Knowledge Area Module (KAM) I - Leadership Growth
All Things Apple
Melicia Hampel
Master Major Comprehensive Project
Master’s of Leadership Capstone 600 Course
February 2014
Dr.Sara Garski
Southwestern College Professional Studies
Abstract
The Apple Computer has evolved from humble beginnings to one of the top technological companies in the world. Over the last four decades, the leadership and management have changed as the company has grown. The company’s leadership for each evolutionary period will be assessed, looking at the styles utilized, along with their strengths and weaknesses. Many changes have occurred over the years that have affected the stakeholders with varying degrees. Overall though, they have been rewarded from the successes the company has experienced. Going forward, Apple’s future is cautiously optimistic. Competition among the leading technological companies is fierce. There are many challenges that lie ahead for the company’s new leader that will be explored. Every leader will face challenges during their career. The Apple Company provides a different approach that can be learned from and compared to a leader’s own style. They have been successful with exceeding the customer’s expectations by bringing a vision to reality. Despite the fluctuations they have experienced, Apple has remained resilient and weathered through many trying times. Their leadership like many companies has experienced several changes over the years. Apple offers lessons to be learned from that will influence future leadership growth and development.
All Things Apple
The Apple Company provides an interesting study of the leadership and management over the last four decades. The leadership evolved as the company grew from a small scale to a global technology operation. Each era presents rich lessons that can be learned from. The leadership changed over the years and brought forth different styles, strengths and weaknesses. The internal and external stakeholders were affected by the leadership changes in varying degrees. The changes from their perspective will be described as each evolutionary period is assessed. Apple has a solid foundation, but the leadership does face current and future challenges as they move towards the future. The company has experienced successes and turmoil over the years. Looking back over this history, lessons are learned that can be utilized when comparing one’s own leadership experience. The resiliency and vision of Apple provides information and knowledge that influences the leadership growth and development of leaders.
The Apple Company Leadership and Management Styles (1977-1985)
The computer industry was in the infancy stage in 1977. Creative new ideas were emerging in the world of electronics and technology (Blumenthal, 2012). Steve Jobs was growing up in this environment and was among those who developed an interest in computers. He and friend Steve Wozniak came together to design a new computer and worked on developing their new product. Steve Jobs was visionary and worked to market the new product, while Wozniak worked on creating the computer (2012). They formed their new computer company, naming it Apple Computer.
Jobs and Wozniak both wore their hair long and Jobs was often seen barefoot in cutoff shorts at the company. They scrapped the old corporate rules and replaced the suit and tie with casual dress. There was a flat hierarchy; with a less formal structure, where they did what they considered really mattered, creating computers (Rebello, Burrows & Sager, 1996). In the beginning there was a laissez-faire approach with their management style, but even then, Jobs demanded perfection (Blumenthal, 2012).
Finding investors was initially a challenge, but Jobs was not to be deterred. He enlisted the help of a former marketing manager, Mike Markkula. He realized the potential that Apple had and invested into the company. Markkula helped write the initial business plan and became a father figure to Jobs. He stressed three principles that set the foundation for Jobs understanding his customers better than any other leader (Issacson, 2011 page 78). He stressed empathy or connecting with the customer’s feelings, to focus on what is important and to impute the desired qualities of their products (2011). With the increased responsibilities in the company, Jobs was not handling the pressure well. He was seen as temperamental, had poor personal hygiene and hated authority (2011). Markkula brought in his old friend and co-worker Mike Scott as president in 1977. His primary duty was to manage Steve Jobs and he proved to be just as stubborn as Jobs. Scott mentored Steve during walks, something Jobs preferred to meetings and used throughout his career (2011).
