Ob essay on: Relevance of Organizational Theory towards the success of Apple Company.
Organization is a place where people joining hands come together to achieve common the common objective .It is made up of People .Organizational Theory is defined as a process which is used to solve the problems , use the resources efficiently and effectively, and simultaneously meet the requirements of the stakeholders of the particular Organization .Organizational theories helps to understand about the working process of any Organization .Organizational Theory is composed of various things like culture , People , Process , Resources , & the standards followed by the Organizations .The Organizational theories have been helping in developing the necessary competencies of their employees to compete locally and Globally with other Companies. http://www.oup.com/uk/orc/bin/9780199260218/hatch_ch01.pdf
The Organizational theories importance have been felt by the various companies as the countries have been connected globally and companies want to expand their business from one country to the other country .This only possible if the Employees of Parent Company helps in understanding the culture , legal system, ideas , and the taste and preference of the host country . Organizational Theories have been used by the companies for various departments such as Finance/Strategy , Marketing ,Human Resource ,Information Technology & Operations .In finance/Strategy we need to plan and make the optimum use of resources. It is related in marketing we need to brand our product and differentiate our product on the basis of cost, quality, performance,& design with the Competitor. In Human Resource field we need to build the competencies of the employees for the superior performance at Organization .In Information Technology we need to connect globally through a network to share our business Process. In Operations Organizational theories helps to explain the processes with the customer, suppliers, & with the distributors.
http://www.oup.com/uk/orc/bin/9780199260218/hatch_ch01.pdf
Apple is a multinational Company that has been creating various electrical appliances for the consumers located globally .Apple established its Brand image in the field of Laptops, I-phone, Software ,I-pod. It is a well known company in the field of personal Computers. Apple was founded by Steve Jobs and Steve Wozniak in the year 1977 at California .They wanted to have an apple at every desk .It has been always focusing on the quality and maintaining its brand image globally through its continuous research and developmental activities .Today every consumer wants to have at least one Apple Product with them .The reason behind why apple has been the most successful brand in the Global market is because Apple has been focusing in terms of innovation ,creativity and performance of its employees. Apple founders had to plan a Proper Organizational Structure where how various departments would help them to start their business. They had a proper understanding about the various Organizational Theories and how these theories will help them to apply the various concepts in the field of Strategic Planning , Finance , Marketing ,Operations, Research and Developmental Activities , & relating to the use of the Information Technology. http://thenextweb.com/apple/2011/08/28/steve-jobs-biggest-success-isnt-patents-products-or-profits-its-apple/
The Organizational Theories are categorized into three groups. Each group has got various types of sub organizational theories which are explained below.
| Classical Theories | Neo-Classical Theories | Modern Theories |
| Fredrick Winslow Taylor:-He is known as the father of Scientific Management .He has explained that there should be cooperation rather than the conflict between labour and the Management. | Neo Classical Theory :-It was based on the Informal approach . It was mainly focused for the employees .The Neo Classical Approach explains the Individual , Work Group & about the Participative management .
Individual:-The employees works on their own will .They should not be used as machines. They should not be pressurized.
Work Group:-Employees work informally in Groups .There is not team Spirit within them . Work groups can share and communicate well in the Organization.
Participative Management:- It is a process where management provides autonomy to the lower level of employees in the decision making process of the company .It helps the workers to present their ideas in front of the management.
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Modern Theory:-it is based on the process which will help to cope up with the changes in the business environment. some of the aspects of the modern theories are system concept, adaptive , multidimensional. This theory is divided into three sub theories.
System Theory:- This is a theory based on the types of resources , process , communication & goals of the organization .it is a systematic process where one organization interacts with the other.
Social technical Theory:- this is a theory which explains that not only job enlargement & job enrichment is important but there are other factors which are very much important like knowledge about how to use the technology , process ,dealing with the customers
Contingency or Situational Theory:- Situations are different at different times , so this theory explains that one should have knowledge about political , social & legal factors. This theory explains that one should have a creative approach to deal in various situations. |
| Max Weber Bureaucratic Theory:-The Bureaucratic Approach is a process where the top ranked officials take the decision on the basis of the various factors like resources, process ,& standards. | ||
| Administrative Theory (Henry Fayol Fourteen Principles):-He has identified fourteen principles which helps in achieving the goals of the Organization with keeping in mind the mission and vision of the Organization. The Fourteen Principles are listed below.
