It seems one of the most repeated business stories these days has involved the health of Apple’s CEO, Steve Jobs. Apple and Silicon Valley fanatics have been consumed for weeks with wanting to know the status of Steve’s health. How can one individual have such a profound impact on one company? Yesterday’s announcement that Mr. Jobs has elected to take a six month leave of absence sent Apple stock into a tailspin, and has fueled even more buzz. Included in this latest announcement is a statement that Tim Cook, Apple’s current COO will assume the role of CEO while Steve recuperates. Over on the CNET Apple blog, Tom Krazit pens that media and bloggers have crossed the line regarding speculation of any individual’s health. I totally agree. Rather than add one other Steve Jobs commentary to this litany, let’s a supply chain perspective of this situation.
It’s no secret that Apple has risen to the top of most every industry analyst’s rating of most innovative supply chain. I myself began to cite Apple’s excellence in 2005, before AMR Research’s recent anointment of Apple as number one rating in its latest Top 25 Supply Chains Rating. In 2008, I’ve penned six different posts citing Apple’s supply chain competencies. From my perspective, the fact that Tim Cook, an experienced supply chain executive, will be the interim leader should be no concern whatsoever.
An article penned by Brandon Bailey in SiliconValley.com summarizes a consensus view that Mr. Cook has the right qualities to lead Apple for the next five months. Mr. Cook was recruited in 1998 to overhaul the company’s manufacturing and distribution processes, which had many challenges at the time. He has been widely credited with successfully transitioning production to contract manufacturers, streamlining production systems, and driving today’s efficiencies that we observe in Apple’s highly outsourced supply chain. Tim Cook’s management competencies lie in operational and supply chain excellence, and what’s wrong with that? The path of Apple’s product innovation is already set, and I would argue that in this unprecedented turbulent economy, a focus on execution and cost effectiveness may be just what Apple needs over the coming months.
It will be great to observe a solidly grounded supply chain executive lead Apple. The secret of Apple’s ongoing success is not only in the marvelous creativity of its products, but also the capabilities of its supply chain. If you believe as I do that cutting your teeth in supply chain is a great proving ground for “C-level” success, than rest easy. All will be fine.
Bob – I agree with you that seeing an operations/supply chain executive move to the top at Apple is great news and a clear recognition – that is more often than not lacking – of the importance this part of the business plays in a company’s success. I also agree that, given the market turmoil, the timing is good because operational excellence will be more important than anything else right now.
So, in the short-term, I see no big issue. However, what Apple has failed to do is establish a public persona for product innovation outside of Steve Jobs. He IS product innovation at Apple as far as the world is concerned. One of two things is true – either he truly is the driving force behind the incredibly innovative products that have driven Apple to its current position or he’s just one of many. If it’s the former, Apple had better hope for a speedy recovery, because product innovation, along with operational excellence, are the keys to their success. If it’s the latter, then it’s much more a PR challenge than an innovation challenge they must overcome – which can be quite easily addressed with the launch of their next major innovation.
My fear is that it’s more the former than the latter (despite what I’m sure is an incredible team at Apple), in which case they have both an innovation and PR challenge on their hands.
I completely agree that Apple appears to be in very competent hands right now and should continue to do exceptionally well – relatively speaking given the economy – in the near-term. However, I think their long-term continued growth is dependent on “solving” the innovation dilemma. I’m guessing that given their track record they will find a way. I’ve been incredibly impressed with what Apple has done the last several years and would love to see it continue.
Regardless, here’s to a speedy recovery for Steve Jobs.
Randy, appreciate the added comments. I completely agree that Steve Jobs has become the innovation persona for Apple. Perhaps that is why we are now reading other blog commentary about a potential SEC inquiry into Apple for possibly hiding key information on the health of Steve Jobs that could be of consequence to the operations of the company. It seems this will never end.
I echo the wish for a speedy recovery for Steve Jobs.
Bob Ferrari