Executive Summary
Apple Inc. is a multinational information technology company that designs a number of IT products such as Mac Laptop, iPod, iPad and iPhones among others. The company employs a vertical integrated strategy hence able to control its operations. The company over the years has recorded major profits and this can majorly be attributed to its motivated employees, leadership structure, negotiation and change management strategy. The company’s continued success mainly stems from its motivated employees. By considering the hierarchy of needs, Herzberg’s two way theory and expectation theory, Apple’s employees are wholesomely motivated. With regards to leadership, locus of control, emotional intelligence and situation theories apply to the organization. The company engages in negotiation in its operations to win customers and spur more growth. Additionally, the company has an elaborate change management strategy that has worked for many years.
Overview of Organization
Apple Inc. is a multinational information technology company that designs a number of IT products such as Mac Laptop, iPod, iPad, iPhone, iTunes, desktop computers and OSX operating system (O'Grady, 4). The company is headquartered in Cupertino, California, USA. The company was founded by Steve Wozniak, Ronald Wayne and Steve Jobs, and was incorporated in 1977 (O'Grady, 4). In 1997, the company developed its first computer. The company started concentrating on consumer electronics such as iPad and iPhone as opposed to desktop computers, a strategy that has paid off well. As of 2001, the revolutionary iPod became the world’s best music player. In 2007, the company entered the smartphone market with the iPhone that has proved popular with many consumers. The company has also consumer software such as iCloud, iChat and iTunes. As of November 2012, the company had 395 retail stores operating in 14 countries (O'Grady, 4). Apple Inc. invests heavily in research and development hence the production of highly innovative products.
Apple employs a vertical integration strategy, a strategy it has used for 35 years. The strategy has enabled the company to be a leader in the computer and software market. Apple being a multinational has the resources necessary to manage the different stages of production hence the vertical integration strategy. The strategy enables the company to control production from the beginning to the end (O'Grady, 4). Additionally, the company sells directly to customers through its retail stores hence able to control prices of products.
Organizational Structure
Apple’s organization structure
Motivation
Motivation can be described as the process by which the efforts of a person (employee) are directed, energized and sustained so as to attain goals and objectives. Motivation often describes the desire-levels of employees to perform in their work. There are a wide range of motivators and include career development, good working conditions, job security, bonuses and good pay among others. Employees that are motivated would normally be more engaged to their work, invest more in their work and be more productive. Low motivation among employees, on the other hand, leads to low productivity among staff and hence poor performance by a company (Dess, 8).
Maslow’s Hierarchy of Needs
Abraham Maslow came up with the theory in which he posited that human beings are motivated by five needs essential to them that include physiological needs, safety needs, social needs, self-esteem and lastly self-actualization. According to Maslow, the physiological needs comprise of the basic human needs such as food, shelter, clothing, sex, air and water among others. He argued that when these needs are not met, human beings tend to feel discomfort, irritation, pain or become sick. Safety needs follow right after the physiological needs. These are the needs for a secure and safe environment (physical and psychological) free from threats of any kind. Social needs are the needs of one to feel accepted by others and develop meaningful friendships, be loved and be part of a group. Self-esteem (esteem needs) represent the needs by human beings to be respected, appreciated and recognized by others, and also their need to build a positive self-image. Self-actualization is at the top of the hierarchy and represents the human desire for self-fulfillment. Maslow argues that this need represents man’s desire to accomplish everything he could in his lifetime and become the best he could be. The hierarchy of needs states that the needs at the bottom of the hierarchy (lower needs) must be satisfied before satisfying the higher needs. Maslow argued that only when the lower order needs (physiological and emotional needs) are met is when higher order needs can be met (Dess, 8).
Maslow’s hierarchy of needs is being applied to the fullest at Apple Inc. Apple Inc. is a hub of highly motivated individuals that put their all at their job. Following on the strategies laid down by Steve Jobs, the management of the company leads through motivation and strive to create conditions that inspire employees to work hard. As a result of its highly-motivated workforce, Apple Inc. is the world’s most profitable company posting stellar results each financial year. By acknowledging how needs play a major role in compensation, job design and style of management among other key areas, the company’s strategies are in place to address the needs of its staff. The company ensures that the physiological needs of the employees are met by compensating them wholesomely to meet their basic needs. Additionally, the company provides financial incentives to its employees such as savings plans, flexible, investment options, benefits and rewards. Also, the company provides a good working condition for employees. The company has flexible schedules for the staff and the staff can engage in leisure activities present in the company.
