Situation
Apple Inc. is involved designing, developing and marketing of communication devices, personal computers, servers, portable digital music players, servers, and software and services. Some of the products of the company include; iPod, iPhone, iPad, and Macbook. In the financial year that ended in 2009, the company revenues of the company were approximately $42,905 million. This was an increase of 14% of the revenues that was realized in 2008. Arguably, this growth can be attributed to an expansion in the sales of third-party digital content and appliance from iTunes as well as iPhone handsets. In terms of demand, the main users of the products of Apple Inc. are government agencies, students, businesses, professionals as well as other consumers. These products are sold globally through third-party wholesale resellers, retail stores and online store, (Apple Inc. 2010).
The company has divided its market into five major segments namely; Japan, Americas, retail, Europe, as well as other segments. The segment of retail encompasses activities that are owned by the company in retail stores in the US as well as in other parts of the world. Notably, the company provides similar products in all the segments. The company operates in a very competitive market. Arguably, being a free market, there is free entry and exit into this kind of market which explains why there are many players in the market. Some of the major competitors include: Samsung Electronics Co. Ltd, Dell Inc., Sony Corporation, Toshiba Corporation, Nokia Corporation, Fujitsu Limited, Acer Inc, Oracle Corporation, and Motorola, Inc. However, even though the company is facing competition from the above mentioned competitors and many more, it has managed to remain at the top in terms of growth, (Apple Inc., 2010). This basically due to its ability of its management to capitalize on the strengths and opportunities of the company as well as devising strategies that can minimize the negative effectives of its weakness and threats.
Coordination Mechanism
Apple Inc. operates under a number of departments which dependents on one another to ensure the success of this company as a whole. As such there arise many challenges that are associated with this interdependency of the different departments of this company. In general terms coordination mechanism in this context refers to the mechanisms that the company has put into place to manage the interdependence between its various departments, (Gerald, 2003, pp. 59-63). One of the ways that is used to ensure that there is coordination within the company is by involving all the managers from the various departments in the decision making process. By so doing, all the needs of the different departments within the company and how they should be made are addressed; which ensure that there is efficient running of programs within the company. The other mechanism is by exercising high levels of control. In Apple, one of the roles of the management is controlling all the activities within the company. Lastly, efficient mechanisms of resource sharing among the various departments have been put in place in this company. This has been enhanced through sharing of information and operational resources among the departments of the company.
Organizational Structure
Apple Inc. is one of the companies that have had an effective management which is attributed to the growth of the company to date. In the initial stages, the company had no a clear defined organizational structure. Although the roles of the executive managers and that of the employees were clearly defined, the chain command was not clearly outlined. Many a times the company depended on the information that was obtained from the field in marking decisions, (Apple Inc., 2010). At first, this type of organization seemed to work well until the time when the company started experiencing problems in its growth due to lack of accountability; which was attributed to the lack of a clear chain of command. Emergence of growth problems called for a change of the structure of the company which has led to growth of the company into the entire globe.
Today, in terms of structure, the company is governed by a board of directors which is chaired by chairman, Steve Jobs who is also the CEO of the Company. Under the board of directors are senior executive managers who are in charge of the different departments of the company. They are located in different countries where the company has established its assembling branches. For instance, we have senior managers in charge of marketing, production, finance, and human resource. Notably, the senior managers are accountable to the board of director. Below the senior executive managers are the junior managers who are in charge of specific sector within the various departments of the company, (Henry & Ghoshal, 2003). The junior managers are answerable to the senior managers. Below the junior managers are the ordinary employees of the company who undertake the various activities within the company. Therefore, the present structure of Apple Inc. has clear top-down organizational structures which as enhanced accountability and clear channels for flow of information from top to bottom as well as from bottom to the top. Below is a diagram that explains the geographical organization structure of Apple.
Role of Management
Like in most of its competitors, the growth of the company that is evident in the recent times is attributed to the efficient management that is in place. The management undertakes different roles within the company. The first role of the management is planning. The managements undertake all the planning activities to be undertaken within the company. Precisely, this the responsibility of the board of directors who outlines these plans before instructing the lower managers on what is supposed to be done and at what time within a given working period, (Henry & Ghoshal, 2003, pp. 91-102). The other responsibility of the management is organizing. All the activities within Apple are organized in the way they are to be tackled. Before embarking on any project, a lot of research on the project has to be undertaken to enhance success rates. In most cases, Within Apple, it is the responsibility of the managers to organize how the plans that have been outlined by the directors it is going to be undertaken. Different managers are in charge of the different projects that falls under their area of operation.
Leading/motivation is another role that is mostly carried out by the management. In this case, the managers lead the employees who are working on the projects that have been outlined. In order to enhance innovation, managers create an environment that is conducive for sharing between the employees themselves as well as with the management. The last role that is performed by the management in Apple Inc. is control, (Apple Inc., 2010). Not unless the plans that have been initiated are controlled, the projects of the company will rarely be of benefit, if any, to the company. To exercise effective control, report on the various activities of the company must be submitted to those in charge from below to the top of the management chain. This is one way in which accountability within the company has been enhanced.
Strategy Development Problems
Apple’s development strategy mainly focuses on differentiation of its products. Arguably, the products of this Company are unique in terms of characteristics and feature, as well as are of a superior quality. Even though the company has experienced significant growth using this strategy, it is becoming a problem for the company to expand using the same strategy lately. One of the reasons why this strategy is failing is that it is not attractive to consumers who are conscious of price, (Gerald, 2003, pp. 45-9). Notably, almost all of the companies are relatively expensive associated to the high levels of technologies that are employed in the production of these products. Another reason for the failure of the strategy is that imitation by competitors is becoming a big challenge. Lastly, the changing customers’ tastes and preferences do not favor this strategy. Therefore, the company is at a risk of losing to its competitors who provide the same products even though their qualities are not comparable to those of Apple Inc.
Works Cited
Apple Inc.com 2010
Henry, M. & Ghoshal, S. The Strategy Process: Concepts, Contexts, Cases. New York: Pearson
Education, 2003
Gerald, A.C. Strategic Management. New York: Cengage Learning EMEA, 2003
