Apples Organizational Culture - Case Study Example

Organizations as culture Introduction Culture is a shaping template and a body of different learned behaviours in the form of shared meanings, ways of managing role relationships, and distinct techniques of working and assessing outcomes. In every organization, man values, beliefs and norms are shared by all organizational members (Sutton & Nelson 1990, p. 865). Culture serves many functions within the organization. It creates a sense of identity among all organizational members and it sets limits on behaviour. Culture also shapes attitudes while at the same time generating commitment and enhancing social stability. Additionally, it is an effective sense-making and control mechanism. This paper assesses the concept of organization as culture, with the organization under analysis being Apple Inc. Apple Inc is one of the most reputable companies in the world. Its iconic products are popular and the company’s notoriety for secrecy is well recognized. Indeed, the company imposes extremely harsh sanctions on any employee who violates its rules on information sharing. Some of the products whose release was shroud in secrecy include the iPhone and itunes. Although the iPhone is a great gadget, Apple chose to keep all information regarding it a jealously guarded secret. The corporate culture at Apple is a socially constructed reality that is created and sustained through different kinds of ideologies, beliefs, rituals, norms and values. Although a cohesive culture is an ideal basis for success, it can easily serve as a trap in Apple’s corporate setting. Part A of this paper highlights different aspects of Apple’s organizational culture and its manifestation. It also points out various negative aspects of the resulting corporate culture and how it impacts on the company’s performance. Part B will review and explain Apple’s organizational culture from the view point of another organizational example, that of Canon Inc. Part A Unlike other providers of operating systems, such as Microsoft, Apple’s corporate culture always rejects publicity in matters regarding advice on which anti-virus software users should install. Apple rarely comments on the security level of its products, unless it is advertising matters involving security. Even when there are new software releases and patches, Apple rarely gives out detailed information on their relevance and use. It is common for many employers to be just as surprised as members of the public at announcements of new products, notably the original iPod. Claims of the company’s managers spreading wrong information deliberately are also rife. Giving down false facts deliberately in matters of pricing, features and dates of launching serves the purpose of narrowing down leaks. Typically, the employees who spread the leaks are fired. This culture of secrecy attracts the attention of the public, whereby attention is always focused on the likelihood of Apple presenting the world with another surprise (Nonaka & Kenney, 1991). Indeed, announcements have an air of rituality about them; they are well organized and are always performed to an attentive audience. The culture of high motivation for security seems to have stemmed from the Macintosh era. Microsoft and Sony became aware of this product even before its launch. Since then, Apple has been making great efforts to restrict access to information in order to maintain surprise. The ideology of secrecy is also a reflection of the personality of Steve Jobs, the company founder. The prevailing organizational culture at Apple has created many challenges for managers. Although it has led to increase in the level of innovation and productivity, the culture of dedication has bestowed a challenging management task on Apple’s leaders. Many employees tend to forget that there is life outside Apple; that they have families that they also have to look after. The company rarely has enough people to get the job done, thereby forcing the few available staff members to work overtime in order to meet all set targets. Many employees have to work for between 60 and 70 hours each week. Culture functions through artefacts, which are always visible but rarely decipherable. It also functions through values and norms, which constitute a greater level of awareness. Culture also takes the form of assumptions, which are invisible, hence always taken for granted. Norms and values can be observed in artefacts, which can include behaviour, physical objects, verbal manifestations and behaviour of the organization’s culture. At Apple, one is likely to see employees always busy to accomplish tasks that simply do not seem to an end (Reimann & Wiener 1988, p. 40). Although this artefact is highly visible, it is one of the most superficial manifestations of the culture of Apple. Additionally, it gives more shared meanings than any other artefact. At Apple, just like in any other organization, culture also brings about change in individuals, particularly in times of great difficulties. At a time when Apple was in survival mode, almost everything controversial was readily excused as acceptable for purposes of letting the company survive. Meanwhile, many changes in organizational culture have been taking place over the