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Apple HR Strategy Analysis

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Abstract

Apple Inc. is a company that deals with electronics such as mobile phones and computers and software and related networking services. Considering this multifaceted nature of their operations, there is the need to ensure its HR practices align with its objectives and processes. This research analysis seeks to prescribe a set of HRM recommendations by analyzing the history, strategy, market position, and specific alignment area. Also, there will be a description of current and targeted work processes and the corresponding knowledge, skills, and abilities required to realize the organization’s objectives and identify companies preparing to address the changes. As a final point, the paper will discuss relevant technical considerations to achieve work output in the organization’s goals and the labour market and the appropriate labour law context. 

Key Words: Strategy, Market Position, Objectives, Technology, Labor Market, Labor Law

Apple HR Strategy Analysis

HR Analysis: Apple

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History

In 1977, founders Steve Jobs, a 21-year-old college dropout, Ronald Wayne, and Steve Wozniak created their first Apple computer a year before. Apple started the personal computer revolution after adapting Xerox PARC’s GUI computer interface design. The California-based company previously focused on computers for two decades before branching out to other electronics such as iPods and mobile gadgets. It was previously referred to as Apple Computers Inc., before dropping the title ‘computers’ after adopting newer forms of production. The founders focused on consumer output because their products focused on their clients’ best products, such as creating the portable Mac that set the modern-day laptop path. Ronald Wayne sold his share months after completing Apple, as Steve and Steve formed a formidable ad successful group. Its earlier products included Apple II, Macintosh, and Power Mac. Later in the 1990s, Apple produced their breakthrough computer, the iMac, which had aesthetic and design considerations that made it streamlined, easy to use, and powerful. Steve Jobs is an appreciated figure in the company that he founded, was ousted from, and later returned to create policies that led to its success. Apple continued with its success journey after the turn of the century, which not only reflects its innovatory history but also characterizes its impending success. Thirty years after its founding, Apple is an electronics powerhouse in electronic music, software, and mobile phone technology. 

Strategy

Different companies employ different business strategies and reproductions in the market. Apple’s process often involves high-end products that are commonly highly anticipated compared to business competitor Samsung that floods the market with a variety of affordable products. Under Steve Jobs, the strategy was always on innovations and revolutionary products, no matter how long it took to manufacture. This business strategy has strengthened Apple as a company and has been a significant determinant to its success and expansion from its market niche to the broader populace. The company also bundles its products, for instance, iPhones and iTunes, meaning it attracts new consumers and maintains existing loyalists. In essence, for Apple, it is about the additional service and not just the technology they create. It is about individuality and innovation, rather than competition from other brands.

Soon after taking up his position as the new CEO, Steve Jobs’ new corporate philosophy was on creating identifiable products such as the 1988 original iMac. The revolutionary nature of the company continues presently after the recent launch of its ‘continuity’ strategy. The continuity strategy if a futuristic ambition that seeks to merge computer devices with smartphones. Its customers will be able to interchange gadgets with a similar interface in a coordinative and straightforward manner (Bajarin, 2014). Through this technology, one’s devices will be coordinated and work seamlessly. The change from a personal computer to a tablet and a smartphone is always a complicated process for many people. Creation of software that interlinks all the three devices is a laudable strategy by the electronics giant. It means that one only needs to understand a singular operating system in a cloud-driven ecosystem, which will be applicable for all the gadgets one owns from Apple. Most importantly, Apple values profits over market share.  

Market Position

Apple’s market position during the 1990s was relatively low because of its unsteady sales. Presently, Apple has an estimated market capitalization of $446 billion by January 2014, making it the largest publicly traded corporation globally by market capitalization. One of Apple’s most important strategies is the focus on profits over market share. For that reason, it places more efforts on advertising and marketing of its varied products. Its present market position is quite different from its original humble beginnings.

