High Performance Working System of Apple and Google - Essay Example

Apple and Google Contents Contents 2 Introduction 3 Research Rational 3 Theoretical Background 5 Strategic Alignment of Apple Inc 5 High Performance Working System Apple Inc. 6 Managing Performance Management 6 Performance and Learning 6 Performance and Reward 7 Team Performance 7 Strategic Alignment of Google 7 High Performance Working System Google 7 Managing Performance Management 7 Performance and Learning 8 Performance and Reward 8 Team Performance 8 Process Analysis 9 Analysis of Relevant Issues 10 Process Future 10 Conclusion 11 Reference List 12 Introduction Business in the contemporary era is complex and variable in nature. The firms across each industrial segment try to enhance operational quality for producing superior services and products in the market and generating higher brand value. This essay will compare and contrast the performance management system of two giant multinational companies Apple Inc. and Google. High Performance Working System High Performance Working System defines a set of management practices that aims to create a special workplace environment in an organization where the employees have greater responsibility and involvement in the regular business activities (Kirkman, Lowe and Young, 1999). The path of sustainable long term business development can be achieved with the essence of High Performance Working (HPW) System. Successful multinational companies such as Apple Inc. and Google enhance their business performance quality over time by implementing the HPW system in business. Though both the companies follow HPW system in business, the quality of business performance of the two firms in the market is significantly different. The research work of the essay will analyze the differences in the HPW system of Apple and Google that is responsible for generating its diversified performance outcomes of the two firms. Research Rational The researcher in the essay tries to analyze and compare the HPW system of Apple Inc. and Google in terms of four primary aspects. It is highly rational to select these two firms because both of them are successful multinational organization in the global electronics industry. Figure 1: Apple Inc. Revenue (Source: Market Watch, 2014a) Figure 2: Google Revenue (Source: Market Watch, 2014b) Figure 1 and 2 shows that since the five years the annual revenue of Google and Apple is steadily increasing at an increasing rate (almost convex shaped revenue curves). This shows that the buisness affairs of both the companies are constantly improving in current dynamic market. The researcher will show how the effecienct HPW system of these two firms contributes in its commercial success. Apple Inc. Apple Inc. is a giant multinational company based from the United States. The company was founded in 1976 and its headquarters are located in Cupertino, California, the United States (Apple Inc., 2013). Since, its inception Apple Inc. has considerably expended its business internationalization process and at present operates in all the major economies of the world. The company trades on computer hardware and software products. At the same time it also sells consumer use digital electronics products (Apple Inc., 2013). Over time the company has enhanced its brand value across all its marketplaces and increased its aggregate revenue in a multiplicative manner (Apple Inc., 2013). However, such proficient degree of commercial success could be achieved by the company only with the essence of its own customized HPW system. Google Google is a popular multinational company of the United States. The company sells internet-related products and services in the market. The organization was founded in 1998 and is an equally successful concern as Apple Inc (Google, 2014). The company was founded by proficient entrepreneurs namely, Larry Page, Sergey Brin. Internet, telecom equipment and computer software’s are the primary products and services sold by the company (Google, 2014). Google implements HPW system in business just like Apple Inc. The brand value of Google in as high as Apple and its internationalization process is extensively wide. Theoretical Background Motivational theory Motivation is a very important attribute for any commercial organization. Motivation in workplaces bridges the gap between capability and enthusiasm to work. Maslow’s Hierarchy of Needs, Alderfer’s ERG Theory, McClelland’s Three Needs Theory are some popular motivational theories (Graham, 2000). Adam’s Equity Theory, Goal Setting Theory and Reinforcement Theory are other types of motivational literature that concentrates in Process Theory (Graham, 2000). The Two Factor Theory of Herzberg states that there are certain special factors that help to enhance the level of job satisfaction of the workers and some other set of aspects that causes their workplace dissatisfaction (Graham, 2000). The theory is segmented in terms of two parts, namely hygiene and motivating factors. Motivating factors such as work challenge, responsibility and recognition (the intrinsic features of job itself) helps to enhance the satisfaction level of the workers. On the other hand, hygiene factors such as job salary, security, fringe benefits and status are subcategorized under hygiene factors of the theory (Graham, 2000). These are significant causal factors of dissatisfaction of the workers and are extrinsic in nature. Thus, according to Herzberg theory, human capital of an organization can be made productive with the help of adequate motivating and hygienic factors. Strategic Alignment Strategic alignment is the