Business Case Study: Apple's Management Style

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  • 0:02 Organizational Structure
  • 2:02 High Secrecy
  • 3:29 The Beauty is in the Details
  • 4:22 Customers are King
  • 4:51 Lesson Summary
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Lesson Transcript
Instructor: Kat Kadian-Baumeyer

Kat has a Master of Science in Organizational Leadership and Management and teaches Business courses.

Working for Apple may seem like a dream job for anyone interested in the latest technology. In fact, many employees contend it has everything to do with the management style. Few layers of management and creative freedom are some of the reasons Apple attracts so many young professionals.

Organizational Structure

Most companies use a hierarchy to define the roles within an organization. A hierarchy demonstrates who reports to whom. From the top executive to the lowest level worker, it is a way to break down the structure into smaller divisions or departments. It lets everyone know who is in charge.

Apple doesn't do things that way. In fact, Apple's hierarchy might remind you of a small business. You see, the late Steve Jobs, the founder of Apple, liked to keep management simple. He did not like layers of high-level people, and the company keeps the same management style. It was Jobs' contention that having layers of management took the focus off of the task at hand, and that task, in his opinion, was designing and building the best products on the planet. Even after his death, much remains the same.

Instead, Jobs appointed people to do what they do best. Rather than promoting people because of their tenure, he preferred to have the right people in each position. This is still the practice at Apple even in Jobs' absence. For example, a designer who is great at designing iPhone packaging will remain a designer regardless of the time logged on the job. But Jobs did believe in paying people what they are worth regardless of a promotion to a higher position.

Another reason Apple structures the organization this way is to hold everyone accountable as individuals rather than as departments. Apple doesn't like large teams because they feel that the members tend to focus on what others are doing rather than their own tasks. Smaller teams of about 100 people or fewer managed by a team leader are preferred. By having smaller teams, everyone becomes accountable for their actions. Apple does not tolerate excuses, and this is proven by their directly responsible person approach. This is Apple's fundamental phrase for appointing a person that is held responsible for every product and feature.

High Secrecy

If there is one thing Apple is known for it is keeping things under wraps. So much so that the company employs carpenters to change the office configuration all the time. Whether it's tinting windows that were once transparent or changing locks to entryways that were once accessible, Apple does not like to share its ideas, even with its employees.

Apple management has gone as far to report fake information about products and features just to test whether those in the know will leak the word on the street. If the information makes it to the media, employees responsible for the leak are terminated.

Because Jobs was so concerned about the security of Apple's technology, he did not permit many members of key management to volunteer on boards or committees for other organizations, even though such a practice is widely acceptable in many large corporations.

Jobs also did not like distractions. He believed that if employees dedicated all of their time to Apple, there would be a stronger focus on being the best. To this day, Apple execs and employees are encouraged to put Apple before all else.

Plans for new products aren't the only information held to secrecy. Even Apple's profit and loss statement is off limits to all but the Chief Financial Officer. Most companies would balk at this idea, but Apple believes that employees will render a much more creative product if they don't have to worry about expenses.

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