When the company offered a public sale of their stock, the price and demand for their computers soared. Both founders became multimillionaires overnight. Jobs was very involved and remained the visionary force with the company where in contrast Wozniak became distracted and decided to take a break after being injured in a 1981 plane crash (Blumenthal, 2012). As the company grew, Jobs was known for his energy, passion and vision. He didn’t concern himself with the details of pricing, software compatibility or with the management of the employees. These details were left to Markkula and his team to manage. They were seen as the “grown ups” of the company who were concerned with the day to day operations and the running of the company (Stross, 1993). Scott kept Jobs in check for over four years, bringing organization and structure to the company As the business grew, his management style became more erratic and he was replaced in 1981 by Markkula as the president (2012).
Jobs was instrumental within the company for his innovative creativity and vision. He was obsessed with details though, refused to compromise and was seen as immature. Jobs’s leadership experience was limited and he was not prepared to run a big company that was experiencing the growth of Apple. Makkula decided he wanted to step down and wanted to begin looking for a replacement. Jobs could no longer ignore the establishment and decided to conduct a search to find the right person. Jobs wooed a leader named John Sculley, from corporate America to lead the company (Isaacson, 2011). When the partnership first began, Sculley and Jobs were very compatible. Jobs wanted to learn from John and each saw similarities among each other. The honeymoon would not last though, as Jobs began to notice the differences they had with their values and their ways of looking at things (Issacson, 2011).
The Strengths and Weaknesses of the Leadership Team (1977-1985)
The board and Sculley had strengths with running the finances and marketing. They were effective with increased sales and growth. Internally though, there was turmoil. Although there was a president, Jobs was very involved behind the scenes with the running of the company. He was seen as having the drive behind the products, but did not think the usual rules applied to him. The leadership team provided the buffer needed with the company’s employees to deal with Jobs stormy, but oddly inspiring behavior (Isaacson, 2011). There were mounting business pressures when sales of the Mac grew short of projected sales and customer confidence was decreasing. There had been delays with the development of the Mac, costing the company considerable dollars. A power struggle increased between Jobs, Sculley and the board of directors (Lane, 2013). The company had transformed into a mainstream corporation and they began to pressure Sculley towards moving Jobs into an ambassador role. The company was experiencing financial challenges and wanted to seek a new leader for the Mac division. Tensions mounted when Jobs and Sculley had a show down with the board of directors. Their faith was placed with Sculley and Jobs was asked to leave the company (Uttal, 2011).
The Apple Company Leadership and Management Styles (1985–1996)
The next eleven years were a time of considerable transition for Apple. Both founders would each leave, with new executives coming in to lead the company. There are many different opinions on how the exit of Steve Jobs was handled. Most would agree though, his departure in 1985 was a significant change for the organization.
John Sculley began his leadership with a low trust in his abilities by many people. He came from a background that looked at the next opportunity rather than introducing a new product (Elliott & Simon, 2011). He closed half of the factories and laid off many employees due to the financial challenges they were experiencing. He enlisted the expertise of his followers in the company and streamlined the operations. This was seen as a favorable move and would present a new face to the customers (Uttal, 2011). Sculley was not popular with the employees within the company initially. He decided to not upset the culture that was established and used a participatory style of leadership. A decision was made to market the Mac and change the focus towards becoming a consumer product company. This direction was effective at first, but the lack of decisiveness mounted within the company and became the brunt of jokes with the employees (Rebello, Burrows & Sager, 1996). Sales decreased, Sculley became increasingly disinterested in the company, and was ousted as the CEO in 1993.
Michael Spindler followed as the CEO for the next few years. He was known as an excellent strategist, but was looked upon soon after coming, as not a good fit for the company (Isaacson, 2011). Under Spindler’s leadership, he laid off 15% of the work force and reorganized the company. Perks such as free fitness and meals were now charged for, along with suspending bonuses and pay increases. He moved towards a rigid and hierarchical structure where employee morale was at an all time low. He was not able to secure a deal with a major hardware company and had failed negotiations with the Sun Company to buy Apple (Hormby, 2013). His resignation was asked for in early 1996 as the company continued to spiral downwards.