With regard to safety needs, Apple Inc. ensures that the employees meet such needs by providing them with job security, flexible retirement benefits and a very safe working environment. The company provides full medical cover insurance to its employees, full time or part-time. Additionally, the company provides various schemes, sickness and pension, to its employees. The company has also made sure that the employees’ social needs are met. The company has created an atmosphere in which the employees work as a team and feel that they are part of bigger team. For instance, the company has eliminated bureaucracy within its operations and treats all employees equally. This has been the corporate culture of the company since its start-up days. For a long time the company has been voted as being one of the best places to work and hence promoting social needs of the employees. In order to fulfill the esteem needs of the employees, the company emphasizes on values such as self-respect, respect for others and compliments. The company has set in place a strategy for conflict resolution so as to ensure these values are fostered. Also, the appraisal system that the company has celebrates the achievements of the employees and recognizes their achievements. The company also offers discounts to the employees on some of the products such as iPhones and iPad among others. To meet the self-actualization needs, the company invests in extensive training of its employees to ensure that the can grow career-wise and also improve their skills. Additionally, by investing heavily in research and development, the company has allowed the employees to put their talents to full use leading to highly innovative products.
Herzberg’s Two Factor Theory
Frederick Herzberg proposed the two factor theory which states that in the workplace there are a number of factors that lead to job satisfaction and other that cause job dissatisfaction. Herzberg argued that in order to truly motivate individual, conditions that make them feel satisfied or fulfilled in the workplace must be created. Herzberg’s theory proposes that intrinsic factors are related to job satisfaction while extrinsic factors are related to job dissatisfaction. Motivators are the satisfiers while the hygiene factors are the dissatisfiers. According to Herzberg, the motivators are the physiological needs that are perceived to be beneficial to an employee. Hygiene needs represent the physiological needs that the employees want and expect to be fulfilled. The job satisfiers include the recognition of a performance or effort, increased responsibility, opportunity for promotion and improvement, and creative and challenging work (Dess, 10). The dissatisfiers, on the other hand, relate to the company’s policies and regulations, working conditions, compensation rates, supervision of work, job security, employee benefits and status.
Herzberg’s two factor theory is heavily applied at Apple Inc. The company has made sure that the efforts and achievements of the employees do not go unnoticed. Apple’s employees are praised and recognized for their efforts and accomplishments and are usually rewarded through rewards (bonuses) and also through promotion. The company also offers opportunities for growth through training and education. Additionally, the company makes sure that the job the employees engage in is meaningful, challenging and motivating to ensure that the employees perform at their best. All these are motivating factors that the company has instated to motivate the employees. Furthermore, the company offers the competitive remuneration for its employees. Besides, the company offers health care plans to employees and provides a safe, secure, clean and hygienic work environment. Also, its policies promote the performance of its staff.
Expectancy Theory
Expectancy theory describes the connection that employees expect between the efforts that they put in place and rewards they obtain at the end (Dess, 11). The theory outlines that an employee that performs very well and puts in extra effort in his or her work always expects to be rewarded accordingly. Rewards may include praise or compliments for work done, compensation, promotion or any other form of reward. Employees that work hard and lead to better results for a company often expect rewards for their services. Employees that are not rewarded for their efforts often feel left out and become unmotivated, leading to poor performances. Companies that thrive well today take into account the efforts of their staff and reward them accordingly based on their performance and efforts. Apple Inc. is one company that has taken into account the premise of expectancy theory. The company has a policy that ensures the efforts of its employees are rewarded. Through compliments from managers, salary raises, bonuses and other benefits, the employees are always rewarded for their efforts. The company also puts the high performing employees through training so as to build their skills and expertise. The company makes sure that no effort or performance goes unnoticed or unrewarded.
Leadership
Leadership is defined as the ability to influence a group of individuals towards the achievement of a specific goal and objective (DuBrin, 5). For organizations to achieve optimum effectiveness, they need strong leadership and management. An effective leader is a person who acts as a team player, empowers others and mobilizes employees towards the achievement of the company’s vision. Apple Inc. is one company that has achieved immense success as a result of effective leadership over the years.
Locus of Control
Locus of control is a principle developed by Julian Rotter and examines the level of confidence a person has on his or her fate as a leader. It is the level to which people expect that they can control events that may or may have impacts on them (Dess, 11). The principle describes the extent to which people perceive that outcomes are as a result of their own actions or behaviors or from forces that are beyond their control (external forces). As a result, there is the internal locus of control and the external locus of control. Leaders with an internal locus of control tend to take more responsibility for their actions despite the results (Dess, 18). On the other hand, those with an external locus of control who tends to look at everything around them as part of failure or success. They will attribute success or failure to environmental factors such as luck, fate and timing among others. A leader with an internal locus control is favored by others simply because he or she takes responsibility for events (DuBrin, 7). Such leaders demonstrate a strong belief in self-efficacy and often believe that they can change unfavorable conditions.