Division of Work. Authority with Corresponding Responsibility. Discipline. Unity of Command. Unity of Direction. Subordination of Individual Interest to General Interest. Remuneration Centralization Scalar Chain Order Equity Initiative Stability of Tenure Esprit De Corps. |
http://www.fao.org/docrep/w7503e/w7503e03.htm#TopOfPage
Organizational Theory is very well linked with the success story of Apple .The founders of apple had a mission and a vision to create it .They started as an entrepreneur who have an ability to take a risk .The first theory which we can link is Classical Theory of Organizations .The sub category of this theory is the Administrative Theory which is well linked towards the success of the Apple Company .This theory explains the fourteen principles explained by Henry Fayol .
Division of Work:-Apple founders focused on dividing the work among the employees as per the caliber and the competency of their employees .They had well identified the types of skill sets required for a particular Job. It was on the basic of well designed Job Description .One employee should not be given all the work .It should be based on the skill of the Employee.
Authority with corresponding responsibility:-Responsibility comes with the authority .They gave the work with the authority to employee .There was a proper distribution of the power among their employees for the superior quality work. As we all know that Apple Products are well known for its Quality .They inculcated the culture of responsibility of employees towards the management of Apple.
Discipline:-Apple employees always maintained discipline in the Organization because it is a work place where employees come from various diversities and culture .They always respected each other and developed a harmonious atmosphere for the Smooth functioning of the work at all levels , and at all departments of their Company. Employees at Apple respect each other and also cooperate with each other.
Unity of Command:-The employees at the Apple had their department heads to whom they had to report. The marketing executive had to report to the head of the marketing .One employee should report to one boss to remove the miscommunication.
Unity of Direction:- The employees of apple company were directed towards the goals of their organizations. The employees knew well about the mission and vision of their organization. The employees are given clear instructions about what work they need to carry out and on what aspects they need to focus for maintaining its Brand image in the Global markets.
Subordination of Individual Interest to General Interest:-At Apple employees were directed towards the objective of their Company .The objective of their work should match with their personal objective .Apple had a opinion that if employees are unsatisfied then they will not perform their best .They had divided the strategic goals into the tactical goals to have a smooth functioning in the Organization.
Remuneration:-Apple pays their employees fairly to motivate towards the work .The employees are paid as per their potential level. Their salary is not differentiated in terms of caste ,race, gender and etc .The employees are well paid on the basis of their Job .They also know how employees are being motivated by the Organizations .As one of the psychologist, Frederick Herzberg has well explained that employees feel satisfied and dissatisfied due to two factors .They are known as Hygiene factors and the motivating factors .The Hygiene factors are like salary ,company policies, & the Working Conditions .The motivating factors are Recognition, Achievements , Growth & Promotion. Apple knows well how and when should they use these two factors.
Centralization:-Apple follows a centralized process where there is a control for all the activities in their Organization. Apple’s major decisions are taken from a centralized office and being followed to various offices located globally. A proper location should be there for managing all the activities which apple has been focusing till now.
Scalar Chain:- At Apple the strategic decisions at made at the top Level and pushed down at the bottom level .The management decides about the policies , standards ,and process to be followed in their Organization . A chain of command & instruction should flow systematically to the bottom level.
Order:- Proper order is placed by Apple to their suppliers to reduce the cost and wastage of the time. Employees also strictly follow the order of the management .Apple has been timely fulfilling the order of its suppliers , agents and ultimately of its customers. Apple is timely ordering and timely fulfilling its order.
Equity:-The employees at Apple are treated fairly .They are not being harassed and dominated on the basis of race , caste , gender ,and etc .They do not tolerate any sort of misconduct .Apple does not create partiality among the employees to create conflict between the employees.
Initiative:-The founders of Apple related to the Personality traits of BIG FIVE MODEL . It includes the traits like extroversion, Agreeableness ,Emotional Stability ,Openness and Conscientiousness .The employees at Apple are having an inspiration from their Leaders .The Leaders or the founders were creative enough to inspire the employees at Apple .The Leaders at Apple follow the various style of Leadership styles like Participative, Supportive ,Directive,& Charismatic Leadership styles .The employees at Apple are creative and they keep on focusing in creating something new on their own. They do not manufacture the products seeing their competitors products.
Stability of Tenure:-At Apple there is low attrition rate which helps in the stability of the employees .A stable employee will always have a career developed. Employees who are unstable can never reach to the strategic position of the company .Stability at Work place matters equally for the employees as well for the employers. Apple focuses on the developing the better working culture so that employees have an emotional bonding towards it and thay have a longer stability in the Company .To be successful stable employees are required more because they have been already trained and are well familiar towards the culture of the Company.
