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How Apple Is Organized for Innovation
- Joel M. Podolny
- Morten T. Hansen
When Steve Jobs returned to Apple, in 1997, it had a conventional structure for a company of its size and scope. It was divided into business units, each with its own P&L responsibilities. Believing that conventional management had stifled innovation, Jobs laid off the general managers of all the business units (in a single day), put the entire company under one P&L, and combined the disparate functional departments of the business units into one functional organization. Although such a structure is common for small entrepreneurial firms, Apple—remarkably—retains it today, even though the company is nearly 40 times as large in terms of revenue and far more complex than it was in 1997. In this article the authors discuss the innovation benefits and leadership challenges of Apple’s distinctive and ever-evolving organizational model in the belief that it may be useful for other companies competing in rapidly changing environments.
It’s about experts leading experts.
Idea in Brief
The challenge.
Major companies competing in many industries struggle to stay abreast of rapidly changing technologies.
One Major Cause
They are typically organized into business units, each with its own set of functions. Thus the key decision makers—the unit leaders—lack a deep understanding of all the domains that answer to them.
The Apple Model
The company is organized around functions, and expertise aligns with decision rights. Leaders are cross-functionally collaborative and deeply knowledgeable about details.
Apple is well-known for its innovations in hardware, software, and services. Thanks to them, it grew from some 8,000 employees and $7 billion in revenue in 1997, the year Steve Jobs returned, to 137,000 employees and $260 billion in revenue in 2019. Much less well-known are the organizational design and the associated leadership model that have played a crucial role in the company’s innovation success.
- Joel M. Podolny is the dean and vice president of Apple University in Cupertino, California. The former dean of the Yale School of Management, Podolny was a professor at Harvard Business School and the Stanford Graduate School of Business.
- MH Morten T. Hansen is a professor at the University of California, Berkeley, and a faculty member at Apple University, Apple. He is the author of Great at Work and Collaboration and coauthor of Great by Choice . He was named one of the top management thinkers in the world by the Thinkers50 in 2019. MortentHansen
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Harvard Business Case Study: Apple Inc.
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- April 2010 (Revised July 2014)
- HBS Case Collection
Apple Inc. in 2010
- Format: Print
- | Language: English
- | Pages: 25
About The Author
David B. Yoffie
Related work.
- Faculty Research
Apple Inc. in 2010 (TN)
- Apple Inc. in 2010 (TN) By: David B. Yoffie
- Apple Inc. in 2010 By: David B. Yoffie and Renee Kim
IMAGES
COMMENTS
Apple is well-known for its innovations in hardware, software, and services. Thanks to them, it grew from some 8,000 employees and $7 billion in revenue in 1997, the year Steve Jobs returned, to ...
Since the COVID pandemic, Apple gained over 20% of the world smartphone market and 50% of the U.S. market, making Apple the largest seller of smartphones in 2023. Apple's services revenues were exploding while it was actively diversifying its product line, introducing their first spatial computer called the Vision Pro in June 2023. At the ...
After a decade as CEO, Tim Cook is facing one of his biggest strategic transitions of his tenure. While Apple had performed spectacularly well under Cook, Apple's core business was maturing. Sales of iPhones, iPads, and Macs were flat or down. However, Apple's new hardware-Apple Watch and Airpods-as well as services were growing rapidly. This case explores Apple's history and Cook's strategic ...
Dean, Apple University Morten T. Hansen Faculty, Apple University AUTHORS FOR ARTICLE REPRINTS CALL 800-988-0886 OR 617-783-7500, OR VISIT HBR.ORG Harvard Business Review November-December 2020 3 This article is made available to you with compliments of Apple Inc for your personal use. Further posting, copying or distribution is not permitted.
The case is set in September 2019 and the protagonist is Tim Cook, the CEO at Apple, Inc. In 2019, Apple had revenues of $260 billion; yet, net revenues were down by 7 percent over the same period. Much of the decline in Apple's revenues is a result of decreased sales of the iPhone, which contributed 62 (!) percent of Apple's total revenues in 2018, and declined to 54 percent in 2019. The case ...
However, Apple's new hardware—Apple Watch and Airpods—as well as services were growing rapidly. This case explores Apple's history and Cook's strategic options for driving new hardware and services into Apple's mainstream in the next decade. ... Harvard Business School Case 720-454, April 2020. Educators;
Abstract. Describes Apple's approach to innovation, management, and design thinking. For several years, Apple has been ranked as the most innovative company in the world, but how it has achieved such success remains mysterious because of the company's obsession with secrecy. This note considers the ingredients of Apple's success and its quest ...