Gil Amelio followed as the CEO, marking his first hundred days, with many changes as he set out to change the company around. Although Amelio knew computers, he had little experience in the personal computer business. He was seen as an inexperienced leader who had the business in disarray (Schlender, 2011). As the financial picture continued to deteriorate, Steve Jobs entered the picture. He offered his consultation services to Amelio and they struck a deal to buy the NeXT Company that Jobs had formed. The word was out; Steve Jobs had returned to the company he loved (2011).
The Strengths and Weaknesses of the Leadership Team (1985-1996)
The decision for the board of directors to select John Sculley for the position of CEO was easy for them. Steve Jobs never had been one to play office politics, where Sculley had a proven record in business. Jobs would say later that he thought the focus of the company had changed where it was more important to make money than to make new products (Elliott & Simon, 2011). The mentor he romanced had now replaced him as the leader of the company that he had founded. Sculley said in an interview years later, that he should have not been hired from the start. Although he had a strong business background, his experience in the computer industry was limited. It was clear that Jobs was not ready to run the company at his young age, but Sculley would have liked to have explored alternatives so they could have worked together (Lane, 2013). Amelio came in after Spindler’s departure attempting to turn the company around, but things were fragmented and the company lacked a clear focus. The customers were losing confidence and talented employees were leaving the company in frustration (Schlender, 2011). There was increased turmoil during the years that Jobs left the company. The board of directors was closely involved and did support the leaders they selected. Each leader brought different talents to the company, but each lacked insight and the vision needed to oversee a rapidly changing technological company. The customers connected with Steve Jobs and the Apple product they were loyal to. The company lost this leverage when he left, and struggled to develop a clear direction and focus. The company had hardships during the years Jobs was away; however both sides experienced growth that proved to be beneficial in the years ahead.
The Apple Company Leadership and Management Styles (1997-2011)
Steve Jobs returned to the company, late December 1996, as an advisor to Gil Ameilo. He offered a new strategy that was built around the company he founded NeXT. He began slowly asserting himself when he first returned and began to place trusted colleagues into the top ranks (Issacson, 2011). By summer, Amelio resigned and Jobs became the interim CEO. Jobs returned by streamlining the products they sold and moved towards building a culture that supported innovation (Elliott & Simon, 2011). He worked towards this vision by encouraging collaboration, decreasing control by insisting on being open minded and then working to inspire the employees (2011). He took bold steps and worked with Bill Gates in a deal where Microsoft would make its software for the Mac. The investors got the message and their stock shot up with the confidence that the company would be around (Blumenthal, 2012). Jobs never lost his passion and love for the company he left. He returned with a new sense of maturity, listened, but was determined as ever. He had a path that he wanted to achieve and had the ability to move the company towards his vision. Jobs was a charismatic leader who motivated his followers by using the elements of transformational leadership. He was able to develop a strategic vision, communicate the vision, mentor ideas and worked towards commitment (McShane & Von Gilnow, 2013). He had exceptional visionary talent and passion, but he also was known for his impatience and controlling behavior. These traits remained throughout his leadership. He was one of few leaders who ran his company like he wanted and was successful despite some of his negative leadership traits (Stone, 2011).
The Strengths and Weaknesses of the Leadership Team (1997-2011)
The organizational effectiveness of the company changed during these years. The company was barely clinging to life before the return of Steve Jobs to the company. He was openly welcomed with a sigh of relief from employees and investors. They adapted to the rapidly changing market by introducing the iproducts and met the stakeholder’s expectations (McShane & Von Gilnow, 2013). Jobs hired “A- people” and worked towards having a learning organization (2013). He worked towards inspiring people and was known for rewarding them for their efforts (Elliott & Simon, 2011). Jobs felt after returning that the board of directors lacked the vision needed to move the company towards the future. He asked all the board with the exception of two members to resign. This included long time friend Mike Markkula (Isaacson, 2011). This move was looked upon as a weakness at the time, but proved to be a decision that would support his vision going forward. Jobs returned to a struggling company and was able to turn the company around. An unconventional organizational chart was put into place that had the leadership of the company at the center or core of Apple. They focused on just a few things at once and had the ability to move nimbly in the organization with this structure (Lashinsky, 2011). Jobs enjoyed the support of his board and changed the company into a leader with introduction of the iproducts.