procedure and result accrued from linking organization’s resources and structure with its business environment and strategy. The process ensures higher productivity of operational process of a company and efficient allocation of its useful resources (Tihanyi, Griffith and Russell, 2005). Thus, it helps to augment the performance quality of a company. In the current dynamic biasness environment strategic alignment is the progression with the help of which a company can improve its productive resource base in business. Thus, explaining and analyzing the H PW system of an organization equivalent to analysis of its strategic alignment. Moreover, the different aspects of HPW system are built according to the different theories of motivation. Strategic Alignment of Apple Inc Strategic Alignment is achieved by Apple Inc. through its quantum strategy in business (Heracleous, 2013). Aiming for uniqueness, choosing niche market and centering on extreme efficiency are the three primary factors of Apple Inc. strategic alignment. The organizational strategies of Apple Inc. are implemented for enhancing its operational quality. The company places leadership as the primal aspect of such strategies that ultimately helps to improve its competitive advantage in business (Heracleous, 2013). The entrepreneurs or leaders of the company frames its generic business strategies and aims to attain strategic alignment that balances the competing demand in the market. The strategic alignment process of Apple Inc. helps it lead the industry with extraordinary performance. Strategic alignment of Apple Inc. is pioneered by Steve Jobs (Heracleous, 2013). The quantum strategy of the company is rare and non imitable in nature. Superior leadership, innovation and cost minimization are the principal elements of Apple’s strategic alignment. High Performance Working System Apple Inc. Managing Performance Management Apple Inc. is considered to be the most expensive company in the electronics industry in terms of market capitalization. The company sells premium priced products in the market but still have achieved adequate business growth in situations where consumers in the market desire to purchase less pricy products. Despite of becoming bankrupt in 1997, the company has adequately progressed in terms of all business dimensions (Heracleous, 2013). However, the progress of the company is caused due to its superior leadership, talent management approach and productive workforce. Under the regime of performance management, Apple Inc. tries to make new innovation and expands business in booming markets. Employee productivity of the company is enhanced through lean management system. The company recruits limited workforce because it believes that understaffing can improve the quality of its team working and increase the yield of each task (Heracleous, 2013). The performance culture of the organization is improved by ensuring the adequacies of its job hygienic and motivating factors (in terms of Herzberg’s theory). The company ensures that its limited skilled workers are satisfied in the intrinsic and extrinsic worth of its job. Thus, Apple tries to create greater creativity and differentiation in business by making its workforce more dynamic in nature. Performance and Learning Innovation and creativity have become the primary success factors for Apple Inc. because of its productive knowledge management system. Knowledge management is implemented in the organization in terms of output, production and technical aspects. The company not only recruits highly skilled workforce but also enhances their productivity and knowledge by conducting regular training sessions. Apple Inc. trains its workers in ways through which they can appropriately access the requirements of its potential customers. In the long run the new strategies of the concern are framed according to the demand requisites in the market (Heracleous, 2013). The training programs of the company are conducted in the company’s Authorized Training Center. The company’s certified trainers make its employees more customer-oriented in nature. Increased innovation and efficiency is achieved by Apple through productive working of its employees. The skill set and working capabilities of the workers of Apple are constantly improves through its regular training sessions. Performance and Reward Superior performance management system and adequate knowledge management are not the only causal factors influencing the efficiency level of the employees. As stated in Herzberg’s Theory, extrinsic components of a job such as salary, work status, incentives and rewards are direct influencing factors of employee’s dissatisfaction. The rewards and compensations received by the employees of Apple increases with the rise of the company’s annual profit. The reward winning employees of Apple are able to purchase the company’s popular products with in huge discounted prices (Whitney, 2012). At the same time the workers of Apple Inc. are given adequate scopes of promotion and salary hikes on occasions of special achievements. Team Performance Team management is Apple Inc. is headed by the strategic leadership principles of its transformational entrepreneurs such as Steve Jobs and Tim Cook (Sullivan, 2011). The company realizes that performance quality can ultimately improve with the help of team work. For improving the level of team coordination, Apple Inc. ensures adequate communication facilities between its lower, midlevel and senior employee’s. Regular review meetings are conducted by the company for analyzing the problems faced by the workers during the course of any action (Sullivan, 2011). Each team of Apple contains heterogeneous specialized officials. The company offers rewards and increments for each group as a whole. Strategic Alignment of Google The strategic alignment process of Google is as productive and efficient as that of Apple Inc. Superior entrepreneurship, innovation and cost minimization are the primary elements of the company’s strategic alignment process. Differentiation is also another crucial aspect of its product manufacturing and operational process (Wan and Hoskisson, 2003). Through differentiation Google attempts to make its business highly distinguished from that of its prominent business rivals. The business leaders of Google make its investments strategically, in ways that maximizes its returns subjected to minimization of cost. Team working is an important element of Google strategic alignment process. The company tries to achieve its desired goals in business by making its personnel mutually work together. Tackling organizational challenges and innovation are the primary driving forces of Google’s strategic alignment process. High Performance Working System Google Managing Performance Management Google is a popular company in terms of product quality and workplace quality management. The company aims to enhance its performing excellence by acquiring the right talent in business. Innovation is also considered to be an important success factor of Google. The organization constantly invents new technologies through which it can make its customer’s internet surfing simpler and easier (Wan and Hoskisson, 2003). Google tries to allocate productive resources in business in cost effective means. The performance quality of Google is improved under the guidance of its entrepreneurs. The performance management system of Google tries to improve its employee engagement and performance appraisal process. The Forbes Group of business recorded in 2012 and 2013 that Google is one of the best places to work in the corporate industry (Pulakos, et al., 2012). The company claims that its performance is improved in terms of three primary ideologies, namely performance review, performance up-gradation plans and goal setting. The strategic goals of each employee of Google are linked up with its general organizational objectives. Thus, the performance management system of Google is forged with its constant performance evaluation and innovation strategy. Performance and Learning Google has become the leading technical software company in the market primarily with the essence of its superior knowledge foundation in business. Latest technical innovations and adequate investigation on automated search algorithms are the chief competencies of Google. The knowledge management department of Google tries to analyze the latest demand trends of the consumers. Accordingly, the organization guides its workforce to achieve the desired goals. The knowledge resource of Google is improved by its proficient Chief Internet Evangelists and entrepreneurs. The company recruits skilled workforce and the operational knowledge of its workers is improved through the activities of its GoogleEDU department (Pulakos, et al., 2012). The senior manager of the company trains its existing workforce through different means of communication such as video conferencing. Performance and Reward Google ensures increased productivity of its workers by enhancing their motivation at work. In order to retain high quality talents in business and guarantee maximum output from their work, Google has introduced innovative means to achieve employee motivation. The working individuals in the office premises of Google are provided with amenities such as free food, swimming pool, free childcare facilities and free pet keeping conveniences (Pulakos, et al., 2012). Moreover, they enjoy high job status and adequate professional growth scopes from the company. Team Performance The activities of the workers are coordinated in Google by its efficient entrepreneurs such as Larry Page, Eric E. Schmidt and Patrick Pichette (Pulakos, et al., 2012). The company establishes realistic goals for each of its professional teams. It utilizes its own superior communicational means to maintain increased workplace unity and coordination within and between its working teams. The company uses popular technical tools such as project management contrivance for evaluating the performance of its teams. Adequate workplace diversity and equality between workers are strictly maintained by the organization. Process Analysis Apple Inc. and Google are both successful multinational companies and own dominant market shares within their competitive external business environment. Such high commercial and social returns could be gained by the two firms only through its HPW systems. The HPW system of both the companies is initiated through its proficient internal business leadership skills and extensive innovation related activities (Hughes, 2013). Both the firms recruit skilled workforce and considers motivation as well as team management are crucial employee performance enhancement tools. However, the amount of innovation investments made by Google is more than that of Apple Inc. Figure 3: Innovation Investment Comparison (Source: Yarow, 2012) The above bar graph shows the results of a Business Insider research study in 2012. It can be clearly observed that amount of research and development investment of Google is more than Apple. Moreover, Google spends a larger proportion of its revenue in innovation investments compared to Apple. Apple provides rewards to its employees by providing them with its own electronic