Apple Inc. Organizational Structure - Paper Example

2021-08-25 14:56:47
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Apple Inc. is one a successful global corporation. Apples corporate structure usually applies a traditional structure. Apart from owing its success to the great innovation and effective leadership approach, the fortunes of Apple Inc. are also attributed to its corporate structure which facilitates the implementation of its main operational strategies. Tim Cook, who succeeded the founding CEO: Steve Jobs, introduced few changes which aimed at strengthening the companys position in the market, ultimately enhancing Apples efforts when it comes to meeting the industry demands. This task will focus on exploring and describing the nature of Apples organizational structure and how this structure enables the firm to accomplish its strategies.

Description of Apples Organizational Structure

Initially, Apple Inc. had adopted a traditional organizational structure. However, the dynamism in the industry prompted Apple to shift away from its original corporate structure and move towards to peculiar models of managing its organization (Elmer-Dewitt, 2011). Apple based its operations on the informal corporate culture concept as it applies to the technology industry, ultimately favoring the adoption of the flat organizational ad hoc structure to the tall corporate structure. Apples pursuit of innovative strategies compelled it to implement administrative adhocracy, which is crucial in enabling a firm to withstand intense competition and dynamic technology.

The management of Apple is facilitated by the Board of Directors, which is composed of eight members. Factors such as diminishing technology lifecycle and recent decrease in the sales of the companys products such as iPhones, iPad, and Mac, imply that modification on Apples organization structure is imminent. Apple Inc. has incorporated various elements of corporate matrix structure and divisional organizational structure to enhance the effectiveness of the companys new product development strategies (Dudovskiy, 2017). Apples corporate structure is divided into five separate business divisional structures which consist of entertainment and devices segment, the server and tools division, online section (online business services) and customer division.

At the top of the companys vertical organizational structure is the CEO, Tim Cook. When Steve Jobs was the Companys CEO, he had a hand in the management of various operations. However, Tim Cook has allowed the adoption of the collaborative leadership approach, through the departments of Senior Vice Presidents, Chief Design, Vice Presidents and Chief Operating Officer (Yarow, 2013). The section of the senior vice presidents includes segments such as retail, internet software and services, software engineering, chief financial officer, hardware engineering, worldwide marketing, general counsel and hardware technologies. This demonstrates that Apples corporate structure does not incorporate elements of matrix structure, but rather a divisional structure, which enables the companys activities to be classified in particular divisions.

Chief Design Officer, Chief Operating Officer, and Vice Presidents also constitute the second tier of the companys vertical organizational structure. Apples vice presidents are designated into different divisions which include User Interface Design, Communications, Industrial Design, Marketing Communications and Worldwide Human Resources (Yarow, 2013). This is an indication that Apples vertical and horizontal organizational structures apply decentralization of the companys activities (decision-making process). The collaborative management model adopted under Tims leadership has made Apple Inc. relatively more deliberate, thus leading to the delays (Dudovskiy, 2017). However, it can be asserted that Tim Cooks implementation of the decentralized and collaborative approach of decision-making has paved the way for the improvement in Apples levels of innovation and creativity in its operations.

The product-based consortium is another significant feature associated with Apples corporate structure. The companys products such as iPad, iWatch, Apple TV, Mac, and iPhone are attributed to collaborative approach of Apples product based groups (Elmer-Dewitt, 2011). It follows that the vice presidents of Apple Inc. across identified divisions are required to facilitate various activities such as preparation of customer accounts and sales, inventory control and record keeping. This has been achieved through the adoption of Apples divisional structure which allows the grouping and classification of the companys operations in different portions.

Feature of Apples Organizational Structure

According to Meyer (2017), Apples corporate structure plays a significant role as far as the companys rapid innovations are concerned. The development and designing of new products such iWatch and iPhones are attributed to the support provided by Apples corporate structure. Spoke-and-wheel hierarchy is one of the key feature associated with Apples organizational structure (Meyer, 2017). During the era of Steve Jobs, everything, regarding the companys management, went through the CEO (Steve Jobs). However, when Tim Cook took over, there have been changes in the companys organizational structure. The changes under Tims administration have focused on implementing collaboration of various divisions of the firm such as software and hardware units. Currently, the companys vice presidents have higher autonomy than they had under Steves management. This indicates that Apples organizational structure is now relatively less stiff, even if the CEO is at the center.

Function-based grouping is also another characteristic identified with Apple Inc. organizational structure, and this approach is derived from the upper tier of the divisional form of structure. There are senior vice presidents who designated business functionalities within a given division, and they report directly to Tim Cook. For example, has senior vice presidents for industrial design, marketing, retailing, general counsel and hardware technologies (Yarow, 2013). This is an indication that the feature of the function-based grouping in Apples corporate structure enables the companys top leaders to handle business needs which are related to their respective functional areas.

