This dependency relationship implies that the success of the succeeding item is contingent on the preceding task; hence, it can only proceed upon the completion of that task.

According to Thompson’s conceptualisation, there is a need for proper management of the sequential technologies to attain the desired output for the organisation. Intensive technology refers to the interplay of tasks whereby various tasks can be performed in either forward or reverse modes.

The performance of one task influences the performance of the other and the vice is also true in a reciprocal perspective. The Apple Company utilises the long-linked technology in its innovative efforts.

There are no structural problems identified in the Apple Inc. This situation implies that the organisational structure is designed in line with the culture, leadership, and business objectives whereby each core unit works in a complementary perspective.

This organisational arrangement puts the Apple Company in an unmatched and inexplicable position in terms of employee behaviour, product design, and market positioning. The firm’s customers manifest an exemplary evidence for the love and loyalty they have attached to its products and services.

It has been reported that the company also establishes a close feedback monitoring whereby customers are given the opportunity to air their views on the product specifications and provide suggestions to some of the problems they face with them.

This monitoring is part of the all-inclusive research and development efforts that the Apple Inc. does in a bid to align its production efforts with the customer requirements on the ground.

Political Perspective

The political structure of any organisation is core to its overall performance. It is responsible for relegation of responsibilities and deployment of resources necessary for the attainment of its set goals and objectives¹².

The organisational structure should match the allocation of authority patterns for an effective management of its operations. As indicated in the organisation chart in figure 1.0, the Apple Company is headed by a CEO and managers in different departments.

The most conspicuous management in the Apple Inc. revolves around innovation culture. Power in the organisation has been delegated from the CEO through various presidents down to the employees following the top down approach.

The influential leadership style of Steve jobs remains in use to date. His leadership involved the stimulation and evaluation of the different roles of the organisational elements. The management structure of the Apple Company allows the different players to exercise autonomy in decision-making.

The decisions made at the lowest levels do not necessarily warrant approval from the top management for their implementation. This form of leadership enables quick decision-making that ensures that changes are appropriately executed in relation to both the micro and macro environments.

The organisational structure of the firm has been described as obsessively secretive. Many businesses have tried to learn what makes the company unique and its secrets to the extraordinary excellence in vain. Secrecy is highly upheld by the Apple Inc.

This phenomenon has been deemed as the fundamental determinants of its incredible focus and discipline. The firm does not get distracted from what it does no matter the scale of the external factors such as economic crises. The company values competitiveness as it maintains an obsessive secrecy of its functional areas.

The company has thrived on simplicity. This situation poses an enormous threat to the near future of the organisation due to the existing close competitors who have kept the pace of almost reaching its level in terms of sales and profitability.

Conclusion

This paper reveals the interplay of different organisational perspectives that determine the overall success of the organisation.

These perspectives revolve around the organisational behaviour as defined by the corporate culture, management, leadership styles, technology application, and authority distribution that leverages decision-making processes in the organisation.

The Apple Inc. has been chosen in the analysis as it is a leading multinational in the technology industry.

Bibliography

Daft, R., Organization theory and design, Cengage learning, Boston, MA, 2012.

Hatch, M., Organization theory: modern, symbolic and postmodern perspectives, Oxford university press, Oxford, 2012.

Johnson, K., Li, Y., Phan, H., Singer, J. & Trinh, H., ‘The Innovative Success that is Apple, Inc.’, Marshall Digital Scholar [website], 6 May 2015.

Lorsch, J., Encyclopedia of Management Theory, Sage Publications, London, 2013.

Volberda, H., van der Weerdt, N., Verwaal, E., Stienstra, M. & Verdu, A., ‘Contingency fit, institutional fit, and firm performance: A metafit approach to organization–environment relationships’, Organization Science, vol. 23 no.4 (2012), pp. 1040-1054.

Zhang, D., Linderman, K., & Schroeder, R., ‘The moderating role of contextual factors on quality management practices’, Journal of Operations Management, vol. 30 no. 1 (2012), pp. 12-23.

Footnotes

¹ K. Johnson, Y. Li., H. Phan, J. Singer, & H. Trinh ‘The Innovative Success that is Apple, Inc.’, Marshall Digital Scholar [website], 6 May 2015, Para. 1.

² Johnson, Y. Li., H. Phan, J. Singer, & H. Trinh, Para. 2.

³Ibid, Para. 2.

⁴Ibid, Para. 3.

⁵ R. Daft, Organization theory and design, Cengage learning, Boston, MA, 2012, p. 23.

⁶ H. Volberda, N. van der Weerdt, E. Verwaal, M. Stienstra, & A. Verdu, ‘Contingency fit, institutional fit, and firm performance: A metafit approach to organization–environment relationships’, Organization Science, vol. 23 no.4 (2012), p. 1040.

⁷ H. Volberda, N. van der Weerdt, E. Verwaal, M. Stienstra, & A. Verdu, p. 1041.

⁸ J. Lorsch, Encyclopedia of Management Theory, Sage Publications, London, 2013, p. 203.

⁹ J. Lorsch, p. 212.

¹⁰Ibid, p. 215.

¹¹ D. Zhang, K. Linderman, & R. Schroeder, ‘The moderating role of contextual factors on quality management practices’, Journal of Operations Management, vol. 30 no. 1 (2012), p. 12.

¹² D. Zhang, K. Linderman, & R. Schroeder, p. 15.