MGMT1002 Principles of Management
Case Study: Atlassian
Atlassian was started by two Australians – Scott Farquhar and Mike Cannon-Brookes in 2002 with some simple goals: they wanted to not have to wear suits to work and earn more than what Farquhar was offered by PwC. After turning down the $48,500 job at the accounting firm, Farquhar says Atlassian was born into an ecosystem that didn’t really even exist yet. The co-founders met while studying at the University of New South Wales and created the company on the back of credit card loans.
“There was no technology industry in Australia at the time, nor a start-up industry,” Farquhar stated. “Our university professors disowned us. Our parents looked the other way. Our original goal was to earn more than $48,500 and not to have to wear a suit to work.” It was supreme confidence in the idea behind the software companyand its global potential that led the co-founders to make the decision, and it all came from one simple belief. “We believed that software would be huge, that it would disrupt every industry.” Farquhar says. “The world just hadn’t realised it yet.” The two founders had a strong faith and belief and were willing to take a risk.
Atlassian now employs over 1500 people, its products are sold in more than 100 countries, and has $1 billion in sales, is worth over $US3 billion and has set up shop across four continents. After relocating its headquarters to London Atlassian moved to becoming a public company, with the founders still retaining about 78% of Atlassian ownership between themselves. Going public provides a big boost for them and the employees. While they are not driven by profit, they recognise investormoney enables them to build great products.
In another break away from the traditional way of doing business, Atlassian employs few sales staff. It instead simply lists all relevant product information and prices directly online for all to access. It’s a technique that is disruptive in its simplicity – there are no discounts and no cold calls. Staff are seen and treated as important “members” of Atlassian. Staff have likened the workplace of Atlassian, as a “colourful playground”, with great open space, state of the art officefurniture and equipment,access to gym and café 24/7, and flexible work conditions that support work-life balance. Members also have access to day care services for their children.
Atlassian successfully tapped into the growing trend to work in virtual teams, and designs software products to support collaboration amongst team members. Atlassian software supports a moretechnology driven workplace. They created an application called JIRA to enable all team members to share information and track development changes, to reduce confusion & costly time delays. Theprogram enables contributors to work co-operatively, view and participate in idea generation, andmake instant changes. This increases development process, allows capturing of ideas and assists in new product development. It is especially useful due to geographical distances between staff. JIRAis now used by 150,000 customers. In over 115 countries. Atlassian uses their own platforms to encourage a more flexible work arrangement.
Another of their programs called Confluence, is designed to especially prevent tacit knowledge being trapped and not shared. Sharing and managing knowledge is a challenge for large organisations, and so fast processes are essential for sustaining competitiveadvantage.
Co-founders Scott Farquhar & Mike Cannon Brooks recognise their ability to produce innovative solutions for customer problems is through Atlassian’s own capacity to attract and retain the best software engineers and to have a company culture that encourages risk taking and collaboration. They use the “ShipIt days”. This is when employees are given 24 hours in which to solve a problem, develop and pitch a new idea. This has resulted in the creation of over 600 internal projections. Themanagement support and encourage risk taking and learning and value employee’s ability to think creatively. The company’s priority has been to create knowledge sharing among employees and cooperation with their customers through building strong relationships. One of the extra bonuses is that staff continue to grow and evolve professionally and personally, as they remain linked to the ideas and expertise of their networks.
Why is it critical for Atlassian to scan and understand the external forces operating in the business environment? Using Thompson’s Model, describe one general external force and onespecific external stakeholder which provide opportunities for Atlassian.
Using Schein’s three layers model describe the organisational culture of this business. Use examples from the case to support your points.
Identify and describe the organisation design or structure of Atlassian, using the six elements of design.
Using Blake and Mouton’s Managerial Grid, describe the management style of the Founders of this organisation. Explain whether this style of leadership may be considered appropriate given the goals and the culture of the business.
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