The Apple Company Leadership and Management Styles (2011-present)
Steve Jobs remained active in the company until he could no longer carry on his duties. He had worked with Tim Cook for several years to prepare him for the time when he exited the company. He left, placing his trust in his successor and towards their future (Isaacson, 2012). The company has worked towards showing their customers they can still execute the business without Jobs. Tim Cook has shown a different leadership that is more open and has kept most of his management team together (Stone, Satariano,& Burrows, 2012). Cook is known to hold his opinions until after meetings and is willing to say when he doesn’t know something. Both internally and externally he has managed to grow the business and show positive gains in the stock market (2012). Cook is known as a thoughtful, hard driven executive who listens intently, but also has style that is kinder and gentler than his predecessor. He has worked to become more transparent with investors and the employees (Gupta & Henderson, 2013). Time will tell if he will succeed, however he is off to a good start.
The Strengths and Weaknesses of the Leadership Team (2011-present)
Tim Cook came with a strong background in manufacturing and had been in the leadership role at Apple several times. He had run the company with Jobs blessing during the times he was ill and away from the company. Unlike Jobs, Cook does not have the same visionary outlook. The last two years, the company has produced upgrades on current products, but has not come out with anything new. The company has kept their focus toward keeping products before profits and continues to push towards perfection. The leadership of Cook is more transparent and has been seen as positive to date with the internal and external stakeholders. Cook understands his limitations and has relied on the talent of his management team. Unlike Jobs, he does not micromanage, but he also needs to ensure that his workers are getting the feedback needed (Stone, Satariano, & Burrows, 2012). Time will tell if his leadership will sustain Apple going forward, but to date, he has successfully increased profits and their stock remains strong.
Apple’s Current and Future Leadership Challenges
There are several challenges that the leadership faces currently and in the future. Although Cook had been quietly leading the company and was handpicked by Steve Jobs, he has had to prove himself as the chosen leader. Over the last two years, Tim Cook has led by steadily gaining the confidence of investors and the employees. Apple has set the bar high and is challenged to remain the innovative leader. The company has provided incremental improvements to their current products, but has not come out with a new product under Cook’s leadership. Technology consumers become bored quickly and have been questioning when Apple will come out with something new. They face stiff competition from other major technology companies such as Microsoft and Google, where each wants to dominate the market (Farber, 2013). Apple has solid resources and a talented team in place (Heath, 2013). Cook needs to retain his team and not have them leave to other companies. Apple is involved with litigation currently with Samsung. Until this is settled, the hope of new products remains slim.
The world of technology is demanding and rapidly changing. From software, to android phones, the loss of market share is a very real threat that Apple faces each day. They have led the market by connecting emotionally with their customers, offering quality products a cut above the others. Advancements will offer a change where technology will be woven further into everyday lives (Farber, 2013). For Apple to be on top, the leaders will need to have a solid strategy going forward. They will need to remain innovative and creative in their approach to deal with the competition they will face. Consumers are becoming restless and the pressure is on to debut something new. Although Tim Cook leads Apple, many of the public are not familiar with him as they were with Steve Jobs. They need a spokesperson that customers can identify with going forward. The company faces doubts the longer they go without producing a new product and will need to have strong leadership in place to respond to these concerns.
