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  • What Apple Can Learn From The Tonight Show

    May 2nd, 2007

    As a practical matter, maybe Jay Leno isn’t the greatest host ever for NBC’s Tonight Show. Some prefer Johnny Carson or Jack Paar, or even Steve Allen, all of whom are no longer with us. But Leno surely gets decent ratings, usually better than rival David Letterman. But this isn’t a TV column. Instead, I’m going to explore a significant issue about succession.

    It has been known for quite some time now that Leno will be stepping down as host in 2009, and replaced by the man who hosts the show that follows his, none other than Conan O’Brien. It’s not important that O’Brien came to his job as a relative unknown, although he had great credentials as a comedy writer. What is important is that NBC has worked out a long-term succession plan so everyone knows who will be hosting Tonight after Leno departs.

    It’s not important, of course, that Leno’s retirement was probably forced on him to keep O’Brien employed by NBC.

    So what does that have to do with Apple? Yes, that’s right. There is no public succession plan at Apple, although I don’t dismiss the possibility that there’s a private one. But consider this: What will they do after Steve Jobs leaves his CEO post? Will he engage in a gradual retirement, and hire someone to be President of the company under his direction, or will he just leave, cold turkey?

    Unlike many tech companies, Apple’s success is almost entirely credited to Jobs. His forceful leadership after returning to the company he co-founded a decade ago supposedly saved the company from imminent bankruptcy, and put it on the path to its present-day stellar success.

    But nothing is forever. There are many reasons why Jobs would depart. For the moment, let’s forget a serious illness or injury or — heaven forbid — his death.

    Instead of taking the morbid approach, let’s look at the practical reasons why Jobs might leave. First, of course, is that he might one day decide he’s sick and tired of the daily grind and wants to spend the rest of his life doing something else. Maybe he’ll want to become a philanthropist in the fashion of his arch-rival, Bill Gates, although he doesn’t have anywhere near that level of wealth. Maybe he’ll choose to get involved in a different business, or maybe he’ll simply decide to spend more time with his family.

    There’s also the unfortunate possibility that Jobs will ultimately be implicated in that stock backdating scandal, and will face criminal charges, fines or other consequences that will make it impossible for him to function as CEO of a public company.

    Regardless of the reason, how is Apple’s board preparing for his inevitable departure. Whether it happens this year, or the next, or a couple of decades from now, nothing is forever. More important, when a company’s fortunes are so closely tied to a single person, if that person is gone, how will the company survive? How will they cope with the loss of his vision and iron-willed leadership?

    As a practical matter, Steve Jobs is not the only person responsible for Apple’s success. He sits atop an empire of thousands of loyal employees, most of whom work in lock step to bring his vision to life. Indeed, such people as ace designer Jonathan Ive are as essential to Apple as Jobs. It’s the Jobs-Ive partnership, in fact, that is generally regarded as responsible for the simple elegance of an Apple product. What if Ive left to pursue greener pastures, or another occupation entirely? Would that be quite as damaging to Apple as the loss of Jobs?

    So what is Apple’s succession plan? Has it really been worked out, in private, to be unveiled only when necessary? And will that plan, whatever it might be, be sufficient to settle the nervous stomachs of both stockholders and customers? How would Wall Street react? Would they accept the inevitable as a natural succession process or will the company’s stock price crash on the spot?

    But what if Apple’s board announced an officially-anointed successor? He or she could be someone in the position similar to that of the Vice President of the U.S., someone waiting in the wings to take over in the event the chief executive is no longer able to function.

    Would that satisfy the financial community and nervous investors that Apple’s future is in good hands?

    Of course, that would depend on who that successor might be? In any case, I don’t expect Apple Inc. to take lessons from The Tonight Show? But it would surely be a responsible solution to a potentially serious dilemma. What do you readers think?



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    18 Responses to “What Apple Can Learn From The Tonight Show”

    1. Benton says:

      Ask the Board of Directors.

    2. Ask the Board of Directors.

      And they will tell you — what?

      Peace,
      Gene

    3. SteveP says:

      Granted that few companies are as dependent on a directors ‘mystique’ as much as Apple, but few companies have that kind of clear succession. I think we just need confidence in ‘the company’ – to begin to be able to see it as having a self substaining direction. I think this is what they are working towards. The bigger and more diverse they become the less the ‘Jobs factor’ is an issue.

      I think Jobs has a ‘vision’ of what he thinks Apple should be and he isn’t there yet. (I suspect between 5 & 10 years and closer to 10) Barring something like health – or less likely, legal problems – force him out he will try to become his vision.

