Filed under: Analysis / Opinion, Apple Corporate, Steve Jobs
Continuity: Executive succession plans in history
We all know that Steve Jobs will eventually leave Apple, and Apple's executive team has a responsibility to draft a succession plan to help minimize the turmoil when that day comes. To figure out what Apple might do, we can look to the past for other examples.
Ford Motor Company was founded in 1903 by Henry Ford. In 1918, at the age of 55, Henry handed the presidency of the company to his son Edsel. When Edsel died in 1943, Henry came back to Ford Motor Company ill, "mentally inconsistent, suspicious, and generally no longer fit" for the job.
Most of the board didn't want him to be president. Even with no official title, he'd been in de facto control of the company since Edsel took over. Nevertheless, the board elected him (rather than cross him), and he served until the end of the second World War. Gravely ill, he turned control of the company over to his grandson, Henry Ford II, in 1945. Henry Ford died two years later.
Steve Jobs has four children, the oldest of whom is Lisa Brennan-Jobs, a 30-year-old journalist. None have publicly expressed any desire to run Apple.
Maybe a look into Apple's past is a lesson in itself. When Jobs was forced to leave Apple in 1985, he was relieved by John Sculley, who had most recently been CEO of PepsiCo. (Michael Spindler was next, hired from inside Apple Europe to lead the company worldwide.) Gil Amelio, another past CEO, was hired away from National Semiconductor, and proceeded to lay off a third of Apple's workforce.
Should Apple now look to another company for its next CEO? Many companies have found new CEOs from outside their walls, with varying degrees of success. Carly Fiorina, famously, was hired by HP from Lucent, and she became a reviled figure among HP's employees for her brash management style -- and for allegedly spying on other board members. On the other hand, there's Lee Iacocca, who is credited with reviving the Chrysler brand in the 1980s after being fired by Henry Ford II. Iacocca introduced the world to the minivan, and bought AMC to revitalize the Jeep brand in the early 90s.
Perhaps more relevant, and more recent, is the story of sometimes-foe Microsoft, and its founder Bill Gates. Gates stepped down from his role as CEO in 2000, but was (and is) still chairman of Microsoft's board of directors. He handed the CEO spot to Steve Ballmer, and split his duties among Ballmer, chief software architect Ray Ozzie and chief strategy officer Craig Mundie. Gates' strategy? Promote from within.
We may be seeing hints of a succession plan like this already at Apple. No one person could probably replace Steve Jobs, so instead a (insert painful swallow here) Microsoft-style approach might be forthcoming. The title of CEO, in theory, could go to Tim Cook, currently in charge of Apple as Jobs takes his leave of absence. Any of Apple's senior vice presidents, including Jonathan Ive and Phil Schiller, could have Jobs' responsibilities split among them. The big question is: Who is the strongest leader among these Apple veterans?
Let us know what your succession plan would be by leaving us a comment.
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Reader Comments (Page 1 of 2)
Bart Verso said 9:16AM on 1-15-2009
Dear people of Tuaw,
I've been following up your website for longer than I can remember now. It has always been my number one to trust source about Apple related news. You've written previews, reviews, stories, and so on in such a great way that it is very unlikely for readers to dislike Tuaw.
But the recent entries on Steve's health are just outrageous. I've noticed this rise of this craze about his personal affairs on many sites for a while now, but you guys put it in such a way, that he already passed away. Is that the way you want to show your respect to our, and undoubtedly also your Guru?
Please show some respect, lay off for a while, or at least show the same trust or faith Steve has.
Kind Regards,
Bart Verso
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Adam S said 9:25AM on 1-15-2009
Ignore this guy. I agree everyone has a right to privacy. But when Jobs devised a plan to make himself and Apple one and the same, when he decided to project the image of the messiah of the Apple cut, he forfeited his right to hide things like this, not from fans, but from stockholders, software developers, and those whose lives are tied to the success of Apple. No man is bigger than Pepsi, no man is bigger than Walmart, no man is bigger than CVS, but Jobs, unfortunately, is as big as Apple. And that, I'm afraid, is by design.