Espirit De Corps:-This is a very important point which is being well discussed and applied in the Corporates .Today the companies are focusing more on the Team based Job. Apple knows that its strength is its employees who work unitedly .Team work at Organizations helps in superior performance of the employees. Apple has been using the team concept since it has been formed .Team work helps in minimization of the resources, better productivity , and setting the standards. The team workers are directed towards the common objectives .Every member in a team is focused and aligned towards one objective .There is a flow of synergy within the teams.
http://www.pathways.cu.edu.eg/subpages/downloads/Teams_Chapter_2.pdf
The team of Steve Jobs and Steve Wozniak created a successful story throughout the world .Apple created various types of teams like Problem Solving Teams, Self Managed Teams, Cross-functional Teams , and Virtual Teams .Problem solving Teams at Apple helps to manage the Quality ,Performance and efficiency of the organization .This team consist of 8-15 members .Here the team members offers ideas and the suggestion to each other. Self managed teams takes the responsibility of their supervisors. It is composed of 10 to 15 members. Cross-functional teams have been created at Apple to have knowledge about various countries Organizational Structures, their taste and Preference of the customers ,their culture, their language to create the products and sell it globally .Cross-functional Teams helps in creating new ideas .Virtual teams concepts have been used by the software and the other companies to connect globally ,share their business process at a proper time. It is a process of creating online teams to connect and share the information globally.
This is how Henry Fayol’s Administrative theory has been used by Apple to create a success throughout the world.
http://davidkramer.wordpress.com/2010/01/21/management-thinker-henri-fayol-14-principles-discussed/
http://en.wikipedia.org/wiki/Big_Five_personality_traits
The other theory which can be related to the success of Apple is the Modern Organizational Theory.
Modern Organizational Theory:- It is based on the process which will helps to cope up with the changes in the business environment.
In System Theory:-A system is an combination of interdependent and interrelated parts which when combined together produces a unified as a whole .There are two types of systems like open system and close system .Open system is a one which interacts with the other organizations to have a knowledge about changes in technologies, resources , structures ,style of management ,skill and etc. A open system based organization like apple is connected with its customers globally. A close system is one which does not interact with the other organizations .This is a theory based on the types of resources , process , communication & goals of the organization .It is a systematic process where one organization interacts with the other. At apple they communicate with their suppliers and also with the customers to create their brand Image in the minds of the consumers .Systems are also composed of Components like individual, formal and informal structures, employees , technology , Behavior of employees ,and also the environment where one works .The processes are linked in systems to maintain a harmonious relationship within the organization by the help of a proper flow communication channel .Apple has built an effective system with the help of proper decision making process and making clear to the employees about the goals of their Organizations .The Goals must be Aligned with the mission and vision of the organization.
In Socio Technical Theory:-Apple motto was to think in a different way to differentiate its products from the competitors in terms of quality, performance, designing , cost .Apple always focused more on innovating new ideas than comparing its products with its competitors .The employees at apple utilize the optimum use of the resources provided to them .The new technologies are created and supplied in the market. The employees focused on the process of the Job Enrichment and Enlargement Methods. Job Enrichment is the vertical expansion of the job where one gets expertise for a particular skill .For example if there is a designer of I-phones then he will just design the outlook of apple I-phones where as if there is software designer is also being trained and given the work of designing then it is known as Job enlargement .It is a horizontal expansion of the job ,where additional responsibilities are being provided..To work as per this theory one should have knowledge about the technology being used in companies and also should have an eye open to focus on the changes being brought in the new technology.
In Contingency or Thought Process theory:-It is a process where organizations Employees need to have a Cognitive way of thinking .Apple employees always think out of the box to be the leader in the market. The Organizations need to focus on the various aspects like their Structure, Management Style , changes in the environment, changes in the legal system, political system ,and the economic system. Apple had always provided what it has committed with its customers .This was only possible when the employees had proper and a systemic thought process. Apple was successful in creating its own structure for its innovation. Apple softwares and its products have attracted millions of customers globally. Apple never focused on producing cheaper products because it is satisfied and has occupied the top position of the ladder in the minds of the consumers. Apple does not want dilute the brand image from the market by producing cheaper products to have a mass market share .
Apple is already a established brand and has been recommended as a good product by consumers ,the Corporates , and by it suppliers .The Company has been continuously focusing on various modern aspects and contingencies to cope with the challenges in the local and the global market .The foundation and the success story is built on various aspects of Innovation ,technology ,employees, structure, style of management ,strategies followed by apple and etc. At apple integral decisions are made every day to be the best in the market. It has been long time creating a successful story by apple . The founders of apple has a passion to create and do something new .Every day is a new day .A day brings with new ideas at apple Company to the market be a leader in the market .Youths have a rhythm of using the apple products to show that they follow to a particular class level. Success is only achieve if there is support of employees and at Apple the employees have been performing in a superior way to give their best. Apple have been always welcoming the challanges in terms of technology ,in terms of resources & in terms of Creativity .This is how Apple have been recognized as a successful Brand throughout the world.
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