years. Different reasons cause these changes, most significant among them being changes in leadership. This factor has resulted in transformations in the relationship between Apple, its customers and employees. Although some changes have been taking place with regard briefing customers on future technologies, field employees continue being asked to leave the room during such announcements. This ritual has become part of the company’s established culture that simply cannot fade away. The changes in consumer buying habits have also shaped Apple’s corporate culture a great deal (Morgan 2006, p. 112). Sometimes, what works best for product development does not reflect positively in sales. This unfortunate scenario has forced some management people at Apple to encourage the notion that customers do not know what they want, and therefore, have to be told what they need to buy. During the 1990s, Apple Inc. employees spent a great deal of their time with product advisory councils and focus groups (Garsten1994, p. 63). This marked a change in corporate culture that led to a turnaround in sales volumes under the leadership of Steve Jobs. However, continued absence of key executives in field operations created the impression that they had become arrogant and disinterested in building and maintaining key relationships with customers. Its cultural emphasis on consumers rather than enterprise customers also became increasingly overt. Apple’s culture, like all others that are made up of socially constructed realities sustained through different values, ideologies and norms experienced a significant conflict with issues relating to strategy. In most cases, competition between strategy and culture resulted in a convincing win for the latter. The resulting misalignment between culture and strategy resulted in a slow pace of instituting systems necessary for creativity and innovation. This is because the culture was tightly controlled and highly controlled. The main elements of Apple’s corporate culture that make the company’s ideology distinct include focus on design, believe in task procedures, emphasis on unique application of technology, and the belief that Apple is much better than any other technology company. This culture is so unique that employees who join this corporation from other corporate establishments often suffer from the problem of cultural incompatibility. In terms of design, Apple puts emphasis on an accurate understanding of the demands of consumers. Beating expectations is one of the things the employees at the company are expected to do in order to prove that they are up to the tasks entrusted to them. Ignoring the element of design is tantamount to nurturing the metamorphosis of the company into a completely different corporate establishment. The cultural reality that has been constructed at Apple extends beyond employees; it applies to consumers as well. The same expectations that are bestowed upon employees also apply to consumers. Consumers, for instance, are expected to maintain confidence in the company’s management to revive its fast-ageing business model. On their part the company’s managers take it as their responsibility to deliver top-notch products into the technology market. One of organizational culture’s most negative aspects is that a single event can result in the establishment of an ideology. Apple’s founder, Steve Jobs believes that his company is the best among its peers and will always remain like that. This belief has embedded a culture of a bloated ego that Apple’s employees have to keep defending all the time in a world of ever-changing technologies. Surprisingly, the company’s top leadership does not appear to have a good grasp of the subcultures that have been nurtured among factory-line employees. The resulting clash of cultures leads to counter productivity. Furthermore, the presumption that customers are wrong has resulted in lack of understanding of enterprise customers, who end up being treated just like consumers. The company has made it the standard operating procedure for customers to have the right phone numbers whenever they want any form of assistance yet things do not work best that way. Moreover, customers who have been told what is good for them can easily be convinced that they need to haul their products to the nearest Apple store to get assistance. An inefficiency that is commonly cited by consumers relates to the manner in which issues of support, sales and repair are handled. The inefficiency mainly arises from the corporate culture that nurtures inappropriate ideological conceptions. This is a trap that Apple owners got into over ten years ago when the company started operating like the hardest companies to deal with in issues of the sales process. Although it was a great idea to focus inwardly on creating great products, this same inward focus appears to have failed to deliver positive results in the area of customer relations. Moreover, it has ended up making extremely hardworking employees encounter losses in terms of job performance levels and outcomes. Whereas these employees may have helpful answers to customers, they are always at loggerheads with top management, which claims to have the monopoly of all the answers. No wonder these employees feel less empowered