I sold all my Apple stock shortly after Steve Jobs passed away. It was premature (which is another word for stupid). Apple stock is today worth about 10 times what I sold it for.
My reasoning was that Apple couldn’t function without Steve Jobs -- not for long, anyway.
Well, 12 years later, it’s doing quite well, thank you. It has a stock price of almost $200 per share (as of this writing). Sales have never been stronger. While replacement CEO Tim Cook is no Steve Jobs, financially he has grown Apple into a monolithic force with a market capitalization of almost 3 trillion dollars. There is no other company even close to that.
Now, with the benefit of hindsight, I realize I underestimated Tim Cook. But I stand with my original instinct: Whatever Apple was under Steve Jobs, it couldn’t survive without him. And to understand why, let’s take a quick look back.
Jobs was infamously ousted from Apple in 1985. He remained in “NeXTile” for 12 years, coming back in 1997 to lead Apple into what many believe was its Golden Era. He passed away in 2011.
In the 14 years Jobs led Apple in his second run, the stock price went from about 20 cents to about 12 dollars. That’s growth of about 6000%. Steve Jobs brought Apple back from the brink of death. If it wasn’t for a lifeline thrown to it by its number one competitor, Microsoft, in 1997, Apple would be no more.
As Jobs himself said, “Apple was in very serious trouble.” And what was really clear was that if the game was a zero-sum game where, for Apple to win, Microsoft had to lose, then Apple was going to lose.
But those growth numbers are a little misleading. For you to be one of the fastest growing companies in history, it helps when you start with a very, very small number. A share price of 20 cents is a very, very small number.
Much as everyone lauds Steve Jobs for the turnaround of Apple, I would argue that Tim Cook’s performance is even more impressive. To say that Apple was already on a roll when Cook took over is an understatement. In 2011, Apple was going from success to success and could seem to do no wrong. That was one of the reasons I was pessimistic about its future. I thought it couldn’t sustain its run, especially when it came to introducing new products. How many Jobs-inspired home runs could it possibly have in its pipeline?
But what Tim Cook was great at was logistics. He took that pipeline and managed to squeeze out another decade plus of value building, thanks to what may be the best supply chain strategy in the world. Analysts have said that half of Apple’s 3 trillion dollars in value is directly attributable to that supply chain.
But when you squeeze every last inch of efficiency out of a supply chain, something has to give. And in this case, it may have been creativity.
The Job’s era Apple was a very rare and delicate thing in the corporate world: a leader who was uncompromising on user experience and a design team able to rise and meet the challenge. Was it dictatorial? Absolutely. Was it magical? Almost always. It was like catching a spark in a jar.
That design team was headed by Jonathan Ive. And when you have a team that’s the absolute best in the world, you can put up with an asshole here and there, especially when that asshole keeps challenging you to be better -- and when you keep delivering.
The alchemy that made Apple spectacularly successful from 1996 to 2011 was a fragile thing. It wouldn’t take much to change the formula forever. For example, if you removed the catalyst -- which was Steve Jobs -- it couldn’t survive. But equally important to that formula was Jon Ive.
As David Price, the editor of Macworld wrote, “What Ive brought to Apple was a coherent personal vision. That doesn’t mean Apple’s designs on his watch were always perfect, of course; there were plenty of missteps. In broader terms, his arch-minimalism could be frustrating for those who wanted more physical controls.”
Ive and Jobs were, by all accounts, inseparable. In a heartfelt tribute to Jobs published shortly in the Wall Street Journal after Jobs' passing, Ive remembered, "We worked together for nearly 15 years. We had lunch together most days and spent our afternoons in the sanctuary of the design studio. Those were some of the happiest, most creative and joyful times of my life." Ive continued, "I loved how he saw the world. The way he thought was profoundly beautiful."
For Jobs and Ive, “Think Different” was both a manifesto and a mantra. That philosophy started a not-so-slow death the minute Jobs passed from this earth. Finally, in June 2019, Ive announced his departure “after years of frustration, seeing the company migrate from a design-centric entity to one that was more utilitarian.”
It seems companies can excel at either creativity or execution. It’s very difficult -- perhaps impossible -- to do both. The Apple of Steve Jobs was the world’s most creative corporation. The Apple of Tim Cook is a world leader in execution. But for one to dominate, the other had to make room.
Today, Apple is trying to be creative by committee. Macworld’s David Price mourns the Apple that was, writing “Maybe Apple is no longer a company that focuses on individual personality, or indeed on thinking different."
This week we also got the news that Ive’s position as design chief will not be filled, with a core group of 20 designers instead reporting directly to the chief operating officer, who is no stranger to design and likely has his own ideas. "If design by committee has been the de facto approach for the past four years, it’s now been made official.”
And committees always suck all the oxygen from the room. In that atmosphere, the spark that once was Apple inevitably had to go out.