Busi 2215 Organizational Behaviour: Groups Structure and Culture - Apple Computer Inc

BUSI 2215 Organizational Behaviour: Groups Structure and Culture

Assignment #2: Apple Computer Inc.

Group 1

1 - How does the Apple Company structure change in the years described in the case?

At its birth in 1977, Apple’s structure was typical of most new companies; organic, simple and informal with the power centralised to its founders. This structure was apparent especially in the Macintosh division. The company valued creativity and innovation which encouraged employees to develop their own ideas or improve Apple products. Everyone was using informal lines of communication, enabling staff to solve problems quickly. Since the company was structured informally, there was less complexity and less bureaucracy, resulting in the freedom to work without cost and time constraints which enabled employees to develop quality products. Steve Jobs was very involved with the development of new products, working together with the staff and creating a strong sense of ownership towards the company and making him a sort of role model for the company.

         As Apple progressed through its lifecycle towards maturity, it experienced tremendous successes and, partially as a result of these successes, Apple’s structure, evolved to be more functional-based.  

Jobs, acknowledging the need for the company to become more formalized, bought John Sculley on board.  Sculley brought a wealth of financial and leadership experience but had never worked in the computer industry. The company’s structure was immediately changed to mechanistic functional structure. He implemented departmentalization and merged four production divisions into one. He implemented formal lines of communication, tight deadlines on product development and executive oversight with focus on finance.  In addition, processes were formalized and standardised.  The staff was reluctant to the change, particularly in the R&D department, where a compromise led to a more informal line of communication for a select few engineers. In an attempt bring about a revival, the company was once again redesigned, and the four departments were recreated with the same independent work scope as under Jobs, though under different names.

2 - Why did the structure change?

The changes in Apple’s organisational structure was partially as a result of the company’s natural evolution through the various stages of its life-cycle.  These structural changes were also influenced by both Apple’s internal and external environments that included changes in the company’s size, changing technology, strategy and goals

Differing managerial styles also impacted Apple’s structural changes. Steve Jobs created Apple through his thirst for innovation and entrepreneurship skills. He lacked formal business training and experience, resulting in an informal and relaxing environment. Staff had freedom to develop their own ideas, with little regards to finance. John Sculley was brought in to provide the formal business experience that Jobs lacked. Sculley has a more formal management style and has tons of management experience. He quickly noticed inefficiencies and restructured the company with tight controls on project management and finances to ensure to company’s survival. His aim was to build the company and rescue it from the effects of its macro-environment. The ongoing restructures were directly tied to a shift in market demand, where diversification in other technical fields would reduce effects of market demand fluctuations.