to handle their customers’ needs. Micromanagement also rules the field in terms of sales. In a context of scarce resources that continues to plague Apple, this culture does not bring about the best in employees. The most critical roles are played by people who are not empowered while the people who weird most of the powers do not seem interested in company’s affairs. Apple’s culture of micromanagement, lack of power to resolve all customer issues and having to keep adapting to the Cupertino view of the Apple appears to be the trap that the company’s employees have to maneuver in order to retain their jobs. Employees that it helps to do anything that will make them retain their jobs. It is not surprising, therefore, that some of them lie flatly or become unresponsive to customers’ requests. They understand that such requests may necessitate a decision, which can put them on collision path with the management. The sales culture at Apple is also problematic. The company’s top management advocates that sales people have to do anything in order to make big returns, even if it means completing with other sellers at Apple who have already been assigned predefined spaces. This creates an awful situation where Apple’s main competitor is neither Dell nor HP, but other Apple resellers and Apple organizations. This culture, though cohesive, serves as a trap, leaving other partners in the Apple sales business suffering. For a company such as Apple, which has limited sales resources, this is the most counterproductive sales culture to create. Part B In May 2010, Apple Inc surpassed Microsoft as the largest electronics company in the world. This improvement in Apple’s fortunes was largely attributed to Steve Jobs’ introduction of a new culture, one that blends elements of innovation, culture and secrecy. This part of the paper compares Apple’s corporate culture with that of Canon Inc in order to assess the similarities and differences in the approaches adopted by these two unrelated companies. Canon was founded in 1933 for the purpose of manufacturing 35mm cameras. Throughout the 1950s, the company experienced tremendous growth. However, during the 1960s, the company faced the challenge of having to diversify into areas of office machinery, mainly in the form of calculators and copying machines. The company’s fortunes started falling due to a drop in the company’s sales, forcing the company to suspend payment of dividends and to pull out of the low-priced calculator market. However, Canon managed to pull its resources together. The company had already accumulated a diverse technical staff of about 3,000 engineers consisting of mechanical engineers, electronic engineers, physicists and chemists. Issues of quality management and innovation were at the core of the company’s success in production of plain paper copiers during the 1980s. As a rule, the company’s teams of representatives held weekly meetings jointly with groups drawn from the production engineering section in order to decide on all different production matters. These meetings greatly reduced the time taken between development planning and completion of a product. Apple Computer, Inc. is different from Canon in many ways, although there are many similarities with regard to the product development processes that both companies adopt. Apple was incorporated in 1977 one year after it started selling personal computers made in the garage of one of the founders. In 1982, the company’s sales had reach $750 million. However, the early eighties were difficult times for Apple, mainly because of poor market performance of the Lisa and Apple III. With the management being in the hands of the founders, the company suffered from the problem of bureaucratic and financial discipline. The resulting confusion led to many R & D projects commencing simultaneously. After being left out of the Lisa project, Steve Jobs started looking for a Macintosh project that would compete with Apple for resources in order to produce an ‘insanely’ great computer (Garsten 1994, p. 61). The Mac team, which initially comprised of three members, increased to 28 in 1982. Communication and interaction among members was closely-knit, and it led to incorporation of new features into the computer. The company’s obsession with the culture of secrecy dates back to these times. As Morgan (2006, p. 61) points out, it is difficult to point out the evolution of a distinct culture from the outside. For the insiders at Apple, however, the aspects that outsiders took for granted were the ones that mattered most. It did not matter they seemed bizarre and superficial. In this regard, the culture that facilitated the goings-on at the Mac project was different from the one that was employed for Canon PC. However, just like at Canon, managers at Apple were always an integral component of the design and production process. This created crucial artifacts that could be of little significance to an outsider at first glance. Another crucial cultural artifact was the positioning of the Mac team building, which was situated separately from the rest of the company’s premises, creating an atmosphere of constant and intense in-house interactions. However, this was a cause of conflict with other sections of the corporation in terms