His followers demand to know this information. Not reporting it doesn't make it not news.
+. said 9:29AM on 1-15-2009
oh, nonsense.
Apple is a publicly-traded corporation that has made a huge impact on the technology world. Steve Jobs is its (unusually high-profile) executive, who gets personal credit for a large portion of the company's success. so (1) his health is a direct concern of both shareholders & fans of the company, because for YEARS now we've been led to believe (by sites like TUAW & others) that so much of what makes Apple, well, *Apple* is tied up in this man. & (2) Steve maintains a certain level of "celebrity" based solely on his position & the mystique he purposefully carries around his persona. when you're a celebrity, even your private life becomes a matter of public interest. to think that Steve is not aware of that -- or doesn't accept it -- does him a far greater disservice than speculation about his ability to do his job.
don't get me wrong, it's touching to be concerned about the welfare/feelings of others. but man, what *i'd* like to see cease is exactly the sort of "Guru" crap that you're pulling up here. the man's not a guru, he's a corporate executive. & whether or not he has a viable succession plan in line is so ridiculously important to the future of Apple, i'd feel TUAW to be remiss in *not* bringing up the issue.
Kev orng said 10:30AM on 1-15-2009
So you don't think the executive succession plan of a publicly traded company should be discussed publicly?
And you think that the only reason why Jobs might leave the CEO role is his death, like a king or a mafia boss?
And you think we all worship him like he's the benevolent lord of some attractively designed and user-friendly fiefdom, raining electronic doo-dads down upon his adoring subjects?
A lot of TUAW readers are Apple shareholders. Shareholders have a right to know about and discuss issues that might impact their income. And if there is one thing I've learned, it's completely irresponsible to fail to have and make known a succession plan, from the smallest local company to the biggest multinational.
Rylin said 10:53AM on 1-15-2009
@Kev orng:
"A lot of TUAW readers are Apple shareholders. Shareholders have a right to know about and discuss issues that might impact their income. "
Are you completely nucking futs?
The amount of TUAW visitors with AAPL stock is less than 1% -- most likely way less than that.
Either way, TUAW is not an outlet for shareholder discussions, unless, of course, the stock in question is that of Weblogs, Inc -- and even then, there are most likely more relevant places to discuss issues.
Unfounded speculation on non-logical choices for the succession is just plain stupid. If Apple were to actually announce something, THAT, on the other hand, would merit discussion.
As it is everyone is just going through the same old pre-MWSF hysteria we're used to, albeit in a "Who's gonna replace sjobs!!?" fashion.
It does nobody a favor, and lowers the constantly sinking TUAW reputation.
Adam S said 11:03AM on 1-15-2009
@Rylin:
How do you know what percentage of TUAW readers have Apple stock? You certainly never queried me. I'd venture to say you completely pulled that figure out of your butt; you simply made it up, based on nothing at all. Super lame.
42.7% of statistics are made up on the spot.
. said 11:14AM on 1-15-2009
@ Rylin:
for someone flaming others on a blog with a "constantly sinking reputation," on a post of "unfounded speculation" that "is just plain stupid," i've certainly seen some long-winded discussion from you on here. related to the exact same issues. *cough* http://www.tuaw.com/2009/01/05/steves-ok-everyone-relax/ *cough*
your posts become 23.4% less sensible each time, i suppose?
Rylin said 4:04PM on 1-15-2009
@Adam S: Yep, I pulled the number out of thin air, but I also used a fair bit of reasoning to arrive at the number.
TUAW has an estimated 40000 pageviews per day (alexa), with 2-3 pageviews per visit, on average (various websitecheckers that have been +-10% for sites I've been involved in).
Not everyone visits TUAW every day, but some of us visit several times per day, and the demographic is rather spread out (roughly half the visits come from outside the US).
In other words, 10000 unique visitors per day sounds reasonable, and that would put the number of AAPL holders at 100 people a day.
Where I live (i.e., a rather civilized country with a very high standard of living), less than 1/10 own stock in *any* company (in fact, I know of only five people I hang out with on a yearly basis who do), and none who own stock in AAPL.
