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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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