Apple Management Will Carry Out Vision as CEO Steps Down
Over the coming days there’ll be a barrage of opinion about Steve Jobs’ decision to step down as CEO of Apple. It’s perhaps inevitable that we’ll see overbearing and highly speculative scrutiny of every aspect of the news, from the state of his health, to the short-term impact on the share price and the prospects for Apple under new management.
In this respect, I’m troubled by the fact that I’ve found myself writing about it this morning. First and foremost, Mr Jobs’ illness is a deeply sad development for him and his family. This is something altogether lacking in coverage I’ve read. In fact, reports read more like an obituary. Let’s be clear — as far as Mr Jobs and Apple are concerned, nothing has changed in 24 hours.
Such reporting is of course testament to his astonishing achievements at a company he returned to in 1996 following an acrimonious departure in 1984. He leaves Apple in an astonishing position. The company has a market capitalisation of $348.75 billion, which is 1.67 times larger than Microsoft’s. Last quarter Apple had $76.4 billion in cash reserves — that’s more than the US Treasury, and the sum could exceed $100 billion by the end of the year.
It’s no surprise, then, that question on the media’s lips is whether Apple can maintain the trajectory without the driving force of its former CEO. The answer is simple. It’s business as usual.
Mr Jobs has effectively been absent for the past 12 months, in which time Tim Cook has steered a steady course as chief operating officer. Mr Jobs may still have been involved at a strategic level, but his day-to-day operational involvement was already substantially reduced. He’s created a strong management team that has undoubtedly been shaped to take over the reins on the day of his departure.
This isn’t to say he won’t be missed. Mr Cook has a big pair of shoes to fill, but he’s demonstrated sound management and a good command of supply chain dynamics in the face of significant disruption in Japan and exceptional demand. The operational structure will inevitably change. Mr Jobs will no longer be solely responsible for approving (or culling) new projects and ventures.
This change may even prove positive for Apple. But most importantly, Mr Jobs’ vision is well defined within Apple, and he’s likely to continue advising the board. The short term is about ensuring that the company continues to perform. The bigger question is how the departure will affect Apple in the longer term. There’s no single answer to that question, but the sad reality is that Mr Jobs won’t see the next stage of his vision in the role of CEO. The TV screen is arguably the next frontier for Apple. Two generations of Apple TV were a prelude to the main event, but my bet is that Steve Jobs has set the course and we won’t have long to wait.
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