Comparative Analysis of Semco, Google and Apple - Case Study Example

Comparative Analysis of Semco, Google and Apple Introduction Semco is a Brazilian family-run business that was founded in 1953 and the author, Ricardo Semler joined the family business in 1980. Semco is a commercial equipment manufacturer and supplier to some of the big names in the industry, such as Alcoa, General Motors, Nestle and Saab. In 1989, the company was in its rapid growth phase with around 800 employees and a participative management style. The growth was so strong that the company recover from being a financial disaster to a growth firm with profit margin of 10 percent. The organisational environment was determined to be participative in nature where the focus is on employee engagement. In the regard, the management’s opinion was that all employees are adult and responsible and have developed strong sense of responsibility towards the organisation (Semler, 1989). Google was founded in 2000 and eight years later, the company had 18000 employees belonging to different areas of expertise. The case indicates that employees were leaving at a rapid pace citing various reasons but it was obvious that they were not satisfied with the perks, work environment and managerial practices. Analysis of opinion of most employees suggests that current practices at Google are preventing them from exploring their innovation. However, Google does present significant amount of freedom to its employees. Apple, in this regard, is a very different company. The company is extremely unconventional, not only in business terms but also in terms of organisational practices and behaviour. Apple practices strict control over its products, consumers and resources. Products and processes are defined by precision and perfection at Apple (Kahney, 2008; Lashinky, 2008). There are stark differences among these three organisations yet there are certain similarities. Besides comparing and contrasting the managerial practices at the three organisations, the paper also discusses leadership styles of each organisation in terms of the pros and cons of the style and the entrepreneurial efforts of the corporations in their respective challenging markets. Similarities among three companies Based on the assessment, it was determined that all the three companies, Semco, Google and Apple are high successful in their respective markets. The majority of similarities have been pointed on the basis of specific fundamental principles which are also responsible for the success of each of the companies. For example, Google and Semco share similar organisational culture where employees are provided significant amount of autonomy for better performance and organisational development. In Google and Semco, significant autonomy is provided to employees so that sense of belonging is fostered among employees. Semco not only bear similarities with Google but also with Apple. At both these companies, organisational process is focussed on project modules. In other words, resources are allocated at Apple and Semco in terms of projects and the organisations work on fewer projects to improve productivity and focus. Concentration on limited number of projects helps the corporations to allocate resources in an effective manner so that projects are accomplished in a timely manner. All of the companies, Google, Apple and Semco operate in an extremely competitive and technologically advance industry where they have developed market advantage by means of innovation. From realistic perspective, all the three companies are innovation driven; primarily because innovation has caused the companies to achieve market leadership and accelerated business development. It is interesting to note that Google, Semco and Apple operate in different sectors yet have been successful in developing strong market value through consistent technological innovation. Differences among Google, Apple and Semco It was observed that Apple, Google and Semco share significant degree of difference irrespective of the aforementioned similarities. Besides areas of operation, the companies differ in terms of their management practices, marketing policies and their leadership style. It was interesting to observe that difference between organisational practices in the three companies is reflected in terms of their business practices which further define their success in their respective target market. The primary difference that was observed at Google is that the organisation has strong tendency of experimenting with product and services irrespective of the risk associated therein. It was gathered from the assessment that Google has access to ample human and non-human resources and consequently the company encourages trial and error practices in projects even if the scope of failure is relatively high. Google bears stark contrast with Apple in terms of project management. For instance, Apple is extremely focussed on specific products and resources are allocated very critically. At Apple, product failure is simply unacceptable and that has been made very specific by Steve Jobs. Apple’s efficiency has resulted in creation of various successful projects such as iPod, iPhone and iPad. Limited product development at a time is a speciality of Apple and consistent innovation has resulted in Apple gaining significant market share in the industry of consumer electronics. Semco’s approach to resource management is partially similar to that of Apple as it ensures that its resources are focussed on limited project for ensuring high quality. Nonetheless, project management style of Semco is different from that of Apple because at Apple there is no scope for failure but Semco encourages employees to take decision regarding projects so that their empowerment is established. Mistakes are not treated harshly at Semco. Unlike Apple, employees are not dismissed at Google and Semco. Another prominent difference between Semco and other two companies is that Semco mainly develops products for commercial consumers while Google and Apple develop products for mass consumption irrespective of business and personal use categorisation. Additionally, Semco develops products that are of standard use to its clients whereas Google and Apple develop innovative and unique products which stand out in the crowd. Difference between the three companies can be observed in terms of their management and leadership style as well. At Google, laissez faire is practiced and employees have no restriction regarding their jobs. They can choose between projects and work accordingly. Participative management at Semco allows employees to participate in organisational decisions and work in a cooperative manner. Contrastingly, Apple has adopted traditional autocratic style where employees are under constant fear of punishment in case of imperfection (Kahney, 2008; Lashinky, 2008; Semler, 1989). Entrepreneurial efforts by each organisation in the competitive environment At Google, entrepreneurial efforts within the organisation are pursued by giving maximum freedom to employees to nurture their innovative skills. High