Case Overview
Case Overview
Case Overview
Harvard University
MGMT E-5100
Apigee: People Management Practices and the Challenge of Growth Case Study
Case Overview
Since the turn of the 20th century, the information technology industry worldwide began
experiencing exponential growth seemingly year-after-year. With organizations around the world in
demand for comprehensive consumer data, operational efficiencies, and continual financial growth and
sustainability in cutthroat industries, application programming interface (API) providers saw opportunities
for business ventures that met those demands. Apigee Technologies Pvt. Ltd was one such API provider
which experienced success during the ascent of this specialty in the technology sector of the early-2000s.
Based out of Bangalore, India, often referred to as the “Silicon Valley of India”, Apigee took well
advantage of their area’s highly educated workforce of inhabitants specializing in STEM fields. Apigee
experienced further growth after Srinivasulu Grandhi took over as vice president and managing director
of Apigee’s Bangalore office in 2011. By 2015, he oversaw Apigee’s staff blossom from 250 to well over
400 during that four year span. Perpetuating the vision espoused by Apigee’s CEO, Chet Kapoor, Grandhi
learning. Their approach during this tenure paid off for the company as Apigee’s total revenue grew from
However, as often happens with fast-growing companies, its losses had also been soaring, from
$8.3 million in FY 2012 to $60.8 million in FY 2014. Losses in FY 2015, however, had slowed compared
with the previous year. In April 2015, the company sold 5,115,000 shares in its initial public offering,
raising $87 million. Apigee’s was thus the first public offering from a software company that worked on
APIs. Despite the rise in recorded losses, the company’s future was still exceedingly bright. With the
company trending towards further expansion, there was dubiety on whether the company would be able to
2
maintain this culture of “collaboration, openness to experimentation, and an emphasis on innovation and
learning”. Key members of the senior staff pondered whether Apigee would require adjusting critical
human resources operations in order to adapt to the foreseeable growth. A question that must be answered
is: “Would it be possible to connect the growing number of employees with the organizational values of
sustaining passion and excellence without creating organizational conflict?” While the optimism and zeal
was high throughout the organization, Grandhi was well aware of the challenges that lie ahead and knew
he needed to discuss with the HR team and the senior management the integration of Apigee’s unique
Experiencing Growth and Dealing with the Potential Pitfalls of Organizational Success
Since Apigee’s inception, Kapoor and Grandhi were clear that the organization would be
designed and driven by a heavy focus on people and would work toward establishing management
practices that empowered employees. Kapoor stated, “ We at Apigee deeply believe in the ‘magic of
people.’ Apigee nurtures the right environment for people to realize their potential and lets the magic
unfold. We constantly look at fine-tuning our ways of working and our hiring approaches to allow this
management was based on the strong inclination that putting the employee first would enhance
productivity and the efficiency of processes would soon follow. This people-focused style of work
necessitated an understanding of the culture and the values that prevailed at Apigee. “Referring to
Apigee’s unique culture and its effectiveness, Michael Fleshman, senior VP for customer digital
technology at BBC Worldwide, remarked, “What defines success for us is the design of the APIs
themselves. The level of expertise that Apigee brought to the table in terms of individuals who can help
with the design of the APIs was an important aspect” (Ivey Publishing 2017).
3
There are several reasons why many point to the growth and success at a company like Apigee.
These are some of the highlights that set the company apart from several other inside and outside of the
tech industry.
○ The unique culture at Apigee, i.e., “the Apigee way,” was the outcome of
culture-building exercises that were initiated to identify the company’s core values.
Apigee’s way of building culture was markedly different from traditional top-down
■ What this entailed was a culture in which democratic values were appreciated.
Employees were allowed to express their thoughts and opinions regarding their
work, the company, and its culture. There are three critical values were
internalized and exhibited at Apigee: passion, a bias for action, and respect.
○ In addition to the personnel at Apigee being passionate about their work, they also took
an interest in the work of others and supported their success in addition to their own.
Learning beyond their individual roles took place as well. Thus, individuals within the
○ “Another important value that guided Apigee’s manner of operating was its “bias for
action. The secret of Apigee winning deals and appreciation from clients stemmed
primarily from Apigee’s culture of taking quick decisions and responding promptly to
clients. Because of the hyper-focus approach towards customers was emphasized and
4
associates were not micromanaged, associates were free to make unilateral decisions
○ Lastly, “respect, both for each other and for autonomy, was a deeply valued and
cherished philosophy at Apigee. This respect was reflected in Apigee’s flat organizational
there is hardly any hierarchy. All employees can walk up to the CEO anytime to talk
about new ideas or about something the employee is not happy with” (Ivey Publishing
2017). Another employee stated, “Employees are trusted and empowered to make
decisions. We have freedom in doing what we need to do to get the job done. There is no
Publishing 2017).
○ With Apigee’s core values of “passion, a bias for action, and respect” being at the center
of their success, a specific human resources strategy was set in motion to ensure the
preservation of their core values. This entailed that the hiring process must be keen on
identifying candidates who could blend seamlessly with Apigee’s culture of being able to
○ As the company evolved, the leadership team introduced performance management via a
mobile application that had four or five customized themes for each business function.