Apple has a market-leading position due to its branches globally, apart from its headquarters at Infinite Loop, Cupertino, California 95014. Its operating segments are in America, Asia-Pacific, Europe, Japan, and Retail. Despite its solid stance in the market, challenges such as changing demographics, globalization, competition from China, and supply chain disruptions. The objective of Apple, similar to its competitors, is to make profits, contrary to consumer perception that companies want to sell as many units as possible. The chief executive officer, Tom Cook, affirms, “We aren’t interested in revenue for revenue’s sake. We could put the Apple brand on a lot of things and sell a lot more stuff. The most important thing to us is that our customers love our products, not just buy them but love them” (Shaughnessy, 2013). Compared to Android, Apple has a considerably small market share, averaging 18% compared to android’s 74%. Astoundingly, according to Yarow (2013), Apple makes greater profits because it makes more money per point of market share. 

Specific Area of Alignment

Apple is a leader in the alignment of its business and strategy. As a company, and its leadership strategy, Apple has received criticism such as being arrogant, not listening to its customers, and their perfectionism. This means that they do not let their processes and culture evolve; instead, they ensure that their strategic framework aligns to their business. The strategic framework defines the way a company offers value to its customers. It is possible to determine business processes, management processes, and leadership styles through the framework or model. A competitive, theoretical, future-driven, risk-taking culture summarizes Apple’s alignment in the market. 

Misalignment occurs when a company tries to adopt the latest trend at the expense of their own established company framework. Apple’s specific alignment area provides superior products and ensures its client base pays for the premium products. The organizational culture promotes creativity in concepts, ideas, and tasks. The CEO also creates the necessary alignment through his actions, in terms of what he does and what he does not do. The ‘always dissatisfied’ nature of the leader always inspires the workforce to work harder to meet its expectations. The use of cross-function teams that compete against each other in the company is a plus in generating healthy competition, which eventually translates to more significant innovation. Also, through competition, there is a likelihood of choosing the best employees for specific assignments. The best employees are those who outperform their last job. 

Job Pricing and Compensation Package

Software and hardware engineers enjoy higher pay than the rest of the staff at Apple. Even so, the design staff still receives a considerably high income compared to other technology companies such as Google and Android. The different job pricings cut across at least twenty departments ranging from the Mac genius, software designers, hardware designers, branch managers, to the art director. Some of the job pricings are higher than other companies, and the benefits rise as one advances his role. The former CEO, Steve Jobs eminently took home $1 but received other compensation forms such as stock grants. Most employees’ salaries are competitive in the job market but are not as high as most people assume, considering the high turnover the company presents yearly.

Among the compensations and benefits that Apple employees receive include health and life insurance, short- and long-term disability coverage, wellness programs, and stock purchase plan, to name a few. The benefits depend on one’s position in the company and the duration of time they have been part of the team. Apple’s new CEO, Cook, receives a much higher pay, but the executive board is quick to point out that the tasks assigned attract more responsibilities.

The Current and Targeted Work Processes

It is only until recently that Apple developed a typical product development process. In the opinion of its ‘individualistic’ managers, changing or adapting to a new strategy often wastes time and resources for an organization. It is advisable to maintain a common organizational practice, for instance, cross-function teams to promote innovation. This has worked for the company for a long time, and it is only until recently that the management has developed an interest in changing some of the policies guiding the company.

A company’s philosophy and hiring process define the current work processes. Apple’s work process begins with the designers, who determine the targeted vision of the product. Working under the Industrial Design studio, designers are tasked with the first role of product development. After completing a product, it is redesigned, rebuilt, and retested in a rigorous process that involves as much secrecy as possible. Designers and engineers are often cordoned in private rooms to focus on the creation of new products. They develop several products of the same design, which analyzed and finally they choose a formidable product. The product result is excellent software in special packaging/hardware.

Currently, Apple is investing in new technology to aid their design, led by Senior Vice President Jony Ive, engineering objectives and other behind-the-scenes work of mass-producing gadgets. According to Satariano (2013), technology ranges from assembly robots to milling machines. Also, it has openings for website designers and developers, alongside robotic experts. These are among the technology consideration that Apple incorporates to achieve work output in the context of the organization’s goals.

