Managing Organization Life Cycles: Apple Inc. Case Study
a) Select a company and evaluate what major crises the organization is likely to encounter as it grows
According to Greiner’s Model of Organizational Growth, there are five growth stages. In each stage, there are crisis and one has to overcome and resolve the crisis before moving on the next stage.
Apple was established on April 1, 1976, by Steve Jobs, Steve Wozniak and Ronald Wayne to sell the hand-built Apple I personal computer kit. During the first five years of operations, its revenues doubled every four months recording an extraordinary growth. A new CEO, John Sculley was hired in 1983 and there was a power struggle between the board members and Jobs resigned from Apple in 1985. The rapid growth led to crisis of autonomy. Job is known to be very innovative and he felt frustrated due to lack of decision making and bureaucracy stopped innovation. Under the leadership of the new CEO, Apple spent enormous resources in developing problem-plagued models and other consumer products and Microsoft began to take over its market share. Apple encountered crisis of control as Sculley centralized all decision making and made unrealistic forecasts on the demand of these products. The company failed to handle coordination among departments properly. In 1997, Jobs returned and restructured Apple’s product line. He resolves the crisis of control by finding the right balance of centralization and decentralization. Between 2003 and 2006, the price of Apple's stock increased more than 10 times, from around USD$6 per share (split-adjusted) to over USD$80, which marked another great success. Jobs announced in 2006 that Apple would be known as Apple Inc., because the company had shifted its emphasis to mobile electronic devices with the widespread success of its iPhone, iPod and iPad products.
b) Suggest two foreseeable factors to explain the potential causes that may lead to the organization’s decline using by your selected company.
One foreseeable factor is
According to Greiner’s Model of Organizational Growth, there are five growth stages. In each stage, there are crisis and one has to overcome and resolve the crisis before moving on the next stage.
Apple was established on April 1, 1976, by Steve Jobs, Steve Wozniak and Ronald Wayne to sell the hand-built Apple I personal computer kit. During the first five years of operations, its revenues doubled every four months recording an extraordinary growth. A new CEO, John Sculley was hired in 1983 and there was a power struggle between the board members and Jobs resigned from Apple in 1985. The rapid growth led to crisis of autonomy. Job is known to be very innovative and he felt frustrated due to lack of decision making and bureaucracy stopped innovation. Under the leadership of the new CEO, Apple spent enormous resources in developing problem-plagued models and other consumer products and Microsoft began to take over its market share. Apple encountered crisis of control as Sculley centralized all decision making and made unrealistic forecasts on the demand of these products. The company failed to handle coordination among departments properly. In 1997, Jobs returned and restructured Apple’s product line. He resolves the crisis of control by finding the right balance of centralization and decentralization. Between 2003 and 2006, the price of Apple's stock increased more than 10 times, from around USD$6 per share (split-adjusted) to over USD$80, which marked another great success. Jobs announced in 2006 that Apple would be known as Apple Inc., because the company had shifted its emphasis to mobile electronic devices with the widespread success of its iPhone, iPod and iPad products.
b) Suggest two foreseeable factors to explain the potential causes that may lead to the organization’s decline using by your selected company.
One foreseeable factor is