Now, I do realize that visitors to this site are somewhat more likely to own stock in AAPL than someone who normally visits e.g. Neowin, but I think you'll find that the vast majority of TUAW visitors don't hold any AAPL.
Could I be wrong? Absolutely.
Am I? Probably, but I doubt I'm off by much.
Feel free to point to data saying otherwise -- I'd genuinely be interested in seeing it and find out where my reasoning went wrong.
@.:
Long-winded discussion?
I see a rather short post, along with clarification on what I meant.
I prefer to give people thought through.
As for TUAW's quality slipping, you'll definitely have noticed others complaining as well if you've noticed /me/ post several times.
That being a minor point, the bigger one is the eventual succession.
Are you seriously saying that the idea of one of Steve's kids being the future CEO of Apple actually holds merit and is worth posting about? Was it just a cheap segue to move things away from the auto industry? What about pointing out that Apple are likely to recruit from within its ranks or bring in someone from the outside (feel free to point out other options).
The post is basically a nice piece of history, and yes, it does ask people to sound off in the comments on what they think.. much like the constant rumor mongering that the Apple community is known for.
While the rumor mongering is fun on occasion, all this doom and gloom is basically saying Steve is dead and buried, with last year's lilies on top of his grave -- it's just not /right/
Stoking the fire is never a good thing (which is what the TUAW articles, Wired speculation, "industry analyst" one-sentence quotes etc. accomplishes) -- especially in troubled times.
If anything, people (yes, that includes stockholders) should trust that there actually is a sound plan for continuing without Steve.
+. said 4:45PM on 1-15-2009
@ Rylin:
".. you'll definitely have noticed others complaining as well .."
yeah, i notice people coming onto blogs like this & bitching about "declining quality" all the time. it's been happening @ Engadget for as long as i've been reading it (~ 3 years now). complaining about the "quality" of one of several thousand blogs, one which you willingly continue to read, is actually a pretty standard form of passive-aggressive venting on the internet. i'm just pointing out the irony in the sheer amount of thought/effort you put into claiming something isn't worthwhile. :P
"Are you seriously saying that the idea of one of Steve's kids being the future CEO of Apple actually holds merit and is worth posting about?"
no. i doubt the author was either, seeing as that's all of *one* sentence in a much longer post.
"What about pointing out that Apple are likely to recruit from within its ranks or bring in someone from the outside"
um, the author does this. explicitly. did you *read* the post? that was part of the whole "auto industry" bit you apparently dismissed. are you saying it isn't apt to compare Apple to other large industries? why not?
"Stoking the fire is never a good thing ..."
the fire of...? also, are you saying that we shouldn't discuss a company's problems? or things that are likely to affect its stock price and/or products? (& before you start, i'm not making a value judgment on whether Steve Jobs' health *SHOULD* affect the stock price. "should" doesn't factor it---it *DID* affect the stock price, regardless.)
"If anything, people... should trust..."
i agree. good sentiment. perhaps it would be better received if you said it without needlessly flaming people?
good day, sir.
Adam S said 4:49PM on 1-15-2009
@Rylin:
Your logic is faulty. You are reading a niche site about a specific company. Your logic about who owns what stock is for the general public. But your sample group is far from the general public. In fact, I'd argue this is likely a group that is far more likely to own AAPL than any old Joe.
Alan Wilensky said 9:31AM on 1-15-2009
"Steve Jobs has four children, the oldest of whom is Lisa Brennan-Jobs, a 30-year-old journalist. None have publicly expressed any desire to run Apple."
You are not serious that would ever be considered? We don't do that in America anymore. Instead, we run banks into insolvency via reckless lending, and then take unsupervised Fed Money without any need to account for what is done with it. We keep the criminally culpable CEO's that got us into this.
Please should be still about Steve Jobs. Apple stands on it's own as a world class design center of unique products with the highest brand recognition and equity of mind share. Jobs has played his part - par excellence. His story is the greatest tale of corporate stewardship and personal /professional rebirth since...since....I can't even think of a parallel where a founder hires an experienced superior, who then goes on to fire the selfsame founder, who comes back to reinvent and save the company from the worst suit-based brand destruction in the modern tech epoch.