Knowledge, Skills, and Abilities Required in Achieving the Organization’s Objectives

Apple has a particular process of recruitment, training, and hiring that defines its organization’s objectives. The company does not focus on one’s knowledge and experience, but rather it analyses one’s personality. After recruitment is when one is offered valuable lessons on job performance and working as a team. This is in the company’s site in the statement, “You don’t necessarily have to be an Apple expert. The best way to understand our company and our customers is to use our products. And if you have passion for what we do and why we do it, even better. But if you have an attention to detail, a collaborative spirit and a readiness to learn, don’t worry—we’ll help you make the switch once you arrive” (Apple, 2014). It is an open field in which minimal experience is required. In terms of abilities, there is little consideration on appearance, background, or race. Even so, one must identify job positions, descriptions, and availability. The jobs range from part-time to full-time employment I both technical and managerial positions.

To realize company objectives, there is a particular attitude that employees must possess. Most employees fail because of their attitude, rather than the lack of knowledge, skills or abilities. For that reason, Apple has distanced itself from merely hiring skilful graduates or proficient engineers. It focuses on one’s attitude to work, motivation to learn new skills, innovative thinking, handling pressure, and group coordination. It is one’s attitude that determines this, rather than qualification. It is easier to guide a new employee on knowledge, skills, and abilities, than instituting attitudinal change. Workforce dynamics regularly change, especially in the globalizing and competitive environment, calling for a need to hire flexible employees who have the right attitude for a job. 

The Labor Market and the Appropriate Labor Law Context

Apple has received considerable disparagement for its contractors’ labour practices. Apart From its online Apple Store and iTunes Store, Apple has over 400 branches worldwide. Apple receives considerable criticism for manufacturing most of its products overseas. According to the company’s executives, most American companies cannot meet the technology, expertise, and labour requirement of most companies found in China. For instance, the recent rush to revamp iPhones at the last minute, in which the Chinese proved reliable, proves their case.  

The labour law context in America and communist nations are different. According to Denninger, in America, there are employees, while in China, there are slaves. Availability and ease of access to ‘slaves’ define China’s labour market, where there are minimal natural economic forces. A current Apple executive says, “We shouldn’t be criticized for using Chinese workers. The U.S. has stopped producing people with the skills we need” (Denninger, 2012). Apple and other companies wish for such working conditions in which employees sleep in dormitories and are available at any time of the night to complete a project at a minimal cost. However, Apple and other companies such as Foxconn, Shenzhen, and Amazon are recently focusing on improving worker conditions (Randewich, 2012). Labour-intensive manufacturers will be affected by this move and eventually have to accept lower profits to maintain their employees. 

HRM Recommendations

In as much as Apple has been successful in its previous approach to business, there is a need to identify future trends early and understand how they affect the market. 

Recruitment of new employees is based on attitudinal values. However, it should not ignore professional qualification. Some people went to college to specialize in technology and have the required skills for such work, and they should not be downplayed because of their low social skills. 

The labour market must be further explored, and there must be efficient systems to ensure there is sufficient labour while ensuring there is minimal exploitation. The HRM department must be watchful of labour policies lest they land the company in future problems. 

References;
  • Bajarin, T. (2014). Understanding Apple’s ‘Continuity’ Strategy. TIME.
  • Retrieved from http://time.com/2981395/understanding-apples-continuity-strategy/Denninger, K. (2012). Apple (and America’s) Chinese Slave Labor Problem. Financial Sense.
  • Retrieved from http://www.financialsense.com/contributors/karldenninger/2012/01/23/apple-and-america-chinese-slave-labor-problem
  • Randewich, N. (2012). Apple labor plan to ripple through China factories. Reuters.
  • Retrieved from http://www.reuters.com/article/2012/03/30/us-apple-foxconn-manufacturing-idUSBRE82T02R20120330
  • Shaughnessy, H. (2013). The Impossible Leadership Position of Apple Inc. Forbes.
  • Retrieved on http://www.forbes.com/sites/haydnshaughnessy/2013/01/24/the-impossible-leadership-position-of-apple-inc/ Yarow, J. (2013). Apple Should Be Furious That It Has Such A Tiny Sliver Of The Smartphone Market. Business Insider.          
  • Retrieved from http://www.businessinsider.com/apples-incredible-profits-and-small-market-share-2013-5#ixzz385InR1G6

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