Leadership Experience and Comparison with Apple
The research in the Apple Company has provided some interesting differences and similarities with the writer’s own leadership experiences. Like Apple, the writer has worked with many different leaders through the years. With each change in leadership, the company would restructure as Apple did when Jobs was away. It is important to have an overall strategy and clear direction that remains despite the leadership. Apple lost its focus at one time and needed to return to their founding principles. This is true at the hospital system where the writer works. At one time, there were so many goals that were being focused on, little was being accomplished. Focusing on the customer and safety has provided considerable clarity to the goals that need to be accomplished.
A group of Catholic nuns came to the United States over a hundred years ago from Germany. They identified communities in need of health care and arrived with few resources other than their vision and persistence. They have provided the writer with inspiration just as Jobs has done with his visionary talent to create products that could only be imagined. There is an appreciation for this talent and the writer’s leadership could strengthen in this area. It is important to hire right from the beginning and work towards having only “A” people as Jobs did. He had a passion and love for the work he did. The researcher shares this same passion towards the profession of nursing and has had an amazing rewarding career.
Despite the fact that Jobs left his company and came back with a softened approach with his leadership style, he lacked true transformational skills. The writer differs from his style when practicing leadership. Jobs was known as impatient, being a perfectionist and was hard on people. The writer has worked towards consistently practicing the principles of transformational leadership and has worked towards utilizing a participatory style. Although Jobs utilized some principles of transformational leadership, overall he used an authoritative approach, which is far different from the style the writer considers effective.
Influence and Future Development Plans
Steve Jobs offered a unique style of leadership that would not be effective for many work environments. His entrepreneurial spirit and vision were legendary. He had an extraordinary inner drive and would not accept things to be ordinary. These are two takeaways that will influence the writer’s leadership practice. As leaders, it is important to strive towards excellence and push the boundaries. New challenges and changes have become a daily part of life for leadership. The Apple Company provides a study of how they have responded to these challenges. It has become essential to learn how to incorporate change and influence followers. Jobs was not prepared to lead the company when it first began. His leadership experience provides an excellent example of knowing your limitations as a leader. Each person has strengths and areas that need development. Jobs leadership journey demonstrates the importance of developing skills and knowledge. His time away from the company provided a time of personal growth that was needed. He learned from his failures and returned stronger than before. Every leader will experience successes and failures during their leadership; however learning from them is essential.
It is important as a leader to become a lifelong learner, increasing knowledge, skills and competence (Alsop, 2013). There is a vast amount of information to learn that will further develop the writer’s leadership skills. The writer plans to attend quarterly leadership classes and to routinely read various leadership texts that will enrich their knowledge base. Communication is a large part of the writer’s leadership role. Skills will be practiced from the information learned and will further develop the writer’s tool box especially in the area of listening. It is important to share a vision and inspire the work force. Jobs had the ability to reach people and inspire them to think differently. The writer would like to further develop skills in this area and has learned valuable information that can be utilized from this research project. The writer would like to take two more classes and achieve the executive leadership certificate. Additionally, a goal has been established to achieve the quality certification that is offered. These will increase the writer’s knowledge base in the areas when working within their organization. The writer plans to continue in their current leadership role, will work towards strengthening skills and will role model the behaviors of exemplary leadership.
Conclusion
This research project provided an interesting study of Apple’s history. The leadership styles, strengths and weaknesses were looked at over the years and how these approaches affected their stakeholders. There have been many periods of volatility that have been faced as the company matured. The styles of leadership changed with approaches as the company grew. They lost their focus at one time, only to rebound with tremendous success. Apple has grown into a power house that played by different rules than most companies. They continue to face challenges now and in the future, but through it all have remained focused on the customer. They have offered new innovative quality products that bring our imagination alive. They are challenged to continue this same vision as their leadership has changed without their founding leader. There is considerable speculation how the company will perform in the future and remain on top. The leadership needs to be stronger than ever in order for this to occur. Jobs left this life too early, but did plan for his departure, leaving his company in capable hands. Going forward the new leader, Tim Cook, has a monumental task of him. Staying true to the mission of the company and by applying great leadership skills, he has a solid foundation and should continue to bring us great products.
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