Strategy & Organization
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Corporate Entrepreneurship – Apple Case
Stephan de Boer Jop Cohen
781550 781657
Prepared for: Dr. Lim
Block: 2122B
Campus: Amsterdam
Date submitted: 05-12-2021
How would you evaluate Apple’s dynamic and strategy based on the perspective
of the articles?
Apple maintains a business strategy that is unique of its kind, especially for a company
of its size. Apple has a very flat hierarchical structure, with the CEO being only 2 levels
from any key part of the organization. In a more technical point of view, Apple
introduced iTunes and the App store, with seamless integration between hardware and
software, enabling a competitive advantage with new financial streams and an increased
market share in the applications -and music industry. This is one of many examples why
Apple’s actions match with the definition of strategic entrepreneurship by Hitt et al.
(2012) “Strategic entrepreneurship involves actions taken to exploit current advantages
while concurrently exploring new opportunities that sustain an entity’s ability to create
value across time”. Job’s previous assembled strategic alliances with big companies such
as EMI, Sony BMG, Universal, Warner Brothers, Beats Electronics and YouTube, show the
boldness, the will to innovate and to gain new knowledge of Apple. In turn, Cook has
shown the open-mindedness and willingness needed to innovate as well, working
together with IBM and Cisco, and by promoting the user-friendliness of Apple products by
collaborating with Adobe and Apple’s direct competitor Microsoft.
Continuing, Steve Jobs has proven to be an excellent strategic entrepreneur, leading in
the orchestration of Apple’s available resources. An out-of-the-box example of this is the
Apple Pirate rainbow coloured flag, stimulating employees to think differently. Zott and
Huy (2007) state that entrepreneurs’ “symbolic actions” speak loudly to a wide array of
resource providers. They found that demonstrating personal credibility and
achievement resulted in higher levels of capital investment, helped entrepreneurs attract
talented human capital and assemble a sufficient customer base. This symbol helped
Jobs motivate his employees and remind them of their mission every day again. Another
sign of Apple’s great ability of bundling resources is their use of “deep collaboration”,
with all the involved experts (mechanical, electrical, software etc.) working in the
same place, creating a holistic view on product development. This is a great example of
Apple’s business, as the choices leaders make regarding the bundling of resources to
stabilize, enrich, or pioneer new capabilities are important to achieving and sustaining a
competitive advantage (Lu et al., 2010).
The literature of Hambrick and Mason (1984) argue that organizational outcomes can be
precited from managerial backgrounds. Based on their theory, it was a wise choice from
Apple to ask Steve Jobs to return to the company, mainly because Steve Jobs brought
his entrepreneurial thinking back to Apple. His entrepreneurial knowledge, which he
improved with the establishment of the companies NeXT and Pixar, helped Apple to form
into a Prospector company, or in order words, a company that emphasizes product
innovation and searching for new market opportunities (Ibid). Another reason why Steve
Jobs was successful for Apple is because according to the literature, people who have
spent their entire career in one company have limited perspectives. It is necessary for
companies that are facing a period of instability to have a CEO that comes from the
outside since they look at problems with a different lens (Ibid). Steve Jobs became the
CEO when Apple was struggling with declining share price and even imminent
bankruptcy. The fact that Steve Jobs returned to Apple 12 years later helped to look at
problems within the company differently, and he implemented a restructuring program
that made Apple successful and competitive in the marketplace.
Eventually, Tim Cook took over as the CEO in 2012 with a completely different leadership
approach compared to Steve Jobs. The latter was continuously innovating to bring new
products on the market, while Cook decided to completely focus on the iPhone. From the
standpoint of the literature this is explainable, because people like Cook who spend a
considerable time (since 1998) at the same company, will probably have limited
perspectives on how to innovate (Hambrick and Mason, 1984). Therefore, Cook started
to focus only on the iPhone to drive the company’s profits on a year-over-year basis.
From the moment Cook decided to hire accomplished professionals from other industries
(e.g. Tag Heuer, YSL), diversity of views entered the company and Apple started to
innovate again (Apple Pay and Apple Watch). This confirms the literature that people
from outside the company bring more changes in structure, procedures, and people than
executives that started within the company (Ibid).
What would be your advise to Mr. Cook?
When Cook took over from Jobs in 2011, he had big shoes to fill. Despite rising
competition from mainly Android and uncertainty about future products, he astonished all
the critics. With the main focus and immensely high sales of iPhones, a growing PC
market share and the introduction of Air pods and Apple watch, Apple became the
world's first trillion-dollar company. Additionally, behind the scenes, Apple seems to be
building both a robotic car and Apple glasses (Kahney, 2019). This new introduction of
product diversification requires new resource combinations to extend the firm’s activities
in areas unrelated, or marginally related to its current domain of competence and
corresponding opportunity set (Burgelman, 1983). Therefore, the advice for Mr Cook is to
keep diversifying their products in order to create gain market share and remain
competitive advantage. To this end, Mr. Cook should remain open to outside influences
and expertise, as this will contribute to the creativity of the company's thinking
(Hambrick and Mason, 1984).
Currently, Apple is creating a cycle of products that will only strengthen their market
share. People owning an iPhone, Air pods, Apple tv, Mac, Apple watch and in the future
perhaps Apple glasses and many more products, are becoming increasingly dependent on
Apple’s services. Because all of Apple's products are connected and linked, people can
communicate through Apple's iOS and ecosystem of devices. This will unconsciously
promote user convenience of the consumer and increase the usage of Apple products.
Therefore, another advice to Mr. Cook is to continue diversifying products and to
compete in multiple unknown markets, in order to enhance this dependence on products.
Articles used:
Articles 1:
Strategic Entrepreneurship: Creating Value for Individuals, Organizations, and Society
By Michael A. Hitt, R. Duane Ireland, David G. Sirmon, and Cheryl A. Trahms (2012)
Article 2:
Upper Echelons: The Organization as a Reflection of Its Top Managers
By Hambrick, D. C. & Mason, P. A. (1984)
Article 4:
Corporate entrepreneurship and strategic management: Insights from a process study.
By Burgelman, R.A. (1983)
