The big news in tech last week was that
Steve Jobs is stepping down from his CEO duties at Apple, recommending COO Tim Cook as his successor. The move had been widely anticipated for some time due to Mr. Jobs’ health challenges over the years. Mr. Cook was the obvious choice given his role as interim CEO during previous leaves-of-absence by Mr. Jobs.
As someone who worked at Apple for a few years, I’m asked often by friends how Apple became the most innovative company in the world. Though I worked at Apple, I was not in Jobs’ inner circle (not even close). But his fingerprints could be found at all levels of the business from its culture to the minute details of everyday execution. And I have my thoughts as to how he was able to build Apple into a globally dominant company. More recently, the question has become: will the tech giant be able to maintain this position in the post-Jobs era. Like most people, I really don’t know the answer to this question. But I have my concerns.
To understand how Apple will perform in a future without its iconic leader, we need to first agree on what Mr. Jobs did that was so special. Most commentary centers on Apple’s uncanny ability to create elegant and easy-to-use products … or his vision for technology … or his “demanding” leadership style … or his mastery of the product launch. My answer boils down to one word: courage.
The phrase, “creative destruction” is often used when one company’s product overtakes the incumbent product of another. Upstart innovations kill the older, established predecessor. Rarely, if ever, do you see creative destruction practiced within a company, on its own products. Usually the opposite occurs. The examples are everywhere: Blockbuster (crushed by Netflix), Borders (bled slowly by Amazon) and Motorola (beaten by Apple then acquired by Google). Incumbent and, usually, dominant companies cling to existing products and avoid anything that might cannibalize sales from their cash cow. Only after a winning product has completed its lifecycle do they come out with a major upgrade. Not Apple. There are no sacred cash cows. I never heard the word “cannibalize” at Apple, ever. Saturday Night Live captured the essence of this pattern in a skit where Mr. Jobs introduces the new, ever-smaller iPod within minutes of launching a previous version. I was sad that the iPod Pequeño name was never actually used. All kidding aside, Apple destroys and replaces its own dominant, profitable products every year (if not more frequently).
Contrast this with Motorola’s cell phone business. When Motorola introduced the StarTAC in 1996, you wanted one. It changed the market. How long did it take the company produce its next “gotta-have-it” product? Seven years (the RAZR was introduced in 2003). And when I moved back to the U.S. and went cell phone shopping four years later, the RAZR was still the best phone I could get from Motorola. The only difference was that I could now purchase a pink RAZR. From 2007 to 2010, Apple introduced four versions of the iPhone, including one major redesign.
This commitment translated into a challenging corporate culture within Apple. With each new product release or upgrade, there would be a fire drill to redesign supporting software products and thousands of highly profitable accessories. Further, our external partners HATED the fact that a new, gotta-have-it gadget would be introduced in September, when they typically lock down their product plans for the holiday season in August. Retailers would need to retool their inventory, liquidate the “old” version and scramble to get enough stock of the new item allocated to their stores.
All of this requires courage, unique courage. And in the case of Mr. Jobs, my concern is that it might have been one man’s courage. His leadership style is well documented as one that is very “command and control” in nature. I’m not sure that personal courage was encouraged in the same fashion as responsiveness and relentless execution. Will Mr. Cook, who is more of a manager than a leader, instill this courage as a guiding principle at the core of the Apple’s culture? Only time will tell. If he doesn’t, Apple’s brightest and most innovative days will have come and gone with Steve Jobs.
Robert Hatta is the Vice President of Entrepreneurial Talent for JumpStart. He has worked at several startup companies in Northeast Ohio and Silicon Valley, as well as other high growth, technology companies across the U.S. and Europe. Through these experiences, Robert has gained an extensive understanding of the culture and needs of high growth companies with a particular focus on talent.