Using the application, the employees entered their goals, which the coach reviewed at the
start of every month. At the end of the month, the employee could perform a self-review,
which would subsequently be approved by the coach. “The use of innovative technology
increased not only the objectivity of the performance appraisal but also its frequency by
replacing the biannual performance appraisal process with a dynamic system that
5
captured performance in real time. The employees were fully aware of their performance
○ Additionally, employees were given the flexibility, freedom, and autonomy to manage
the type of schedules that best suited their working style. With much of the Apigee
work from home (as long as the necessary personnel from their team are notified). As
individual employees did not feel the need to hide information or to make excuses for
their absence. This also meant that employees could take vacations at seemingly any
“Apigee’s unique DNA with regard to its HR practices had several positive outcomes, such as
enhanced productivity, lower attrition, and better collaboration that resulted in organizational
effectiveness (Ivey Publishing 2017)”. In fact, this culture of empowerment and freedom enabled it to
partner with several large and influential clients, including the British Broadcasting Corporation and
Adobe. “Apigee had undoubtedly created much goodwill among application developers, who constituted
another vital stakeholder group and played a major role in contributing to the success of the organization
(Ivey Publishing 2017)”. However, as Apigee was poised to take the big leap to become the leading
provider of cutting-edge digital transformation technology across the globe, Grandhi felt that Apigee’s
existing culture was fraught with risk. He anticipated that Apigee’s culture of excessive freedom and
6
empowerment could lead to lower productivity or subpar organizational results. “After all, a culture that
lacked monitoring could make it easier for employees to set lower benchmarks and to indulge in loafing.
Grandhi and his senior team had invested much time and effort to build the unique culture at Apigee,
which assumed that employees had both the maturity and the capability to handle autonomy” (Ivey
Publishing 2017). With the prospects of Apigee’s growth projections, Grandhi must answer some of these
questions, such as: Would Apigee’s current culture be sustainable if the company grows? Was it possible
to embed Apigee’s culture into people’s consciousness through the use of institutional processes? Or
would such an effort betray Apigee’s culture of autonomy and freedom? Would the leadership team be
able to install processes without entering into the bureaucracy quagmire? How could Apigee guard
against complacency? In light of Apigee’s ambitious growth plan, Grandhi realized the importance of
Throughout their early years of rapid success, Apigee implemented the four most effective
leadership styles to shape their company culture of autonomy, empowerment, freedom, openness to
learning, collaboration, democracy, and employee-centricity. With the balance of the “Authoritative
Style”, “Affiliative Style”, “Democratic Style”, and the “Coaching Style”, Apigee found early success
that set them apart from their competitors and won them favor amongst numerous elite multinational
corporations. While it is imperative for leadership within an organization to employ a healthy mix of
styles to manage their teams, there are also potential pitfalls that may occur when these styles are not
applied correctly or sufficiently to address certain scenarios. I will begin by briefly providing explanations
of each aforementioned leadership style, how or when they may be implemented in certain situations, and
○ An authoritative leader takes a “Come with me” approach: she states the overall goal
but gives people the freedom to choose their own means of achieving it. This style works
especially well when a business is adrift. It is less effective when the leader is working
with a team of experts who are more experienced than he is (Coleman 2000).
○ The hallmark of the affiliative leader is a “People come first” attitude. This style is
particularly useful for building team harmony or increasing morale. But its exclusive
focus on praise can allow poor performance to go uncorrected. Also, affiliative leaders
rarely offer advice, which often leaves employees in a quandary (Coleman 2000).
○ This style’s impact on organizational climate is not as high as you might imagine. By
and responsibility and help generate fresh ideas. But sometimes the price is endless
○ This style focuses more on personal development than on immediate work-related tasks.
It works well when employees are already aware of their weaknesses and want to
improve, but not when they are resistant to changing their ways (Coleman 2000).
As Apigee continues to grow, Grandhi is right to be concerned of his organization’s excessive freedom
and empowerment because while it has worked in its current state larger organizations are inevitably more
complex and need more control and strategic management. With these heightened complexities at play, I
recommend that these additional leadership styles be incorporated into Apigee’s current repertoire.
○ A leader who sets high performance standards and exemplifies them himself has a very
positive impact on employees who are self-motivated and highly competent. But other
democracy are what have made Apigee the type of company that has attracted top
talent in their region in the past, it would be in the best interest of the company to
incorporate pacesetting styles that push employees to reach certain heights when
required. The reason for incorporating this style is that not all employees are able
objectives that otherwise wouldn’t have been achieved without a little nudge
○ This “Do What I Say” approach can be very effective in a turnaround situation, a natural
disaster, or when working with problem employees. But in most situations, coercive
(Coleman 2000).
■ Statistically, this leadership style is the least effective amongst all mainstream
problem employees arise. Thus, in order to maintain order and control, it’s
must emphasize necessary because this style of leadership, when abused or used
Apigee must use this style cautiously, but also understand the powerful influence
Conclusion