Essay: Organizational Change At Apple Inc. - A Case Study.

Introduce the change effort by including the situation, organization, industry, and explain the context for change.

Analyze the change effort. Provide considerable discussion about the following:

Description/images of the change held by the change agent.

Culture and the role of culture within the change process.

Diagnosis of change – what, why, any resistance.

Theoretical constructs and concepts that characterizes the change.

Chosen methods for implementing change-why and the anticipated outcom.

Description of resulting change and alignment with initial vision for change.

Communication of the chang.

Evaluate the quality of the outcome, processes, and the work of the change agents. Explain what went well and represented best practices. Also, devote attention to areas needing improvement and lessons learned. Present strategies for improvement and/or enhancement of success. Assure these strategies are supported with critical analytical reasoning.

An organization refers to an instrument individuals utilize to synchronize their actions so as to achieve what they value or desire (Veronica, 2008). Companies exist to add to specialization and the distribution of industry, to use extensive technology, to economize on transaction costs, and manage the organizational setting. In order to keep up with the fast growing and ever-changing business environment, today’s organizations are constantly enhancing their managerial structure. This is the official classification of authority and task relationships that control how individuals coordinate their actions and make use of resources in order to attain organizational aims. In every organization, there exists organizational culture which is a group of shared norms and values controlling organizational member’s exchanges with each other and with customers, dealers, and other individuals outside the firm (Kotter & Cohen, 2002). Managers are tasked with choosing and managing aspects of organizational culture and structure so that a firm can be in charge of the activities necessary for the achievement of its goals. This is referred to as organizational design.

For today’s organizations to succeed in their business transactions, it is necessary for a few changes to take place. Organizational change is the progression by which a company redesigns its formation and culture to shift from its current state, to some desired upcoming state so as to boost its effectiveness (Bennis, n.d.). Every existing organization has undergone or is planning to undergo this particular process in the course of its operations. Companies or organizations that have experienced organizational change process have also witnessed some form of resistance from employees for fear of losing their jobs. However, a number of strategies have been implemented in the course of the change to address this and other issues, ensuring that the change process is successful and achieves its objectives. Organizational change is a must for any company that wants to expand and uphold competitive advantage in today’s business atmosphere. Learning how to successfully use a varied workforce can result in better decision-making and more valuable staff.

The Crisis/Change effort and Processes, Organizational Culture and the role of culture within the change process

Introduction

In today’s fast-paced business environment, any business that is in search of the pace of change to slow is most likely to be quite disappointed. That is why it is necessary for organizations to embrace change. This particular process is considered to be important since without change, businesses are likely to lose their competitive edge, and in turn fail to meet the demands of a growing base of loyal customers. In this paper, we will specifically look at one of the Fortune 500 companies, Apple Inc., and discuss a recent situation it underwent with regards to organizational change. We will discuss the change effort and process, looking at the reasons why the change was necessary. We will also highlight any resistance that was present at the time.

Theoretical concepts and constructs characterizing the change at Apple will also be discussed, together with the methods for implementing change. We will be able to see how this change was communicated to the company’s staff and whether or not it was in alignment with the initial vision for change. The quality of the outcome, processes and the work of change agents will also be highlighted. Strategies for improvement and/or enhancement of success at Apple in the course of the organizational change will be discussed. In addition, relevant flow diagrams, charts, and surveys will be provided in the course of this paper. 

The Crisis/Change effort and Processes, Organizational Culture and the role of culture within the change process

Apple Inc. is United States conglomerate concerned with designing and manufacturing mainframe hardware, software, and other user electronics (Palmer, Dunford & Akin, 2009). This organization is well recognized for its Macintosh personal computer line, MacOSx, the iPod personal music player, and extremely loyal user-base. Having been established in 1976, Apple Inc. has been able to develop a unique reputation in the consumer electronics arena. Recently, the organization underwent two main organizational changes; its leadership and structure. The leadership change, in turn, had an effect on the organizational culture, something which will be discussed in a little while. Popularly considered to be a controversial genius and charismatic leader, the CEO and Chairman, Steve Jobs, has served for over a decade and is accredited for the worldwide triumph of the company (LaClair & Rao, 2000). Unfortunately, he passed away on October 5, 2011 following cancer complications. His death resulted in moaning for millions of individuals around the world, at the same time awakening anxieties for the outlook of Apple Inc. Tim Cook had already been named Jobs’ successor a few months prior to his passing on. Despite the fact that Cook is a long-term Apple senior manager with an excellent track record, this has not stopped anxieties about the sustainability of the organization’s business culture. This custom had been closely linked with Steve Jobs.