At Apple Inc. the leaders demonstrate an internal locus of control. Steve Jobs, who was the company CEO for a very long time before resigning, demonstrated an internal locus control. Jobs is one leader that believed in his ability to change unfavorable conditions and lead to meaningful change (Reinfeld, 4). Right from the start, Steve Jobs could be seen as a visionary and transformative leader. Jobs steered the company into the best company in the world and this could majorly be attributed to the values he believed in and the vision he had for his company (Elliot, 3). He believed in perfectionism and this led to good products for the market. His decision-making ability, although sometimes questioned, always led to better results for the company. As an innovator himself, the company has churned out the best innovative products over the years. Even with his death, the company still thrives on the vision he set out and rides on the beliefs he had for the company (Elliot, 4).
Emotional Intelligence
The concept of Emotional Intelligence (EI) has for a very long time been viewed as a predictor of leadership success in the workplace (Goleman, 1). Emotional intelligence is defined as the ability to regulate one’s emotions and those of others, discriminate them and use this information as a guide before taking action. A number of people have posited that EI contributes to a person’s capacity to lead others, work effectively in a team and manage stress. It is argued that leaders who are unaware of their own emotions may miss vital emotional signals from workers and may easily make decisions based on their emotions. For instance, a leader may lash out a worker when annoyed or angry.
Apple founder and CEO for a long time Steve Jobs was seen as a transformative and effective leader although he was not seen as being emotionally intelligent (Elliot, 5). Jobs portrayed most qualities of an effective leader including visionary, decision-maker, assertive, intelligence, passion and innovativeness among others. However, reports claim that he was known to scold people, cry in meetings and swear at people. This shows he lacked emotional intelligence. Despite these flaws he was able to tap into his strengths and drive Apple to tremendous success. Tim Cook, the new CEO, is considered to be emotionally intelligent as he is known to influence people and maintain close relationships with the company’s staff (Reinfeld, 5). By tapping into the foundation that Steve Jobs laid, he has been able to ensure the company continues to post better results each year.
Hersey-Blanchard Situational Theory
Situational theory developed by Paul Hersey and Ken Blanchard has gained much prominence over the years and is being applied by various companies. It is a contingency theory that focuses on the followers (employees). Focus on employees is due to the fact that it is the employees that reject or accept a leader. It states that effective leadership is achieved through the selection of the best leadership styles contingent on the level of readiness of the employees to perform tasks (DuBrin, 23). The theory gives the analogy of a parent-child relationship. Just as a parent relinquishes control of a child as s/he matures, so should leader-follower relationship. The theory states that effective leadership depends on the ability of the followers and their motivation. At Apple Inc. the theory is in force. The management of the company knows how important employee motivation relates to the acceptance of their leader. As a result, employees are motivated by competitive salaries, good working conditions and rewards among others. The company also has a non-bureaucratic system and hence easy access to managers and other leaders (Reinfeld, 6). With emphasis on team work, leaders and employees relate freely and employees also give their opinion on various issues that could improve the company.
Negotiating
Not only does leadership require vision, self-confidence and charisma but also negotiation. Good leaders also portray an effective negotiating skill. Leadership has its limits and sometimes the people being led are more powerful than the leader. For a leader to persuade people to follow him or her, the leader must communicate to them effectively, appeal to their interests and sell the vision to them (DuBrin, 28). Al these are part of effective negotiation.
Stages of Negotiation
Negotiation involves four key stages that include: preparation, discussion, proposing and bargaining. Preparation involves the collection of relevant information before entering into a negotiation. This involves gathering the relevant facts, economic issues, legal issues and any other relevant information. For instance a person negotiating salary for a new job must gather information about the job beforehand. The next stage involves discussion of the information with the relevant parties. At this stage, both parties try to determine what should be addressed. At this stage it is important to get much information from the other party. At the proposal stage is whereby the two parties in negotiation try to come up with solutions or decisions. Each party comes up with its proposal which is discussed further. The last stage is the bargain and involves arriving at a solution that will leave both parties satisfied. Apple Inc. employs negotiation in a majority of its operations, whether hiring, developing a new product, selling products to masses or resolving conflicts. For example, Tim Cook used negotiation in changing the company’s culture towards larger cooperative teams. He engaged in negotiations with staff and co-leaders.