This case focuses on the supply chain strategy of Apple Inc. (Apple). Set in early 2020, it provides a detailed description of the company's supply chain network and capabilities. Data in the case allows students to develop an understanding of Apple's source of competitiveness and to gain insights into the management of a large, complex global supply chain network that focused on the ...
Abstract. The essential components of carrying out an organizational analysis (a case study on Apple Inc) include evaluating external factors that can affect the organization's performance as well ...
Apple's core business—the iPhone—continued to deliver spectacular results. In addition, Cook was aggressively introducing new products, ranging from Apple Watch to HomePod. Cook also had the world's biggest balance sheet to invest in new technologies and markets. ... Harvard Business School Case 718-439, May 2018. (Revised December 2019 ...
Apple's radi then picked u as the same of clever str understandin." The iPod fa is enthusias for all these ses and fac d many ind s logic and w _____ d this case. This c tended to serve a es or request perm w.hbsp.harvard.e he permission of H tion at — Apple matic debut r more than f conomies, an h a market c was now w orporation b ngly ...
Many observers worried about what would happen to Apple when Steve Jobs died in 2011. But Apple had performed above everyone's expectations in Cook's six years as CEO. Apple's core business - the iPhone - continued to deliver spectacular results. In addition, Cook was aggressively introducing new products, ranging from Apple Watch to HomePod. Cook also had the world's biggest balance sheet to ...
This Harvard Business case study analyzes Apple Inc. and its success introducing innovative consumer electronics through technological creativity and expertise. It explores Apple's business plans and strategies that led to revolutionary new markets like microcomputers, iPods, and iPhones. However, the case questions whether Apple's management achieved an unprecedented business model example ...
Abstract. At the end of 2014, Apple Inc. recorded the most profitable quarter of any firm in history, and its market capitalization soon topped $700 billion. 'Apple Inc in 2015' explores the history of Apple, its successes under Jobs, its continued growth under Tim Cook, and the challenges facing the company in 2015.
View PDF. Harvard Business Case Study: Apple Inc. Dennis Stovall Kaplan University GB 520 Strategic Human Resources Management March 25, 2014 Abstract This business analysis focuses on the commercial enterprising activities of a world leading consumer electronics company, i.e. Apple Inc. and how, through its technologically advanced creativity ...
As leaders in developing people who change the world, we can help provide resources and impactful development to Apple leaders at scale, in real time, even during times of uncertainty. Together with Harvard Business School, we've been delivering dynamic learning experiences globally for more than 100 years.
The recently retired CEO of Apple Inc. was a legend: he had changed Apple from a company near bankruptcy to one of the largest and most profitable companies in the world. Moreover, he had revolutionized several industries in the process, including music, phones, and computer tablets. This case explores Steve Jobs' successes and the challenges ...
At the end of 2014, Apple Inc. recorded the most profitable quarter of any firm in history, and its market capitalization soon topped $700 billion. 'Apple Inc in 2015' explores the history of Apple, its successes under Jobs, its continued growth under Tim Cook, and the challenges facing the company in 2015. With iPod sales continuing their freefall, tablet sales in decline, and the Macintosh's ...
Apple Case Study 2018 - Free download as PDF File (.pdf), Text File (.txt) or read online for free. Tim Cook announced Apple's fourth quarter results for fiscal 2018, with record revenue of $265 billion, gross margin of $102 billion, and net income of $59.5 billion. Apple had shipped 2 billion iOS devices and celebrated the 10th anniversary of the App Store.
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Abstract. On April 4, 2010, Apple Inc. launched the iPad, the company's third major innovation released over the last decade under its iconic CEO Steve Jobs. Apple's strategy of shifting its business into non-PC products had thrived so far, driven by the smashing success of the iPod and the iPhone. Yet challenges abounded.
CEO Tim Cook confronts multiple issues that each relate to identifying a source of longer-term growth at Apple, as it becomes increasingly dependent on iPhone revenues. Since Steve Jobs' death, Cook has successfully led Apple and made it the first company to be worth more than $800 billion. However, under Cook's leadership, Apple has largely released derivatives of existing products (e.g ...