
How Tim Cook is changing Apple - maayank
http://tech.fortune.cnn.com/2012/05/24/apple-tim-cook-ceo/
======
doubleconfess
Apple has been an outlier kind of performer under Steve Jobs, because Jobs was
an outlier kind of human being. All I take away from that article is that
people better start tempering their expectations of this new Apple, because
once the product pipeline that Jobs oversaw is depleted, what we have left is
merely a "very good" company built on a great foundation.

So much of the article seemed to point out the Tim Cook was friendlier in
terms of investor relationships, but who cares about that (from a technologist
point of view)? I mean, the biggest indicator of the shift in their priorities
is that they took 100 billion dollars in cash and used it for stock buybacks
and dividends. Can you imagine Google doing such a thing? They would never
dream of this, because they are too busy re-investing their profits with their
big-picture potentially world changing research projects.

But hey, kudos for Tim Cook for not trying to be someone he is not, he's a
money and operations guy. So money and operations will get looked at at the
expensive of innovation. But this is not good for those who are used to
miracles from Apple:

 _"It looks like it has become a more conservative execution engine rather
than a pushing-the-envelope engineering engine," says Max Paley, a former
engineering vice president who worked at Apple for 14 years until late 2011._

 _"I've been told that any meeting of significance is now always populated by
project management and global-supply management," he says. "When I was there,
engineering decided what we wanted, and it was the job of product management
and supply management to go get it. It shows a shift in priority."_

Yuck. The geek inside dies a little at reading this.

~~~
alain94040
_"I've been told that any meeting of significance is now always populated by
project management and global-supply management," he says. "When I was there,
engineering decided what we wanted, and it was the job of product management
and supply management to go get it. It shows a shift in priority."_

As an engineer, I understand why you are scared that "global-supply
management" is getting involved. But you forget that the volumes that Apple
works at have changed in the last 10 years, to the point where new products
need to be manufactured at launch, in quantity that no one else in the
industry has ever heard off. Good old days where you could manufacture 1
million iPhones in the first quarter and be happy, those days are over.

So pay a bit of respect to global-supply management. Manufacturing is actually
as respectable as engineering. Just different concepts, but both optimize
under heavy constraints to achieve near-impossible goals (at least at Apple).

~~~
excuse-me
Apple's real innovation is in supply management (well that and iTunes)

Anyone can make a thin smooth aluminium laptop. Being in the position of
making the premium priced top of the range product, while paying far less for
your components than your big box competitors and having such a stranglehold
hold on supplies of those components that you can keep competitors out is
amazing.

It's as if Audi not only made great cars - but also had all the worlds supply
of tires and engines and was paying half as much as chevy for them!

~~~
csmeder
I feel like this is ignoring the tough decisions Job's made when they didn't
have the supply chain. The original iPod was priced at US$399 and US$499. It
had very few features and most people called it lame.

When Job's decided to remove floppy disk drives and made iMacs that you
couldn't upgrade the components from computers people called it lame. (This
really upset people)

When the first iPad came out most people called it lame. (Has everyone already
forgotten this? People were screaming it was going to fail, because it didn't
run OSX).

To dismiss Apples success as only dependent on supply chain management is
missing the mark in my opinion. Apples success in a large way hinged on Jobs
ability to make decisions that in the immediate would piss people off but in
the long term seem obvious.

~~~
excuse-me
Apple's CURRENT (and future) $$$$ success is now because of their supply
chain.

Yes they have some very nice products - but what has moved them from a niche
supplier of shiny toys for the 'money > sense' crowd to a gaziilion $$ market
cap - is that their excellence in delivering on these products.

A lot of this feeds into the the products. They don't need cheesy Blah inside
stickers because they don't need to earn that extra $0.50 They don't have to
bend over to the demands of Walmart buyers or chase the latest fad because
they are in a position to decide the fad.

But they don't have a unique technical skill. They have an Intel CPU, an
NVidia card and a li-ion battery in an aluminium case with a Unix OS and a
pretty gui. It's delivering this package at that price with that margin that
now makes them special.

~~~
Fluxx
While I don't disagree that Apple's technical skill isn't best of breed, where
Apple has shined - both now and in the past - is their ruthless determination
and focus on UX and HCI. Apple goes further than any company on the planet to
make technology devices (computers, laptops, music players, tablets, etc) that
delight their users and just work and make them happier and more productive.

Apple doesn't have "cheesy blah inside" stickers because that doesn't delight
users and make the product better to use. They're stupid. Apple also doesn't
chase fads because fads are just that, "a fad" and rarely do fads have long
lasting staying power like a good product should.

~~~
excuse-me
I'm not sure that Apple's UX is that much better than Windows7/Gnome/Unity.
They have done a very good job of making it easy for you to buy from them with
the integration of iTunes but a single button mouse and a single menubar at
the top doesn't necessarily make every app easier to use.