Leadership Change

The late Steve Jobs had been perceived as an untraditional leader capable of rallying numerous stakeholders for Apple Inc. for his vision while demanding excellence from his staff (O’Sullivan, n.d.). He was also recognized for his blunt delivery of criticism. When Jobs was CEO, Apple’s organizational culture was considered to be a power culture. He had focused the majority of the decision-making authority at his hands, often challenging staff for better performance, criticizing them indiscreetly if their presentations did not meet his standards. Jobs became well-known for pressurizing individuals and teams to improved performance and establishing a business culture of high of elevated level performance (Moritz, 2010). Interestingly, Jobs’ exceptional traits and headship style had established a power custom within Harrison’s Model of Culture outline (1972), something which has added to Apple Inc. becoming the most precious company globally, by market capitalization. The insinuations of personality and leadership of a leader in the establishment of organizational culture is quite vast in that actions and conduct of the leader is often copied by workers in inferior management levels. The organizational custom has a significant weight on members’ conduct and reaction to given situations. The staff at Apple Inc. drew on their cultural principles to direct their actions and decisions when faced with ambiguity and uncertainty. Therefore, leaders need to set their culture within their organization through their work ethics, techniques, communication, and general behavior (Lazonick, & O’Sullivan, 2000).

When Steve Jobs’ health started declining and concerns of interference with the performance of his duties at the company were raised, the place of CEO was taken over by Tim Cook, with Jobs serving as the Apple’s chairman until his passing away. It was crucial that Cook be highly competent to take over the power culture that had been established by Steve Jobs, lest he fails in his effort to be the new leader. The power culture that Jobs established at Apple had numerous drawbacks, such as under-utilization of employee creativity and initiatives, decisions of a leader not facing criticisms in lower management levels and high level of risk linked to decisions taken (Lazonick, 2010). People were concerned that the leadership skills of Tim Cook might not match those of Jobs.  It was therefore necessary for this new CEO to adopt a proactive approach with regards to promoting task culture within Apple Inc. through communicating relevant values to different organizational stakeholders in an efficient manner. Organizational stakeholders are those individuals who have an interest, stake, or claim in a company, in what it does, and in how well it performs (Freiberger, & Swaine, 2000). Furthermore, Cook was to assume the function of change agent in the transition from power culture to task culture. He was now responsible for setting new organizational goals and redesigning Apple Inc.’s structure. Notably, the CEO’s reputation and action would have a huge impact on outside and inside stakeholders’ perception of the company, and influence its capacity to draw resources from its surroundings.

Analysis of Change Effort

Apple Inc.’s organizational structure is hierarchical. This had been established by the late former CEO, Steve Jobs, as a way of ensuring focused realization of his clear vision and innovative ideas for the business.  The organizational arrangement has so far been subjected to definite alterations or changes since Tim Cook took up the leadership role in 2011. This new CEO welcomed the idea of devolution of decision-making to a definite extent in order to support creativity and originality at numerous departments (Chandler, 2001). Despite this, the organizational structure is still quite hierarchical. Apple Inc.’s structure is also tall, meaning that the hierarchy has numerous levels relative to the organization’s size. The figure below is an illustration of the company’s organizational structure at the senior executive levels.

Figure a:

Source: Burke, 2011

Apple’s organizational structure tends to incorporate some key components from other forms of organizational structure. Even though the victory of this particular company is associated with the leadership and innovation of its late founder, Steve Jobs, its organizational arrangement is partially accountable for ensuring the support for such guidance. Currently under Cook’s leadership, Apple Inc. has made a few changes in its organizational structure in order to suit the market and trade demands. The company’s organizational structure allows for it to keep on innovating quickly, thanks to a few important features of the new organizational structure under Tim Cook. These features comprise of product-based assemblage, function-based assemblage, and spoke-and-wheel chain of command (Thomas & Christopher, 2009). In the past, everything went through Jobs’ office where he made all the key decisions regarding Apple Inc. However, under Cook’s guidance, this form of managerial structure has slightly transformed in that there is now more teamwork among diverse departments of the firm, such as hardware and software teams. The top most level of Apple’s managerial structure has function-based grouping, a component of the functional type of organizational structure. Here, the senior leaders attend to business needs in terms of utility areas (Burke, 2011). On the other hand, the lower level of the company’s organizational structure has product-based grouping, a component from the divisional type of organizational structure. This enables Apple to attend to specific product or products components.

Diagnosis of change – what, why, any resistance

Organizational change is inevitable and it has to take place at some point in an organization’s existence. It usually takes place when an organization is making a move from its existing state to some desired upcoming state (Brown, 2011). Apple Inc., under the new management, realized that an organization that is able to manage change well, will eventually maintain its relevance and productivity over time. There are various types of organizational change, each requiring different forms of leadership action and effort. Developmental change is aimed at improving, refining, and enhancing what already exists. Transitional change, as is the case with Apple Inc., involves moving from an old to a new state with operations aimed towards creating the new and letting go of the old (Anderson, 2002). Notably, most change management literature tends to focus on this particular type of organizational change. Another form of change is the transformational one which emphasizes on key changes in identity, strategy, mindset, culture, and worldview. With transformational change, while the imperative for change is clear initially, the end point and total impact of the transformation is less so. There are a number of forces for change that might have pushed Tim Cook to implement a different strategy at Apple Inc., for instance, competitive forces, ethical forces, and economic forces.