compensation package and option are provided to employees in order to ensure prospective projects are developed and overall organisational development is achieved. Investment in significant projects at Google helps the company come up with atleast some highly profitable projects. Furthermore, Google’s creative environment encourages brain storming and development of new products through creative ideas generated by various talented employees while working together. The comparative assessment of entrepreneurial trend of the three companies suggest that three fundamental principles, namely, democratic management style, information sharing and profit sharing. The company ensures that employees develop sense of ownership and belongingness with the company. Freedom to employees at Semco is considered responsible for success of the company as employees have the right to express their concern to the organisation. At Semco, efforts are made to ensure that business development process is accelerated by means of greater authority delegated to employees regarding job and managerial activities. However, greater authority is only successful when information is disseminated in a transparent manner. The company ensures that all information is available to different employees so that they can exercise their responsibility towards the organisation. Profit sharing and salary determination authority has been largely distributed among employees so that entrepreneurial sense. The firm does not punish its employees for failure or loss in projects. Consequently, employees put their best effort in doing their job and increasing firm’s profitability. Apple has brought in entrepreneurial wave since the return of Steve Jobs in the company. The company has changed the face of the technology industry by bringing about innovation in already existing products. For instance, the company brought in the iPod in place of mp3 players and captured the market. Another entrepreneurial strategy of Apple is maintaining secrecy about products. The level of confidentiality is so high that employees are not even allowed to discuss the products with their family members. At Apple, even highly skilled employees are treated as commoners and all remunerations are oriented to high class product development. The main survival strategy that was determined for Apple is development of superior quality product as well as superior marketing of the same. At Apple, few products are developed simultaneously so that competitiveness in the market is maintained (Kahney, 2008; Lashinky, 2008; Semler, 1989). Leadership styles of Google, Apple and Semco From the organisational perspective, different leadership styles have significant impact on organisational performance and motivational level. It was gatherer that Laissez faire is largely practiced at Google; while, Apple and Semco has adopted autocratic and participative leadership style respectively. Based on the performance of each company, it can be suggested that the companies have adopted appropriate leadership strategy as per business environment and organisational culture. In Semco, participative leadership style is practiced by means of greater organisational authority to employees and open communication. The employees in the organisation are allowed to participate in the management decision and administrative decision making process. Employees have the liberty to determine their own salary and bonus. As per participative leadership style, significant degree of autonomy is provided to employees and often several decisions are taken on the basis of employees’ opinion therein. Since employees have been largely empowered at the organisation, organisational growth and development is a serious matter to the employees of Semco (Semler, 1989). At Google, laissez faire leadership is extremely common where employees have absolute freedom of doing things their way. The company believes that employees are responsible enough to take their own decisions and do the right thing that is healthy for the organisation. Arguably, Google is the most liberal corporations among all the three. Employees at Google are not restricted regarding their work hour, outfit and activities. Furthermore, they are not even punished for poor performance and project failure. In this regard, it is noteworthy that the liberty is implemented appropriately by the employees therein and outstanding products have been delivered by Google (Lashinky, 2008). In Apple, the autocratic leadership style has been largely implemented. In the company, Jobs was treated as the task master, who created ideas and led the firm to the introduction of various innovative products. Contrary to popular notion, this leadership style has brought the corporation significant level of success. Perfect products such as iPod, iPhone and iPad can be considered as outcome of fear induced motivation by the autocratic leader. However, it was also gathered that besides being an autocratic leader, Jobs was charismatic as well. Every product success resulted in generous flow of appreciation and reward. Nonetheless, employees enjoy their position at Apple because they have ample scope of learning therein (Kahney, 2008). Conclusion Innovation and creativity in the technology industry in the contemporary scenario is not only being used for product and service development but has also become an integral part of generating competitive advantage for the firms. Considering the strategies used by Google, Apple and Semco, it can be observed that these firms have extensively connected their product development and diversification strategies with their competitive aspects. For instance, the vertical integration process of Apple with their suppliers has also been adopted by Google when they acquired other companies. In context of the internal management policies of the business houses subsequent changes have been noticed such as Google is focusing on generation of a young, energetic and innovative employee base with specialised skills for increasing the organisational performance where as Semco prefers to develop a multi-skilled employee base so that they have an adaptable workforce. Apple on the other hand has an authoritarian approach which has directed their recruitment strategy to look for employees who can abide to rules and regulations and follow the organisational policies strictly. It can be observed that the changes in the managerial approaches have also led to development of alternative factors and their implementation in their strategic planning process. Furthermore, the relationship between the managerial and leadership styles employed in the concerned organisations has also helped them in building an appropriate framework which is aligned with their organisational objectives. References Kahney, L. (2008). How Apple Got Everything Right by Doing Everything Wrong. Wired Magazine, 16(4), 1-4. Lashinky, A. (2008). Where Does Google Go Next? Retrieved from http://money.cnn.com/2008/05/09/technology/where_does_google_go.fortune. Semler, R. (1989). Managing without Managers. Harvard Business Review, 1-10. Read More