Where they do shine is in build quality and user experience which comes from
owning the entire product - HW/OS/sales channel/support - and having enough
margin to do it well. That's the difference between them and an equally
specced Sony laptop running Windows.

It's the profit margin that really makes them special. Sony used to make
products of this design and build quality but then to compete had to cut costs
and so quality and had to accept the bloatware and stickers. Apple's
brilliance has been in managing the process so that they can cut production
costs while increasing quality and adding more stuff.

I give a huge amount of credit to Cook for this. Jobs demanding rounded
corners on dialogs or sticking to a single button mouse whatever focus groups
said was good technical leadership, Ive's produce design is great. But
dominating the manufacture and supply network to the extent that Apple have
done and with the effectiveness they have done is a major achievement and is
not easy.

Look at Boeing having to delay the 7E7 because it couldn't get rivets - while
Apple has 747 freighters booked ready to fly new products straight to the
store the day they are released.

~~~
forensic
>I'm not sure that Apple's UX is that much better than Windows7/Gnome/Unity.

... this is insanity. These UXs you refer to are Apple copies that were
released years after the Apple UX. Windows7 has a nice UX because Apple forced
it to. People were abandoning Windows for OSX, so Microsoft invested in their
UX.

Your comment is like saying, "Henry Ford's Model T was no big deal. It's
hardly even better than my 1990 Honda Civic." No shit!!!!

~~~
excuse-me
To a buyer today it doesn't matter who did what first in Guis.

It's like saying a BMW is unsafe because they copied seatbelts from Volvo.

~~~
forensic
That's a non-sequitor and you have now changed the goalposts of the
discussion. The discussion is about what got Apple its marketshare in the
first place.

------
cageface
_Indeed, the vibe, in the words of a former employee, is of an Apple that is
becoming "far more traditional," meaning more MBAs, more process, and more
structure._

This doesn't sound like a positive development to me. This kind of structure
almost always seems to lead to less accountability and more business-speak
bullshit.

~~~
crusso
An influx of MBAs after the original Jobs ousting was the hallmark, if not the
actual cause of, the death spiral that Apple was in until Jobs returned. I
worked there for a stint during those stagnant MBA-life-sucking days.

Another one from the article:

> investors now have the CEO's ear for the first time in years

To that, I say, "Oh crap".

Jobs took Apple to greatness because he obsessed over making incredible
products. Build incredible products and the money and investors will follow.
Change your focus to investors, operations, or accounting and watch as the
products suffer.

CNN's breathless and laudatory tone in describing all these responsive changes
from Apple just serves as a reminder that reporters should just keep their
views to themselves. You can tell that this CNN reporter/editor has a tingle
up his leg over Cook's touchy-feely professionalism... as though that's going
to improve Apple in any way that matters to those of us who use their
products.

Cook may not be a disaster on the level of John Sculley, but his focus on the
corporation of Apple rather than on the coolness of its products would worry
me if I was long on AAPL.

~~~
snowwrestler
Investors have always had Tim Cook's ear--that was part of his leadership role
at Apple for many years. Now that he is CEO I don't see why that would change.

Tim Cook is a very talented business and operational manager. I don't think he
should try to become a "product guy" CEO just because Steve Jobs was a product
guy CEO. He should stick to spending his personal time on doing what he does
best--operations.

Yeah, product development at Apple is going to suffer because Steve Jobs is
gone. There's nothing anyone can do about that, including Tim Cook. The thing
that Cook has to do is protect what remains of the great creative processes
that are still going. If we hear that investors have Ives' ear, that's when
it's time to panic.

~~~
evoxed
Almost exactly what I came here to say. As long as Tim and Jon have a good
relationship (or at worst, big decisions that aren't plainly suicidal defer to
the design team) they'll be in good shape.

------
replicatorblog
I point to 3 stories of CEO succession that worked. Not every company will
turn into HP or Yahoo. A couple co's that had visionary founders have been
able to survive for a century or more:

Bob Iger taking over from Michael Eisner: Forbes has a nice write up about his
time at Disney which reads very much like the profile of Cook. Iger is a quiet
delegator, but has had a tremendous amount of success.

[http://management.fortune.cnn.com/2012/05/09/500-disney-
iger...](http://management.fortune.cnn.com/2012/05/09/500-disney-iger/)

Michael Eisner taking over from Walt Disney: He didn't directly follow Walt,
but Eisner reinvigorated an iconic company that was rudderless after Walt
died. Paints a picture of what Apple might have looked like if people asked
"What Would Steve Do" at every turn.

