Functions Management the Purpose of This Report

Functions Management

The purpose of this report is to analyze the leadership and planning systems at Apple Inc. Apple has been one of the success stories of the past decade. Leadership has played a strong role in Apple's success, with the company generally thriving under Steve Jobs and struggling under other leaders. With Jobs' passing, the company faces a challenge of adapting its leadership and planning systems, both of which were centered around Jobs' charismatic leadership.

The study focuses on two sources of information. There is little academic literature on Apple, in part because of the company's famous secrecy. The business press, however, has analyzed the company's leadership and planning processes and was used as a source of information. In addition, literature focusing on the leadership and planning theories was used to develop the frameworks for analysis.

The findings of this report are that Apple's success in the past has relied on charismatic leadership and a highly centralized planning process. The death of Jobs will signal a change in the company's leadership style in the coming months and years, and this will bring with it significant challenges. It is recommended that Apple adapt to this change in several ways, including co-opting the memory of Jobs to maintain the veneer of charismatic leadership, while reverting to a more transactional style. The company will also need to make changes to open up planning and leadership to a broader group of employees, in order to tap into the latent innovation capabilities throughout the organization. This will help to replace the innovation function, if not the transformational leadership that has been so essential to the company's success.

Introduction

Apple Inc. was founded in the mid-1970s by Steve Jobs and Steve Wozniak as a maker of personal computers (FundingUniverse, 2011). It was the former who would eventually come to shape the culture of the organization and have significant influence during his terms as CEO on the functions of management used by Apple. The company has, in the past ten years, become a highly influential firm based on its marketing, its products and its culture, all of which are intertwined with one another. The company is somewhat secretive about some of its business practices, and coupled with its recent run of success this makes it all the more compelling a story.

In general, employee well-being is not a big concern at Apple. The company is famous for its culture of secrecy surrounding new innovations, and for the tight control that senior management puts on all significant activities within the organization. The well-being of employees is considered to the point that they need to attract and retain talented people, but that is as far as it extends. The company has been known to fire employees who violate its code of secrecy and even lie to employees about projects in order to spread misinformation (Stone & Vance, 2009).

This essay will focus on a few key functions that have proven essential to Apple's success. The essay will focus on leadership, something that has been critical to the company's success. In particular will be a discussion of succession. Lastly, the planning function is something that will be discussed. Much of Apple's success in the past decade relates to how well its product innovations, marketing, and fostering of corporate culture have worked together. This integration is not by accident, but rather the result of a careful planning process.

Discussion

Leadership is essential to the success of any organization, and for Apple leadership has been a key determinant of the company's success. A moderately successful, innovative firm in the 1970s and 1980s, Apple fell on hard times during the late 1980s and 1990s as the result of poor leadership after Jobs first resigned from the company. The company's reversal in fortunes began shortly after Jobs returned. Equally important was that when Jobs returned he had made adjustments to his strategies, but not the leadership style with which he had been successful (Kanter, 2010).

There is no shortage of leadership theories, but one that embodies Apple well is charismatic leadership. This theory of leadership rests on the assumptions that self-belief and charisma are important components of great leaders. People, it is assumed, will follow those who they personally admire (ChangingMinds.org, 2011). The common traits of charismatic leaders is that they are the ones who "pull all the strings," something that accurately describes Jobs' style. The other leaders at Apple -- each of whom was a failure -- could well have failed because the people at the company looked for charismatic leadership and found none. Apple thrives on people who believe fervently in the company, its missions, and its leaders. The company has extended this culture out to its customers as well.

Indeed, the current issue surrounding Apple is with respect to its leadership since the passing of Steve Jobs. When Jobs first stepped down as CEO, he remained the company's charismatic leader no matter how much or little he input to the company on a day-to-day basis. The company's identity became tied to Jobs, so it is a difficult task for the current leadership to maintain that culture in his absence. Yet, the current leadership recognizes two things -- that it does not have a charismatic leadership style and that it does not want to change the corporate culture (Mintz, 2011).

Going forward, Apple is likely going to introduce a new, hybrid leadership style. The corporate culture is not likely to change overnight, because so many of the people within the company are so immersed in the culture. In addition, whereas in many situations where leadership changes the new leader seeks to put a personal stamp on the organization's culture, this is less likely at Apple where the new leadership is part of that culture and understands how critical the culture is to the company's success. However, the new leadership under Tim Cook will need to lead differently. Two styles likely to influence the company in the future are participative leadership and quiet leadership.

Participatory leadership runs counter to Apple's existing leadership style, but it is a way for the new management to foster the maintenance of the Jobs-era culture going forward. While employees have traditionally been motivated by their dedication to the company and belief in the mission, the co-founder was always the symbol of that. It was easier to believe in Apple when Steve Jobs was running it. A shift, therefore, may be made to encourage more participation from employees. The employees would, therefore, see themselves as a significant part of the company, as the embodiment of Jobs going forward.

Quiet leadership is another means of co-opting the Jobs legacy into the future of Apple. While being unobtrusive is again counter to the traditional leadership style at Apple, it is means for the new leadership to allow Jobs to resonate over the company, specifically by failing to exert themselves. The new leadership can allow Jobs to remain a figurehead at the company, there in spirit, while they focus on the more transactional elements of running the business.