Negotiating Strategies
A good negotiation strategy is important in negotiating. A negotiation strategy that responds to your interests and the other party’s interests will lead to valuable outcomes. A number of strategies exist including: problem-solving, contending, yielding, compromising and inaction. Problem solving involves both parties examining and discussing issues deeply so as to arrive at a solution. Contending involves convincing the other party to concede to your side during bargaining. It is trying to win them over. Yielding is conceding a part that is not as valuable to you but valuable to the other party. Compromising is making sacrifices and settling for an outcome favorable for each party. Lastly, inaction is buying time during negotiation so as to gather more information and scrutinize the proposal. Apple Inc. engages widely in negotiation and hence has made use of these strategies. In settling the Samsung copyright infringement case, the company had to compromise as Samsung is one of its major suppliers. The company uses contending in trying to win customers.
Across Culture Negotiations
Cultural differences often play a part in negotiations and hence the need to understand them before arriving at decisions. Cultures influence behaviors and actions of people. Due to these differences, it is difficult to arrive at solutions easily. Strategies and different types of negotiations need to be used. For example, compromises have to be made and sometimes the negotiation may employ the problem-solving strategy. Apple Inc. is a company that has diversified its operations and mainly conducts its manufacturing in China. Given the cultural differences, the company has to negotiate with the employees in matters related to work conditions, nature of work and compensation among others. Failure to negotiate across such cultures would be detrimental to the company. Also, the company employs different people from all over the world, hence the need for cross –cultural negotiations.
Change Management
Organization Culture
Change management could mean defining and implementing procedures or technologies to enable cope with the changes in the business environment (DuBrin, 24). Change is inevitable as from time to time businesses have to adapt to the changing environment. Adaptation to change is key to effective change management.
Managing Change
Managing changes in the business environment can be tough. Opinion is sharply divided on which factors influence the most the transformational initiatives. Over the years it has been found that effective change management is related to the organizational culture, leadership and motivation levels of the employees. Apple Inc. has undergone changes through the years and has always emerged stronger (O'Grady, 10). Recently, there was a change in leadership where Tim Cook replaced Steve Jobs. Many predicted tougher times for Apple but this has not been the case. Cook has been able to adapt easily and has steered the company to greater profitability leveraging on the foundation laid by Steve Jobs. It is clear that the company’s organization culture allowed this change and the staff was motivated enough to allow this quick transition.
Measuring Change
Measurement of change should be considered during the planning stages of the impending changes. Measurement is done to motivate employees to perform effectively as requires and to provide guidance towards the achievement of goals and identify pitfalls. Success is measured based on the motivation levels of employees and the attainment of goals and objectives (O'Grady, 10). With the leadership change at Apple, the company has seen continued growth, meaning that the change has been successful so far.
Conclusion
Apple Inc. is by far one of the best companies in the world. Much of its success can be attributed to the motivation levels of the employees, its leadership structure, negotiation strategies and strategies for change management. Apple’s employees are highly motivated as can be explained by the hierarchy of needs, Herzberg’s two way theory and expectation theory. Its leadership can be regarded as visionary and transformative as can be explained by the leadership theories (locus control, emotional intelligence and situation theory). Additionally, the company employs a number of negotiation strategies to enable it win customers, promote sales and ensure productivity. The company’s change management strategy is also commendable given that it has been able to lead to profitability over the years.
Works Cited
Dess, Gregory G. Strategic Management: Text and Cases. New York: McGraw-Hill/Irwin, 2012. Print.
Dormehl, Luke. Different Thinking: Steve Jobs, the Counterculture and How Apple Inc. Took Over the World. London: Virgin, 2012. Print.
DuBrin, Andrew J. Essentials of Management. Mason, Ohio: South-Western/Thomson Learning, 2012. Print.
Elliot, Jay. Leading Apple with Steve Jobs: Management Lessons from a Controversial Genius. John Wiley & Sons Inc, 2012. Print.
Goleman, Daniel. Emotional Intelligence. New York: Bantam Books, 1995. Print.
O'Grady, Jason D. Apple Inc. Westport, Conn: Greenwood Press, 2009. Internet resource.
Reinfeld, Carina. Influence of Leadership on Motivation in an Intercultural Context. Illustrated by the Comparison of the Leadership Styles of Steve Jobs and Tim Cook (apple Inc.). , 2015. Internet resource.