[http://www.nytimes.com/2005/03/20/books/review/020LEONAR.htm...](http://www.nytimes.com/2005/03/20/books/review/020LEONAR.html)

Jack Welch taking over from Thomas Edison: Again, not directly, but GE was on
the ropes when Jack rose to the top and employed a strategy very different
from the founder to get 20 years of solid growth.

[http://www.businessweek.com/managing/content/apr2008/ca20080...](http://www.businessweek.com/managing/content/apr2008/ca2008049_455024.htm)

Ultimately, you want someone with a vision at the top, even if it's not the
same vision as the founder. Cook seems to have a plan and can execute on it
well. Give the guy a chance!

~~~
jshen
I don't know the story of all of these, but I know that Iger was at Disney for
years before becoming CEO. He was promoted up, and not some outside former CEO
that was brought in. Same with Cook, and I believe this same is true of Welch.

Maybe there is something to promoting from within vs hiring some former CEO?

~~~
maayank
Funny you mention it, that is exactly the subject of a new Economist
story[1][2]

[1]
[http://www.economist.com/blogs/graphicdetail/2012/05/daily-c...](http://www.economist.com/blogs/graphicdetail/2012/05/daily-
chart-15)

[2] link from within the charts page above:
<http://www.economist.com/node/21555895>

~~~
cpeterso
Jobs did a good job of grooming his replacement(s). Promoting an insider means
strategic continuity and established trust.

------
nicholassmith
The more I read about Cook the more I think he was the right choice for the
role. Trying to replace Jobs with another Jobs-lite CEO wouldn't have worked,
because they wouldn't have been Steve.

It's clear Cook cares about the company and wants to drive it forward, and
it's clear that things aren't as focused on letting the engineers rule the
roost, but we'll judge him over the next 5 years rather than when he's barely
had chance to settle into the seat.

~~~
danso
Were the engineers ruling the roost in Steve Jobs' years? The story has seemed
to be that the designers/visionaries steered/put the engineers in their place.

~~~
nicholassmith
From what the article says it was the engineers, but I think you're right on
the money on that.

------
Feoh
I didn't draw the same conclusions that others seem to be drawing from this
article. Having been in the tech industry for over 20 years now, I can tell
you that a company's CEO having a firm grasp on the business side is nothing
but win.

This doesn't mean that Apple will become Microsoft, or that all the technical
innovation will end, it simply means that they are taking the steps they need
to take to ensure that the techies will be ABLE to keep innovating.

But, don't let me get in the way of a good hand wringing session :)

------
mrich
Cook is running Apple well and should be applauded for implementing changes
that make Apple a modern company with social responsibility. But in the end he
will be judged on whether he can come up with new, innovative products and
lead them to success. All products released during his tenure have been
iterations as the article mentions.

~~~
cmdkeen
You mean whether Apple can come up with new, innovative products. Cook should
be able to recognise good from bad and keep an eye on quality, but not be
expected to come up with The Next Big Thing.

Read some of Ive's infrequent interviews, he uses the word "we" never "I" to
discuss the design process. That is what makes Apple so successful.

~~~
sp332
Or because he's British and uses the royal "we"
<https://en.wikipedia.org/wiki/Royal_we> :)

~~~
easp
I can't speak to Ive's personality in particular, but many product designers
view their work as inherently collaborative.

------
bedris
Mark Andreessen, paraphrased: "Salespeople can be very good at optimizing a
company over a 2-4 year period. The [Andreessen-Horowitz] fake hedge fund
trade is: when a sales guy replaces a product guy as CEO, go long 2 years,
then short."

Source: [http://blakemasters.tumblr.com/post/22660214207/peter-
thiels...](http://blakemasters.tumblr.com/post/22660214207/peter-thiels-
cs183-startup-class-10-notes-essay)

~~~
JumpCrisscross
Just for fun I went through a small sample of US companies who changed from
technologist-led to MBA-led; this trade is garbage. Sometimes facts make
inconvenient clever quips.

~~~
robterrell
I don't doubt you, but I'd love to see your small sample. The quip _feels_
right to me, but I'm biased and would like some facts.

~~~
nswanberg
Same here, though I am more interested in how one could quickly collect a list
of companies that have undergone that specific leadership change. Proprietary
or public database? Google? Old-fashioned human memory?

~~~
JumpCrisscross
Bloomberg (8K(date of change in executive management) + bios(presence of "MBA"
after exec without and at least a B.S.; finance, accounting, marketing, etc.
excluded) | Jensen's alpha over IWM and sector SPDR over [0,2) versus [2,5))
-> R. Russell 2000 members 2006-2012. Bias may be introduced from these all
being large, public companies - I don't know if VC-backed companies led by
engineers v ops guys have a different story. I didn't dig very deep to try and
see if I could remove noise, but TL;DR too much noise and drawdown at the
outset.