Chosen Methods for Implementing Change

Similar to any other organization undergoing changes, Apple Inc. also witnessed some resistance to change, particularly from the old members who were used to Steve Jobs’ leadership style. Resistances to alterations can either be at the directorial level, group level, individual level, or functional level. At Apple Inc., resistances to change were mostly at the organizational, functional and individual levels (Van de Ven & Sun, 2011). As it has already been discussed above, Steve Jobs implemented a strict and authoritative leadership style where all decisions were made only by him. He had developed a traditional organizational culture and structure. This means that the staff adapted to Jobs’ expectations of them and formed habits that would ensure their retention at Apple. However, following Tim Cook’s entrance into the scene, the company’s staff had to drop their old habits and adapt new ones. There was some conflict due to this new power and members developed uncertainties and insecurity about their jobs. 

Theoretical constructs and concepts that characterizes the change at Apple

In the recent past, different theories have been used to try and explain organizational change and leadership, for instance, transformational leadership theory, Hersey and Blanchard’s situational management theory, path-goal theory of leadership, collective leadership theory, and the ‘Great Man’ theory, among others.  Two theories that can be used to explain the case of Apple Inc. are the Great Man Theory and Behavioral Theory. It is believed that the late CEO, Steve Jobs was a natural born leader, especially considering the fact that he managed to led the company into its current success. The Great Man Theory holds that people are born into leadership, and that a leader is born, not made (Choi & Ruona, 2011). Jobs had to learn his way up to the top and did not attend any special leadership training courses. His was inherent. On the other hand, the current CEO, Tim Cook, is a leader who was made, not born. According to the behavioral theory, any person can learn to be a leader. Even though Cook was introduced to the company while Jobs was still chairman, he had to learn how to be a leader, and a different one for that matter. As the paper has revealed, each of these individuals implemented distinct leadership styles and management, both of which have made Apple Inc. maintain and preserve its competitive advantage.

Chosen methods for implementing change, communication of the change and why the anticipated outcome at Apple Inc.

Alignment with Initial Vision for Change

There are various methods for implementing change in a given organization, and Apple Inc. opted for a few of these. They are communicating the underlying principle behind the need for alteration, executing the transformation in stages, and evaluating, assessing and reporting on change (Kotter & Cohen, 2002). The first technique for introducing any organization change was to communicate and explain to employees why it was significant for the change to take place, and the anticipated outcomes. Managers handled this particular process carefully and communicated it to all affected parties. Tim Cook acknowledged that if he had not communicated the change and missed out on this phase of the process, it would have almost certainly damaged the whole transition process before it even began. Most change can be divided into stages that can be reviewed along the way. Therefore, collaboration is key, and having a pilot group of workers to test this particular change before it is fully implemented is an effective way to ensure that more individuals accept what is taking place, and why (Fayol, n.d.). After implementation, it was expected that the process would be successful, and that all employees would adjust to the change process. Careful monitoring of the whole change process is crucial so as to measure its impact and evaluate its success.  

Strategies for improvement and/or enhancement of success

A strategy refers to a precise outline of decisions and actions that organizational managers take to use central competences to attain aggressive advantage and surpass their competitors (Watzlawick, Beavin & Jackson, n.d.). These competences refer to the abilities and skills in value creation activities which allow a company to attain greater efficiency, novelty, customer responsiveness, or quality. The following flow diagram shows how organizational strategy is incorporated into the value-creation cycle.  

Figure b:

There are four main levels of strategies for improvement and/or enhancement of success that Apple Inc. and other companies today can consider, for instance, functional-level policy which is a plan to combine organizational resources together with its synchronization abilities so as to establish central competences. Business-level strategies can also be considered, and these refer to plans to combine functional core competences to position in an organization so that it achieves an aggressive advantage in its industry (Palmer, Dunford & Akin, 2009). Corporate-level strategy which is a plan to utilize and extend core competences so that a firm not only can safeguard and expand its existing industry, but also can expand into novel domains, can be considered by Apple Inc. Perhaps the most suitable for this particular company is the comprehensive development strategy whereby the preeminent strategy is chosen to enlarge into overseas markets so as to acquire scarce resources, and develop core competences (Bennis, n.d.).  

Evaluation of Outcome and Work of Change Agents

Conclusion

In this paper, we have specifically looked at Apple Inc. Company as an example of how organizations address the issue of organizational change. We have also looked at how this company implemented change by using a few strategies, and how the change was communicated to parties involved. Moreover, we have also discussed a few theoretical concepts that are applicable to Apple Inc.’s case. Globalization has increased the markets and chances for more development and revenue. That is why today’s companies are trying to keep up with the fast-moving business world in order to maintain a competitive advantage.

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