User:Soc25ty/Management Practices of Apple Inc

Founded in Palo Alto in 1976 as Apple Computer by Steve Jobs and Steve Wozniak, Apple, Inc. is a worldwide leader in consumer technology and recently became the most valuable public company of all time. Since its inception over thirty years ago, when it only sold personal computers, Apple has introduced devices and software that have changed the face of industries from music and television to education and telephony. Along the way, the company expanded from two employees to over 70,000, with offices worldwide and manufacturing contracts across Asia for production of Apple devices. In addition to standard personnel and manufacturing issues prevalent among large corporations, however, Apple has another powerful influence on its management practices: the science and design behind the company’s products, which changes as fast as (or in many cases faster than) the dynamic technology industry. This evolution placed tremendous strain on Apple’s organization practices, which proved increasingly resilient as the 21st-century brought the introduction of three new industry-busters with the iPhone, iPad, and iCloud.

Hub-and-wheel management
From the outset, Apple was a team-effort led by Steve Jobs’ charisma and salesmanship, with which he was able to sell computers and attract brilliant talent. Throughout Apple’s history, from its earliest days to Jobs’s death in 2011, the company remained a loosely organized, horizontal structure, with Steve Jobs as the linchpin; Steve was the sun of the Apple universe, with all mid-to-major strategic and executive decisions going through him. As the company became successful and IPO’d, the core mentality remained staunchly anti-bureaucratic. Steve Jobs describes the original Macintosh team as a group of hippie geniuses who were passionate about technology and personal computing, and built the product they wanted to own for a price they’d want to purchase it. It was this staunch opposition to conformist business practices that led to the 1985 power struggle between Jobs and newly-minted CEO John Sculley that eventually saw the founder ousted. Sculley subscribed to a hierarchical approach to accountability with regulated hours and benefits that directly opposed the hub-and-wheel Jobsian management style. In Sculley’s words, “[Steve] did not respect large organizations. He felt that they were bureaucratic and ineffective. He would basically call them ‘bozos.’”

Upon his return to Apple in 1997, Steve made returning to the hub-and-wheel model an immediate priority of the ensuing corporate shakeup. He met with hundreds of people in every facet of the company, regardless of rank, asking them a series of questions that put them on the defensive about their jobs, and retained only the ones he liked: “He had total disregard for the hierarchical chain of command. He would remember what several hundred people did and call on whomever he needed, always bypassing their managers”.

By building up personal knowledge of specific employees and motivating them to take pride and responsibility over their product areas, he built task forces that were the best at what they did. But another sentiment grounded Steve’s power at Apple: fear. Jobs was well-known as a ruthless leader who demanded nothing but perfection. Employees feared that a misstep during a brief encounter with the CEO, even in an elevator, could get them fired. In reality, off-the-cuff terminations were few and far between, but by instilling fear of failure in his employees and simultaneously fostering a secretive culture based on the notion that Apple’s technology and design was years ahead of its competitors, Jobs was able to create a cult-like atmosphere that drove performance far better than the traditional bureaucracy it replaced.

The Tim Cook era and Apple’s supply-chain
After Steve Jobs’ death in 2011, control of the company passed to former-COO Tim Cook. Cook had joined Apple in 1998 and quickly made a name for himself by revolutionizing Apple’s supply-chain. As a member of Nike’s board of directors, Cook was familiar with mass-scale manufacturing and distribution, and was able to translate that to the fickle technology sector. He organized deals with Chinese parts suppliers and manufacturers like Foxconn, and was able to forecast consumer demand to minimize excess inventory. While Jobs was still CEO, Cook had played a crucial role in vertically integrating towards the consumer by managing all inventory worldwide for the Apple Retail Stores, which ended up being a gigantic win for the company. His position at Apple as Jobs’s right-hand man made Cook the obvious choice for permanent succession in the months leading up to Jobs’s death.

After assuming control of the company, Cook made a marked attempt to gently transition away from the hub-and-wheel model to an executive oligarchy (demonstrated in the chart), with less rigid hierarchy at the top to encourage leading by consensus, and especially valuing input from others. As Apple CEO, Cook is much more subdued and down-to-earth than his predecessor. Shareholders have noted with appreciation the time and attention Cook devotes to them, things they had not received from Jobs. Said one anonymous tech executive: “I forgot he's the CEO of Apple. And that was not my experience with Jobs.”

Employee experience has been markedly similar; Cook has been able to maintain Apple’s elite corporate culture, but this time governing less austerely. Whereas Jobs forced adherence to secrecy with threats and shouts, Cook appeals to employee’s sense of corporate camaraderie: “‘It stays with Apple. With us,’ he said. It wasn't a threat. It wasn't an order. The ‘us’ he spoke of, the tone he used, conveyed a sense of kinship. It showed the confidence and trust he had in every single Apple employee packed into that auditorium. We were Apple and Tim Cook appreciated us for that.”