A Level Business Studies: How easy is it for a CEO to change a struggling business into a more successful one? Apple & Steve Jobs

Steve Jobs, the founder of Apple, was asked to come back as Chief Executive in 1997 when the business was making a loss. Jobs was appointed to provide a clearer vision for the business and to improve its profitability. How easy is it for a Chief Executive to change a struggling business into a more successful one? Justify your answer with reference to Apple and/or other organisations you know.

Steve Jobs is a returning Chief Executive of Apple. Appointed to provide a clearer vision for the business and to improve its profitability, Jobs’ transformation of the struggling business will depend on how struggling it is. It could be struggling in more pressing senses like financial issues which may make change more difficult, or in regards to direction and innovation, a few small changes may solve the problem. Jobs’ would be wise to align values of the business and adopt a leadership style that will see them work through this period of hard times to reach a point of success.

How easy it is for a Chief Executive to change a struggling business into a more successful one depends on the amount of resistance from employees. It may become increasingly difficult for change to be implemented if workers are reluctant and wish to stick with the traditional methods they are used to. Kotter and Schlesinger’s model for reasons to resistance to change states that many people resist change out of self-interest, fear and misunderstanding, differing views and that they wish to maintain the status quo of their work and the organisation. For example, some employees may oppose changes out of fear of redundancy so will require a sense of reassurance from managerial roles to ensure that their job is secure going into the future. This can be motivating and can act as a method of overcoming resistance to change – which is another of Kotter and Schlesinger’s models. Steve Jobs would need to consider the amount of resistance posed by employees and come up with a suitable method to overcome the opposition. This could be done through six methods: education, participation, facilitation, negotiation, manipulation and coercion. These methods can help ease employees into the change and give them a better understanding of what the change entails so that they have no reason to fear or resist it. Involving the employees in the change is likely to end worries and motivate the employees to get involved as it will give them ownership, meaning they will push for success. If resistance is substantial, Jobs may need to bargain with troublesome workers to get them to agree to the change, or, in some extreme cases, threaten them with redundancy. An example of a business that underwent large amounts of change is Royal Mail; Moya Greene recognised the considerable amounts of competition and so decided to be “brilliant at the basics”. Greene devised a reward system for employees which acts as a motivator and would likely get them to agree with the proposed changes. Apple could work similarly, but it ultimately depends on the amount of employee resistance. Whether Jobs responds appropriately and effectively to the opposition will determine how hard the change will be to implement going into the future.

Despite this, it is important to consider the fact that Jobs is returning to Apple and is a co-founder. This means he will find it easy to align values of the organisation, lead with drive and passion and restore a sense of unity and direction to the company. The chances are that the employees will welcome him with open arms and take on board any criticism or change that he delivers; change is rooted within the culture of creative and innovative organisations like Apple, so it is likely that many of the employees will understand the requirements for change and be on board with the proposed ideas. Employees would need to be optimistic during this period and work more productively as this will give them a competitive advantage in the technology market and could see the business go from struggling to successful. The sheer nature and culture of Apple means that it may be easier for Jobs to implement the change because it is what the workers are used to. There is a level of trust that employees will have with Jobs as he is arguably one of the most iconic and successful executives of any business. This is similar to how Starbucks recently changed – Howards Schultz handed the reins over to Kevin Johnson who is known for technology experience, and is likely to grow the business through developments in mobile and digital ways, ensuring long term success for the company. As there is a sense of familiarity between workers and the Chief Executive in both these cases, there is less room for resistance as they already know what to expect from these figures and know of the previous success they have had. These reasons are likely to make it easier for change to be introduced in a business.

How easy it is for a Chief Executive to change a struggling business into a more successful one depends on a variety of different factors. No change will ever be smooth and simple as people do not like change and opposition to new procedures is a natural response. In the case of Apple, the culture of the organisation would make it more easy than hard for the business to be turned around as they are in a market that is constantly changing and developing. It is important to consider the leadership style of the Chief Executive who will be trying to put the business on a new path; if the business is struggling badly, an autocratic leadership style may be required to significantly improve profitability. A more democratic approach may be better despite lengthening decision making however, as workers will need to be motivated by the change as they are the people who ultimately decide the success of the organisation. However, whilst leadership style is important to how easy it is to change, it may also depend upon how much the change relies on external factors. The change could be incremental (changes over a period of time in small stages) or step (occurs rapidly). Step change may pose more problems for a business as it is likely to be a change in legislation which may shake up the business and force a change. This can put pressure on the organisation to change quickly and effectively which may lead to carelessness.