‘Tis a sad day in Cupertino, as the inevitable happened. Steve Jobs, 56, battling pancreatic cancer, tendered his resignation as Apple CEO. He plans to stay on as chairman. Operations chief Tim Cook takes the CEO reins.
Silicon Valley loses an icon of innovation embodied in a favorite son. Corporate America loses the greatest modern-day CEO. The tech industry loses its top visionary. But what does Apple really lose, aside from a stock price that slid 5 percent on the news in after-hours trading?
Short answer: Apple’s future.
Let’s face it, no CEO has ever played a more important role than Jobs at Apple. Without Jobs, there's no iPhone or iPad. Apple would not have a soaring stock price, a string of record-breaking earnings, some $80 billion in cash on hand, and the second largest market cap in the country – all accomplished during the worst recession in decades.
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The chances of replacing a leader like Jobs are slim to none. The same thing was said about GE’s legendary Jack Welch when he retired, and Welch wasn’t anywhere near the lofty status of Jobs. And it turned out to be true: GE under Jeffrey Immelt has never been the same.
In the short-term, a Job-less Apple should be okay. The current product pipe line is already set, and versions 18 months from now are already in the works. While Apple will miss the marketing showmanship of Jobs at product launches, iPhone 5 should still be a huge success.
In fact, Apple might fare better without Jobs in at least one upcoming service, iCloud. “Jobs really didn’t get the back office,” says tech analyst Rob Enderle. “He was strong on hardware and user experience but weak on services, which includes the Web. The cloud might actually go better without him.”
The bigger loss will be felt down the road, namely Jobs’ ability to visualize markets and execute on future products. “Only about 5 percent of people can imagine something, play with it in their mind and visualize the outcome,” executive leadership expert Paul David Walker, author of Unleashing Genius, told me. “Jobs is in the 1 percent of that 5 percent.” (For more on my Q&A with Walker, check out Leadership Lessons from Apple CEO Steve Jobs.)
Job’s ability to work with engineers will also be sorely missed. Engineers, says Walker, respect his intellectual acumen and cognitive skills. He could take their ideas and turn them into products that sell. Despite his reputation as a tough boss, “Steve Jobs is an engineer’s greatest ally,” Walker says.
Adds Enderle: “He was the perfect counterpoint to the typical engineer who tends to go feature crazy but has no idea how to sell a product. If Jobs couldn’t figure out how to sell it, it didn’t go in.”
There’s no question Jobs attracted top talent in every corner of Apple. People wanted to know what is was like to work for an iconic leader. With Jobs gone, expect an exodus of talent at Apple. “He held a lot of talented people in the company,” Enderle says. “They have been leaving quietly for months in anticipation of his departure. I expect that will accelerate now.”
Unfortunately for Apple, Jobs also didn’t help the company prepare for life without him.
“Steve Jobs redesigned Apple around his unique skill set, and then not only didn’t mentor a replacement but blocked the board from creating one,” Enderle says. “That has just become a problem. Apple will have to change. Like Disney after Walt, that change is likely to eventually be very painful.”
Here is Jobs’ resignation letter:
To the Apple Board of Directors and the Apple Community:
I have always said if there ever came a day when I could no longer meet my duties and expectations as Apple's CEO, I would be the first to let you know. Unfortunately, that day has come.
I hereby resign as CEO of Apple. I would like to serve, if the Board sees fit, as Chairman of the Board, director and Apple employee.
As far as my successor goes, I strongly recommend that we execute our succession plan and name Tim Cook as CEO of Apple.
I believe Apple's brightest and most innovative days are ahead of it. And I look forward to watching and contributing to its success in a new role.
I have made some of the best friends of my life at Apple, and I thank you all for the many years of being able to work alongside you.