      I do think Apple stock will take a hit if he leaves, but I also suspect they would take a similar hit if they ‘announced’ a successor. There is no one at Apple who has Jobs dynamics and that in itself would raise the same questions of ability as we have now. I almost wonder about Google’s chairman being on the board! A ‘training’ position? It’s a way ofletting a person with drive and vision get a feel for the Apple ‘way’ before bringing someone in from the outside. I don’t think they have a ‘capable’ leader in house.

      A solid business plan and business success will weather the Jobs and Ives storm in a couple of quarters. I don’t think they are, in reality, as important to the future as people think.

    4. Granted that few companies are as dependent on a directors ‘mystique’ as much as Apple, but few companies have that kind of clear succession. I think we just need confidence in ‘the company’ – to begin to be able to see it as having a self substaining direction. I think this is what they are working towards. The bigger and more diverse they become the less the ‘Jobs factor’ is an issue.

      I think Jobs has a ‘vision’ of what he thinks Apple should be and he isn’t there yet. (I suspect between 5 & 10 years and closer to 10) Barring something like health – or less likely, legal problems – force him out he will try to become his vision.

      I do think Apple stock will take a hit if he leaves, but I also suspect they would take a similar hit if they ‘announced’ a successor. There is no one at Apple who has Jobs dynamics and that in itself would raise the same questions of ability as we have now. I almost wonder about Google’s chairman being on the board! A ‘training’ position? It’s a way ofletting a person with drive and vision get a feel for the Apple ‘way’ before bringing someone in from the outside. I don’t think they have a ‘capable’ leader in house.

      A solid business plan and business success will weather the Jobs and Ives storm in a couple of quarters. I don’t think they are, in reality, as important to the future as people think.

      Well, there’s certainly a lot of PR value in conveying the impression of an iron-fisted visionary in charge of Apple’s destiny. Even though many of the decisions and actions may be made by others in the company, Jobs gets all the press coverage, except when the story is about Ive, of course 🙂

      Peace,
      Gene

    5. MichaelT says:

      A position like Vice President of the U.S.? Don’t they have someone that qualifies for that on the board? 🙂

    6. A position like Vice President of the U.S.? Don’t they have someone that qualifies for that on the board? 🙂

      🙂

    7. Marie Drovinsky says:

      Jay Leno isn’t the worst talk show host ever on TV, but Conan O’Brien is.

      If Apple was to make such a choice (as an eighth rate looser like Conan O’Brien) now the stock would drop to $zero overnight. The only successor who would be acceptable would have to over time prove he had all Steve has and that isn’t possible since Steve would eat him alive during this proving process. Leaders like Steve go down hard and a complete sea change of culture will follow in the wake of a decent leader replacing him. Third string leaders would have to leave culture alone and Apple would wander aimlessly and die slowly.

    8. Jay Leno isn’t the worst talk show host ever on TV, but Conan O’Brien is.

      If Apple was to make such a choice (as an eighth rate looser like Conan O’Brien) now the stock would drop to $zero overnight. The only successor who would be acceptable would have to over time prove he had all Steve has and that isn’t possible since Steve would eat him alive during this proving process. Leaders like Steve go down hard and a complete sea change of culture will follow in the wake of a decent leader replacing him. Third string leaders would have to leave culture alone and Apple would wander aimlessly and die slowly.

      But NBC clearly didn’t want to lose O’Brien 🙂

      In any case, the problem is that Apple has been sidetracked over the years with several third-rate CEOs, and thus Wall Street would be very antsy if there was a period of uncertainty in finding a successor to Jobs. And, no, I don’t think I’d recommend Al Gore for the job.

      Peace,
      Gene

    9. MichaelT says:

      You wouldn’t recommend Al Gore? But Dick Cheney’s not on the board! 😉

      (If I keep this up I know you’ll want to kick me off the forum, but I can’t help myself! 🙂 )

      But seriously, have you given any thought to who you’d like to see? Whether they are on the board, or even at Apple or not, is there someone you can think of that has the sort of vision that could carry Apple along and keep them moving forward? Those are big footprints to follow!

    10. You wouldn’t recommend Al Gore? But Dick Cheney’s not on the board! 🙂

      (If I keep this up I know you’ll want to kick me off the forum, but I can’t help myself! 🙂 )

      But seriously, have you given any thought to who you’d like to see? Whether they are on the board, or even at Apple or not, is there someone you can think of that has the sort of vision that could carry Apple along and keep them moving forward? Those are big footprints to follow!

      I wouldn’t want Cheney either or any part of that crowd. Then again, Cheney does have experience as a CEO for a large company, and his fearsome demeanor would certainly throw fear into his troops and make them do what he wants. That is, of course, assuming he has any understanding at all of how to run a company like Apple, which I doubt.