Disclaimer: I'm not an MBA and don't intend on getting one. That being said,
I've noticed Silicon Valley discounts solid operations knowledge as much as
Wall Street tends to discount the difference between a hacker and an okay
coder. Andreesen is a smart man and was probably making a rallying cry/culture
call rather than an analytic one with this line.

------
saturdaysaint
His attitude toward the competition (Amazon and Samsung) strikes me as similar
to Jobs' decidedly friendlier attitude toward Microsoft when he returned to
Apple. I think this bodes well for Apple. The only way for Apple to stay where
they are in the technology landscape is to continuously disrupt their most
successful products - in other words, they need to have products so good in
the pipeline that they take the present day competition in stride.

------
didgeoridoo
>>>In a February appearance at an investor conference hosted by Goldman Sachs,
for example, he mentioned that he had worked at a paper mill in Alabama and an
aluminum plant in Virginia

The most incredible people always have the least predictable life stories.

~~~
smackfu
Heh, this is actually a predictable path. He has a BS in industrial
engineering, and typically that means you do work in plants in the middle of
nowhere where labor is cheap.

~~~
didgeoridoo
Ah I suppose I'm guilty of romanticizing it a bit -- I rather imagined him to
be working on an assembly line.

~~~
smackfu
Well, it is true that it is more of a blue collar job than many others, even
if you are in management or doing engineering work on the line. I had a friend
who worked at a paper products factory in rural Pennsylvania as an IE as his
first job out of school, and he didn't care for it. The kind of area where
everyone young just wants to leave, and you are coming in as a 21 year old.
Not fun. And I particularly remember he had to buy a 4WD Jeep because the
plant was always open but they didn't do a good job plowing roads.

------
firefoxman1
I think we all saw this coming. I remember when Cook was first chosen, CNBC
kept referring to him as the "logistics guy." That's good news for just about
any company but Apple.

Sculley was a "logistics guy" and it worked for Pepsi. By 1995 Apple was a
bureaucratic, MBA-filled, artist-less mess. Apple isn't HP or Samsung or one
of a dozen other bland electronics companies for a reason.

------
sparknlaunch12
Completely tough job to follow in the foot steps of big figure like Jobs. You
wish Cook all the best in the new role. If he succeeds, Jobs will get the
credit for leaving a strong legacy. If he fails, he can only be g forgiven for
not being Steve Jobs.

Nevertheless what a fantastic opportunity to be involved with a leading
company.

------
arthurrr
I think what's going to happen eventually is that the A-level engineers are
all going to leave Apple and start their own company, when they start getting
frusterated with the new Apple. I don't think Tim Cook understands the
arguably 25:1 dynamic range that exists in software the way Steve Jobs did.

------
sparknlaunch12
Just heard a podcast with Adam Lashinsky. He is the Senior Editor at Fortunate
magazine and author of a book on Apple. In the podcast:

"[Lashinsky] shares an insider look at Apple, one of the world's most iconic
and secretive companies. Based on his research into the technology giant's
internal processes and approaches to leadership and building products,
Lashinsky offers insights and surprises from his book, Inside Apple: How
America's Most Admired--and Secretive--Company Really Works."

Cook was the supply chain guru Jobs employed to turn Apple's supply chain
model into one like Dell's. No surprise with this knowledge Cook is now CEO of
Apple.

[1] <http://ecorner.stanford.edu/authorMaterialInfo.html?mid=2931>

~~~
Drbble
And he is taking Michael Dell's advice to give money back to the shareholders.

------
philip1209
> If anything, Apple under Tim Cook will embrace efficiency to an even greater
> degree, especially as the company grows bigger and more complex -- to the
> _dismay of those who think techies should rule the roost_.

I don't understand this line of logic. Tim has an engineering degree, and
optimizations are a core of 'techies.'

------
studio816
The bit about praising his competitors shows "The Benjamin Franklin Effect" in
action: [http://youarenotsosmart.com/2011/10/05/the-benjamin-
franklin...](http://youarenotsosmart.com/2011/10/05/the-benjamin-franklin-
effect/#more-1459)

------
jfaucett
so Jobs has been gone 6 months and the previous #1 company in the world is
still number one and didn't collape? I think we need to wait at least a couple
years before any statement can be made about the CEO's leadership abilities...
just saying

------
myspy
As long as they release great products and make existing products better, I'm
happy.

If not, I have to look for other things and I don't really see something which
could hold a candle to Apple.

------
silentscope
This is what's referred to by reporters as a "snow job".

------
damian2000
Apple has gone from the disruptive upstart to the elephant in the room that
everyone will be trying to take down in the future.

------
CharlesPal
"Steve Jobs' successor is making his mark and trying to keep the Apple magic
going."

I think that says it all.