of coordination and technology transfer. The different cultures that can be discerned in both the Canon PC project and the Mac Project are as a result of differences in the way the top management handled all the processes. In both cases, though, slogans worked effectively in motivating members of the design and production teams. For Apple Inc., the position of Steve Jobs as the ‘product champion’ has always been critical to the shaping up of the company’s culture (Reimann & Wiener 1988, p. 39). Steve Jobs always made the final decisions and continues to do so. This autocratic system creates a culture where good ideas are ignored because of the preconceptions that Jobs harbors (Sutton & Nelson 1990, p. 865). Although Jobs’ position as a product champion is crucial, he often brings about significant complications into the design and production process. For Canon, the role of product champion was completely different: individual play was never allowed, submission of patents was done through teamwork and commitment to new technology was required of every team member (Nonaka & Kenney 1991, p. 69). Hiroshi Tanaka, the product champion at Canon at one time said that ‘no Canon project has ever succeeded when a selfish person is put at the leadership position, no matter how capable he may be’ (Nonaka & Kenney 1991, p. 69). Innovation, for both Apple and Canon, has been modeled into a culture of creating information in a process that involves a lot of social interaction. Through innovation, a company creates an effective structure within which creative processes are located. For this culture to be nurtured, an atmosphere of intense communication on a daily basis is necessary. Both Canon and Apple have succeeded in creating new conceptions of products through use of analogies and metaphors. In most cases, these new understandings have proven useful whenever these companies want to reassert their position of dominance in a market characterized by feelings of ambivalence. For Canon, the aim has been that of taking established products and redesigning them for a large market. For Apple, the goal has been undertaking a fundamental step ahead in the area of personal computing. In terms of hiring practices, Apple has traditionally been poaching talent from other technology companies, notably Hewlett Packard and Xerox PARC & Kenney, 1991, p. 70). Although this brings about ease in recruitment, it has a negative effect, whereby employees leave the company more readily than before. This state of affairs is evident in the fact that almost all the employees who developed the Mac have left, including Steve Jobs. The experience and information possessed by these employees constitutes lost assets for Apple. At Apple, the founders of the organization have exerted profound influence on its organizational culture. The founders were responsible for creating the initial culture. Similarly, the history of the individuals in the founding team is also significant. The individual that most people focus on is Steve Jobs. Shared experiences have served to galvanize the existing culture. A comparison between the culture of Canon and that of Apple also reveals the significance of national cultural differences. In this regard, organizational culture is viewed as a manifestation of the national culture. For example, in issues of recruitment, Canon adopts a policy that adheres to the Japanese culture of long-term employment contracting. This system requires Japanese firms to draw largely on internally nurtured talent during high-level recruitment processes. Conclusion Attempts to manage the organizational culture have succeeded at Apple. Steve Jobs has managed to blend elements of culture, innovation and secrecy in order to make Apple the world’s largest technology company in 2010. On the other hand, Canon’s main cultural highlight is a stable process of maintaining a long-term employment practice in order to create innovative products while at the same time achieving growth. In sharp contrast, Apple’s project was characterized by a chaotic start-up, an autocratic leadership style and high-velocity growth efforts to integrate new technologies into the evolving system of corporate formation, growth and decline. The comparison of the different in which these companies have developed their cultures illustrates the fact that culture is an integral part of corporate formation and growth. Additionally, it is clear that even the best of corporate cultures can have some negative aspects that may be counterproductive. References Garsten, C 1994, Apple World: Core and Periphery in a Transnational Organizational Culture: A Study of Apple Computer Inc., Coronet Books, Philadelphia. Morgan, G 2006, Images of organization (updated edition), Sage, California. Nonaka, I, & Kenney, M 1991, Towards a new theory of innovation management: A case study comparing Canon, Inc. and Apple Computer, Inc. Journal of Engineering and Technology Management, Vol. 8 No. 2, 67-83. Reimann, B, & Wiener, Y 1988, ‘Corporate culture: Avoiding the elitist trap’, Business Horizons, Vol. 31, No. 2, pp. 36-44 Sutton, C, & Nelson, L 1990, Chronic Work Stress and Coping: A Longitudinal Study and Suggested New Directions, The Academy of Management Journal, Vol. 33, No. 4 (pp. 859-869) Read More