The one challenge that this poses is that the company would lack transformational leadership if management adopted a "quiet leadership" stance. Innovation leadership is critical to the success of Apple, and at least participatory leadership would allow for the organization's trop innovators to rise to the top. Whichever direction Apple chooses, replacing the style and effectiveness of Jobs' leadership is going to be a significant challenge. Transformational, charismatic leadership is difficult to replace. The company wants to channel the devotion the workers felt to their charismatic leader, but this could lead it to a management style where the new leader is too quiet, where decisions are made in committee or without any sense of vision or inspiration (Arora, 2011). The company has a deep roster of competent managers it should be noted, but none are battle-tested and at this point none have emerged as the sort of charismatic leader that may be required for the company to continue its pattern of success (Helft & Miller, 2011).

After leadership, the planning function is perhaps the most important for Apple. The company is fanatical about controlling its employees (Stone & Vance, 2009) but this is part because Apple wants to be able to formulate tight plans. Each element of the company's business has historically been carefully managed. This has allowed the company to enjoy considerable strategic synergy. As an example, the iPod was able to capture a large market share in the mp3 player industry not on the strength of an innovative product but on the strength of innovative market. In turn, the iPod requires iTunes to run. iTunes not only sells music, but is also gives non-Apple users a feel for Apple software. Eventually, the success of the iPod drove more customers to Apple's computers. As the company gained momentum it introduced a smartphone at a time when there was no consumer-centric smartphone. This tied back to the marketing of applications and again the product was highly-synchronized to the computers. The iPad is another extension of this concept. The family of products together ties in with the culture of loyalty and devotion, shared by employees and customers alike, to the idea of a family of products, something no competitor can match.

In hindsight, the moves that Apple made in the past ten-year are clearly the result of excellent planning. Apple has traditionally controlled the planning process at the highest levels of the organization. Those in lower levels typically have little to no sense of the company's broad plans and strategies. Even new product introductions are subject mainly to speculation, as little information leaves the center of power at Apple. This centralized planning process allows the company's products to have a high degree of uniformity throughout the family. The same industrial design team is responsible for each product, giving them a consistent look and feel. There is a team that works to ensure that there is as high a degree of synergy as possible in the software the different devices use, again highlighting that the planning process is based on a central team that attempts to build the company around a central vision. That vision, ultimately, was that of Steve Jobs, who is believed to have had final say about many decisions, particularly with respect to new products.

That reality presages a change in the way that Apple conducts the planning function. While the key players worked together to build a common vision and a role for each function (marketing, design, development) within that vision, there was always a final decision-maker. The risk now is that the planning process becomes different. It may become less centralized, with more people throughout the company becoming involved. It may be less focused on a single person, devolving more power to the other senior executives. Ultimately, however, some of the uniformity in the company's products and marketing came from uniformity of vision, and that in turn came from having a single individual's oversight on all significant issues. The company may decide that maintaining that system with a new CEO is still the best way to go, given how well that planning process has served Apple in the past decade.

Conclusions

At Apple, the systems that were in place during the Jobs era with respect to planning, leadership and even employee management worked brilliantly, as the company's shareholders will attest. The problem going forward is that those systems tended to be dependent on the charismatic leadership form. The company's leadership right now consists of followers, rather than charismatic leaders in their own right. This calls into question the viability of the company's systems with respect to delivering the same high level of planning. With respect to execution, it is expected that Apple can continue to excel. The planning, innovation and inspiration processes, however, need to be professionalized at Apple in order to effectively replace Jobs.

One of the things that Apple needs to recognize is that employee well-being is more important now than it used to be. The company had no qualms about treating employees poorly, such was their dedication. Their dedication to the memory of Jobs may be sufficient for the time being for the company to maintain the status quo with respect to employee treatment, but over time that will wane. Employees will need to be more engaged in order that they continue to feel a strong part of Apple culture. In addition, better treatment and a higher level of engagement among employees in general may allow some to flourish who otherwise would have not felt the opportunity. If lower level employees begin to flourish, this may become a source of innovation for the company. Such employees have a high level of passion and knowledge, and if given the opportunity may contribute the planning ideas, the innovation and the inspiration that the company needs going forward. Apple will, ultimately need to come into its own with respect not just to attraction and retention of talent, but to unlocking that talent's creative and leadership potential.

Management needs to be careful about disrupting the company's culture too much to make these changes. A company that has thrived in an environment of careful central planning should always be cautious when it starts to decentralize. Poor decision-making in general, and spreading the company too thin with a poorly coordinated family of products, is something that got Apple into trouble before. But even if the final decision-making authority still lies within the core of Apple's power structure, the company can take steps to foster loyalty, innovation and creative thinking at all levels of the organization.

Recommendations

There are five recommendations that can be made for Apple management with respect to improving its management practices as it transitions to post-jobs existence. The first is to retain the memory of Jobs as the charismatic leader. The company has relied on the charismatic leadership model so long that it risks floundering without the leader. Therefore, the leader must be retained in spirit, and invoked whenever the sense arises that dedication to Apple's culture and ideals is waning.