Jobs. Stellar, accomplished, and having done his best and in a time and season when he must tend to his person, leaves the company sitting on a pile of cash and product portfolio (and management bench) that will endure.
Let the vagaries of the market gyrate.
Now, Apple can carry on.
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Bart Verso said 9:37AM on 1-15-2009
Well....
Of course you guys got a point there....
I rest my case, your Honour.
...
(but still :-p)
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FearlessFreep said 10:06AM on 1-15-2009
I'd argue that Apple doesn't need a CEO in the traditional sense of running the business, but rather more of a Chief Strategist to continue innovation and serve as the public face for the company. That in fact is the role that Jobs has been doing since his return and it's where his absence will be felt. Someone to foster new ideas, present them to the masses and generally push the envelope. Apple has more than enough people to handle the day-to-day business side of things that a traditional CEO does.
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Elias said 10:10AM on 1-15-2009
Apple *should* promote from within, whereas MS should have brought-in a few outsiders.
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Johnny said 10:44AM on 1-15-2009
What? You don't like Steve Ballmer? Maybe Apple could persuade him to take over.
(I'm off to throw up now)
Jeremy said 10:52AM on 1-15-2009
I agree with Bart and Alan, this article is just stupid and a bit shallow to jump on the issue in the way that it has.
First, he's not dead. Keep saying that to yourself over and over so it will sink in. Steve Jobs is not actually dead yet.
Secondly, the whole idea of a successor having to be related to him is so last century and ridiculous that it's kind of dumb it was even mentioned. Although I am grateful to learn of his very hot daughter :) (haven't seen that picture before).
Third, the analysis of whether they should hire from without or promote from within is weak and not very well thought out. How about writing an article about the real issues the management has to think about in terms of succession? Do you really think that the execs sit around and say "Well should we hire from without, or within?" Far more important is the candidate themselves and the background they have.
When Steve was ousted the first time, he was replaced "from without," but the guys that replaced him were sugar-water salesmen. Don't you think that the reason they failed was more to do with the fact that they had no experience in running a tech company, instead of the fact that they "came from without?" Lee Iacoca is the famous example of a new CEO from outside coming in and saving a company, but he was an automotive executive in both companies. It's not like Chrysler hired a former oil executive, or clothing manufacturer.
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kev orng said 12:33PM on 1-15-2009
Why do you (and others) read this as being about Jobs being dead, or almost dead? Nobody said he was dead or dying. It's like you're assuming that he holds the CEO role until death. King Jobs.
This article is speculation on what will happen when Apple has to replace Jobs as CEO. There are a number of reasons why a CEO might need to be replaced, and death is only one of them. Another one is resignation.
So, to paraphrase you, he doesn't have to be dead to resign as CEO. Keep saying that to yourself over and over so it will sink in. Steve Jobs does not actually have to be dead to resign.
Colin Rowley said 11:17AM on 1-15-2009
While I hate to speculate that a 6-month leave of absence is the beginning of the end for Steve Jobs, there's no question that he won't be around forever. What does it hurt to speculate?
We need someone dynamic and techie who also has a love for Apple. Any ideas? Obama fits two of those three, but I don't think he is an Apple lover :-)
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mirq said 11:28AM on 1-15-2009
For the succession comments, I would suggest everyone take a close look at Scott Forstall's partial keynote presentations online. He introduced some parts of Leopard, then the iPhone SDK. The charisma is there. The confidence is there. The smirk is there.
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Mike Eggleston said 11:38AM on 1-15-2009
The discussion about what Apple shoud do when Jobs leaves the company is a valid discussion. Is he leaving right now? No, all signs point to not a chance. However, to stick your head in the sand and say nothing is wrong is equally disturbing and ignorant.
Will Apple hire one of Steve's children, as Jeremy said, it is very much last century. However, I do think that they have the people in place to move forward when Steve does step down.
I just honestly think that this time isn't going to be Steve's last hurrah. That said, this will be a good dry run to see how the company does without Jobs at the helm.
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