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Business Functions and Organization Structure

Apple focuses more on exploitation than exploration, refining its existing products and services through incremental improvements. Under Tim Cook, Apple has transformed from an innovator under Steve Jobs to focusing on small efficient changes to products like the iPhone. Cook has also improved Apple's supply chain, outsourcing manufacturing and developing a leaner system to reduce costs and ensure products are available worldwide. This focus on exploitation through refinements and supply chain efficiency has allowed Apple to survive in the evolving technology industry.

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Joseph Githaiga
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151 views

Business Functions and Organization Structure

Apple focuses more on exploitation than exploration, refining its existing products and services through incremental improvements. Under Tim Cook, Apple has transformed from an innovator under Steve Jobs to focusing on small efficient changes to products like the iPhone. Cook has also improved Apple's supply chain, outsourcing manufacturing and developing a leaner system to reduce costs and ensure products are available worldwide. This focus on exploitation through refinements and supply chain efficiency has allowed Apple to survive in the evolving technology industry.

Uploaded by

Joseph Githaiga
Copyright
© © All Rights Reserved
Available Formats
Download as DOCX, PDF, TXT or read online on Scribd
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BUSINESS FUNCTION AND ORGANIZATION STRUCTURE 1

Business functions and organization structure

Name

Institution
BUSINESS FUNCTION AND ORGANIZATION STRUCTURE 2

Usually, organizations find it hard to achieve ambidexterity, which is a balance between


exploration and exploitation. Apple Inc. is one of the largest technology companies and leans
more on exploitation focus. Exploitation refers to the refinement of existing resources, products,
competencies, and knowledge and is usually linked with learning via local research and
incremental improvements. Apple has it’s headquarter in California and deals with online
services, computer services, and consumer electronics such as mobile phones and computers.
During the Steve Jobs era, the company was highly involved in various innovations such as the
iPhone and iPad, but the Tim Cook era has seen great exploitation involving the improvement of
products and services to achieve higher efficiency and profitability (Hobcraft, 2016). Due to the
great focus on exploitation, many people have accused apple of being non-innovative in the last
decade.
The technology industry that apple serves is dynamic, and thus the company has to sense
and seize any available opportunity. Apple's core product is the iPhone, which is ranked among
the bestselling smartphones in the world. Since the development of the first iPhone in 2007,
apple has had incremental innovation on the iPhone, leading to the release of various models
with different updates (Pereira, 2017). In this scenario, Apple has continuously released other
iPhone generations that are efficient by exploiting its knowledge and resources. Due to the
exploitation of existing knowledge and resources, Apple Company has managed to survive in the
ever-evolving technology industry. The exploitation of technology and constantly updating them
with new features has enabled the company to update and develop new, attractive concepts to the
consumers.
Firms following the exploitation focus achieve their success through improved reliability
and efficiency in producing and delivering their products and services. Top management in an
organization plays a crucial role in decision making and thus influences which focus a company
has to take. Tim Cook, the current CEO of Apple, has transformed the company from the famous
disruptive company during the Steve Jobs era to a company currently involved in incremental
innovations (Hollestelle, 2019). By focusing on small improvements and innovation, Tim cook
has revolutionized iPhone through some changes making it attractive to many people in various
parts of the world. For instance, the currently released iPhone 11 series saw some improvement
on its screen display, camera, A13 Bionic chip, and battery duration, all of which are incremental
improvements from the previous version. Tim cook had to change the top management and have
others aligned with the exploitation focus to facilitate the changes.
Steve Jobs had a dream of achieving a closed ecosystem supply chain for Apple to enable
the company to control every aspect of the supply chain. To improve on the work of Steve Jobs,
Tim Cook outsourced manufacturing in various companies in China, leading to the closure of
various manufacturing factories and warehouses worldwide. He also reduced the number of
suppliers as well as the inventory for the company. The suppliers for the company manufacture
the products on their own and thus secure the supply chain. The development of just-in-time
supply chains and factories helped reduce the company's inventory and save on storage costs.
These moves in the supply chain helped Apple save a lot of money and have better quality
products and services (Lu, 2020). The company also has a better distribution channel that ensures
its products and services are available in different parts of the world. The company also saves on
tax through saving on duty and shipment since most of its products are shipped from its
outsourced manufacturing plants in China. Therefore, by making the supply chain leaner and
BUSINESS FUNCTION AND ORGANIZATION STRUCTURE 3

agile amongst other continuous improvements, Apple has developed one of the world's best
supply chains.
BUSINESS FUNCTION AND ORGANIZATION STRUCTURE 4

References
Hobcraft, P. (2016). Balancing Exploitation and Exploration to Improve Performance. Retrieved
from https://blog.hypeinnovation.com/balancing-exploitation-exploration-for-changing-
performance
Hollestelle, T. (2019). Apple: A prime example of how incremental innovation can lead to
disruption (again) | by Tom Hollestelle | Medium. Retrieved from
https://medium.com/@tom.hollestelle/apple-a-prime-example-of-how-incremental-
innovation-can-lead-to-disruption-again-7068299a84c1
Lu, C. (2020). Apple Supply Chain - The Best Supply Chain in the World. Retrieved from
https://www.tradegecko.com/blog/supply-chain-management/apple-the-best-supply-
chain-in-the-world
Pereira, L. (2017). Exploration vs Exploitation. Notes on Product #2: Quora | by Luis Pereira |
Product Coalition. Retrieved from https://productcoalition.com/exploration-vs-
exploitation-c38ce7aa932d

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