gadgets at discounted prices. On the other hand, Google tries to motivate its employees at work by providing them with luxury amenities in its own office premises. The workers of Google are provided with greater luxury and reward offers compared to that of Apple (vc, 2013). Apple’s HPW system is primarily guided by the entrepreneurial skills of its business leaders. On the other hand, Google’s HPW system is primary headed through goal setting programs. The company tries to improve its working quality by constantly establishing new business goals and evaluating its implementation success over time. Apple’s HPW system is less target oriented that Google. However, in other dimensions under HPW system such as knowledge management and team working, are similar for both the companies. Apple and Google are strong rivals in the market of Smartphone software. Like typical Oligopolistic firms both the companies conduct business on the basis of strategic behavior. Under this regime one firm formulates strategies after referring to the same undertaken by its market rivals. Thus HPW systems of Google and Apple are almost similar to each other. Analysis of Relevant Issues Apple Inc. Apple Inc. often faces problems in managing its workforce across all its business branches. Employee internal disputes, allegations and lobbying are common incidents of the workplaces of Apple. The company is trying to improve its core competencies in business by enhancing its innovation investments (Apple Inc., 2013). However, due to increased research and development expenditures, the gross profit of Apple Inc. is declining over time. Team management often becomes a problematic issue for Apple for cross-country business projects (Apple Inc., 2013). Google Google faces less performance management issues that Apple. However the employees of the company often claim that they are over burdened with work load. After the recession in 2008, Google had increased its employee lay-off rate by 25% for lowering operations costs in business (Pulakos, et al., 2012). Increased competitive pressures in the market have substantially forced Google to lower its employee incentive investments. The company is at present saving more money for making new innovations in its business product and process systems. Process Future Apple Inc. Apple Inc. is aiming to lower its human resource management issues by guaranteeing implementing workplace diversity and equality approaches. The company is planning to change its pricing strategy for some products categories. By utilizing competitive pricing methods Apple has decided to save more money and increase business profitability in business, regardless of lowering its innovation expenditures (Bowman and Ambrosini, 2003). Apple Hs decided to make its cross-country business projects successful by improving the level of communication between each business branches. Google Instead of increasing the rate of employee lay-offs Google is now planning to recruit limited workforce as per its financial reserves. This is because; employees provide less value to organizations experiencing higher lay-offs rates as the job uncertainties in such workplaces are high (Aguilera and Jackson, 2003). The company is also formulating new plans for providing greater scopes of promotion to its employees against diminution of their incentives programs. Conclusion The framework of the essay shows that high performance working (HPW) system is adopted by the senior officials of companies for improving the level of organizational learning and enhancing its work performance. Realistic goals achievement and workers motivation can be experienced with the help of efficient HPW system (Kirkman, Lowe and Young, 1999). Over time HPW has gained significant importance because of the positive impact it creates on the performance of a company through increased productivity of its workforce. Certain business activities such as employee recruitment policies, workers performance evaluation, communication processes between employees and flexibility of job design are all parts of HPW system (Kirkman, Lowe and Young, 1999). From the essay it would be correct to conclude that Apple Inc. and Google have achieved adequate success in business only with the essence of its efficient HPW system. The HPW systems of the two firms estimated in terms of performance management quality, knowledge management, reward management and team management are almost similar and proficient. However, Google in a more successful organization compared to Apple in terms of innovation investments and performance management. The existing problems of HPW system of the two companies can be improved in the long run through changes in its current pricing, human resource management and organizational communication strategies. Reference List Aguilera, R. V. and Jackson, G., 2003. The cross-national diversity of corporate governance: Dimensions and determinants. Academy of management review, 28(3), pp. 447-465. Apple Inc., 2013. Apple. [online] Available at: < http://www.apple.com/> [Accessed 17 July 2014]. Bowman, C. and Ambrosini, V., 2003. How the Resource‐based and the Dynamic Capability Views of the Firm Inform Corporate‐level Strategy. British Journal of Management, 14(4), pp. 289-303. Google, 2014. Google. [online] Available at: < https://www.google.co.in/?gfe_rd=cr&ei=F9DHU6aSIM_M8geBvIGwDQ&gws_rd=ssl> [Accessed 17 July 2014]. Graham, S., 2000. Theories and principles of motivation. [pdf] UNCO. Available at: [Accessed 17 July 2014]. Heracleous, L., 2013. Quantum strategy at Apple Inc. [pdf] Heracleous. 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