      But you do raise a larger issue: Who among the current high-profile CEO crowd would be a suitable chief executive for Apple? Readers — care to comment?

      Peace,
      Gene

    11. Dana Sutton says:

      There’s a famliar Silicon Valley script: visionary young genius with a great idea needs startup funding, goes to venture capitalist. When the company starts to take off the venture capitalist figures out a way to get rid of the young genius and replace him with a drearily predictable M. B. A. type (the theory being that if you can manage anything — Pepsi Cola, for instance — you can manage everything). I have had a lot of pleasure seeing this script turned inside-out at Apple. Young genius comes back after the M. B. A.’s have screwed up the company unbelievably and proves to be a far better businessman than they were. AAPL just went over 100 today, and figuring in the subsequent stock split it’s going for nearly 200% higher than when Sculley left. But yes, the pancreatic cancer scare and the stock split flap should remind us that nobody is immortal, and that the lack of a good second banana and plausible successor is scary. It pains me to say this, but what Apple needs is somebody a whole lot like like Steve Balmer. And, in reply to what somebody wrote above, I bet there indeed are a lot of other creative visionaries within Apple. If Steve were to go, the problem might well turn out to be that it has too many creative visionaries. What’s needed is a strong leader capable of knockling heads together and keeping everybody focused on a relatively few viable projects, so that products actually get out the door, rather than letting everybody stray off in his own direction (and I bet a lot of this happened before Steve returned because the M. B. A. types didn’t have very much techological savvy, and so didn’t have a clue about what was going on within the company).

    12. Matt Carrell says:

      I thought this was a done deal already.. Jonathen Ive is pretty much a shoe in. He has the technical prowess and a not too bad stage presence..

    13. I thought this was a done deal already.. Jonathen Ive is pretty much a shoe in. He has the technical prowess and a not too bad stage presence..

      It makes sense from a logical standpoint, but nothing of this sort has ever been confirmed. And that’s the problem — Apple ought to say something about it.

      Peace,
      Gene

    14. SteveP says:

      I totally disagree about Ive.
      He’s a designer! (Not meant as a negative.)
      That’s where his technical prowess is. You shouldn’t take someone whose brilliance is design and make them a president. That would also leave a hole in design. And Ives is NOT a visionary leader in the mold that Apple would need as the head of a company. (And I’m not suggesting that they need a clone of SJ. He has his own negative issues and it’s very possible that the right person could have similar ‘vision’ with fewer negatives and manage to take Apple even higher.)
      I still wonder about my original thought of Google’s chairman fitting the role. Manage 2 different but related companies. Kind of like Jobs and Pixar/Disney?

    15. I understand the concern about Jobs leaving or dropping dead, etc. But frankly, if the fortunes of a large company like Apple are so inextricably tied to Jobs, then maybe Apple doesn’t deserve to live after Jobs is going. I think you are asking the wrong question. It shouldn’t be about Jobs’ successor, it should be about structuring the company so that it not quite as important who replaces Jobs. This rock star CEO syndrome is tiresome and short sighted.

    16. I understand the concern about Jobs leaving or dropping dead, etc. But frankly, if the fortunes of a large company like Apple are so inextricably tied to Jobs, then maybe Apple doesn’t deserve to live after Jobs is going. I think you are asking the wrong question. It shouldn’t be about Jobs’ successor, it should be about structuring the company so that it not quite as important who replaces Jobs. This rock star CEO syndrome is tiresome and short sighted.

      There’s a big if there, but certainly Jobs is the company’s face and its vision. It’s perfectly true that his vision cannot be carried out without lots of talented people working under his direction. Perhaps one of those people would be a suitable CEO as well. But it is up to Apple’s board to make that decision.

      Peace,
      Gene

    17. Let’s hope they choose well.

    18. Matt says:

      I can imagine it’s tiresome to some (mostly the MS investors or computer-tweaking junkie types who don’t get it about what Apple’s really all about), but for Apple, the “rockstar” whatever you wanna call it, works. It didn’t work for Microsoft, although they certainly tried because Balmer is a clown and Gates is a complete stiff.. not rockstar material.. For that matter, I’d call saying “Steve Jobs is a rock star” a fairly stretch of the imagination. He’s popular, but obviously leaves the rock stars for the stage performances at his keynotes. It took a popular dictator to turn Apple’s fortunes around. As I recall, when Apple had a very low-profile CEO, it was virtually ran into the ground. I find charisma to be an excellent quality for a CEO. That has nothing to do with the talent of the engineering team on board.. it takes both together to make a company that gets noticed and sells great products.

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