Product-based grouping is another significant feature associated Apple Inc. corporate structure, and it is derived from the companys lower tier. Below every senior vice presidents, there are vice presidents designated for various outputs and products of the company. For example, Apple Inc. has vice presidents for User Interface Design, Communications, Industrial Design, Marketing Communications and Worldwide Human Resources (Dudovskiy, 2017). The product-based grouping allows Apple Inc. to handle particular product components and issues related to its product line.

Apples Vertical and Horizontal organizational Structures

Apple Inc. vertical corporate structure was designed to promote the companys efforts in achieving particular dominance in the industry, thus ousting its close competitors. This involves focusing on the implementation of a business model which enables an organization to control not only its end products but also its components parts (Sunaina, 2015). For many years, Apple Inc. has inclined towards the vertical corporate structure, ultimately enabling the company to focus on integrating various operational features through the adoption of its hardware-and-software model. For example, Mac, iPad, and iPhone are made of hardware and software which has been designed by Apple. However, the growing demands of the technology industry made Apple Inc. rethink on its vertical integration strategy, which implies paving the way for the modifications on its vertical organizational structure.

Apple has also adopted a flat organizational structure to facilitate the implementation of the companys horizontal integration strategy. This model has enabled Apple Inc. to apply on employee-centered approach when it comes to promoting elements of teamwork and collaboration in the companys operations (Sunaina, 2015). Apples horizontal integration strategy involves expansion of its product line and services they render to its targeted market, while at the same time owning all of its retail stores and shops. Some of the services include Apple Store, Apple Store online, iOS App Store, iTunes Store, iBooks and iCloud. Apple Inc. corporate structure indicates that it is easier for the company to expand horizontally than its vertical expansion (Yarow, 2013). This has prompted Apple Inc. to focus on increasing its market share through the occupying of similar businesses.

The Role of Apples Corporate Structure in Accomplishment of its Strategies

The design of Apple Inc. corporate structure was specifically tailored to facilitate the companys efforts when it comes to the implementation of its strategies. Apples hierarchical and divisional organizational structure enables the company to integrate its different operational units. These functional components play a vital role in the contribution of ideas which strengthen the functioning of the organization (Sandoval, 2017).

The divisional structure adopted by Apple Inc. allows the company to pursue its horizontal and vertical integration strategy. Apples horizontal integration strategy involves expansion of its product line and services they offer to its targeted market, while at the same time owning all of its retail stores and shops. Some of the services include Apple Store, Apple Store online, iOS App Store, iTunes Store, iBooks and iCloud. Apple Inc. corporate structure indicates that it is easier for the company to expand horizontally than its vertical expansion (Yarow, 2013). This has prompted Apple Inc. to focus on increasing its market share through the occupying of similar businesses.

Apples organizational structure also enables the companys marketing unit to focus on empathy which allows the company to understand the needs of its customers as well as enabling the firm to eliminate unimportant issues and opportunities (Sandoval, 2017). Apples success is also linked to its Human Resource Department. The companys divisional structure ensures that employees across different units to understand their respective roles. This model also frees up the companys leadership tasks due to the efficient deployment of the workforce, thus allowing the top management to focus on critical managerial issues such as leading, provision of excellent customer services and inspiring employees (Meyer, 2017). Other divisions such as financial unit help the stakeholders in maximizing the value of their investment.

Conclusion

Apples organizational structure has contributed significantly to its success globally, as the leading corporation in the technology industry. After succeeding Steve Jobs, Tim Cook has modified Apples corporate structure, ultimately incorporating elements of collaboration and teamwork in the companys operations. It can be asserted Apples new organizational structure has enabled the company to devise strategies which suit the organizations business model.

References

BIBLIOGRAPHY Dudovskiy, J. (2017). Apple Organizational Structure A Hierarchical Structure that May Change in Near Future. Research Methodology , 1-7.

Elmer-Dewitt, P. (2011). Rethinking Apple's org chart. Fortune , 1-6.

Meyer, P. (2017). Apple Inc. Organizational Structure: Features, Pros & Cons. Panmore Institute , 1-5.

Sandoval, J. (2017). Apple's Organizational Structure. 1-7. Retrieved from http://www.academia.edu/7937905/Apples_Organizational_Structure

Sunaina, J. (2015). How Apple uses Vertical and Horizontal Integration? 1-4. Retrieved fro...

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